Righteous actions are becoming increasingly important as a form of giving, according to The Future of Philanthropy: The Evolution from Charitable Giving to Charitable Living, a new study of philanthropists from Raleigh-Durham, N.C.-based Fidelity Charitable. Making purchases from socially conscious firms, investing in funds that support equality and environment causes and supporting organizations that promote economic or racial justice are gaining traction as “next wave” forms of philanthropy.
Millennials -- individuals born between 1981 and 2000, according to the report -- are more likely to embrace these new forms of giving back. While half of donors reported making a purchase from a socially-responsible business, two-thirds of Millennials did so. The one in five donors (20%) who have considered social or environmental implications when making investments is outstripped by the 43% of Millennials who make these considerations. And while seven in 10 philanthropists, overall, believe it is important to work for an organization that engages in socially responsible actions, Millennials, at 87%, outpace other cohorts.
There is also a difference in how Millennials view what being a philanthropist means. According to the research, three-quarters of Millennials consider themselves philanthropists, compared with one-third of Baby Boomers.
“The term philanthropist has traditionally been associated with wealth and privilege,” Fidelity Charitable Head of Marketing Amy Pirozzolo said during a video conference. “But younger donors don’t buy into that thinking. The younger generation, their idea is that philanthropy is far more inclusive. They apply the term very broadly to anybody who gives their time, talent or treasure to making the world a better place.
Motivation for Millennial giving is also more likely to focus on how they view themselves as socially conscious, as opposed to older donors, who want to support the missions of the nonprofits they support. The top three reasons Millennials gave for their charity were:
- I can make a difference with my donations;
- I have a responsibility to give; and,
- It helps me live a life that reflects my values.
In contrast, the top three reasons offered by Baby Boomers were:
- The nonprofits I give to are trying to solve important problems;
- I have a responsibility to give; and,
- I am personally connected to the cause or I know people personally impacted by the causes.
The rise of younger digital natives -- those born into an Internet-connected world – has similarly shifted the importance of electronic giving. Overall, 40% of donors have used online giving platforms such as GoFundMe to make a donation, as have 25% who used a social media platform. Six in 10 gave through an organization’s website in 2020, and 18% said they did so more often than they had previously. They are also more likely to use their social media platforms and their networks of friends to bring attention to their support of nonprofits dear to them, and to encourage similar support among others.
The speed at which support of, and opinion about, nonprofits is transmitted via these networks might have implications for charity among this group. With Millennials, their values are more important than a specific nonprofit brand. A nonprofit that fails to live up to their values, or that is seen as out of line either due to organizational or individual missteps, runs the risk of losing Millennial support more quickly than among older cohorts.
“Nonprofits need to consider this broadened definition of philanthropy, and recognize that it is not just all about funding the NPO, but rather engaging the donor to be more involved with the organization, because once they get involved, they are going to bring their network, they are going to bring their volunteer hours and then eventually bring their funding,” Fidelity Charitable President Pamela Norley said during the video conference.
Artemis Strategy Group, on behalf of Fidelity Charitable, surveyed an initial round of 3.055 adults who had given a minimum of $1,000 during 2019 in March 2020. In January 2021, a survey of 830 people who had donated at least $1,000 during 2020 was conducted for comparison purposes.
A full copy of the report is available here: https://bit.ly/3gXl8pP