BioTrends 2011: The New Philanthropy

November 1 2010

"The poor you will always have with you" has withstood the test of time; in our current times, philanthropy has evolved into more than a matter of individual social conscience. Spurred by Warren Buffett and Bill and Melinda Gates, many of the richest people in America have pledged to donate half their wealth to charity.

What's the big deal? You might cite the 19th century's J. P. Morgan, Andrew Carnegie and John D. Rockefeller of "Robber Baron" as great philanthropists (not to mention "robber baron" fame).

I think the big deal is that four new trends are emerging:

1) Global scope. The World Bank, the U.N., Doctors (and others) without Borders are among the groups that set the foundation for expanding assistance beyond our next-door neighbor. While local needy are best served by local individuals and local groups in wealthier countries, any significant impact on the poorest of the poor must be accomplished by those outside their borders.

2) Leverage. As implied above, individuals best serve other individuals who are close by. Groups are necessary to extend most individuals' reach to those most in need. And who best to found and lead those groups but wealthy individuals who have achieved their wealth through their business success? This business success is always achieved through leverage: no one creates a successful enterprise, business or otherwise, without the multiplier strength of the resources that other people and enterprises bring to the effort.

3) Goal-based. Health challenges exist worldwide. "Feel-good" aid programs are slowly giving way to  those producing measurable results. Many focus on practical, high-impact, here-and-now improvements, such as providing mosquito nets or donating to organizations focused on appropriate technology, such as The National Center for Appropriate Technology and The Appropriate Technology Cooperative.  

There are a couple of caveats to applying a broad-brush approach to results-oriented giving, however, as the Financial Times so ably presented in "Crumbs of Comfort." You've heard the phrase "be careful what you measure" (or reward) in business, like setting sales targets or holding  contests without regard for profitability or production capacity. Measuring results of aid is admirable, but agencies and donors need to be sure they're measuring the right things.

4) Sunset. Sometimes foundations and other philanthropic organizations take on a life of their own. Who wants to admit that their pride and joy has run its course? Sunset laws and zero-based budgeting policies serve a useful purpose, namely to avoid the wastefulness inherent in what I like to call "bureaucracy buildup;" I hope the trend by philanthropic organizations will follow the Gates-Buffet example. See "The Best Way to Really Give Away Money."

Category: BioTrends 2011
Filed under: Philanthropy; Poverty, Developing Areas