Many Questions – and Answers – About Charitable Giving

Many Questions – and Answers – About Charitable Giving

from Giving USA Presentations

 Many Giving Institute member firms have spent the time since the release of “Giving USA 2011” hosting Webinars and presentations to go over the report’s findings on charitable giving in 2010. We asked three firms – Collins Group, Inc. (Seattle), Campbell & Company (Chicago) and Cramer & Associates, Inc. (Dublin, Ohio) – what sorts of questions their programs received. Below is a sampling of those questions – and the answers.

Q. I work in healthcare.  Are there particular points specific to my work that are notable in the most recent Giving USA report?

A. The most notable point to health care organizations contained in the recent Giving USA results is that philanthropy has grown in that sector in each of the past two years. The only other sector to have positive growth in both 2009 and 2010 is international affairs (human services was up .1% in 2010, which is an essentially flat result). Many people were surprised by this result, which bodes well for the health care sector.

Q. Within the education sector giving, is there a breakdown in the report between higher education and K-12 giving?

A. There is no breakdown between giving to higher education and giving to K-12 schools in the education sector of Giving USA.

Q: What is included in international affairs?

A: Giving to organizations working in international aid, development or relief; those that promote international understanding; and organizations working on international peace and security issues. This subsector also includes research institutes devoted to foreign policy and analysis, as well as organizations working in the domain of international human rights.

Q. Can you speak more about bequest giving? Is it data from federal estate tax returns so it is only from the large estates or something else?

A. Our estimate for bequest giving includes an estimate for itemized giving by estates in 2010 and an estimate for giving by non-itemizing estates in 2010. These numbers are based on an econometric model. So, this figure includes an estimate for ALL estates in 2010. Our methodology section provides significant detail on how we come up with this number.

Q. Would anyone be willing to comment on the changing face of giving?  I.E., If you buy our product, we donate a portion to charity X.  Do you think this is becoming a significant portion of corporate giving?

A. Corporations are increasingly concentrating their giving among organizations whose mission is closely aligned with the corporations’ social responsibility goals. And in doing so, they are increasingly building larger partnerships that involve much more than gifts of cash. They are being structured to provide value both to the nonprofit and the corporation and often include in-kind gifts, cause-related marketing that leverages the purchase behavior and loyalty of their customer base, skills-based volunteerism for their employees, media exposure and other appropriate “cross pollination” activities.

Q.  Do you think the new legislation on healthcare will affect giving in that sector?

A.  Possibly. The recent AHP report indicated that giving to healthcare grew. Whether or not this will continue is not certain at this time.

Q.  Do you think the recent Gates/Buffet Giving Pledge will affect these numbers in the coming years?

A.  No, not really, not unless it begins to have a trickle-down effect and those larger donors in individual communities begin to abide by the “Give While You Live” philosophy.

Q.  Do you think philanthropy will continue to grow at 2%?

A.  That’s up to us, but our values have changed. It could stay at 2% or even go higher if we do our jobs and engage and educate people on our causes because I just heard on the radio that every household could cut their expenses by 10% and not feel that much of an effect. Now, this doesn’t apply to mortgages and transportation, but it does to dinners out, our food budget, entertainment, and even our electrical and power bills can be cut. If everyone just cut their expenses by 2% and gave it to charity, imagine what a difference that would make.

Q.  Based on this report, what are the three things I should take back and begin doing today at my organization?

A. 1) Work with your Board to develop a plan for what if. What if the stock market drops again, what can we do, and/or reallocate to weather the storm? 2) Track the GDP. If you want to know what’s going to happen in philanthropy watch the GDP. 3) Develop a fundraising plan, work it and be deliberate in your fundraising efforts.

Q.  Did you see more corporate monies going to international giving?

A.  Somewhat, but that’s also because corporations are now looking at their entire enterprise and not just where their headquarters are located. In the past, many corporations only gave in the community in which they were headquartered but more and more are now giving where they have locations, distribution centers, factories, etc.

Q.  Do you see an increase in online donations?

A.  While some reports will say online donations are increasing, and they are, in our research we haven’t seen them make a huge difference, but America gave over $290 billion last year. We do know that there have been some major gifts in the $100,000 range given online – one of which was to Doctors Without Borders – and while the nonprofit incurs fees for transactions/donations done online, my guess is that individuals are doing this for the credit card benefits/points. With that said, our donor demographic is changing and the younger generation does more and more online and we must all adapt and be aware of this change.

Q.  I thought we were told because of the downturned economy that there would be less and less nonprofits being formed, but according to the graph the number of nonprofits keeps increasing?

A.  My opinion on this is two-fold. 1) I think there are more and more specialty type organizations being created. For example, instead of giving to the American Cancer Society, you can now give directly to an organization who works with and does research for, say, a specialty type of cancer like breast cancer, colon cancer etc. Now, research-type folks are really liking this, as their research projects for specific things can get funded. I also think that many people have a great idea and are opposed to looking out into their communities to see if there are other organizations doing similar things; they are instead creating their own organizations.

Q. We keeping hearing that nonprofits should merge and/or collaborate. Do you see this happening? And do you think it’s a good idea?

A. Yes, and no. While many have been asked it’s a hard thing to do and accomplish. Now I do know that many that are doing shared services, which is helping with overhead costs. Do I think it’s a good idea, sometimes. I do think Boards should talk about it.  Most of the time Boards only talk about it when an Executive Director is leaving an organization, but a discussion on partnering and collaborating should be occurring all the time. And funders like to see organizations do this.  Again, mergers are not the easiest thing to do and sometimes it’s not in the best interest of the organizations, but collaboration and partnership are always a good thing.

For more information about Giving USA 2011, please visit www.givingusa.reports.org

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