Zero-sum game? Nobody loses if philanthropy grows

Hands_for_ch_blog In his Business Week Online article decrying the marketing efforts of community foundations to inform donors about charitable giving options, Foundation Source CEO Daniel Schley misses the forest for the trees. Instead of bristling at what he considers a competitive threat by community foundations to woo away donors from the private foundation market that pays his salary, Mr. Schley should embrace the notion that better informed donors make more strategic philanthropic decisions, get better results from their giving, have more fulfilling and enjoyable giving experiences, and ultimately want to give more. There is an opportunity here for the lens to focus not on how Mr. Schley wants folks to give their money away, nor community foundations, but on what makes most sense for the donors. Some donors just don't want to deal with minding their own foundations, even if the administrative burden has been eased by the outsourced services and online tools that Mr. Schley's company offers.

The article that Mr. Schley accuses of "actively promot(ing) the termination of private foundations in favor of a community foundation account," actually offers advice to professional advisors who are counseling clients, for example, whose life circumstances have changed and who are looking for alternatives: "When people establish private foundations, they want to give back, make a difference, change some small corner of the world. But then death, divorce, retirement or other family changes intervene. Sometimes other charitable options offer greater advantages." Hardly the private foundation-bashing alluded to by Mr. Schley.

The notion that community foundations, or any charities for that matter, consider the best way to get new donors is by stealing them away from existing charitable giving vehicles is illogical and short-sighted. The largest-ever inter-generational wealth transfer, while still unproven, suggests that many more charitable dollars will be entering the sector. The number of wealthy households in the U.S. continues to surge. The way to get new donors and new donor dollars is to find compelling giving opportunities, package them attractively, communicate them via channels of choice, and then report on the impact of charitable giving against those opportunities in ways that reward donors and excite them to give more, and to invite their friends to join them in solving social problems.

So let community foundations tell their stories, Mr. Schley, and while you're at it, tell your own. If private foundations make people feel great about themselves and their giving, please shout it from the rooftops (and via the Internet, and, while you're at it, how about a blog?) The conversation is not about re-channeling existing philanthropic assets, unless of course, that is the best way to keep the donor's dollars flowing to charity, it's about growing the philanthropic pie so that more folks give, and more communities benefit. Hardly a zero-sum game.

Caroline Heine

Posted at 8:15 AM, Aug 31, 2006 in High Net Worth Donors | Permalink | Comment