In July 2009, Barclays Wealth and Ledbury Research released a study called Tomorrow's Philanthropist. The paper presented a picture of the current philanthropic landscape and how the wealthy will engage with charities and causes in the future. The research included consultations with 500 UK and US-based high-net worth and ultra high-net worth individuals, including perspectives of a wider panel of international experts.
The six major findings include: (1) a new breed of philanthropists is emerging who are more socially aware and more motivated to give back to the communities they came from, as well as global causes; (2) the wealthy are giving despite the downturn; (3) the wealthy are funding welfare projects; (4) they prefer to fund projects directly; (5) they are active donors and seek to solve rather than simply support; and (6) smaller, nimbler and more accountable charities are becoming more attractive to donors compared to large, traditional charities.
When asked "Which foreign countries or regions do you target with your philanthropic donations?" those donors living in the UK tend to have a more international perspective. For example, 8% of UK high-net worth donors target the Indian subcontinent with their donations, compared to just 2% of wealthy donors in the US. 8% of UK donors target the developing South East Asia compared to 4% of donors in the US. Meanwhile, 2% of both UK and US donors support causes in China.
The findings do not differ from where I believe philanthropy is heading. Those practicing in the field see the signs and the trends. What was surprising for me is Barclay's tremendous focus in developing its philanthropy advisory services. Last April, Barclay's hired Emma Turner from Goldman Sachs to be their head of philanthropy. Emma was previously the executive director of Goldman's Charitable Services Group in Europe, Middle East and Africa and Asia. Shortly thereafter, Tomorrow's Philanthropist was released.
In December of 2009, Barclays released another report, Philanthropology: the Evolution of Giving. The report identified six different types of donors and explains "how factors such as age, source of wealth, religious or political beliefs are influencing the ways in which high-net worth individuals give to charity, and impact their decisions for supporting certain causes." The data was taken from the same group of UK and US-based donors in the previous report, Tomorrow's Philanthropists. The six profiles of UK and US donors are:
1. Privileged Youth: Typically younger, and have inherited their wealth. Give their time and energy to charitable causes as a means of offsetting some of their guilt about their comfortable lifestyles. They are very generous with their time, and use their social networks to support predominantly social welfare causes across the globe.
2. Eco Givers: Eco Givers are most likely to be young females who have worked hard for their wealth. They are demanding of how their donations to charity are spent and, fundamentally concerned with the issue of climate change, this group predominantly supports environmental charities.
3. Altruistic Entrepreneurs: Middle-aged business owners with strong ties to their roots, this group's wealth is self-made. With a strong belief that successful people have a duty to share their wealth, their philanthropic behaviour is often driven by their desire to support the communities in which they grew up.
4. Reactive Donors: Predominantly high-earning male executives, this group usually gives to charity because they believe that it is expected by their peers, rather than through a social or moral motivation. They also tend to give indirectly, through purchases from brands that support charities.
5. Cultured Inheritors: In their late 50's and 60's, this group's wealth tends to be self-made although they also have inherited wealth. They plan to bequeath their wealth to their families. They wish to continue to the legacies of their parents, who may also have been heavily involved in charitable work. Their social and moral beliefs drive their motivation to give.
6. Professional Philanthropists: Consisting of high-level executives and successful business owners, this is the oldest group and their wealth is almost exclusively self-made. They support causes not only through donations but also by offering their business expertise, leading them to be more demanding of charities as they want to see the impact of their donations.
Photo courtesy of Kevin Kelly: Asia Grace
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