Three Rising Trends in Philanthropy
Image: Return on Good's co-founder Ann Oleson speaks with collaborators at the recent Digital Evolution Institute conference on the future of Philanthropy and Endowments. As the economic landscape continues to shift, so does the world of philanthropy. As a strategic philanthropy company, Return on Good helps our clients define, reveal and manifest their values to maximize the good they do in the world. We work with family offices, individuals, foundations, and nonprofit organizations to help them maximize the power of philanthropy. In today's changing environment, that means tracking key changes in the way we're all thinking about giving. Here are three key trends that represent some of the most important movements in philanthropy today:
Strategic giving means giving smarter, and planning your philanthropic support to do the most good
With more than one million nonprofits in the U.S. vying for charitable dollars, the way we've given has changed in the past few decades. According to Foundation Source, there are roughly 600 new foundations opening each year with a level giving mark of at least $250K. This type of strategic giving is up by 6.1% in 2022, poised to increase in 2023. As I told leaders of foundations at a recent speaking engagement, this is great news. It means that philanthropic leaders are doing more and being more organized in their good to help solve world problems with big gifts. Giving has changed. What we’re understanding is that there are many facets represented in the philanthropy equation. In some cases, funders are staying very involved in the solution. In others, the research is done extensively in advance, and then the charities are relatively free. The Gates Foundation has revolutionized a focus on science outcomes. McKenzie Scott, Amazon co-founder, has readily opened her checkbook to develop trust through being a philanthropic leader. The Chan Zuckerberg Institute embraces a true collaborative approach to funding through impact investments that support sustainable innovation. We believe that future models will be even more strategic in their map to giving. This creates a Build-Do-Fund continuum. The new philanthropy will cohesively merge phenomenal innovation and creativity with big dollar investments to solve big world problems.
Women’s philanthropy is rising to become a massive force for change
A whopping 43% of the nation’s top wealth holders are women. A recent Women’s Philanthropy Institute event in Chicago with the Lilly School of Philanthropy hosted more than 800 women who are using their dollars for greater good, and Return on Good was there. Women who hold wealth are focused on giving, investing and volunteering to help make our world better for the lives of others. We were inspired. Shining stars like Heidi Roddenberry, Jennifer Pritzker, and other "Under 50’s" are making strategic and impactful decisions with their dollars. Women's giving has traditionally been more collaborative. So, it’s no surprise that Giving Circles are now on the rise, with more than 2,000 formal circles involving some 150,000 women. And women are funding core needs that empower future generations for success. A trend toward financial literacy has taken hold, and women are driving that outcome. A great example is Rosie Rios, the 43rd treasurer of the U.S., who identified the goal to get women front and center in US currency. She was the managing director for MacFarlane Partners $22billion REIT, now launching Notable Women, Augmented Reality with Google Women Finance. There are even new nonprofits like Womxn of Wealth who focus on financial literacy for women at all levels; other funds target support for female founders or female grant recipients. The bottom line: if your investment portfolio doesn’t include any of these kind impact opportunity, you should consider adding them. Where we put our money matters, and that's the next trend in philanthropy we'll cover.
There is big focus on ESG, corporate social responsibility, and focus on bad behaviors like greenwashing
ESG, or the practice of responsible investment integrating of environmental, social and corporate governance continues to rise in popularity. Though this trend became relevant in the 60’s and wasn’t originally a part of financial analysis, rather a concern of financial relevance, that is changing. In 2004, the UN Secretary wrote to 50 top CEO’s who were involved in major financial initiatives toward research. Later, in 2005, the Who Cares Wins report, followed by the Freshfield Report made a compelling case for embedding environmental, social and corporate governance factors in capital markets. The idea was to make good business sense which leads to more sustainable markets with better outcomes for our society at large. Hundreds of SRI officers were added to corporate teams and currently there is a rise of the position of Chief Sustainability Officers. Today $20 trillion is invested in the SRI (Socially Responsible Investment) movement. Though ESG has been entangled in politics and we hear the buzzword “greenwashing” in the news, there is hopeful change happening. Just a few weeks ago, a lawsuit against Delta Airlines focused on the carbon-neutral claim to hold a large organization accountable toward environmental responsibility. Here's the big take away: there are a number of funds, investments and philanthropic missions that are doing tremendous good for the world through social impact. Of note are those zeroed in on funding to impact major health crisis, including diabetes, obesity, the opioid epidemic, mental health support, and food insecurity issues. Return on good causes, strategic giving clients, and investors are contacting us regularly with a focus on these crucial issues and want to put their money where it will make a difference. Return on Good is focused on Returning Good to the world. That's why we partner with people and projects that are strategic, values-driven and will make a difference. If you are ready to give and invest smarter, drop us a line. We're ready to help.