Bloom Blog

Insights from Michael Bloomfield, Founder and Executive Director of the Harmony Foundation http://www.harmonyfdn.ca/

Charitable Giving: What Motivates Philanthropy?

Charitable Giving: What Motivates Philanthropy?

You must be the change you want to see in the world

Mahatma Gandhi (1869 – 1948)

Growing up learning to give

I was raised in a family where the Jewish obligation to perform charity, tzedakah, was a core principle. Most Jews embrace tzedakah by contributing a portion of their income to charitable organizations, making donations on special occasions and sharing food with strangers on Jewish holidays. All forms of charity are not equal. The medieval philosopher Maimonides listed Eight Levels of Giving that outlined the morally most superior way of giving through to the morally most inferior. The highest level of charity is to anonymously “give an interest-free loan to a person in need” the lowest level is to “give in sadness”. This means that gifts (monetary or non-monetary) given to the recipient in a dignified, respectful manner rank above gifts given out of pity, begrudgingly or with self interest, such as seeking praise and approval.

In today’s world, supporting charitable causes is not just a personal act of compassion or religious obligation. It has become a responsibility for government and business as well, and the challenges are that great. But what motivates major corporations, small companies, government agencies, foundations and individuals to give to various charitable causes? Would you be surprised to know it may not just be the passion for a social or environmental or health cause that impels them to do such things, but also the potential financial benefits or improved reputation philanthropy entails? In other words, we may see a number of philanthropic practices today, ranging from the highest to the lowest rung on Maimonides’ ladder.

Corporate philanthropy – what are the reasons?

The western world provides financial aid to the third world, often a percentage of the national GDP. Major corporations also contribute through corporate philanthropy. One would hope, that the reason for giving is not just the guilty burden of a long history of wrongdoing that western countries carry, or simply acknowledgement that the problems the third world faces impact all of our lives. That perpetuates charitable giving as an indication of superior moral standing when it should be a selfless contribution to heal the world and solve real social, human and environmental problems.

After nearly 40 years of working for one cause or another I have no illusions about that. Individuals and organizations may be passionate about an issue, but do not necessarily have the means or expertise to solve the problem on their own. Therefore, they need to persuade others to donate money or volunteer time and expertise. Some corporations are very generous, but too often only in return for benefits they receive as donors. Here is the rub. In a culture where “what is in it for me” is a common refrain, corporate charitable giving often ranks on the lowest rungs of Maimonide’s scale.

Over past 25 years I have watched as philanthropy and marketing merged. Far too many companies, governments and others have used charities, some as willing partners, to promote their own organizations, products and agendas. Charities do a remarkable job managing their affairs in ways most businesses could not imagine, efficiently managing the money raised while compelled by regulation to spend 80% of what they raised as donations within 12 months. Over and over again they must find new ways to keep the attention of often fickle donors who demand performance and pandering that can be beyond reasonable.

There are, however, possibilities for corporations to connect with charities in a more positive manner. One of the business leaders I most admired in my career, Allan Taylor, former Chairman of the Royal Bank of Canada, once said in a speech to his peers: “Don’t treat the charities you support as ships passing in the night, build lasting relationships.” Far too often, this is not the case when the cause of the year is embraced only to be abandoned the next year as a new cause gains favour in the ever dominant marketing department. Logo gratification is not philanthropy.

Charities are created by people with a passion for a cause or an issue. Their dedication is infectious and attracts the support and participation of others. Choosing to donate to a charitable cause should be a matter of personal conviction about the importance of social, humanitarian or environmental problems, cultural and educational and health needs and so on. While it is important to do your best to make sure your donation makes a difference, far better to risk some money on good intentions than to be part of a stingy, self-centered society which ignores the needs of those less fortunate and our responsibilities to each other and the future.

Recommended further readings and links

Singer, Peter (2009): The Life You Can Save: Acting Now to End World Poverty. New York: Random House.

Sulek, Marty (2009): On the Classical Meaning of Philanthropia. In: Nonprofit and Voluntary Sector Quarterly

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This entry was posted on September 14, 2010 by in Ethics, Ecology, Sustainable Development Series.
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