Nonprofits’ Effectiveness, Transparency Impacting Donors

October 5, 2016       Andy Segedin      

Tides of change within the nonprofit sector are influencing individual donors’ personal perceptions and giving behaviors. Greater than two-in-five (41 percent) of donors report that increased knowledge and transparency into nonprofit effectiveness has affected their approach to giving. More than a quarter (27 percent) state that technological advances such as mobile giving and micro-giving have had similar impacts.

The Future of Philanthropy, a new study released by Fidelity Charitable, was built on survey responses from 3,254 individuals answering questions relating to their relationship with giving. Evolving technology, organizational practices and social norms have all made an imprint on individual philanthropy, the report’s findings state.

Changing attitudes toward generational wealth such as giving away higher portions of wealth as opposed to passing it on has impacted 21 percent of donors, while expanded access to financial strategies such as donor-advised funds (18 percent) and rise of alternative forms of giving such as investing in socially conscious businesses (16 percent) have also left a mark.

The study points out similarities and differences between generations, focusing on Millennials and Baby Boomers. Access to basic health needs, developing treatment and cures for diseases and addressing hunger appear on the top three lists of priorities for both age groups — though Millennials favor basic health needs while Baby Boomers focus on hunger.

Millennials tend to be more global in their approach than Baby Boomers, with 47 percent splitting concerns between foreign and domestic needs, while only 31 percent of Baby Boomers feel similarly. Baby Boomers are also less influenced by trends than Millennials, 57 percent to 73 percent, and are especially less likely to be influenced by three or more trends, 23 percent to 43 percent.

Both generational groups tend to be at least somewhat optimistic that philanthropy can solve major issues, 96 percent of Millennials versus 93 percent of Baby Boomers. But Millennials are almost twice as likely to be “very optimistic,” 29 percent to 15 percent. When asked which types of groups have the potential to solve problems in the future, Millennials were as or more confident than Baby Boomers in every subgroup — topped by nonprofits (47 percent), public-private partnerships (42 percent) and individuals or groups of individuals (41 percent).

Other findings from the report include:

* Developing treatments or cures for disease is the most important challenge for society to address in the future, according to respondents, receiving priority among 39 percent of those surveyed. Hunger and access to nutritious food, 38 percent, was right behind followed by access to basic health services at 33 percent.

* Donors prioritize domestic issues. More than three-in-five (61 percent) of donors focus on domestic issues while only 2 percent key-in on foreign needs. The remaining donors, 37 percent, split interests; and,

* Cause or organizational loyalty remains a key driver. When asked why they give, 59 percent of donors responded that the cause or organization is important to them. Nearly half, 49 percent, identified giving as a personal or family value while 28 percent said that they want to make a difference.

  • donors
  • Fidelity Charitable
  • giving