We’re entering a new era of philanthropic giving, led by women. Donations by women increased by 187% from 2011 to 2021, jumping from $1.5 billion to a staggering $4.3 billion in 2021 alone.
And big gifts have been making headlines: in May, Melinda French Gates announced her investment of $1 billion over two years into organizations working for gender equity. And in March, MacKenzie Scott, author and ex-wife of Amazon founder Jeff Bezos, announced a gift of $640 million to 361 non-profits — on top of the $15 billion she had already granted to nearly 2,000 organizations.
Research shows that women are 40% more likely to engage in philanthropy than men, and with an estimated $1 trillion CAD in personal wealth set to change hands in the impending intergenerational wealth transfer (which will affect women first), that predilection will have an outsized influence.
A lifelong commitment to charitable giving
How women give depends on their stage of life, says financial advisor Nancy Fong, President of NYF Wealth Management, and a guest speaker in our recent webinar on women in philanthropy. She says she’s noticed patterns in the way women practice philanthropy based on their age brackets.
Those in their twenties and thirties who are just beginning their giving journey tend to have lofty ambitions. “‘I’m going to save the world’ kind of thing,” says Fong. They often don’t have specific charities in mind and, without the disposable income to make large donations, they often volunteer. Similarly, women into their forties typically give their time through volunteer opportunities such as Parent Advisory Committees, community fundraising drives and charitable event planning.
As women advance in their careers, their financial wellbeing typically improves. That’s when, Fong says, their giving becomes more personal. “It could be about an illness you’ve experienced or a cause you’ve encountered in your life.” This is when women tend to make bigger gifts – whether monetary, or through participation on boards of directors. Because women typically outlive men, the biggest financial gifts are increasingly being decided by women, and when it comes time for estate planning, Fong says philanthropy is an opportunity to build a legacy around one’s values. For many women, those values include hands-on impact.
Redefining philanthropy
Women volunteer at almost twice the rate of men, and that’s emblematic of one of the big differences in their approach to philanthropy – it’s not always about cutting a cheque, they often meld action with money. Fong says it’s not surprising women have such a knack for giving. “Philanthropy sounds so big,” she says, “but it’s a lot like what women have been doing forever – taking care of other people.”
That sense of community mindedness is transforming philanthropy for the better, says Janice Margolis, Philanthropy Advisor with JLM Philanthropy, who also shared her views in our recent webinar. “I see women getting involved in a project and really getting their hands dirty,” she says. Sarah Fitzpatrick, a partner at Miller Thompson LLP, as well as a participant in our recent webinar, agrees: “Women are more involved in the causes they’re supporting and understand what’s actually happening on the ground.”
Margolis says she also sees women collaborating together for a cause. For example, she has worked with clients who celebrate birthdays by choosing a charity to donate to with a group of friends. Sometimes they also choose to volunteer, mentor, coach or offer business advice. “I’m seeing a kind of collaborative model,” Margolis says. “I think that’s the way women are changing things.”
How to give for impact
As women seek to effect change by supporting causes they’re passionate about, there are factors to consider to ensure their desired impact aligns with the organizations they give to. Margolis says the first step she takes with her clients is getting clear on what is most important to them.
“We look at their motivational values like relationships, self-reliance, innovation, community, integrity, and how they want to make an impact in the world,” she says. “What ways do you want to help? What projects and programs appeal to you? How do you like to work with charities? We try to get a sense of what’s worked well for them in the past and how they would like to pursue that more so we can really prioritize their interests.”
Donors should do some research to determine whether an organization is the right fit, says Fong. Things like where their donation will go, and whether the non-profit is ESG-optimized are important variables. “Then, once you’re committed, I recommend looking at their financial statements and seeing what percentage is allocated to admin spending,” she says. This can illustrate how much of a donation may go directly to the cause. “Lastly, if you’re really interested in making a bigger gift, you should go visit the charity,” Fong says. She recommends volunteering as an effective way to get a sense of how a non-profit functions.
Doing this kind of active legwork to get to know an organization is critical, says Fitzpatrick, because ultimately the best donor/recipient relationships are predicated on trust. “Philanthropy puts faith in that organization,” she says. “It doesn’t put restrictions on them.”
Getting younger generations involved in giving
As women evolve their own giving, many also look to involve younger generations, says Margolis. They help their children cultivate their own philanthropic literacy. “I see clients wanting their kids to think beyond themselves, think about community, get involved and do something for the world,” she says. “The only way they will become engaged in philanthropy is if they’re encouraged to explore their own passions.”
Meanwhile, some women without direct heirs are choosing to transfer their legacies to charities, adds Fitzpatrick. Increasingly, she sees women transferring gifts of real estate. “Whether that’s their principal residence or it’s an investment property, it’s a trend I’ve noticed and it’s normally women who are giving that type of asset to charities” she says.
Regardless of how women choose to give, their involvement is not only changing the charitable sector, but it’s paramount to supporting impactful work. “Charities aren’t profit-making ventures,” says Fitzpatrick. “Philanthropy is a critical part of charity, because without it, charities wouldn’t be able to do what they do.”
References:
- New TD study reveals distinct giving behaviour among Canadian female philanthropists (no date) TD Bank Financial Group – Media Room. Available at: https://td.mediaroom.com/2023-11-28-New-TD-study-reveals-distinct-giving-behaviour-among-Canadian-female-philanthropists (Accessed: 09 July 2024).
- Gates, M.F. (2024) Melinda French Gates: The enemies of progress play offense. I want to help even the match., The New York Times. Available at: https://www.nytimes.com/2024/05/28/opinion/melinda-french-gates-reproductive-rights.html (Accessed: 09 July 2024).
- Beaty, T. (2024) Mackenzie Scott donates $640 million, more than doubling her planned gifts to nonprofit applicants, AP News. Available at: https://apnews.com/article/mackenzie-scott-open-call-yield-giving-bezos-ae809a469080e9e61a945a14a230629e (Accessed: 09 July 2024).
- $15 billion in five years: What data tells us about Mackenzie Scott’s Philanthropy (2023) HBS Working Knowledge. Available at: https://hbswk.hbs.edu/item/mackenzie-scotts-15-billion-pledge-what-the-data-says-about-her-epic-giving (Accessed: 09 July 2024).
- Tessa Skidmore Research Associate of Philanthropy and Charles Sellen Global Philanthropy Fellow (2024) Giving while female: Women are more likely to donate to charities than men of equal means, The Conversation. Available at: https://theconversation.com/giving-while-female-women-are-more-likely-to-donate-to-charities-than-men-of-equal-means-141518 (Accessed: 09 July 2024).
- Harjani, A. (2015) Coming soon: The biggest wealth transfer in history, Entrepreneur. Available at: https://www.entrepreneur.com/business-news/coming-soon-the-biggest-wealth-transfer-in-history/241753 (Accessed: 23 July 2024).
- Garibay, N.M. and Storyteller, C.A./ (2023) ASU Lodestar Center Blog, A Lesson in the Role of Women in Philanthropy & Their Giving. Available at: https://lodestar.asu.edu/blog/2023/03/lesson-role-women-philanthropy-and-their-giving (Accessed: 09 July 2024).
