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After the Giving Pledge: Strategic Philanthropy Is More than Money

June 17, 2013

(Mary Glanville is Managing Director, Institute for Philanthropy UK. The London-based institute works to increase effective philanthropy in the United Kingdom and internationally by providing donor education, building donor networks, and raising the awareness and understanding of philanthropy.)

Headshot_mary_glanvilleIn February, the Gates Foundation announced that the Giving Pledge, founded by Warren Buffett and Bill and Melinda Gates in 2010, would for the first time extend its invitation to philanthropists outside the United States. The pledge, whose signatories propose to give at least half their wealth to charitable causes, welcomed twelve more people to its ranks, bringing the total number of those who have signed the pledge to a hundred and five.

It's a commitment that does not tally with the traditional media-held view of wealthy individuals and their families, a view that portrays the preservation of assets as the primary if not sole consideration. In order to understand what has prompted the apparent urgency and scale of this charitable giving, we asked twenty-two donors in our networks about the rate at which they intend to deploy their philanthropic capital. Their responses were revealing in several respects.

The donors came from many countries and regions -- from the UK, the U.S., Brazil, Canada, Lebanon, and Mexico -- and they or their foundations had philanthropic assets on average of $79,081,250, from which they gave an average of $2,168,050 each year. Half said they would give at least 25 percent of their wealth to charity.

Despite the regional differences, it was possible to discern a common theme in their areas of giving: none of the respondents gave money to the arts, as might be expected, but instead gave to address social issues that they considered among the world's most pressing problems. One donor was particularly forthright on this point, stating that "I generally believe in addressing the needs of underserved poor in the neediest parts of the world, where I have worked for much of my professional life, not the arts or environmental needs so popular among donors here at home, or SOBs (symphony, opera, ballet) -- as much as I love them personally."

Among this group of twenty-two, the four leading charitable causes, by frequency, were education, children and youth, community re-generation, and the environment. Impact investing and technology also were fairly high in the rankings. In addition, there was a notable emphasis on the part of respondents on being proactive and fully engaged in their grantmaking. One donor remarked that "I strongly believe that philanthropy can be more effective when driven by the wishes and strategy of a living donor. Long-lasting philanthropic institutions can become sclerotic and bureaucratic, not always but often. Family foundations may end up with their hands tied by a legacy directed at tackling a social problem that no longer exists." Another highlighted the need to avoid "safe" causes, saying: "I focus on leadership and because my funds are limited support smallish charities with dynamic leadership in unattractive and unpopular fields where it is difficult to raise funds."

Perhaps the most promising theme was the focus on collaborating effectively with other individuals and organizations toward a common goal. One donor put it best, identifying the key elements of such collaboration: partnership, engagement, and empowerment. As he put it:

Partnership: the more we -- civil society, philanthropists, NGOs and activists -- can work together toward a cause, the faster we can move the needle.

Engagement: not only personal engagement, but moral and legal and financial engagement. Empower the organization so they do the best they can to move the needle. Help the executive team to excel in their strategy and operations to achieve their mission and reach goals they have set with their trustees and other constituencies.

What is clear is that making well thought-out, intentional decisions about the rate and timeframe over which assets are deployed can often assist in making one's philanthropy more strategic. It is encouraging to see these issues being raised more frequently between philanthropists across the globe, and it will be particularly exciting to see how donors in emerging markets inform this new vitality in charitable giving. We look forward to seeing and reporting on how the space develops.

-- Mary Glanville

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