By Andy Carroll, Exponent Philanthropy
I regularly explore trends influencing philanthropy by spotlighting articles, reports, and essays in the media. I cast a wide net, venturing beyond philanthropy and traditional topics to consider a variety of ideas, innovations, debates, and critiques. Read previous posts in the series
Lack of Guidance, Not Lack of Desire, May Be Limiting Social Change Philanthropy
A recent study by Foundation Source and reflections by experienced philanthropic advisors shine a light on challenges faced by high net worth donors in diversifying their philanthropic investments. Donors’ penchant for giving to large, traditional, well-known organizations such as major universities, hospitals, and religious organizations may not always be their first preference, but a kind of default choice resulting from difficulties identifying smaller, lesser-known social change organizations. Funding social change takes more time and work; requires shedding a measure of privacy to go out into public to learn; and often requires taking on more risk.
Nevertheless, the possibility of making significant progress on difficult and urgent issues donors care about, holds great appeal. There is tremendous frustration, experts say.
Neither financial advisors nor the vast amount of information and data available online seems to be meeting the need for this type of guidance. High net worth donors may be looking for a network of trusted people—including peers—who are deeply knowledgeable about opportunities to advance social change and who can listen carefully, engage in discussions of values and goals, and guide donors without self-interest.
Getting Real About Funding Impact
Dan Pallotta sees a damaging contradiction in the public’s attitude toward nonprofit organizations. On the one hand, donors expect nonprofits to operate lean, minimizing fundraising and operating costs; on the other, we expect charities to work harder and on a bigger scale to make real progress in addressing society’s urgent problems. To empower nonprofits to achieve what we expect of them, Pallotta asserts that we must invest boldly in developing nonprofits’ capacity and in their growth—just as we invest in building for-profit companies. To do this, we must take more smart risks.