The world of philanthropy has changed radically in the past year. Andrea Riddell and Andrew Sadauskas highlight six insights you need to know from this year’s Generosity Forum.
Philanthropy has been a moveable feast over the last year, responding to the bushfires and COVID-19.
Against a troubled backdrop, philanthropy has adapted and changed dramatically. The impacts have been felt in all facets of the field, from relationships to Indigenous communities and the arts through to the emergence of new best practices.
Many of the shifts have been profound, with impacts that will continue to be felt as we emerge into a post-pandemic world.
In 2021, the Generosity Forum brought this all to the front.
Here are six vital lessons from the conference that will help you to navigate the new post-pandemic landscape.
1. Brave New World: How will new philanthropy change the sector – and the world?
At the beginning of day three, we were joined by David Callahan, Founder and Editor of Inside Philanthropy, who in an article at the beginning of 2020 had predicted that something “really bad would happen in the 2020s”. Something like a pandemic. He was not wrong.
In his 2017 book The Givers: Wealth, Power, and Philanthropy in a New Gilded Age, David described a golden age of new philanthropy with three decades of massive accumulation of wealth at the very top of the income spectrum. In the last 10 years, more of this wealth has been harnessed through philanthropy, creating a diverse melting pot of old, longstanding institutions, such as The Rockerfeller Foundation, mixed with new wealth and philanthropy coming from the likes of Mark Zuckerberg and other tech titans.
David reminded us that while billionaires were quick to respond to the pandemic, what was given, at least in the US, was a drop in the ocean compared to what some billionaires made during the pandemic. This was also reflected in Australia as numerous billionaires saw massive increases – in some cases, doubling – to their wealth.
Despite this many tech and Wall Street billionaires were absent from the response to COVID-19. Instead, institutional funders and community-based foundations have been at the forefront of the recovery. Is this because of a lack of experience, or a lack of empathy?
How will new billionaires turning to philanthropy – and with more money than traditional foundations – change the sector? And how will they change democracy? With prosperity comes power. How will billionaires leverage their influence to change public policy and the fabric of society? Can philanthropy be a solution when it’s a direct product of our capitalist society?
2. Want better grantmaking practice? Take money off the table
Delegates at Generosity Forum were treated to a sneak peek at a new report soon to be released by the Menzies Foundation following on from their Philanthropy – Towards Better Practice Model Report.
CEO Liz Gillies took us through some of their findings, which reveal plenty of opportunities for grantmakers and grantseekers to come together. Best practice philanthropy means evolving from more traditional conventional models towards venture and even catalytic models that put more responsibility on funders to create measurable impact. Instead of a transactional relationship where grantseekers apply for a grant, this change in philosophy requires grantmakers to step up and create holistic, often multi-sector, approaches to target societal and environmental issues.
But to achieve this, grantseekers and grantmakers must take money and power off the table and out of conversations.
“Money and conversations about money are inherently limiting in terms of working for new and better ways to work in social innovation for social impact,” said Liz.
The biggest impact will be achieved by understanding what needs to be done outside of the constraints of resources.
Out of all the foundations and philanthropists surveyed, only 19% identified as catalytic, while 31% identified as traditional and 27% identified as venture.
The report will be out in the coming months with insights to help better your practice. F&P will keep you posted on its release.
3. Sub-funds could be a great introduction to giving
With the wealthy getting wealthier and the divide between the rich and the poor widening, many predict that mass market giving will continue to decline, while funds from major donors will increase. With many people coming into wealth, sub-funds could be a great stepping stone for people to whet their appetite towards the idea of philanthropy, without taking on the full responsibility of a Private Ancillary Fund (PAF).
Some key features of sub-funds include:
- They sit within a larger Public Ancillary Fund (PuAF)
- Donors contribute to their sub-fund and receive tax benefits
- Donors make recommendations regarding where the funds go
- Governance, reporting, investing and distribution is managed by the PuAF
- There’s a lower entry threshold (can be as low as $20,000 to set up)
Krystian Seibert, Industry Fellow at Centre for Social Impact Swinburne and Australia’s sub-fund expert, took us through the key feature of sub-funds before engaging in a panel discussion with sub-fund owners Stephen Ward and Anna Rose to discuss their personal experience with owning a sub-fund.
For Stephen, Director of the Ward Family Foundation, moving his family’s foundation from a PAF to a sub-fund of Australian Philanthropic Services was a no-brainer. As his sister described it, they saw the sub-fund structure as “outsourcing” parts of their giving that were time-intense or complex, such as investing the funds, distributing funds and reporting. In a nutshell, it allowed his family to concentrate on the best parts of having a foundation: helping to make a difference.
Anna Rose’s experience was similar to Stephen’s – she and her husband set up a sub-fund of Australian Communities Foundation for their private giving. With funds not at a level to warrant setting up a PAF, the sub-fund model allowed them to consciously work towards a better future for their son by supporting organisations working in the climate change space. Anna also co-founded Groundswell, Australia’s first climate advocacy-focused giving circle, in 2020 as a sub-fund.
Some tips from the panel:
- Choose a PuAF that aligns with your values and mission.
- As sub-fund owners can be ‘invisible’ to nonprofits, if sub-fund donors want a relationship with organisations they’re supporting, they need to proactively build this and make them aware of any incoming grants from the sub-fund.
- Sub-funds are just a structure. Don’t be caught out by the lack of transparency with sub-fund owners and donors. Nonprofits should still work to build relationships and network with people as well as PuAFs.
4. There’s a new community-led approach to Indigenous philanthropy
Historically, donors have guided how philanthropic funds to First Nations communities in Australia are spent. But even when it’s well-intentioned, this top-down approach creates a number of problems.
There is an uneven power balance between donors and recipients. In many cases, white funders have taken a paternalistic view, believing they know how to fix problems better than First Nations people themselves.
Many philanthropists apply a one-size-fits-all approach, which neglects the needs of people and communities in particular places. Donors also lack first-hand experience of what hasn’t worked in the past. This leads to them making the same mistakes time and time again.
These issues result in problems persisting or getting worse, despite large sums of money being spent to solve them.
First Nations community-led organisations, such as Barrmal Bijirril, are working to solve these issues by taking a new approach to philanthropy.
As Barrmal Bijirril CEO John Harding pointed out, a key element of this new approach is for funders and communities to co-design grants. This allows communities to direct funding to areas of genuine need and programs that will make a real difference.
“They already have an established knowledge of what’s come before, what works, and what doesn’t work,“ said John.
As well as being community-led, these new organisations take a place-based approach to philanthropy
“You have to understand there are very, very different problems for the Koori kid hanging around the streets of Geelong than there are for a kid sitting in the desert in the Pitjantjara land… in Central Australia, where 99% of the culture is intact,“ said John.
This place-based, community-led approach taps into the support networks that already exist in First Nations communities. As Indigenous Employment Agency Executive Director Dennis Batty explained, these networks have developed “over not just years and not just decades, but thousands of years”.
“[Through these networks, we] understand the difficulties within particular regions and within particular communities. We understand the needs of each community, and have supported each other over that period of time,” he explained.
“We also understand how to communicate with each other in a way that perhaps non-Aboriginal people and community organisations don’t. There can quite often be a level of honesty and telling each other what we need to hear. If we’re going to a philanthropic organisation or a funder, we’re going to be far more cautious.”
John added that one of the things that makes First Nations organisations unique is that every organisation, no matter whether it’s a legal service, a health service or a child care agency, takes am holistic approach.
“We know that housing affects health, affects education, [affects] the fact that you’re getting in trouble with the police. All those things are connected – and the stats prove it.”
His advice to people looking to support First Nations communities is to reach out to Indigenous-controlled organisations in your state or territory. “Go and have a cup of tea. They’ll all make you welcome if your intention is in some way, financially or otherwise, to support their communities.”
5. Great relationships mean the show can go on
It’s an understatement to say the pandemic has been devastating for arts community.
Cellist Chris Howlett responded to the crisis by launching The Melbourne Digital Concert Hall to present classical concert performances online.
This posed a number of logistical challenges and costs.
“If you’re putting [a concert] behind a paywall, it has to be something more than just someone singing or playing to their laptop and then broadcasting it on Facebook, because there’s a lot of free content out there,” said Chris.
“For us, it was all about making sure that every event we did was high quality. It was the best experience that we could do, and that’s where I came from with MDCH. We installed $30,000 worth of microphones, about $30,000 worth of cameras.”
There were similar dilemmas for The Torch. Established in 2011, The Torch supports Indigenous offenders and ex-offenders in Victoria, aiming reduce the rate of reoffending by encouraging the exploration of identity and culture through art programs.
“We had to be really engage with the digital domain to transform a lot of our work, which was very much [dependent on] face–to–face, on site, physical exhibitions and events,” said Chief Executive, Kent Morris.
“We invested in making a whole lot of good videos where people could interact with the artist by their stories online. And of course we’ve still got to bring an audience. We had to really supercharge our digital marketing and audience engagement.”
What was the secret to raising the capital needed to ensure the show would go on? In short, it was drawing on strong existing relationships with supporters and donors.
Chris described calling arts funders, who came on board quickly after he explained the need to them: “This is how we’re going to help with the mental health of our colleagues. And the musician that you’ve seen on stage many, many times? He’s going to be able to pay the rent over the next two, four, eight and 10 months.”
Thankfully, loyal and generous philanthropists like Lyndsey Hawkins were willing to answer the call to support artists and organisations in their moment of need.
“We had prior relationships with Chris through other musical events. For me, it was just reacting to a need, which was obvious – the dire predicament of musicians,“ said Lyndsey.
6. Women are making an impact through philanthropy
One of the highlights of the Generosity Forum was the findings from new research into Australian women’s philanthropy.
Philanthropy and Fundraising Strategist Kim Downes undertook the study in 2020 and 2021, via focus groups, surveys and one-on-one interviews.
This vital research was endorsed by the JBWere Philanthropy team, QUT, Philanthropy Australia, Melbourne Women’s Fund, The Indiana University Lilly Family School of Philanthropy, and the Australian Women Donors Network.
Kim’s research built on an earlier study by the IUPUI Lilly School on women’s philanthropy in the US, which found that:
- Women are not a niche market (they are the market)
- Women prefer stories not stats
- Men’s giving is transactional, women’s giving is relational
- Women aren’t asked to give
- Women volunteer more time than men
Some of the key findings from Kim’s research are:
- Women have been introduced to philanthropy through family and volunteering
- Overwhelmingly women are playing a lead and proactive role in their family philanthropy and decisions
- Women identified social responsibility as the main attribute they want their children and others to learn from their philanthropy
According to Kim, many women see the word ‘philanthropy’ as being from a bygone era.
“It’s amazing how many people here in Australia don’t understand philanthropy is those three T’s: time, talent, and treasure. And that it doesn’t matter, that treasure component, how much you’re actually giving – if you’re doing that, you’re a philanthropist,” Kim said. “It’s no longer a word for the elite.”