BLOGS

The economy is causing more focus by foundations on the needy, a new survey suggests.

According to the Council on Foundations, nearly one-third of family foundations are stepping up their giving to people affected by the economic downturn and the subprime mortgage crisis.

Of the 1,841 members of the Council on Foundations surveyed, 15% said they are supporting activities related to the subprime mortgage crisis, while 86% said they are giving money directly or indirectly to support families, provide human services, and help lower income populations. Nearly one-third of these foundations said they've stepped up such support within the past year.

Additionally, 55% of foundations said the decline in the stock market will have no effect on their level of grantmaking next year, but for community foundations, it's a different story. According to the survey, a majority of community foundations (52%) said they would have a lower level of grantmaking next year, while only 46% said they would be able to maintain this year's level of grantmaking.

"Many foundations often don't have the flexibility to quickly respond to sudden changes in needs," the report said. "With the increase in populations seeking assistance, and the potential for a tightening of philanthropic dollars due to the stock market decline, how the philanthropic sector plans to respond is an important question."

Meanwhile, a new survey of philanthropic donors by Bell Investment Advisors in Oakland, Calif., reports that many wealthy baby boomers have cut back on their gifts to charity in the last six months, another sign the economy is having an impact on giving. The donors surveyed by Bell all had investable assets of $1 million or more.

As corporate gifts go global, will domestic causes lose out?

When the Committee Encouraging Corporate Philanthropy published its Board of
Boards report a few weeks ago, [http://corporatephilanthropy.org/] one
of the most interesting stats was buried deep in its pages: 67 percent of
CEOs at major companies say their giving will become more global over the
next five years.

There’s precious little additional detail provided about that shift: McKinsey and Company are releasing a companion study later this month. Nonetheless, even with only the barest glimpse at the trend, the fact
that two-thirds of large-company CEOs plan to move their philanthropy abroad raises several
important questions.

For example, what does the waning of domestic, corporate philanthropy mean
for American communities that have come to depend on such works to augment
their social safety nets? Will our domestic philanthropic good works diminish, much as did some of our local cities when companies began hiring workers in cheaper labor overseas?

At the same time, it’s certainly appropriate for companies profiting off the
natural and labor resources on foreign shores to give back. Indeed, in
developing nations whose budgets are so modest that they have little in the
way of state-sponsored social supports, it’s arguably more important for
companies to give locally.

Still, since American corporations still give a strikingly small share of
their profits to charity (and particularly in comparison to what private donors
give), it might not be worth getting too worked up.

In 2006, Americans give $295 billion in charitable gifts. Of that, 83
percent came from individuals, with a pricetag of $245.8 billion. Compare
that to corporate gifts: $36.5 billion, or 12.4 percent of all gifts.

What do you think, should companies do more—even in an economic downturn?

With all the negative headlines out of China lately—from lead paint in children's toys to monks coming under fire in Tibet and continued reports of air and water pollution—there is at least one bit of news that's favorable—namely, the Hurun Report, a list of the top 100 altruistic donors in China.

According to Rupert Hoogewerf, a British accountant formerly with Arthur Andersen and the man who compiles the report, the top 100 Chinese philanthropists have given a total of $1.8 billion to charities over the past five years, mostly to causes targeting education, social welfare, and poverty relief. Almost 5 percent of the total wealth of the donors was given to charitable causes, Hoogewerf says.

Chinese hotel and real estate magnate Yu Pengnian, 86, was named the most generous of China's donors on the Hurun index. Yu has given three billion yuan (or roughly $429 million) since 2003 to health and education causes, chiefly free cataract surgery. Property deveoper Zhu Mengyi, 49, was ranked second on the list with a stock donation valued at 1 billion yuan (or about $143 million), and Huang Rulun, 56, the chairman of the the Jinyuan Hotel Group, came in third, having given 850 million yuan, or ($122 million) since 2003. The Hurun China Rich list showed that 66 of the top 100 philanthropists were also among the wealthiest.

The Chinese government, fearing civil unrest as a result of widening gaps between China's rich and its rural poor, has been encouraging China's nouveau riches to give back—and it appears to be working.

What do you think? Is it enough?