Why businesses dabble in art?

Corporations collect and invest in art for various reasons. Turning a profit is perhaps the least important of this. Some major companies like to see backing talented artists as a way of fulfilling corporate social responsibility, or philanthropy purpose - artworks can be lent to galleries and museums for special shows.

Then there are corporate entities that use art for the purpose of flaunting their wealth. The former chief executive of Royal Bank of Scotland, Fred Goodwin, often boasted about the David Hockney in his plush office. Sometimes, artworks are used for enlivening the drab work environment.

It was in the 1970s that Deutsche Bank of Germany started collecting art. The bank now has a trove of over 56,000 works, by artists like Joseph Beuys, Nan Goldin, Jeff Koons, Lucian Freud, and Henri Matisse. These paintings are proudly displayed on the main office walls across branches in close to 50 countries.

However, when companies fall, it can result in an art market bonanza. For example, Germany's HypoVereinsbank disposed a blue sponge painting by artist Yves Klein last year from its collection for 6.2 million pounds through Sotheby's. When Commerzbank took hold of Dresdner Bank, it also acquired an Alberto Giacometti sculpture ‘Walking Man’ that became the most expensive work ever when it went for 65 million pounds at Sotheby's auction in London earlier this year.

Lehman Brothers auctions at Sotheby's (New York) and Christie's (London) reportedly raised over $10 million for the creditors, only a fraction of the debt worth $613 billion held by Lehman after it collapsed in late 2008. Their multimillion-dollar art collection boasted works by Gerhard Richter, Damien Hirst and others.

Bankruptcy administrators of Italian airline Alitalia disposed a collection of Futurist works for more than 1 million euros. Sotheby's sold nearly 1,000 photos by lens masters like Ansel Adams, Dorothea Lange during a bankruptcy court-approved sale of defunct camera-maker Polaroid’s collection.