With so many urgent societal problems needing time, attention and resources aimed at solutions, do we really need to invest in understanding and improving the way people give money away?
The short answer is yes if we want philanthropy to reach its promise—to leverage private charitable resources for the most public good. And, to do so, we must ask how philanthropists can do better at making the world better.
With support from the Raikes Foundation and the Bill & Melinda Gates Foundation, The Philanthropy Workshop (TPW) was in a position to take time to probe into the knowledge, practices and attitudes of more than 200 TPW members and other high-wealth philanthropists to learn what’s working and not, and to share these findings with a broad audience that cares about catalyzing social change.
The result? A comprehensive report titled “Going Beyond Giving: Perspectives on the Philanthropic Practices of High and Ultra-High Net Worth Donors.”
Report Identifies Challenges, Offers Solutions
Below are three takeaways from the report’s findings and beyond:
1. Time is reportedly the scarcest resource for philanthropists. And yet:
- 60 percent report having no staff;
- 29 percent report having fewer than five staff members and of those, almost half have fewer than or equal to one staff member; and
- only 9 percent of respondents reported they had engaged with a philanthropy advisor in the last three years.
As one respondent expressed:
I want to be the one deciding how to spend this money … But I am so busy. I am worried I might be so overwhelmed I won’t get down and do it. But I’m also very driven to do it. There’s so much to learn.
Philanthropists understandably pressed for time can benefit from paying expert professionals to do some of the heavy lifting required for strategic grantmaking and investing.
2. Feeling confident about money well spent is not the same as actually achieving impact. When asked if they have a clear understanding of how their philanthropy contributes to social change:
- almost 80 percent of respondents report that they are highly confident of their impact; and
- 70 percent of respondents use strategic plans to guide their philanthropy.
Yet, few use metrics to objectively determine the degree of effectiveness in obtaining a defined result; and only 44 percent require grantees to submit reports that specifically talk about impact. More attention is needed to help philanthropists and their partners understand, agree on, and use reasonable proxies for success.
3. Organizations who pursue an evidence-based approach to making change face an uphill battle to compete for resources with organizations that are recommended by friends and family.
More than half of respondents rely on family, friends, and professional networks to identify funding opportunities; only 36 percent use research. We need to inject these trusted peer networks with more knowledge and elevate strong intermediaries who can help match private capital with high-impact organizations and initiatives.
Original contribution by Tracy Mack Parker, Senior Advisor at The Philanthropy Workshop. Parker has facilitated TPW’s year-long intensive program each year for the past seven.