Making an Impact with Philanthropy

Exciting new forms of giving are enabling donors to match their desire to do good with a drive for measurable, businesslike results.

Executive Summary

Making an Impact with Philanthropy image

There are exciting new forms of giving that enables donors to match their desire to do good with a drive for measurable, businesslike results. Philanthropy in the United States is undergoing a change. Time was, wealthy individuals would send large checks to organizations while expecting little in the way of feedback on where their dollars went. Today, an increasing number of givers are taking a vested interest in where the money goes and how successfully the recipient charities pursue their stated missions. It’s called impact philanthropy, and while it remains an evolving area, this type of giving is developing certain hallmarks:

  • Many young entrepreneurs, especially those in the technology sector, are gravitating to impact philanthropy and in many ways are helping to define the movement.
  • Sitting at home with a computer or tablet, impact investors can easily search for ways to effect real social change, in areas that are meaningful to them, with their gifts.
  • There are resources available that are clearinghouses for best practices and research on causes ranging from education to the global fight against infectious disease.
  • To attract donors, more and more nonprofits are providing data that show the likely impact of each dollar.

A somewhat controversial trend is for philanthropists to search for ways nonprofits can use mechanisms of the free market to boost the impact of charitable works. This may cause some organizations to scramble to meet those demands, potentially undercutting their core missions.

While some donors orient their dollars in ways that can save lives, others recognize that charities face day-to-day operational expenses — rents, salaries and so forth — and direct their gifts to that end.

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