A Global Culture of Giving is Emerging

The practice of philanthropy has begun a sea change in the last decade, one that make take at least the next decade to be fully resolved. From our vantage point, we see emerging a global culture of giving. Several forces drive this development. First, flows of technology, travel and capital have created an explosion of awareness about global matters both around the globe – AIDs, poverty, lack of education – as well as awareness that matters are global – climate change, migration, terrorism.

Second, in many, many countries we’ve reassessed the role of the public sector, either by belief or of necessity. In many places government resources are shrinking. More critically, the belief that governments and multilateral institutions will solve problems has been deeply shaken and often abandoned.

A new set of expectations has emerged from these changes. First is that the ultra-wealthy should be actively involved in philanthropy – not just generous, but informed and committed. Second, we now look to the private sector – whether for-profit or nonprofit or a hybrid – as the engine of innovation and change. In fact, we are re-defining philanthropy to include impact investing, social enterprise, and crowd-sourcing.

What are the indicators of this global culture of giving? Think about all the programs about philanthropy that banks, multi-family offices, consulting firms and other service providers now offer on virtually every continent. Note that the World Economic Forum now has sessions on philanthropy and impact investing. Look at the reaction that the Giving Pledge is getting around the world – it may be criticized in some places, but it’s being discussed. The idea of not passing all one’s wealth on to children used to be largely an American perspective, but now we hear people from many cultures and regions express an intent to apply a significant amount of their wealth to social change rather than dynastic strength.

These donors are getting involved earlier in their lives, and bring their intellectual, social and human capital along with their financial capital. They are willing to be make big bets – but are focused on measurable results, leverage and scale.

As these global culture of giving spreads over the next decade, we’ll be faced with some fascinating challenges and opportunities – some if which may be hard to tell apart. Among the risks we need be aware of is the sad fact that impact assessment is still more an art than a science. If we can’t move that field further forward, many new donors will walk away in frustration (and many billions in funding will leave no trace behind). There will certainly be too many new programs created by the desire to be innovative, and we’ll have to try to refocus the discussion on what’s effective. And expectations for philanthropy may be unrealistic. Most of the money for social change is still in the public sector.

But the positive developments could be remarkable. With some good stories to tell and some real results to graph, the global culture of giving could expand rapidly in a virtuous cycle, spread by the technologies of social media – along with older technologies like conversations on yachts and golf courses.
© 2012, Rockefeller Philanthropy Advisors, Inc.