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Philanthropy plays a vital role in the health and vitality of our region and our nation. By working together with nonprofits, businesses and government, philanthropy improves community conditions and contributes to civic life and leadership through the responsible use of collective assets, networks, research, voice and advocacy.
Organized philanthropy has grown dramatically over the past few decades. As the number of private foundations increases, the ways people give are diversifying. Significant developments include the creation of charitable gift funds operated by large financial institutions; the rapid growth of donor-advised funds at community foundations; the popularity of online giving and use of social media to support causes; the expansion of pooled funds such as giving circles; and an inceasing interest in impact and mission-aligned investing.
While organized philanthropy continues to grow and adapt to ever-changing social and economic trends, it is important to note that contributions by individuals remain by far the single largest source of charitable dollars in the United States. According to Giving USA, individual giving combined with bequests consistently accounts for more than three-quarters of total charitable giving each year.
Unlike tax dollars, philanthropy has greater flexibility to fund innovation, risk and creativity, and to advocate for social change, making it an important and unique component of our community’s fabric.
Giving Trends
Trust-based philanthropy
Many acknowledge that the prevailing power dynamic between funders and grantees can be a barrier to impact. Trust-based philanthropy attempts to break down the traditional power dynamic and create a collaborative environment that supports listening, learning and the ability to be nimble. Pioneered by The Whitman Institute, the model is based on the belief that efforts to create social, political, and economic equity will be more successful if philanthropy embeds trust, dialogue, and relationship-building in its practices with grantees.
Visit the Trust-Based Philanthropy Project website for information about recommended principles and practices and resources to help you get started.
Impact Investing
Impact investments are made into companies, organizations, and funds with the intention to generate social and environmental impact alongside a financial return. In philanthropy, impact investing cover two distinct categories of investments: Market-rate mission investments, also known as "mission-related investments," are part of a foundation's endowment and have a positive social or environmental impact while contributing to the foundation’s long-term financial stability and growth. Below-market mission investments, also known as "program-related investments" or "PRIs" are designed to achieve specific program objectives while they may earn a below-market financial return.
To learn more about how leading foundations are engaging in impact investing, visit Mission Investors Exchange and the Global Impact Investors Network (GIIN).
Participatory Grantmaking
Participatory grantmaking encompasses a range of models, methods, challenges, and insights. At its core, this approach to funding cedes decision-making power about grants to the very communities impacted by funding decisions.
To learn more, download the GrantCraft guide, Deciding Together: Shifting Power and Resources Through Participatory Grantmaking and visit IssueLab's participatory grantmaking information hub.
Disaster Philanthropy
Recent years have seen an exceptional number of disasters that have garnered the world's attention, as well as their dollars. Starting with the September 11 terrorist attacks in 2001, followed by the Asian Tsunami, Hurricane Katrina, and more recently the devastation caused by Hurricanes Sandy and Maria, both individuals and institutions worldwide have made unprecedented donations for relief and recovery efforts.
To learn more about best practices for disaster grantmaking, visit the Center for Disaster Philanthropy and read the post from the Center for High Impact Philanthropy, Disaster Relief: Help Now, Help Later, Help Better for advice on helpful donor strategies.
Collective Impact
The idea of Collective Impact advances the theory that no organization acting alone can solve large-scale issues. Beyond mere collaboration, collective impact describes a rigorous approach incorporating five critical elements that, together, can leverage deep and lasting social change. FSG’s researchers first introduced the concept in 2011 and continue to study the strategy. They have created an online knowledge exchange to share tools and stories of collective impact in action.
To learn more, visit the Collective Impact Forum.
Giving Circles
Over the past two decades, giving circles have emerged as a new and growing trend in hands-on philanthropy. Giving circles are formed when individuals—often friends, neighbors or co-workers—come together around a common cause and pool their charitable dollars to have greater impact. Examples of regional giving circles include Impact100 Philadelphia, Philadelphia Black Giving Circle and the Asian Mosaic Fund.
For additional information, visit Philanthropy Together and read a report from the Johnson Center for Philanthropy, In Abundance: An Analysis of the Thriving Landscape of Collective Giving in the U.S. (2024)
Giving While Living
Individuals and families who subscribe to the philosophy of “Giving While Living” choose to devote their funds—and often their time as well—to charitable causes during their lifetime instead of bequeathing funds to a foundation or charity after their death. Many donors find this approach yields enormous benefits and satisfaction, allowing them to experience first-hand the impact of their gifts.
Read the Center for Effective Philanthropy's A Date Certain: Lessons from Limited Life Foundations, and visit the The Atlantic Philanthropies' Giving While Living webpage.
Scaling Impact
Groups like the Growth Philanthropy Network (GPN) have pioneered efforts to find and finance projects that have a proven track record of success. GPN's Social Impact Exchange is building a "philanthropic capital marketplace" that seeks to provide reliable funding for scaling high-impact nonprofit initiatives.
Read the Stanford Social Innovation Review article, From Scaling Impact to Impact at Scale.