Reading tea leaves, #5: adapt and survive?

Reading tea leaves, #5: adapt and survive?

News (UK)
Tracking the impact of the recession on giving...

As the first wave of recession shock subsides and the world settles reluctantly into acceptance, the global giving community has begun in earnest to assess current and long-term impacts. 

Of the independent surveys published in the past fortnight those coming from the US indicate that although straitened circumstances are heavily impacting on giving trends, the behaviour of both individual givers and foundations reflects a willingness to adapt.

The Chronicle of Philanthropy annual survey of online fundraising shows that the online gifts to 203 non-profit organisations that provided data for 2007 and 2008 grew by 28% last year; half of the organisations saw giving grow by more than that amount and half did less well, although this increase was smaller than the 42% growth in 2007.

The ‘good’ news in this is that although the size of the average online gift has dropped by about 20% the number of donations has grown by 26% (statistics from M+R Strategic Services, consulting company that specialises in online fund raising and advocacy).

This trend, highlighted in the survey, of seeking smaller donations that reach and, potentially, draw in a wider range of supporters allows charities to make the case for regular donations.

The giving trends of US-based foundation endowments and grant-making show a similar willingness, or ability, to adapt. A Council on Foundations’ (CoF) survey report based on data collected from 430 foundations in March 2009 found that though 48% of foundations said they will reduce the value of their total grant-making for 2009 by 10% or more, 38% reported that they will maintain or increase the value of their grant-making this year. More than half of corporate grant-makers and 41% of family foundations stated they will maintain or increase the value of their grant-making.

Most strikingly, 92% of foundations stated they are making grants in 2009 to aid low-income individuals and families and others adversely affected by the economic downturn, 31% said they are increasing their support for basic needs and 6% said they have added it as a new grant-making area.

Conversely to the findings in the CoF survey, the one area of giving that indicates static growth and predicted decline compared to other forms of giving is that of US corporate foundations as reported in the Foundation Center’s Key Facts on Corporate Foundations.

The report shows that charitable giving by the US’s 2,500 corporate foundations remained virtually unchanged in 2008, and that after inflation, corporate foundations reported slower cumulative growth in giving than other types of foundations since 1990.

This could be a direct reflection of the fact that the banking and finance industries account for about one-quarter of corporate foundation support in recent years.

Of the corporate foundations responding to the Center's annual forecasting survey 51% said they expect to reduce their giving this year, with three-quarters of these funders anticipating decreases of more than 10%.

Steven Lawrence, senior director of research at the Foundation Center said: "Corporate foundations will not be alone in having to reduce giving this year, but the cuts may well be deeper than for other types of grantmakers."

This side of the pond the horizon looks clearer, with Christian financial support services charity, Stewardship, revealing that giving to Christian causes has increased in spite of the recession.

Christian organisations such as charities, churches, and mission workers have received more than £24m since October last year, when the financial crisis began to impact. This is a 3% increase on the same 6-month period in 2007-08.

According to David Jones, chief executive of Stewardship, those givers with sovereign accounts, used by people to give to Christian charities in a tax-effective manner, “tend to have a planned approach to their giving”

  • Philanthropy stats & trends
  • UK