By Lauren Young
NEW YORK Nov 15 When it comes to donating time
and money, wealthy Americans are thinking globally and using
technology to connect with charitable organizations in some of
the most remote corners of the globe.
For an update on the state of giving, I talked to Una Osili,
director of research and a professor of economics and
philanthropic studies at the Center on Philanthropy at Indiana
University. Here she discusses the latest findings from her
annual survey on high-net-worth philanthropy, conducted in
partnership with Bank of America.
Q. How does charitable giving now compare with pre-recession
A. Giving USA, which tracks the nation's charitable
contributions, saw its steepest decline in giving during the
recession years - a cumulative drop of about 13 percent,
adjusted for inflation. (The last recession began in December
2007 and ended in June 2009, according to the National Bureau of
But since the recession ended, we've seen an uptick in
giving. The most recent numbers show average annual growth in
the 1 percent to 2 percent range during the post-recession
period, with giving reaching about $298 billion in 2011. That's
good news, but if we continue to grow at this slow rate, it will
take more than a decade to return to the pre-recession highs
when peak giving was well over $300 billion.
Q. Who is gaining donors? Who is losing them?
A. Giving to religion declined 4.7 percent in 2011, adjusted for
inflation. This may be explained by recent reports of decline in
membership and religious attendance among some large religious
Some educational institutions have done relatively well,
though. Education ranks as the No. 1 priority among 61 percent
of donors, according to our research. Many donors already have
ties with their alma maters and see education as a way to solve
problems in society.
Q. What about more affluent donors? Are they giving more or
A. Economic and financial security are significant drivers of
giving. Certainly the recession had a big impact on the ability
of wealthy donors to give, and the volatile stock market and low
interest rates don't help. (The survey focused on households
with more than $200,000 in annual income and more than $1
million in assets, excluding their homes.)
We asked high-net-worth donors for the first time: What are
your plans for next three to five years? More than 75 percent
plan to continue at current levels or increase their giving; 24
percent of them plan to give more.
That's a relatively optimistic view. We find that these
donors are deeply committed and highly engaged with the
charities they support.
Q. What's new about the way people give now?
A. The globalization of giving means donors can reach causes in
their own local communities but also in Ghana, Mexico or the
Philippines. Even during the recession, international giving was
emerging as a bright spot, growing at double-digit rates.
When we started tracking data in 2000, about 2 percent of
U.S. households were giving to international causes. Today
that's closer to 8 percent.
Q. How has technology changed the way we give?
A. Technology makes it possible to learn about and get involved
with nonprofits anywhere in the world. You can tweet, Facebook
and connect with an orphanage in Guatemala you might not have
heard about 10 years ago.
In the aftermath of the 2010 earthquake in Haiti, donors
were giving to large nonprofits like Partners in Help, but they
also found their way to smaller nonprofits initiated by
Haitian-Americans as well as churches and other organizations on
Q. What does the uncertain state of tax laws mean for charities?
A. Taxes are not the sole driver of giving, but tax policy
certainly influences it. What's being considered now is a cap on
the amount wealthy donors can deduct. In 2010 donors said for
the first time that they'd change their giving if charitable
deductions were eliminated, according to our study.
Q. What other trends are you seeing on the giving front?
A. Women are increasingly playing a highly visible role,
particularly boomer women. The American Red Cross, for example,
has a Tiffany Circle of high-net-worth women who are making a
In 90 percent of affluent households, women are the sole
decision maker or partner in giving decisions.
Q. Tell me about tomorrow's donors.
A. Young donors have different motivations for giving and the
type of causes they support. They don't want to just write
checks. They want to volunteer. They often take a hands-on
approach to philanthropy and addressing issues like
homelessness. They contribute their time and talents to make a
Some new donors are what we call voluntrepreneurs - they are
young people who want to make a difference around the world.
They are using philanthropy to solve the world's problems in
education, health and elsewhere.
Q. So where do social entrepreneurs - who mix business
principles and social values to solve the world's problems -
fall into this mix?
A. The 21st century requires more creative solutions. Social
entrepreneurship straddles the world of business and
philanthropy. It's different from the older model of
philanthropy because it uses innovative approaches and
entrepreneurial principles to solve social problems on a large
Just look at microfinance organizations like Grameen Bank
and kiva.org, which give small loans to entrepreneurs to start
businesses. We have some very pressing global challenges, and
how do we solve them? It may involve using new tools and ideas,
including some from the business world. The lines may blur.