Corporate profits: Should corporations make charitable donations?
At last Wednesday’s CIBC presents Entrepreneurship 101 lecture, we heard Craig Thorburn of Blake, Cassels and Graydon talk about the nature of the corporation, including the various roles of shareholders, boards and officers.
In the discussion after class, one attendee raised the issue of corporate profits: while accepting the obligation of any company to meet all regulatory, safety, tax, etc., requirements, should a company be obliged to share some of its profits through charitable donations to groups in society?
The opposing view was that the current system works well — corporations are obligated to make as much profit as possible for their shareholders. It is up to the shareholders to “invest” these profits into charities (or not) as they see fit.
Question of the Week
Should the corporation make decisions regarding supporting worthwhile causes on behalf of shareholders, or leave that up to the shareholders themselves?
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As a Venture Group Advisor at MaRS, Tony advises entrepreneurs and high growth companies, particularly in environmental, advanced materials and manufacturing markets, with a special emphasis on mentoring and development of entrepreneurs.