Generosity²: Can you “do good” even better? by Laura Rhodes
With this post, I am pleased to welcome my first guest blogger, Laura Rhodes the founder of Third Sector Consulting Group, which offers services to charities and charitable givers.
It seems absolutely appropriate that Laura provide my first guest post. Laura has 15 years experience working with nonprofits, foundations and corporate social responsibility programs. In addition to Laura’s willingness to share her deep experience with my readers, I am excited to introduce you to her because we began our networking online. Laura and I met via Twitter and continued the conversation offline. Our story demonstrates yet again what powerful tools online channels provide for finding others with similar interests and focus. Nonprofits take note: Are you using social media to make connections with interested potential supporters?
Laura’s post below challenges donors to think of the many different ways their generosity can have an impact. Enjoy, and be sure to leave us your thoughts in the comments.
Last week, three schools announced major gifts: $35 million to Dartmouth College, $40 million to St. Joseph’s College and $60 million to Washington University. The gifts to St. Joseph’s and Washington are the largest gifts in the schools’ histories.
Just two months ago, Baylor University announced a $200 million bequest from a Baylor graduate. Not only is the gift the largest in the university’s history, it ranks among the top 20 private gifts ever made to higher education in the U.S.
These donors are all to be commended for such extreme generosity and for supporting higher education. At the same time, one can’t help but imagine the impact of these gifts if they were allocated differently.
Imagine, for instance, the impact of 200 $1-million endowments. A $1-million endowment should conservatively produce a 4% annual return. How many direct appeals, campaign letters and fundraising events does it take for a small organization to net $40,000 each year?
This is not to suggest that the Baylor donor should have made 200 million-dollar gifts instead of a single one. In fact, philanthropic advisors will tell you that donors should focus their giving and not dilute their impact by giving to too many causes and organizations.
However, if a donor has the capacity to make one or more large contributions, establishing an endowment would be a great way to provide a lasting gift to one or more small nonprofits.
Another giving method that is gaining momentum is what the New York Times simply called a “fat cash prize.” The concept is that a philanthropist can bring attention to ‘their’ cause by offering large cash awards, either for past achievement or to encourage others to work on causes that are important to the donor. According to McKinsey & Company, prize money from philanthropists has increased over the last decade from $100,000 to $375 million per year.
There are many approaches to philanthropy. Professional advisors will call it by different names: thoughtful giving, inspired charity, informed giving.
Personally, I like “strategic giving.” I think charity should be more than simply writing a check.
I also think all giving is good, regardless of the amount you have to give or your method of giving. My hope is that all donors will become strategic givers and always ask themselves, “Can I ‘do good’ even better?”
Comments are closed.