Giving Compass' Take:

• In this post, Kris Putnam-Walkerly discusses the differences between transactional philanthropy (like donating to help those in crisis) and transformational (committing longterm to address the root causes of a problem).

• Neither one of these is necessarily right or wrong, but transformational giving has the potential to be a lifelong calling and bring about sustainable 

• Here's why philanthropists who want to have an impact must still move quickly.

Giving happens in many different ways. When we see the images of horrific damage brought on by hurricanes in the Caribbean, Florida or Texas, or by the earthquakes in Mexico, we are moved to send money in response. Through a simple financial transaction, we’ve helped address an immediate need. The same is true when we support a local food pantry to provide a meal for a hungry family, when we donate to a homeless shelter to keep a single mother and her children off the street or when our gifts to a domestic violence service agency help a battered woman escape an abusive relationship.

This type of transactional philanthropy is important and necessary to help those in immediate crises meet very pressing needs. For many donors, that’s enough. But what happens when we think more strategically about the needs in question? What if we think not about making transactions to help meet needs but about changing the conditions that create the needs in the first place?

Transformational Giving requires that funders:

  • Decide on a specific focus and articulate the problem, approach and anticipated outcomes clearly.
  • Identify grantmaking strategies to meet those outcomes, but recognize that grantmaking alone won’t create transformation. Transformational givers also identify other actions, such as advocacy or research to achieve their ultimate goals.
  • Work with a host of partners. Transformation doesn’t happen in a vacuum, and even the largest funder in the world can’t transform a system or policy on its own. Transformational giving requires the work of many, aligned for a common purpose.

Read the full article about transactional vs. transformational philanthropy by Kris Putnam-Walkerly from Putnam Consulting Group.