What is it About Philanthropy? Looking for Impact

We’ve been thinking a lot recently about how most people view philanthropy. We’ve been thinking that they view charitable giving  as something intensely private, something that comes from goodwill, from the heart, something that ought not to be confused with the rest of life, with numbers, with market norms.

We’ve been thinking that many people don’t really want to focus on the tough issues, on the “why?” for philanthropy: That 3 billion people, almost half of our world’s population, lives in poverty on less than US$2.50 a day, that 1 billion people don’t have access to clean drinking water, that 24,000 children die daily from poverty.

And then beyond poverty, the environmental challenges we face from increasing temperatures and rising sea levels to disappearing forests, from dramatic declines in fish populations to loss of terrestrial biodiversity.

We’ve been thinking that maybe we genuinely don’t have time in our busy lives to focus on what’s happening in the developing world or even the next neighborhood over, or maybe we just don’t want to see for lack of solution. What can we do, after all but write that check and feel that we have done our part?

It is true, that poverty, water shortages and the myriad environmental challenges don’t yet directly impact most of our own lives, which are full enough of each day’s stress.  So when it comes to philanthropy, to volunteering, we want to just enjoy the giving.

We prefer to contribute with emotion, with friends, regardless of the cause, without looking at numbers, statistics, without necessarily thinking about the end result. We want to give to what we know, what we assume will work, what we believe has always worked. We want the safe option, to be part of a community of people doing the right thing in the comfort of friends.

Understandable when we consider that the word philanthropy, loosely translates from its Greek roots as “love for humanity.”

But the reality is there is much more good work that could be done with the US$300 billion Americans give each year – an estimated 45 percent of world philanthropy. And the reality also is that to fix the damaged world our children will inherit, the poverty of our burgeoning world population, we must offer more than just “doing good” as an answer.

We must work against the sense of cross-purposes involved in thinking about the application of market norms to things social if we are to make the real and urgently needed change.  We must pay attention to the issues to which we are giving and use our philanthropy wisely to ensure we are indeed part of the solution.

There is precedent for doing more. We can look into philanthropy’s not so distant past to see that the Rockefellers and Vanderbilts were as innovative as it came in their charitable works. And of course it was Andrew Carnegie who so famously recognized the need for smart philanthropy, warning that most charitable acts go awry.

At essence, the philanthropy sector must draw on all resources at its disposal to build codes and gather information on and publicize successful or failed practices, we must learn to harness markets more effectively, to innovate around business models that can bring the sweeping changes we so badly need. There needs to be more tolerance of risk with charitable dollars.

Of course some of this is already happening with the growth of venture philanthropy, micro-credit and social entrepreneurship, with new models of investing for social impact, but there needs to be more and faster.

How can we promote transformation, not just in the professional philanthropic sector, but also among donors, which in turn will fuel change among implementing non-profits? How can we transform the attention paid to short-term results into a more patient investing in our future?