By Sean Stannard-Stockton | Link to Chronicle of Philanthropy
May 21, 2009
In a quest to make philanthropy more efficient and effective, many organizations and individuals have sprung up to improve the process of how donors give. Most of those efforts focus on giving advice to the biggest foundations, and only a handful of services focus on coaching individuals in the art and science of philanthropy. This imbalance in the way knowledge is shared is a key reason charitable giving is not meeting anywhere near its full potential to transform society.
When the prolific bank robber Willie Sutton was asked why he robbed banks, he responded, “Because that’s where the money is.” This reply also seems to explain why professional philanthropic research and advice has focused on large foundations.
However, it is a myth that large foundations dominate charitable giving.
Foundation grants accounted for only 13 percent of total charitable giving in the United States, according to Giving USA, while donations from individuals make up 82 percent of the annual total. (Corporations give the rest.)
Unfortunately, the extensive work that has been done to make foundation giving more efficient and effective cannot be easily transferred, because it fails to take into account the reasons people give.
In his 2006 book Strategic Giving, Peter Frumkin, a philanthropy scholar at the University of Texas, argued that five elements drive people to give a large share of their money away; change, innovation, equity, pluralism, and self-expression.
At big foundations, self-expression is rarely on the agenda. In most cases, it would be wrong for foundation employees or board members to think of grant making as their own personal self-expression,
But for individuals, self-expression is a vital part of giving. You cannot understand, or influence, a donor’s wish to encourage economic equity or pluralism without recognizing the way that such grants are inextricably linked to the donor’s self-image.
That can be a tricky proposition because Americans tend to think that “good” philanthropy requires sacrifice. Donors, our culture tells us, should not benefit from their giving. Giving is supposed to be motivated by a donor’s selfless desire to help others, and so the idea that a donor may use philanthropy as a form of self-expression seems to reduce the nobility of their gift.
If we ever expect to persuade more individuals to become effective philanthropists, the first step is to break the notion that philanthropy must entail sacrifice. Instead donors need to be encouraged to think about how professionals in many walks of life start with a passion and talent, and then train themselves in the skills they need to excel in the tasks they love. We don’t discount a musician’s performance because he clearly loves playing or an athlete’s accomplishment because she loves sport. So too must the passion for giving become linked with a desire to learn how to do it as well as possible.
The professionalization of philanthropy has produced a large amount of knowledge about what works. Large foundations and their advisers must learn to share their knowledge in ways that meet the needs of individuals who want to give money away.
Philanthropy is not simply a lifeless transaction that transfers money from one set of hands to another. Philanthropy is an act of creation that gives form to humankind’s highest ideals. Organizations and consultants that focus on philanthropy must recognize that they are in the business of spreading ideas and rendering them into tangible results. They can’t expect good results if they focus only on helping institutions become more effective grant makers.
It is high time that more organizations begin to serve the needs of individuals who make donations. Frankly, it will not be easy. Donors are idiosyncratic and motivated by a range of needs and desires that even they do not fully understand. But it is this very idiosyncratic nature that makes individuals far more willing than institutions to give money to causes that involve experimentation, risk taking, and new ideas. Individuals are the future of philanthropy. We need to stop failing them.
Sean Stannard-Stockton, a regular columnist for The Chronicle, is a principal and director of tactical philanthropy at Ensemble Capital Management and author of the blog Tactical Philanthropy.