It’s not often in a person’s lifetime that you feel palpable change, and then see it happening in real time. Clearly, 2020 proffered two such moments: The COVID-19 health crisis itself, and the racial reckoning that followed. While in the United States, the public health pandemic appears to have since turned a corner, its global impact must still be contained, and philanthropy could continue doing more to drive action and address the challenges that were brought to light once and for all.
An Inspiring, Collective Call to Action
The sheer scale of the pandemic moved donors large and small to respond and prompted many to change their giving habits. And then it forced most of society to recognize just how broken the status quo is. The systems in place showed their weaknesses. They benefit only a few and put health care, financial equity, education, justice, and more out of reach for too many others. More than a year later, the call for philanthropy to step in, contribute more than usual and with more flexibility is as loud as it ever was.
To be fair, while philanthropy could have done more to anticipate, or better yet, prevent the problems that unfolded over the last year, it certainly stepped up to respond. New stories unfolded almost daily about individual donors increasing their charitable contributions, offering unrestricted giving and working with their nonprofit partners to adapt to the scale of the need before them. Giving from Donor Advised Funds (DAFs) increased by nearly 30% in the first half of 2020 alone. Giving Tuesday donations in 2020 increased by more than 25% from the year before to $2.47 billion, mostly from smaller donors.
Giving USA data released this month underscores the uptick, revealing that total charitable donations amounted to a record $471.4 billion in 2020, a 5.1% jump from 2019 (or 3.8 percent when adjusted for inflation). Individual giving accounted for a 2% increase, but foundations donated the most by far: $88.6 billion (17% more than in 2019).
Creating a Sustained Slope, Not a Spike In Giving
Big things are possible when sectors come together with shared goals for solving big problems. Think about it: Within nine months, an efficacious vaccine to curb the spread of a virus that ravaged the planet was not only developed but began the process of being delivered into the arms of millions of people around the world. This was years in the making, in part due to philanthropy’s willingness to take risks, and to wait for results. Given the gains the ultra-wealthy amassed in 2020, philanthropic capital is available to generate similar advancements and momentum to other causes as well.
Though the need for immediate COVID relief has subsided in the United States, initial trends indicate that philanthropic activity will continue at increased levels. This news is encouraging since causes that gained attention just months ago – for example, the need to bridge the digital divide, strengthen childcare options and safety nets, and dismantle systemic racism –will take years to remedy. Philanthropy must remain committed, as these entrenched issues all require comprehensive, systemic changes.
Harnessing Philanthropic Urgency Beyond COVID-19
2020 was a grisly year. But if there is at least one thing to build on, it is our collective expectation for philanthropy to meet the moment and rebuild a world that is equitable and works for everyone, no matter their social standing, zip code, or other demographics.
The resources to address big problems are there — in fact, there is even more capital available now, following years of investment gains. Philanthropy should take inspiration from the last 12 or so months and take advantage of this watershed moment to look at big, stubborn problems (including climate change, social justice reform, and economic justice) while there is momentum and appetite for prevention and disruption. There is no time to waste.