U.S. Still Tops In $1 Million Gifts
November 13, 2013 The NonProfit Times
American donors are the largest provider of $1-million-plus gifts in the world, accounting for nearly three-quarters of all seven-figure donations, according to a new study. Nearly $14 billion of the more than $19 billion given in gifts greater than $1 million last year came from the United States.
The Lilly Family School of Philanthropy at Indiana University partnered with U.K. bank Coutts on “The Million Dollar Donors Report 2013.” The study looked at giving in six regions: The U.S., the U.K., the Middle East, Russia, China and Hong Kong. It found that 1,249 donors made 1,955 million-dollar or greater donations worth $19.04 billion in 2012.
Million-dollar-plus donations from the U.S. totaled $13.96 billion. That’s down from a high of $21.73 billion in 2008 but up from the 2010 nadir of $9.62 billion. “This indicates that wealthy donors continue to maintain significant philanthropic efforts even with recent uncertainty in the U.S. economy,” said Una Osili, Ph.D., the Lilly School’s director of research in a statement from the school.
U.S. major gifts numbered 1,408, “a new low” according to the report. “But despite this decline there is cause for optimism,” wrote the report’s authors. The average gift size rose to $9.9 million, the highest it’s been since 2007, and the median gift was a record high of $2.5 million.
Worldwide, higher education was the top recipient of these major gifts at $7.05 billion or 37 percent of the total. The report cited universities’ experience with handling gifts of this size, as well as the “huge variety of activities that major donors can support, from cutting-edge scientific research and the building of new facilities to the provision of scholarships” as attractions for donors.
Individuals gave 46 percent of the $19 billion, or $8.8 billion. The second most popular destination for these gifts, behind higher education, was foundations, which were the recipients of $2.87 billion.
Foundations gave the largest number of $1-million-plus gifts in four of the six regions. In Russia, 71 percent of the 35 million-dollar-plus gifts came from individuals. Because philanthropy was not practiced behind the Iron Curtain between 1917 and 1992, “contemporary Russian philanthropy is in its relative infancy,” the report’s authors speculated. Only 3 percent of the Chinese major gifts came from foundations, with 38 percent being made by individuals and 59 percent coming from corporations and corporate foundations.
Donors in five of the six regions generally give to organizations in their home countries, with overseas gifts accounting for only 5.6 percent of the total $19 billion. The one exception was the Middle East, where 71 percent of the major gifts went beyond the borders. The Middle East was considered the Gulf Cooperation Council (GCC) countries of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates. “This could suggest that donors perceive that there are relatively greater needs in non-GCC Arab countries,” wrote the report’s authors.
From conversations with major donors, the report found a growing professionalism in large gifts. When the scale and longevity of philanthropy becomes significant, this may involve establishing foundations to formalize and sustain their philanthropy, according to the report’s authors. “There is also an increasing desire to be ‘strategic.’ This may involve establishing a clear mission or objectives,” providing unrestricted grants to back organizations they believe in, collaborating with other philanthropists, measuring impact or hiring professional staff.