Is Philanthropy losing its ‘meaning’?

There are various conceptions of philanthropy in American society. While some view philanthropy as a religious obligation, giving their time, treasure and talent to the Church or religious institution, others view it as a ‘social relation’, one that binds people to one another says Paul Schervish, in his paper  Philanthropy as a Social Relation. Increasingly, this aspect of philanthropy is giving way to giving to organizations, anonymous funds and institutions that ‘manage’ our money for the ‘best possible’ social outcome. Is this leading to a de-personalization of charity and are the ‘meaning’ and ‘values’ of giving being lost? Are we witnessing more ‘consumption philanthropy’ and other forms of philanthropy, which is antithetical to how most religious and cultural traditions conceptualize them? Is this problematic or is it a natural part of the evolution of the field itself?

photo credit:kluth.org
photo credit:kluth.org

This is particularly important for my study, as I am looking at the role that faith-based organizations play, as mediators of the discourses of giving, in a context, not of their own making. As Schervish further argues, the key relation in philanthropy that needs to be understood is one that of the donor and recipient. This can lead to a better match between resources and needs of donors, he says. But how does one negotiate this relationship when an organization mediates as a go-in-between the donor and recipient? This and related concerns are some of the newer challenges that have cropped up with the growth of organized ‘philanthropy’.

Still others conceptualize philanthropy as not necessarily positive, but rather as a remnant of colonial mindset, that seeks to ‘dominate’ the weak and oppressed, in the guise of helping them ( Wagner, 2001). In this conceptualization, philanthropy is oppressive and takes on a hegemonic role, something not very pleasant for the donor or recipient. These competing conceptions of philanthropy are interesting in and of themselves and lend themselves to analysis. But my interest in them derives from how they are being articulated in various forms in contemporary society.

Focus on values or metrics?

While much of scholarly work and research is focused on donors and how to attract them, show them that their money is bearing fruit. But what about the recipients? How do we ensure that their dignity is protected and they are also recognized for proper use of the money, given to them. The recipients could be individuals, organizations or foundations.

Peter Frumkin, Professor at University of Pennsylvania on the other hand argues that it is possible to merge the scientific with the aesthetic or related dimensions of giving. He draws a distinction between the ‘art’ of giving and the ‘science’ of it. In his book Strategic Giving, Frumkin concludes with how the art of philanthropy allows donors to express their private values and convictions while the science of philanthropy pushes the field toward greater levels of instrumental effectiveness. As he says in his book : “One of the main arguments of this book is that often philanthropy works best and strategy is most compelling when the donor brings its value set and assumptions to bear on the process of setting forth a philanthropic direction. Without this critical differentiating ingredient, giving can never reach its true potential. When individuals draw upon their life experience and their reservoir of commitment and caring, however philanthropy can take on problems that government and community stakeholders may not yet recognize or prioritize.” While this does mean that philanthropy can become very ‘personalized’ and extremely undemocratic, it also means that once there is a personal stake in an issue, the donor will invest more of his/her time into it. This could also lead to a related criticism of philanthropy that it makes giving very undemocratic and unequal.

Donor advised funds, Giving Circles, Philanthrocapitalism – these are some of the ‘newer’ versions of how philanthropy is being conceptualized and marketed. For the uninitiated, these are various ways that money is pooled and then used for ‘common good’. While financially, these may be smart and ‘efficient’ ways to conduct philanthropy, there is also a fear that the core of philanthropy is being lost here. I would argue that the ‘values’ part of philanthropy is being increasingly side-stepped and this is not a good trend. While making this normative claim, I realize that there is a greater need for accountability that has become the norm in this field of study and practice.

This tension between ‘values’ of philanthropy and the ‘science’ of doing it right is yet to be resolved. While there is the danger of ‘death by data’ in this field, as increasingly, people are asking for more ‘evaluations’ and ‘results’ of projects and not asking whether the mission objectives are being met, even if people don’t ‘deliver’ results in the short-term. Peter Frumkin argues that this is an important aspect and one that we should not lose sight of. In Strategic Giving, he advocates giving from a values perspective, aligning the donors’ values with the projects or organization that one wants to support, so there is greater coherence in giving. His advice is to look at the following five factors, before planning one’s giving strategy:

1. They must declare the value to be produced through their giving

2. Donors need to define the type and scope of program that will be supported

3. Donors have to select a vehicle or structure through which they will conduct their giving

4. Donors must find a giving style and profile level that is satisfying and productive

5. They need to settle on a time frame that will guide their giving

As Frumkin clarifies: “These five constitute the “philanthropic prism,” and are aimed at moving the field of philanthropy towards a more strategic approach. By thinking through how best to present donors with giving opportunities, that connect to the core of their strategic concerns, nonprofits can improve the quality and sophistication of their grant making appeals.” While insightful and well-articulated, the question is, how many High net worth donors or even small donors think of these factors? Will they stop their ego from getting in their way, as they plan their donations? What about external pressures to give that may contradict their values? All of these questions come up as one examines this advise.

Finally, as Schervish and Ostrander point out, the claims that philanthropy makes towards people are normative and not coercive, or transactional. A politician may stand for election and promise certain changes or reforms, in exchange for your vote and this makes it a purely transactional exercise, while a nonprofit leader cannot do the same, they add. This makes the sector unique in a sense of being both bound by certain norms and also free from the sort of ‘effective’ results that it is supposed to generate. The results that philanthropy generates are ‘affective’ instead of ‘effective’ they add. This may be hard claim to sustain, in a tough economy and constricted budgets. While the ‘values’ and ‘science’ could be a false dichotomy, and one that we can overcome, with some thoughtful planning and care, it is imperative that neither dimension is ignored. Being conscious of both aspects of philanthropy may well be critical for keeping the sector relevant and vibrant.

Not everything that can be Counted Counts, and Not Everything that Counts can be Counted: Notes from ARNOVA, 2013

 

I left Hartford, CT on Saturday after three grueling days of intense thinking and engagement at the 42nd Annual Association for Research on Non-profit and Voluntary Action (ARNOVA), the Mecca for nonprofit theorists and practitioners. For over four decades the organization has been the meeting ground for anyone interested and engaged in this sphere. The three days of discussions, debates over coffee, lunch and dinners and intense panel discussions brought forth one key fact for me – data has finally trumped values as the epistemic framework for nonprofit management. And I am not convinced this is an entirely positive thing. Let me explain.

Photo Credit :  Sabith Khan
Photo Credit : Sabith Khan

IMG_3025 IMG_3028 IMG_3029 IMG_3040 IMG_3052 IMG_3056

Of the various sessions I participated in, and also chaired- I ended up chairing two sessions, one  on Understanding and Measuring Capacity in the Nonprofit Sector and the other being The Relationship between Performance Management and Nonprofit Outcomes. One of the discussants in the first panel, Celopatra Grizzle, from Rugters University pointed out that donors don’t care about efficiency of the projects/ organizations that they donate to, but rather its legitimacy. This goes against the utility maximization theory that is used by Economists and those in the profession, who are interested in measuring the effectiveness of philanthropy. Chongmyoung Lee discussed his project of measuring outcomes in nonprofits and the perennial challenge of doing the same.

Lilly School of Philanthropy, an institution that is at the forefront of research in the field of Philanthropy was extremely well represented. Almost its entire research team was here and having worked with them this summer, I was personally excited to see that they turned out in great numbers. Dr.Amy Thayer presented her research on philanthropy and meaning making practices in education among K-12 students. One of the findings of this pilot study is that participation in philanthropic education programs enhances emotional maturity and also participation in these programs is linked to grants being available. This is not surprising, given similar results from a longer program, that has been ongoing at Center for Arab American Philanthropy, part of ACCESS, in Dearbon, MI; targeting a similar demographic among Arab American Youth, through the Teen Grant Making Initiative ( TGI).

Yuan Tian, a doctoral student at the Lilly School of Philanthropy presented her research on International Giving in the High Net Worth givers category. This has been compiled and is documented on an on-going basis through the Million Dollar List, a public list of gifts over a Million dollars made by individuals, in the U.S. She pointed out several interesting findings from the list, showcasing trends in giving and also some unique insights including that the highest donations to the international sector went to Healthcare, Education and Arts. These insights are helpful for both planners and those working in the international affairs sector.

Among the sessions dealing with values, religion and faith – I managed to attend two. One was a meeting of the Values in Philanthropy group, that sought to understand and research the “dark” and the “light” side of Philanthropy, including the activities that are not often brought up , i.e, funding of illegal or anti-social activities through the institution of philanthropy. It could be either the Church support of the Irish Republican Army or support by certain faith based groups in helping Al-Qaeda. The group has decided to further this approach and is seeking inputs on these issues, as they plan the agenda for the upcoming year. I was part of this lively discussion and contributed a few insights.

Finally, I managed to hear Shariq Siddiqui, the Executive Director of ARNOVA and Dr. Mounah Abdel Samad of San Diego State University, who spoke about Civil Society Legislative Advocacy in Morocco, based on his survey of legislators in the country and how much they trusted civil society organizations. Siddiqui spoke about his research on the American Muslim giving experience and this was captured through the example of Islamic Society of North America, the national representative body of American Muslims.

Overall, this was a vibrant atmosphere, and the conference itself addressed philanthropy, voluntary action from various perspectives – both quantitative and qualitative. There were researchers focusing on all sorts of issues – domestic, international, big and small. But one could not miss the heavy focus on quantitative methods and the frameworks leaning towards this mode of enquiry. Amidst the hundreds of presentations, a handful were purely qualitative studies and perhaps this is an indication that researchers are not asking the often harder questions of ‘why’ certain things are the way they are, and are focusing more ‘what’ and ‘how’, that are more easily answered through regression models and quantitative analysis.

 

What is High Net worth Giving and why does it matter?

While the Warren Buffetts and Bill Gates of the world pledge billions to solve  problems that face our world, media outlets write about their foundations, and possibly do a few follow up stories. Often, these High Net worth Gifts are either squarely criticized or lauded as the best thing that the super-rich can do. But how well do most of us understand the “Million dollar giving,” phenomenon? With wealth being increasingly concentrated in a few hands, and the rapid rise of millionaires and billionaires around the world, the Million dollar question is : How do these high net worth donors decide to donate, or not donate? What are the motivators and drivers for their philanthropy and what impact does their philanthropy have on our society?

soure:milliondollarlist.org
soure:milliondollarlist.org

There are a few well-known initiatives that look at the phenomenon of High Net worth Giving in the U.S, the most prominent of them being the Million Dollar List, maintained by the Lilly School of Philanthropy, Indianapolis, where I conducted research this summer. Based on all publicly announced gifts over a Million dollars, this list is one of the most comprehensive ones in the country and captures some key insights into how and where these large gifts are given. As the MDL website points out,

“We see that the million dollar giving of individuals (primarily men, women, couples, and families) tends to be greater on a gift-to-gift basis than that of foundations and corporations. In fact, the average gift value for individuals is nearly five times higher than that of the other types of donors. We also find that gifts to higher education institutions dominate the number of gifts received, but these gifts tend to be relatively small as a fraction of total dollars given on the MDL. There are significant differences in per capita giving and receiving by state, due in large part to the geographic dispersion of large foundations and nonprofits. There are numerous opportunities for future studies using the MDL data, including detailed investigations into donor networks, gift dispersion based on source of donor wealth, and a study of institutional characteristics that attract million dollar plus gifts.”

With the linkage between High Net worth Giving and certain sectors such as Higher Education and Healthcare having been somewhat established, grant seekers and others who are in this field can use this information for their fund-raising campaigns as well as for other insights. More findings and methodology used to gather data in the MDL can be found here.

 

Why do high impact donors give?

There are several motives for people to give. Some give for trigger reasons, as Ms.Rosqueta points out. For example, Imran Khan, the Pakistani political leader started his cancer hospital since his mother died. Political philanthropy is perhaps the least popular among the types of philanthropy and George Soros stands out among the handful of billionaires who has stuck his neck out to support transition of post-Soviet countries to become healthy democracies, through his Open Society Foundation.

 

Speaking of the impediments to giving, “I am not Rockefeller” study, conducted at the Center on High Impact Philanthropy pointed out that lack of confidence that they are able to make a difference is one factor that stops many wealthy donors from giving. Linked to this is the lack of data that they can use to make informed decisions.

Bank of American Study (BoA) at the Lilly School of Philanthropy, that found out the reasons why High Net Worth donors give. Some of the key findings, as stated in the report are:

  • Last year, the vast majority (95 percent) of high net worth households donated to at least one charity. This high rate of giving among the wealthy is consistent with the previous studies in the series, and compares with 65 percent of the general population of U.S. households who donate to charity1.
  • In 2011, 89 percent of wealthy individuals volunteered their time and talent to nonprofit organizations – up 10 percentage points from 2009.
  • For the first time, this study asked wealthy donors to forecast their giving for the next several years – an area of concern for nonprofits operating amid economic uncertainty. The findings offer an optimistic outlook, with 76 percent of wealthy donors planning to give as much as or more during the next three to five years (through 2016) than they have in the past; just 9 percent plan to give less.
  • To put the importance of giving by wealthy donors into context, of the nearly $300 billion donated last year more than 70 percent was given by individuals, of which roughly half was given by the wealthiest 3 percent of American households.

 

While critics of High Net worth Giving point out that this is all about publicity or boosting one’s ego, those who give anonymously are the best refutation of this thesis. IN a conversation a few weeks ago, a senior officer at the Fund Raising Institute, IUPUI pointed out that this is not the case. “The truth is that it is a mix of both factors, both ego as well as altruism that motivate very wealthy people to give. To stress one over the other is to be reductionist in our thinking, he added.

While uncertain economic conditions, cut back in government spending in certain social services puts additional focus on individual donations, knowing how Foundations and the High Net worth donors donate is helpful in many ways. While their dollars may not entirely supplement the need or replace what has been lost in terms of government support, we do know that they can make an impact, if directed and channeled properly and with the right intentions. A closer study of this phenomenon, I argue is indispensable, if we are to be smart about philanthropy.