HNWs need to be nudged into greater philanthropy by banks, companies and governments, a report from New Philanthropy Capital concludes
HNWs need to be nudged into greater philanthropy by banks, companies and governments, a report from New Philanthropy Capital concludes. The report found that barriers to giving, which include fear of complexity, apathy and financial instability, can be overcome by a variety of means.
Among the suggestions: banks should stimulate philanthropy with products such as donor advised funds and charitable giving accounts; private client advisers should mention philanthropy with greater frequency and confidence; charities should convey the impact of their work; and companies should make it easier and more rewarding to give.
Martin Brookes, CEO of NPC, says that the aim of the report is ‘to mainstream philanthropy – we need to make it part of our everyday lives’. The biggest change among HNWs could be made if private client advisers were ‘equipped to have the conversations about philanthropy. There’s movement already in private banks, law firms and family offices, but the talk is outstripping the reality.’ Once firms work out how philanthropy can be part of their business model, Brookes says, this will change.
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Other remedies include establishing a UK Giving Pledge, modelled on Warren Buffett and Bill Gates’ idea, and the media promoting givers as positive role models.
Since moral pressure is not encouraging most HNWs (‘with a few notable exceptions’) to give more generously, says Brookes, ‘We need to change something in such a way that affects them and changes their behaviour. You have to inspire and encourage them to change.’ The report says that the wealthiest 10 per cent of donors give 1.1 per cent of their total spending to charity, compared with 3.6 per cent from the poorest 10 per cent.
There were six commons barriers to giving cited: ‘It’s too complicated’; ‘I can’t afford it’; ‘I find it hard to connect with a cause’; ‘I think charities are inefficient’; ‘I don’t think about giving’; and ‘I haven’t enjoyed giving before’. Each of the ten suggestions was aimed at overcoming these objections.
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