What the Wealthy are Thinking about Philanthropy in the “New Normal”

Last week at the Association of Fund Raising Professional’s (AFP) annual Conference in San Antonio, Bank of America's Kenny Wilson spoke at the Friday breakfast.  He began by telling us that he is “not a speaker.” I have to insist that this simply isn’t true.  He was not only witty and articulate but eloquent and genuine as he shared his and others' thoughts about the “New Normal” in philanthropy.   Kenny described how he contacted some of the most generous philanthropists in San Antonio to get their perspectives on how the current economic environment will affect giving.  His research is illuminating.  

Nonprofits across the state and nation are facing catastrophic government revenue budget cuts.  Foundations are strapped.  Event revenues are down.  Kenny asked some of the wealthiest individuals to speak with candor about how their giving will change as a result of current circumstances.  Some of their comments included:  

 “Before giving, I will want a plan; with specifics and careful measuring.”  “My money is more precious than before.”  “I am more averse to risk.”  “I do not expect the growth of the past.”  “I will study the causes to which I will give.”   “I will focus on the top tier organizations.” “I will treat giving like an investment.” “I will expect a multiplying effect from my gift.”  “I will expect accountability.”  “There will be less giving to a friend’s cause because he/she gave to mine.”   “I will ask ‘Can someone do this better,’ or ‘Can we stop doing this and avoid duplication.’”  “I will expect more mergers and alliances for greater efficiencies.”  “I will give where my heart is, but also where the problems are; I want to help solve problems.”  “I want to be hands on; not detached.”  

In light of these insights from individuals who are positioned to invest in our non- profit infrastructure, I think it is both timely and relevant that this Thursday, a local group of funders is conducting a panel discussion on how funding is allocated.  They will ponder what “transformative social impact” could look like in our community.  Discussion points have been culled from the book “Billions of Drops in Millions of Buckets:  Why Philanthropy Doesn’t’ Advance Social Progress.” In this book, author Steven Goldberg postulates that by reducing funding fragmentation we can increase social impact.  This fragmentation is the result of billions of philanthropic dollars being “haphazardly” allocated across as many as 2 million non profits, which significantly dilutes the impact of those dollars.   The answer might be to invest greater amounts of revenue in fewer, highly effective organizations over longer periods of time while rigorously measuring progress.  (Piece of cake, right!?)  The panel was formed by Amy Phipps of the Zachry Foundation and will be moderated by Linda McDavitt from the Genevieve and Ward Orsinger Foundation.  Non-Profits leaders and funders will both participate in the panel discussion.