UK and International Trends in Philanthropy: Trust and the Rise of Female Philanthropists

I was asked recently by Philanthropy Impact to join an international panel on philanthropy, providing an overview of the UK and touching on some broader trends which may be common across borders. This is the third of three blogs summarising my presentation that I have posted over the last three days. The first blog focused on UK trends in philanthropy and the second on China and Africa. Turning to other themes, I’d like to touch on the impact of trust, strategic philanthropy and the rise of female philanthropists.

We’ve seen trust in charities decline in recent years and the sector is taking another big hit now with the Oxfam events unfolding and impacting other big charities like IRC and Save the Children. This could affect not just funding but the reputation of all large NGO’s in the way the Kids Company crisis tainted many other smaller charities in the UK.

A lack of trust in multi-national NGOs may lead to more local giving instead, where donors feel more in control, but the question is at what cost to those in the developing world. Giving is closely linked to trust and confidence. In order to gift significant sums to an organisation a great deal of trust is put in that organisation to act responsibly and use the money as intended. Thankfully, giving levels are pretty robust over time but a lot of work is needed to rebuild trust in leadership and governance.

With regards to more strategic philanthropy, I do think we are seeing an increased focus on longer term, collaborative and impact-led giving. It’s certainly true at the Bill & Melinda Gates Foundation level with the formation of co-impact, a philanthropy partnership kicking off with a $500m global fund.

One way of getting our heads around this trend is thinking about the differences between transactional and transformational giving.

Transactional giving is obviously good as it addresses an immediate need - but does it help to change the conditions that create the need in the first place?

Transformational givers on the other hand research and identify the core problem, the right approach and the target outcomes. It’s about changing the system.

Connected to this, I’m a big supporter of the “all assets” approach to social investment which is gaining traction. This is about leveraging all the assets of an organisation, or an individual, to maximise sustained, mission-led change.

We are also seeing interesting methods and models evolve such as blended finance, social impact bonds and co-impact funds. And the size of the need, and the potential social and economic benefit, is encouraging many types of asset-rich entities to get involved; for example, banks and pension funds investing in critical infrastructure projects.

Women are also making a big mark on philanthropy. A global #MeToo movement for good perhaps?

Forbes counted 56 self made women billionaires in 2017 – what impact will they have on the sector? Fresh thinking, natural collaboration, shared priorities for change? The vast majority of the 56 women have their own charitable foundations and they tend to focus on empowering women and girls around the world. One reason I highlight this is that women are more likely to give - and to give more – so this is another great opportunity in the making.

So what’s my punchline?

The need for philanthropic capital is huge – at a local level in the UK and globally. The number of very wealthy people is growing at a staggering pace both in the UK and around the world, but many contribute relatively little.

So the wealth is out there – and I think the interest and methods to address big problems are out there – but we still have a lot to do to get that philanthropic capital to where it is most needed.

David Stead – [email protected]  www.cafonline.org