Millennials are bucking philanthropic trends and taking a new and modern approach to giving, says Sam Forsdick
Millennials are often derided as out of touch snowflakes, who are more concerned with their Instagram following than the outside world. However new research by Sharna Goldseker and Michael Moody, co-authors of Generation Impact: How Next Gen Donors Are Revolutionizing Giving, has found that the next generation of HNWs will be the pioneers of a philanthropic revolution.
According to a Boston College report, the next generation of HNWs are set to inherit an estimated £42 trillion – in what could be the largest transferal of wealth in history. But don’t fret, it won’t all be squandered on flat whites and avocado on toast; the same research found that approximately half that amount will be donated philanthropically.
‘That $29 trillion (£21 tn) is going to go both into bequests and lifetime giving,’ says Goldseker. ‘The main difference is that the next generation are starting their charitable careers at earlier ages and as lifespan is increasing they are likely to be involved in the activity of giving for many more decades and overall have a larger impact.’ Gone is the notion that you earn your wealth during your lifetime and then allocate it later in life – the next generation doesn’t care for endowments or perpetuity funds, they want to make a difference now.
Goldseker and Moody surveyed over 300 millennial HNWs across America and found that the majority were already developing their identity as major donors. The vast majority of them, roughly 95 per cent, started volunteering before the age of 21 and began donating their own wealth before the age of 30.
Victoria Rogers is a prime example of this. Her father, John W. Rogers Jr., is the founder of Ariel Investments which manages $11 billion, and through his encouragement she started volunteering at the age of 12. Her first role was at the Sue Duncan Children’s Center where she used her talent for art to teach children from inner-city Chicago. Since then Rogers has gone on to donate both her talent and money to non-profit causes that align with her passion for making art accessible, including Creative Time and Kickstarter and is a trustee for the Brooklyn Museum – all this and she’s still only 27.
But young HNWs, like Victoria Rogers, are not only beginning their philanthropic careers at an earlier age, they are also changing the ways in which they give. ‘They want their philanthropy and social investments to have more impact on the world and finally move the needle on the causes that their parents and grandparents for a long time have tried to address,’ states Michael Moody, a scholar on philanthropy and Frey Foundation Chair for family philanthropy.
Sharna Goldseker can already see differences between the next generation’s philanthropic endeavours and her own. ‘They are motivated by impact; making a difference and seeing the difference they make on the world. They want to be strategic about their investments and they define that by being focused, by approaching at root causes and solving these issues in a really systemic way.’
To this end, millennial philanthropists are turning to smaller organisations and tackling global issues at a local level. By focusing their funding they are able to see the impact that their gifts are having and really get a sense that they are making a difference. ‘It’s about seeing the impact and about being able to give all the assets that they feel are valuable to the cause,’ says Michael, ‘and that includes their time and talents, as well as their treasure.’ They don’t want to just write a cheque, they want to use all the resources at their disposal to help affect change.
One example is Daniel Lurie, who at the age of 23 began working with the Robin Hood Foundation in New York – an organisation which is applying investment strategies from the world of finance to the non-profit sector to help alleviate poverty. On seeing the success of their work Lurie said: ‘I want that for my hometown. It was smart, effective philanthropy.’
On returning to San Francisco four years later, Lurie set up The Tipping Point Community which looked to invest in the most promising organizations working in education, housing, family wellness and employment. The organisation is looking to innovate in the world of philanthropy and answer the question, ‘if the previous approaches to solving poverty haven’t been effective then what can we do to really move the needle?’
Across the Atlantic, BeyondMe – a UK based charity is looking to empower future leaders to support important causes – is seeing similar trends. Michael Harris co-founded the organisation in 2011 after starting a graduate role with PWC. ‘Our generation has a unique set of circumstances,’ Says Harris. ‘Our social models can be a real force for good but there has to be generosity to augment these systems. I want to instil generosity now in the FTSE 100 leaders of tomorrow.’
The network brings together teams of young professionals, from law firms, banks, financial services, and beyond, to work on projects that will be transformative for their chosen charity. Participants in BeyondMe use their skills, as well as their money, to maximise the impact they have; ‘it’s important to give both together to magnify the impact,’ says Harris.
Kitty Kent was on the graduate finance programme at PWC when she joined BeyondMe. She worked with IntoUniversity – a charity that helps children from disadvantaged backgrounds reach higher education – to produce a briefing on how the organisation should expand. Kitty and her team helped identify areas that would benefit most from the charities help. Through her work the charity is able to target its aid and funding to help those most in need.
This next generation of philanthropists have what is described in Goldseker and Moody’s book as ‘an obsession for impact’. They are looking to address growing levels of inequality and provide innovative solutions to social issues and, in doing so, are proving that millennials care about more than just their social media feeds – they want to be a force for change.
Sam Forsdick is a graduate journalist at Spear’s