Millennials At Vanguard of Philanthropic Change
The world is changing fast, and it feels more difficult than ever just to keep up.
Although the pandemic has accelerated many of the cultural and technological changes that most of us struggle to keep up with, the bigger drivers of change were already there.
We often think of swift change as the arena of tech moguls and financial gurus, but the reality is that philanthropy is being transformed, primarily by young people.
At least that’s the conclusion from a new report from Fidelity Charitable, which surveyed more than 3,000 charitable individuals to March 2020. The organization also followed up with those donors again in January 2021 to check for changes in donor attitudes and behaviors after the pandemic, wildfires and many other seismic events of 2020.
One of the biggest takeaways? Many more young people consider themselves philanthropists than in older generations.
“Charitable giving is quickly becoming charitable living,” said Pamela Norley, president of Fidelity Charitable. “There is an entirely new mindset among younger generations shaping what it means to give back. Three-in-four millennials consider themselves philanthropists, regardless of how much they give, compared to only one-in-three boomers.”
The intersection of charity and commerce has grown exponentially in recent years, so that giving is part of everyday decisions and more accessible than ever.
Fidelity Charitable also found that nearly half of all surveyed donors bought products that provide a social benefit. Another 20 percent invested in “socially responsible” investments or businesses.
It won’t surprise many of us to hear that social media has also become a big player in modern charitable giving. According to the Fidelity Charitable report, about 25 percent of donors gave to charities through social media channels, and another 40 percent donated on crowdfunding platforms like GoFundMe.
Millennials are the primary drivers of this change.
Here are a few significant findings from the report:
- About 65 percent of millennials (aged 24-40) bought products from sustainable businesses. That’s compared to 51 percent of Generation X (age 41-56) and 40 percent of baby boomers (age 57-75).
- Even in investing, many more millennials targeted investments that have a dimension of social good, compared with 22 percent of Generation X and just 12 percent of all boomers.
- Given the following statement: “When I consider a future employer, it’s important to me to work for a company that engages in corporate social responsibility,” 87 percent of millennials agreed. The rate of agreement was 71 percent for Gen Xers and 64 percent of boomers.
According to an article from Barron’s, this change in philanthropy has already had a “profound impact” for financial advisors and turns “upside down” how they can approach working with next-generation clients, said Amy Pirozzolo, head of marketing at Fidelity Charitable, told the magazine.
For private wealth managers and philanthropists, these are important facts. Currently, the millennial generation doesn’t have the financial influence of their parents.
Millennials represent just 5 percent of all wealth in the U.S., according to Fidelity Charitable, which was using data gathered from the U.S. Federal Reserve.
But they will inherit billions of dollars from their baby boomer parents in coming years, and will certainly use that money to continue changing the face of philanthropy.
We’re likely to see an increase of charitable partnerships with private businesses, large and small, and an increase of giving overall as millennials use inherited wealth for the social good that drives so much of their behavior.
There’s a fascinating paradox to this change. The younger generations, beginning with millennials but including Gen X and Gen Y, have often been labeled as lazy and entitled. Yet they are now in a position to grow philanthropy throughout our culture and economy.
The world has many problems, but we can take encouragement from the fact that the younger generations seem intent on tackling them.
Turbulent Times A Pivotal Moment for Philanthropy
Over the last few years, it became somewhat of a joke among journalists that the news cycle had sped up.
So many seismic events were happening so quickly that it felt impossible to keep up with all of it, even among the communications professionals whose entire careers are about comprehending and sharing the news.
For philanthropy, this is an especially important moment.
Whether it’s racial justice or climate change or income inequality, there’s a growing feeling that the U.S., and maybe the whole world, is experiencing a turning point.
It’s unclear what turn we’re going to make — and whether it will be a positive one — but leaders in philanthropy are right to try and make something of this moment in time, using the influence that the biggest charitable organizations have developed for years or decades to be a critical mover of social progress
Racial Justice
A year ago, the death of George Floyd kicked off the resurgence of the Black Lives Matter movement. Now, with a conviction of Derek Chauvin for the killing of Floyd, philanthropic groups focused on justice see an opportunity to be a part of institutional change.
In the Chronicle of Philanthropy, Tonya Allen, president of the McKnight Foundation and chair of the Council on Foundations, said this time should be a catalyst for progress, not only for racial justice, but also affordable housing, voting rights, and environmental justice.
“This is a moment we won’t get again to push for transformational changes in public policies and practices,” Allen said. “Before the world moves on, philanthropy can use its considerable influence and conviction to push private and public sector leaders to listen to what frontline racial-equity community leaders have long been advocating for, which are shared power, participation, and prosperity.”
Giving Circles
Giving circles is a form of grassroots philanthropy where people with shared values pool together resources to advance causes — and it’s growing fast.
Philanthropy Together, a relatively new nonprofit that supports giving circles worldwide, just launched a new global directory of giving circles. The directory is searchable and available on Grapevine, a digital platform for giving circles to recruit new members and make donations.
According to The Chronicle of Philanthropy, Grapevine already had a database of a few hundred giving circles. But by partnering with Philanthropy Together the number of giving circles has increased to more than 2,000.
Sara Lomelin, executive director of Philanthropy Together, said giving circles are attracting traditionally underrepresented groups, like women and people of color. These demographics are attracted to the personalized nature of charity through giving circles, Lomelin said.
“Women and Bipoc folks, they see themselves in our vision and our work and our values,” Lomelin told The Chronicle of Philanthropy. “We wanted to build this party that we all wanted to join.”
Adapting to Changes
Philanthropy historian Benjamin Soskis spent most of 2020 tracking the changes to philanthropy caused primarily by racial justice protests and the pandemic.
He released a report of his findings, called “Norms and Narratives That Shape U.S. Charitable and Philanthropic Giving.” It suggests ways that philanthropic leaders can adapt to these big changes.
In an interview with The Chronicle of Philanthropy, Soskis, a senior research associate at the Urban Institute’s Center for Nonprofits and Philanthropy, was asked how fundraisers and nonprofit leaders should plan for the future.
“I wish I had a clear answer for that,” Soskis responded. “There’s one type of timeliness, which is just thinking about time as an important dimension of giving. Then there’s another, which is the importance of giving staked to your particular moment. During the crisis, people were talking more and more about time as a component, but also they were increasingly thinking about their responsibilities as givers to the moment — whether that means giving rapidly or it just means thinking about now versus later.”