Monitor Institute - The Changing Context For Philanthropy

THE CHANGING CONTEXT FOR PHILANTHROPY The World THE WORLD OF THE WORLD AROUND PHILANTHROPY PHILANTHROPY MULTIPLICATION GLOBALIZATION Everything associated with the domain of The growing scale and complexity of today’s social benefit has grown significantly in the You and/or issues—from epidemics to human trafficking— last 25 years, making it both a more active Your seldom adhere to traditional geographic and and more crowded environment. There are Institution programmatic boundaries. At the same time, more wealthy individuals able to give, more resources and ideas to address these problems foundations, more donor-advised funds, more are coming from all over the world, not just the giving circles, more philanthropy-related West. Increasingly, the solutions of the future businesses, and more nonprofit organizations Philanthropy will need to match this global scope and scale, competing for funds. This increases the pool and to cross old borders and boundaries. of ideas, resources, and allies for anyone seeking to address an issue, but also could PRIVATIZATION add to the fragmentation and duplication of The power and wealth of private actors— effort in the sector. businesses, nongovernmental organizations, and individuals—has grown dramatically, and now DIVERSIFICATION has greater potential than ever before to both Not only is philanthropy growing in size, it is diversifying by almost every measure. Philanthropists now operate create and solve social problems. Private individuals such as President Clinton can lead Today’s wealthy include growing numbers of women, Latinos, blacks, Asians, and others in a context that is deeply international efforts that once were the province of government. Although the importance and who bring their respective cultural traditions as well as their assets. Younger donors who different from the one in power of governments has not necessarily diminished, the stage on which they work—and made their money in industries like IT, finance, and biotechnology bring new which many of their the actors with whom they must interact—has been transformed. assumptions about how to get things done and how active they want to be as living donors. institutions, assumptions, CONNECTION And philanthropy is no longer only the province of the rich, as new technologies and habits were formed. New tools and technologies—from free conference calls and emails to blogs, wikis, tags, make it easier than ever before for people of all backgrounds and perspectives to give. Funders sit in the middle of texts, and twitters—are changing the way we communicate and connect. These “social media” OBSERVATION changes taking place in the tools now allow more people to easily engage and connect, irrespective of geographic distance; The enormous growth in both the number of people engaged in the social sector and the broader world outside of they let us access a greater diversity of perspectives and expertise; and they can amount of money coursing through it is sufficient to attract attention. Add in the philanthropy, and in the facilitate accelerated learning and on-demand access to information—all while reducing the increasing availability of information and the means to communicate it instantaneously and midst of irreversible changes costs of participation and coordination. The tools are allowing us to re-imagine many of the social mounting scrutiny is inevitable. As the New York Times has written, the public is now within philanthropy itself. acts we already do—activities such as learning, organizing people, generating ideas, sharing “asking do-gooders to prove they do good.” knowledge, and allocating resources—but with Both givers and grantees are being held to rising standards of accountability and The pressures of this new the potential to do them bigger, better, faster, and cheaper than ever before. transparency by legislators, the media, and the broader public. environment, and the need ACCELERATION REFLECTION to respond to it, will shape As the density, speed, and scope of connection has increased, our society has accelerated the In the last 30 years, people in the social sector have benefited from enormous advances in both how philanthropy is rate at which information is communicated, the rate at which it can be incorporated into other their ability to reflect on and share their own work and the work of others in the field. practiced and the role and processes, and the number of people who can use that information to create new ideas, There is now a history to study and many more institutions and vehicles through which influence of large donors and synthesize new inventions, and make decisions. One effect is that there is a new pressure on one can learn it. What began as a relatively small field with little information available is foundations within the field individuals and institutions at all levels—local, regional, national, and global—to respond more rapidly becoming a mature industry. for the next generation. rapidly to shifting external circumstances. © Copyright 2009 Monitor Institute

A few facts and figures about philanthropy’s changing context Philanthropy by the Numbers Growth in the Number of U.S. Billionaires and U.S. Foundations Number of foundations in the U.S. in 1984: 24,859 Number of foundations in the U.S. in 2007: 75,187 Average number of new foundations created in the U.S. per day in 2007: 8 Number of foundations with assets over $1 billion (in 2007 dollars) in 1984: 11 Number of foundations with assets over $1 billion in 2007: 156 Portion of the field comprised by those billion-dollar foundations: 0.2% Fraction of all foundation assets they hold: 67% U.S. Foundations Portion of the field comprised by foundations under $1 million: 63% U.S. Billionaires Total charitable giving (from all sources) in 1984 (in 2007 dollars): $142 billion Total charitable giving (from all sources) in 2007: $314 billion Total foundation giving in 1984 (in 2007 dollars): $5 billion Total foundation giving in 2007: $44 billion Privatization of Wealth Of the world’s 100 largest revenue producers in 2007, only 33 were countries/ Number of High Net Worth and Ultra High Net Worth Individuals governments (measured by budget revenue). The other 67 were corporations (measured by annual revenue). Wal-Mart was the eleventh largest revenue-producing entity in the world, behind only the governments of the U.S., Japan, Germany, France, the UK, Italy, China, Spain, Canada, and the Netherlands. Bill Gates net worth in 2007, $59 billion, was larger than the GDP of many countries, including Croatia, Ecuador, and Bulgaria. Cell Phone Growth Number of cell phones globally today: ~4 billion Number of years to sign up the first billion cell phone subscribers: 20 years Number of years to sign up the second billion subscribers: 40 months Number of years to sign up the third billion subscribers: 24 months Number of new cell phone customers around the world every minute: 1,000 Web pages indexed by Google Number of Articles in All U.S. Newspapers and Wires with Philanthropy in the Headline or the Lead Paragraph LexisNexis.com © Copyright 2009 Monitor Institute

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Monitor Institute - The Changing Context For Philanthropy

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