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Be flexible or lose support, say major donors

Fundraising | Becky Slack | 1 Oct 2007

Charities need to develop a willingness to accept professional expertise from the wealthy or risk losing their support altogether as the shift towards a more strategic approach to philanthropy picks up speed.

A major piece of research by the Ledbury Trust on behalf of Barclays Wealth into the giving behaviour of high net worth and ultra high net worth individuals confirms anecdotal evidence that major donors are no longer content with simply giving their money away but are now increasingly seeking to become actively involved with the organisations they support.

"As the profile of philanthropy grows, so the way it operates develops," explains the report. "Donors will start to give more time; this time will be based on specialist and commercial skills, as opposed to their current generalist nature. This would also help the more sensitive donors to take on a more detached stance, as they start to think of their charitable activities with their business hat on, rather than an emotional one - thereby producing a more long-term and efficient relationship with their chosen cause."

However, the report goes on to say that this will bring with it increasing questions from donors about how donations are spent, particularly in relation to salaries and administration costs. The key, it says, is for charities to become more accountable and transparent: "Increasing levels of trust, co-operation and relationship-building between charities and their donors should help the former obtain ever-increasing monetary and practical support from the latter."

The report, The Changing face of philanthropy: today, tomorrow and beyond, features quantitative and qualitative data from over 500 high net worth individuals and 15 ultra high-net worth individuals with a combined value of over £95m, plus five thought-leaders, including businessman and philanthropist Peter Beckwith and chief executive of the Institute of Philanthropy, Dr Salvatore La Spada.

It highlighted a change in the factors influencing decisions to give. Whereby previously a 'sense of proximity', such as personal experience was a major reason why people give, developments within communications and technology are currently changing the boundaries of this 'proximity'.

'The new wealthy are increasingly influenced by factors including the explosion of communications channels fuelling the global 24 hour news culture, the growth of internet tools such as social networking and the impact these and others are having on the breakdown of barriers when it comes to international business. All of these factors are, and will continue to have, an impact on the value of proximity as a driver, be it personal or geographical, ensuring it is becoming a less influential factor in the decision-making process,'said the report.

Additionally, intermediary organisations such as New Philanthropy Capital were also found to be having more of an influence on giving activities.

A lack of influential peer groups was also noted, which in turn led to questions regarding how philanthropists are recognised throughout society. While high net worth individuals are happy to discuss the charities they are associated with among friends and family, they were less comfortable when it came to discussing the value of their contributions.

'Overall, the wealthy are not in favour of people publicising their charitable donations, the majority (60 per cent) of the affluent surveyed do not think it important for philanthropists to be recognised and congratulated,' said the report. 'Furthermore, the influence of high profile donors seemed limited partly as their lifestyles are markedly different from the vast majority of the wealthy and the sums donated are beyond the scope of even our UHNWIs,' said the report.

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