A recent report presents a statistical story of mass market giving in Australia and challenges one long-held narrative.
With donations and bequests representing 66% of revenue for our charities and not-for-profit organisations, it’s critical to understand where that money comes from and the motivations and concerns of those who give it. The latest Australian Communities report offers a quantitative take upon the story behind the $11 billion in donations and bequests given to our 43,349 charities in 2020.
Let’s have a look at some of the narrative threads that have emerged from Australian Communities: Understanding Australian givers to maximise the impact of not-for-profit organisations.
The good news
Despite our pandemic times, the rate of giving has pretty much stayed the same with 74% of Australians giving financially to charities and not-for-profits in the last 12 months. The level of giving has mostly stayed the same (74%) or increased (21%), with less than one-third of respondents (30%) decreasing their giving.
Gen X were the most likely to decrease their charitable giving (36%) followed by Gen Z (23%). The reasons for this are beyond the scope of the report but more financial pressure, albeit for very different reasons, could be the culprit.
In especially good news, 90% of givers are very proud of how charities responded to help those in need in 2020 and 85% said the events of 2020 made them more appreciative of the role charities play in society.
The not-so-good news
Australia is increasingly a nation of opportunity givers, with 60% giving when they hear about an issue or asked for a donation rather than committing to regular giving (40%). This is reflected in medical and cancer research claiming the top spot of causes givers are motivated to support and domestic and family violence rising from 11th in 2020 to seventh in 2021. Both are issues that were topical and captured much media attention in 2020.
This trend is particularly acute in the younger generations with Gen Z (78%) and Gen Y (66%) more likely to be opportunity givers than their parents and grandparents. In fact, the older the giver, the more likely they are to give regularly. Those in the Builder Generation aged 76+ are much more likely to be committed givers (59%) than Gen Z (22%).
Whether the younger generations follow suit and become more committed givers as they age and find causes they deeply care about will be an interesting thing to watch.
The unsurprising news
With face-to-face fundraising out of the fundraising mix in 2020 due to health risks, it’s not surprising that digital engagement became a lifeline for many charities. Happily, 81% of givers are open to online fundraising. Again the generational divide reveals itself with a whopping 99% of Gen Z happy to give online compared to 59% of Baby Boomers.
While they may not be committed givers (yet), the younger generations appear to understand the concept of investing for greater impact more than older and richer generations.
In 2020, older generations had to embrace technology to stay connected in an isolated world. Could increased comfort with technology narrow the divide in these stats?
The “are we still having this conversation?” news
The public does not like charities to spend money. They want all their funds to go to the beneficiaries of the causes they support. Keeping admin and marketing costs low (below 20%) matter more to 70% of givers than growing donation revenue.
The report acknowledges that while this mindset comes from the best of intentions, it is counterproductive. It argues that nonprofit leaders need to reframe the narrative to show how greater investment can lead to greater returns.
Given this narrative has been around for decades, this is sound advice. The public (and the media for that matter) are not going to change their opinions without education. Although given the stats, this may be easier than in the past.
The silver lining news
While they may not be committed givers (yet), the younger generations appear to understand the concept of investing for greater impact more than older and richer generations. The older a donor is the less likely they are to trust an organisation to get the greatest return on their investment, even if they spend more on marketing and good staff: Gen Z (52%), Gen Y (38%), Gen X (26%), Baby Boomers (18%), and Builders (16%).
As the intergenerational transfer of wealth ramps up this could be good news, and an unprecedented opportunity, for charities to change the existing narrative.
A note on the methodology: The Australian Communities 2021 report is the collation of quantitative data collected in an online survey in January 2021. The results are based on a sample of 1,467 Australians who have given to a charitable organisation in the last 12 months.
Clare Joyce is F&P’s Content Director.