New research by QUT’s Australian Centre for Philanthropy and Nonprofit Studies shows that there is plenty of room for improvement in the levels of giving by wealthy Australians. Kym Madden reports.
The escalation of wealth in this country presents a huge opportunity for fundraising and philanthropy.
In the past two decades, average Australians have become more affluent, but wealthier ones have done much better. In 2007, the Australian Bureau of Statistics reported that those with higher than average wealth were increasing their wealth at twice the rate of other Australians.
With the support of the Petre Foundation, the Australian Centre of Philanthropy and Nonprofit Studies examined a range of Australian and overseas research to better understand the wealthier donor segment. The result is a new study called Good Times and Philanthropy, which is being released in March.
‘Affluent’ can be defined in many ways, but for the purpose of this study the term refers to those Australians enjoying either a high income (taxable income in excess of $100,000) or high net worth (HNW, with assets outside the primary residence in excess of $1.2 million).
While our study focused on the affluent segment (estimated at 5% of the population), we would also flag the importance of the ‘mass affluent’ – the entire top 20% of the population – as they are likely to move into wealthier terrain over time.
Our analysis shows that the affluent in Australia are more likely to donate than those on lower incomes, that is, a greater proportion donate and, on average, they give higher absolute amounts.
They are also giving more than they were a decade ago, and a higher percentage of this group are now giving. Having more money is commonly cited as the number one requirement for individuals to give at a higher level. However, huge potential also exists to nurture this group’s giving, with evidence suggesting:
The World Wealth Report by Merrill Lynch and Capgemini estimates that the top 17% of ultra rich donors globally (with assets over $US30 million) now give away approximately 10% of their assets annually; they also point to the global HNW population’s growing propensity to allocate between 3% and 11.8% of their portfolios to philanthropic causes annually. While no detailed figures exist in Australia, tax statistics indicate that making substantial donations still constitute an exception rather than a norm for the wealthy here.
Drawing from studies here and overseas, definite opportunities exist to cultivate philanthropy:
The bottom line of this research is that the wealthy in Australia could be giving a lot more, but first they need to be educated about the whys and wherefores.