Among the wealthy, philanthropy in the UK and US is thriving – but you no longer have to be rich to be generous
Written by David Parsley
So you have made your millions, even billions, and you’re feeling a little bit guilty. While you have surrounded yourself with everything a person could wish for, you just cannot help it when your stomach turns over on viewing a starving child in Africa, an earthquake hit city in India, or even poverty and poor fortune on your own doorstep.
It’s a feeling more and more seriously wealthy business men and women all around the world are familiar with and they are doing something about it. They are giving, if not all, a great deal of their fortunes away to help those groups or organisations less fortunate than themselves.
NOT JUST FOR THE FEW
Of course, poverty is not always the problem they want to solve. Sometimes it’s to keep a great art collection open to the public and not locked away in a private vault for investment purposes, or to contribute to the development of public spaces for city populations to enjoy. But if one thing is certain, it is that philanthropy is not just for the few but for the tens of thousands.
The numbers are staggering. The latest figures available show that in 2006, charitable giving in the US amounted to a whopping US$289.5 billion, representing 2.2 percent of GDP and an 11 percent increase on the previous year. Charitable giving in the UK in the same year also leapt to US$29 billion.
There’s not a great deal of point in being the richest person in the graveyard because, as we are led to believe, you cannot take it with you. Indeed, the best known of our modern day givers are stinking rich. There’s the Clinton Foundation, which does not help raise funds to cover Hilary’s expensive and unsuccessful campaign for US President, but funds the research of HIV and helps people with the disease. Elton John has his own AIDS foundation, while The Sage of Omaha, Warren Buffet, made the biggest single charitable donation in history when he handed US$30 billion to the Bill and Melinda Gates Foundation two years ago. And, of course, there’s Bill Gates himself, who packed in the job at Microsoft this summer to take control of his charity full time.
In the UK, there’s software entrepreneurs Ros and Steve Edwards, who donated £30m to New Hall College, Cambridge and got to rename it Murray Edwards College (Murray being the surname of the college founder). And there’s hedge-fund legend Arpad Busson, the lucky man about to marry Hollywood star Uma Thurman, whose ARK foundation raises cash for poor children all over the world. And, as if to prove you can’t take it with you, there is Simon Sainsbury, great grandson of the founder of the Sainsbury’s supermarket chain, who died in 2006 and left 18 masterpieces, including works by Monet, Freud, Gainsborough and Degas, to the nation. Even notoriously selfish UK footballers have shown they have a heart. Manchester United player Ole Gunnar Solskjaer gave away every penny of the £2 million proceeds of his recent testimonial game to build schools in Angola, Malawi and Mozambique.
MAKING MONEY
Giving money away is now big business and some firms are even launching products on the back of philanthropy. Leading research group, Research and Markets, produced a report in August showing banks and institutions are actually making money by giving money away. The report proves that philanthropic gestures are actually a great way of gaining and retaining new customers.
One such investment bank, Smith Barney, says: “All have personal reasons for giving to charity, but many of us give out of a common desire to share our good fortune with others. And while our generosity can certainly improve the communities in which we live and work, it can also help us financially.”
So, there you have it. Giving your money away can make you even wealthier. Perhaps that’s why so many people are doing it.
When George Soros, the financier who has given more than US$6 billion to charitable causes, was asked how one should set on becoming a philanthropist, his answer was to the point: “Get rich first.” This may be the historical precedent but now even the non-rich are getting in on the act.
MICRO-PHILANTHROPY
Jon Brooks is a philanthropist and he wants everyone to be one too. He’s not particularly wealthy but he’s embarked on the philanthropic trail as enthusiastically as Gates.
Brooks launched a website called The Big Give last year. The site links people who want to donate their millions to good causes to those causes that need the financing. Or at least that was the original plan. As the projects have rolled in, so has the interest from donors. But these are not the kind of donors Brooks expected. He noticed that not all of them were City or Wall Street Bankers, Russian Oligarchs or rich entrepreneurs. The majority were actually normal people with small amounts of cash to give away. They are the new breed of philanthropist that want to give and see where there money is going.
“The projects on our site range from rebuilding museums all the way down to helping out at a girls’ youth group,” says Brooks. “It quickly became clear that even people with only small amounts of money to spare liked it because it gave them control over where their money went. It allowed them to donate intelligently and be proactive philanthropists.”
Brooks is part of a new phenomenon, known as micro-philanthropy. There are many similar sites in the UK and US such as microgiving.com and Global Giving. Peter Deitz runs socialaction.com, a site that aggregates all the other micro-philanthropy sites. He describes this new form of giving as Philanthropy Version 2.0.
“It’s the user generated content of the philanthropy world – a bit like bloggers supplementing the media,” he says. “Before, if you wanted to help you had to knock on doors, send letters, spend money. Now there’s a social network provided by the internet that makes it far easier for individuals to get things done.”
While it seems unlikely that any of these small donors will have statues put up in their honour or libraries named after them, or even receive any thanks whatsoever, there is little doubt that you no longer have to have millions sitting around doing very little to become a giver.
If truth be told, you may not have to be a billionaire to become a philanthropist, but it certainly helps.