Forward-Thinking vs. Backward Philanthropy

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Philanthropy comes from the Greek term meaning “love of humanity,” but when you take a realistic look at the way we view charity today, much of it stems from Puritan ideas about penance and making up for wrongdoing or selfishness in other aspects of one’s life. A more forward-thinking philanthropist, instead would take a practical look at how they can integrate philanthropy into all aspects of their life, and achieve the greatest good overall, not just enough that they break even. Today, I’m going to take some time to explore what forward thinking philanthropists are doing, compared against old-school styles of philanthropy.

While past philanthropists have managed to achieve some incredible things in their lifetime, many also harbored some backwards views. For example, up until very recently, poverty was considered a problem that could never be solved, whereas now we are making significant progress toward ending poverty and other social problems, which we didn’t even start measuring until very recently. Here are some other examples of self-defeating, yet arguably prevailing, attitudes about philanthropy, and how some individuals and institutions have begun changing the game.

Backward: Viewing philanthropy as separate from other aspects of one’s life, and even as a way to compensate for selfishness or social harm in other areas. 

When philanthropists are “searching for answers with their right hand to problems that others in the room have created with their left,” (to borrow the language of Peter Buffett), it is perpetuating a cycle where the people “saving” people from societal ills are the same ones who created those problems in the first place. This is what happens when people make money in ethically questionable investments like private prisons and fossil fuels, and then invest some of the money into charity. Does this make up for the harm they are inflicting upon our environment or social fabric? I don’t think so.

Forward: Integrating philanthropic principles into all aspects of your life and business.

Rather than make money off of exploiting people, many companies today are coming up with new ways to do business that they can feel good about. This includes B Corporations that hold themselves to higher ethical standards than most companies, and many of whom have actually integrated charity and/or social good into their business models. In a similar spirit, many large philanthropic institutions have made commitments to divest from fossil fuels and Columbia University has committed to divest from private prisons. Both moves show that leaders in these industries are not only thinking of how to use a designated portion of their income for social good, but how to actually make money in a way that is healthy and beneficial to our planet and the people who live on it.

Backward: Being overly restrictive in your giving.

When philanthropists give, it is common to see grants and gifts that are highly restrictive to a specific project, or which cannot be spent on general operating expenses. Recently there has been some major backlash against the previously generally accepted system of rating charities’ effectiveness based on the percentage of income that was spent on administrative costs. Despite this, many gifts remain project-specific and cannot legally be spent on “overhead expenses” or administrative costs, also known as infrastructure that is vital to sector growth – including fundraising, training, and project evaluation. Additionally, when philanthropists only support projects with a strong track record of success, it can prevent new and potentially highly impactful projects from getting off the ground.

Forward: Supporting social infrastructure and innovative new projects.

By providing nonprofit organizations with unrestricted gifts, donors can contribute to the overall sustainability of an organization – ensuring that they are able to continue to do good work in uncertain economic times. This also enables them to respond quickly when there are changes in the social environment (such as a spike in unemployment or a natural disaster). One institution that has truly taken this philosophy to heart is the Kresge Foundation, which emphasizes calculated risk-taking and innovation, and gives general operating support to charities throughout America’s cities.

Backward: Viewing philanthropists as “saviors.”

Painting a disadvantaged group as perpetually desperate or needy can have a very backwards effect, and cause philanthropists to think of themselves as somehow “above” the people they are helping. Fundraising appeals that show White Americans or Europeans saving the lives of Black African people in need may actually work at getting people to donate, but they can have a dangerous side effect by perpetuating racism and cultural insensitivity. Nonprofit Quarterly recently explored this issue, and revealed a startling lack of diversity among nonprofit leadership, even in charities that center of helping marginalized people. This perpetuates a dangerous attitude of “white people know best.”

Forward: Actually listening to the communities you are trying to help.

On the other hand, a growing number of charities are actually focusing on listening to the communities they serve – including community coalitions and roundtable discussions that are more generally accessible.

Looking for more information on how you can give better? Check out my Charity tag for more information on how nonprofits work and how to give more effectively. As always, thanks for reading!

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