Fostering Orientation to Performance in Nonprofit Organizations through Control and Coordination: The Case of Corporate Foundations and Founder Firms

This chapter investigates the impact of coordination and control mechanisms on the orientation to performances, looking at the relation between Corporate Foundations and their Founder Firms. The research starts from the consideration that the relationship between CFs and Founder Firms can be considered similar to the relationship between headquarter and subsidiaries in large corporations, as the ties are very strong and significant.

In order to address the impact of control and coordination mechanisms on CFs’ orientation to performance, we managed a survey addressed to 188 CFs from six European countries, representing the most significant context for corporate philanthropy in Europe.

The results of a linear regression show that only selected mechanisms are effective for boosting CFs’ orientation to performance, and that these tools must be adapted to the specific nature of the CFs.

The study can help Founder Firms to identify the more effective mechanisms to improve the performance of the CFs they support, in order to ensure the possibility for both the parties to pursue the shared value creation.

The research has put in evidence that CFs must be explored taking into consideration their close tie to Founder Firm, which differentiates them from other interdependent foundations.