Philanthropic Giving Reaches New High in 2016

Despite the turbulent year in American politics, philanthropic giving in the United States increased by 2.7 percent up to $390.05 billion in 2016, according to the annual Giving USA report released in June. These figures mark the third consecutive year of record-breaking donations.

Of the four categories tracked by the report, individual giving increased the most at 3.9 percent growth, while foundations and corporate giving both rose by 3.5 percent. Bequests were the only category to fall, having decreased by 9 percent. Within the foundation segment, community foundations increased most significantly by 9.9 percent, while operating foundations rose 4.5 percent and independent foundations were up 2.3 percent. Giving USA found increased donations across all of the measured issue areas, with the largest change to environmental and animal welfare (7.2 percent growth), followed by arts and the humanities (6.4 percent), international affairs (5.8 percent), and health (5.7 percent). Although giving to education saw more than 8 percent growth between 2014 and 2015, donations only increased by 3.6 percent in 2016.

Read more at Philanthropy News Digest and Giving USA.

Five Questions to Consider: The First 100 Days of the Trump Administration

The election of Donald Trump last November has precipitated significant movement within the philanthropic sector to mobilize resources, organize collective action, and spearhead advocacy for a wide range of issues and communities across America. Now having reached the first 100 days of the new administration, philanthropists are taking a moment to reflect and assess this response. In their recent article for The Chronicle of Philanthropy, Aaron Dorfman, Cathy Cha, Jaqueline Martinez Garcel, and Lateefah Simon — leaders of the National Committee for Responsive Philanthropy, the Evelyn & Walter Haas, Jr. Fund, the Latino Community Foundation, and the Akonadi Foundation respectively — encourage philanthropists to consider the five following questions:

Have grantmakers committed enough funding and resources?

Grantmakers throughout the country have heightened their giving in response to the shifting political climate and policy priorities of the Trump administration. With the Affordable Care Act under threat, the California Endowment announced it will be creating a $25 million fund for health and safety programs. The William & Flora Hewlett Foundation has dedicated $63 million toward climate change, democracy, and women’s health; the Open Society Foundations has committed $10 million against hate crimes; and the Rockefeller Brothers Fund has increased its giving by 12% in order “to protect and strengthen the vitality of our democracy.” Community foundations and smaller grantmakers have followed suit. However, the authors urge philanthropists to ask whether these efforts are truly enough, considering both the intensity of the challenges being faced and the level of resources at their disposal.

Have grantmakers invested in leaders of color and women?

The authors encourage philanthropists to question whether they have prioritized investing in organizations and institutions led by women and people of color. Regardless of their area of focus, incorporating marginalized leaders and communities is critical toward achieving equity and a lasting impact.

Have grantmakers responded quickly enough?

Although it can be challenging for foundations to swiftly review and process grant requests, many nonprofits are facing imminent threats and challenges. As the authors explain, “a slow response from a grantmaker could mean a missed opportunity to make a measurable difference.” The Astraea Foundation, San Francisco Foundation, Solidaire, and Women Donors Network, among others, have all created rapid-response funds to address these needs.

Have grantmakers expanded their vision?

Many foundations focus resources on a particular set of issues and causes. The authors suggest that philanthropists consider expanding their scope to include communities most in need of assistance: “If we stay in our silos and only support those organizations and campaigns that closely match our program requirements, we will probably miss opportunities to make a bigger difference.” The Barr Foundation, Omidyar Network, and Rosenberg Foundation have all awarded grants beyond their typical priorities to support civil rights, investigative journalism, and Muslim community organizations.

Have grantmakers effectively spoken out to defend those in need?

The authors note that although foundations hold a significant level of influence over society, they have historically been reluctant to speak out on contentious issues. The authors encourage philanthropists to make use of their public standing to mobilize support and action for communities in need.

Read more at The Chronicle of Philanthropy.

Ideas42: Using Behavioral Science to Influence Giving Patterns

Established in 2008 as a research project at Harvard University, Ideas42 has grown into an 80 person nonprofit that uses behavioral science to address topics in criminal justice, development, education, health, and philanthropy. The organization draws upon research in economics, neuroscience, and psychology in order to nudge people toward choices that benefit themselves and society at large. In 2016, Ideas42 brought in $12.5 million for their efforts, largely from foundations including the Bill & Melinda Gates Foundation, Robert Wood Johnson Foundation, MetLife Foundation, William & Flora Hewlett Foundation, and the Laura & John Arnold Foundation.

Through their work, Ideas42 seeks to explain why people tend to behave irrationally and apply those conclusions toward advancing social wellbeing. As co-executive director Piyush Tantia explains, “If you design anything — whether it be a social program, a piece of technology, an email campaign — it’s going to influence people’s behavior. In our experience, most of the time, people don’t really think about that human interaction. They’re assuming that people will be rational.” The Cleveland Housing Network, for example, noticed that many of their tenants would habitually wait until the 10th of the month to pay their rent, sometimes incurring late fees when their payments were delayed. In a pilot project funded by the Citi Foundation, Ideas42 found that tenants could be incentivized to pay on time if they were offered entry into a raffle for $100 or a month of free rent. This has now become a standard practice by the housing agency.

Most recently, Ideas42 has been commissioned by the Gates Foundation to examine ways in which giving patterns can be influenced on a wide scale. In addition to examining research on behavioral science, Ideas42 is collaborating with Paypal, Benevity, and Bright Funds — three digital platforms that enable giving — to test new products that might increase donations. Survey data clearly indicates that donors increasingly value nonprofit performance, but are unsure how to assess it. Mr. Tantia would like to address this disconnect: "The entire charitable-giving industry is set up in such a way that it encourages emotional or impulsive giving. If we want to change that, we have to try completely new approaches.”

Read more at The Chronicle of Philanthropy.

Kevin Starr Calls on Philanthropic Sector to Recognize Development Malpractice

In his recent article for the Stanford Social Innovation Review, Kevin Starr — managing director of the Mulago Foundation — reflects upon his trip to Ghana, where he was introduced to a number of different water treatment interventions that had reached the village of Kulaa. While there, Starr met with Saha, a nonprofit organization that addresses the issue of water contamination by setting up entrepreneurial women with the tools needed to sell filtered water for a reasonable price. Two days of clean water for a family of five costs about five cents. The organization adopts a nonprofit model in order to subsidize the initial business cost and provide ongoing support. However, this contribution works out to a modest $13 per person for 10 years of clean water. Saha monitors their businesses and has found the water to be clean and bacteria-free in 99% of cases.

Despite the success of Saha's program, the village of Kulaa was presented with three additional forms of water treatment over the following months. The government provided residents with free ceramic filters, which wound up clogged or broken in less than half a year; an American church group distributed LifeStraw Family gravity filters, which tested positive for E. coli and coliforms; and another NGO offered a filter which was also overly time consuming and contaminated. As Starr explains, “I thought we were going to hear about the difficulties of overcoming long-held customs or the challenges of running a business when you’re barely literate, but instead we sat under a tree talking to a slightly dazed-looking woman who told us of an exhausting uphill battle against the forces of good intentions.” Regardless of their good intentions, these interventions caused considerable harm. They not only threatened the lives of children, but also misdirected resources and attention away from an effective and sustainable solution.

Starr reaches three conclusions from this experience. First, he recognizes that there is a significant cost to failure; the failed initiatives in Kulaa caused more harm than doing nothing. Second, development interventions that require extensive training are likely to fail; Saha’s efforts were most effective in part because they were the most straightforward. And thirdly, develop work requires follow-up; providing an intervention without offering a system for repairs, replacement, and monitoring can result in unintended consequences. Starr calls on those within the philanthropic sector to recognize development malpractice and to act upon it: "If you see something, say something. If you become aware of someone planning/doing/funding stuff like this, talk to them, educate them, dissuade them... Don't let these things happen."

Read more at the Stanford Social Innovation Review.

A Software Revolution for the Social Good

In his recent article for Recode, Benetech Founder and CEO Jim Fruchterman calls for a software revolution within the social sector. Although software development and data analysis have had a transformative effect on commercial products and companies, particularly in Silicon Valley, philanthropy and nonprofits have not experienced similar benefits from progress in technology. However, if a focused effort was made toward the social sector, this same technology could be used to scale successful solutions, identify new opportunities, and demonstrate impact to donors and stakeholders. Software and data could be used, for example, to connect America’s half-million homeless persons with the 100,000 organizations that provide critical social services. Although these organizations conduct extensive on-the-ground outreach, many of those in need remain overlooked and do not get connected to the services that are available to them. As Fruchterman explains, “We need to shift our philanthropic mentality away from funding one-off projects to a model that drives systematic change across entire fields.”

Read more at Recode.