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GIVING USA 2007: U.S. PHILANTHROPY AT RECORD HIGH
Campbell & Company president Peter Fissinger unveiled the key findings of Giving USA 2007 for a capacity audience of fundraising professionals in an event held at Northwestern Memorial Hospital on Monday. Following the presentation, Chair and CEO Edith Falk moderated a lively discussion with four Chicago-area nonprofit leaders: Stephen Falk, president of Northwestern Memorial Foundation (NMF); Penelepe Hunt, Vice Chancellor for Development, University of Illinois at Chicago (UIC) and Senior Vice President, University of Illinois Foundation; Nancy Ali, Senior Vice President, Resource Development of the Boys & Girls Clubs of America (BGCA); and Terry Mazany, President and CEO of The Chicago Community Trust (CCT).
Highlights of the study and additional insights from the participants include the following:
- The estimated $295.02 billion in total giving in 2006 surpassed even the high-water mark set in 2005 when Americans gave generously in response to several major natural disasters at home and abroad. All four panelists reported that giving to their organizations hit new highs.
- The 4.2 percent increase over 2005 (1.0 percent after inflation) makes 2006 giving the highest on record even after adjusting for inflation. Mr. Fissinger noted that this is the first time that giving in real dollars has surpassed the record set in 2000 when Bill and Melinda Gates transferred $10 billion to their foundation.
- 2005's $283.05 billion total included an estimated $7.4 billion in extraordinary disaster relief giving. If these gifts are excluded from the 2005 total, 2006 giving rose 6.6 percent (3.2 percent adjusted for inflation).
- "Mega gifts" including the twenty-year, $30-plus billion commitment of Warren Buffett, drew great media attention in 2006. Yet, they are estimated to represent only 1.3 percent of total giving.
- It is estimated that the wealthiest 10 percent of American families provided 45 to 50 percent of total itemized individual philanthropy, while 50 to 55 percent of all gifts come from donors other than the wealthiest ten percent. NMF's Stephen Falk expanded on this idea, noting that 37 percent of Northwestern Memorial's million-plus donors began their giving with initial gifts of less than $1,000. He emphasized that organizations cannot afford to ignore their smaller donors, and must "fill the pipeline' with prospects for future solicitations. UIC's Penelepe Hunt agreed, noting that organizations still must build successful long-term programs beginning with volunteerism and smaller gifts from younger donors, such as the new freshmen classes at her institution.
- Individuals remained the largest source of philanthropy, providing 75.6 percent of the total in outright gifts, and another 7.8 percent in realized bequests.
- Bequest giving fell by 2.1 percent after very strong growth in 2005. UIC's Penelepe Hunt noted that planned giving includes much more than bequests and that younger donors in particular are often interested in more complex planned giving vehicles.
- Fueled by a strong stock market, foundation giving rose 12.6 percent (9.1 percent adjusted for inflation) to an estimated $36.5 billion, or 12.4 percent of total giving. CCT's Terry Mazany described how robust investment returns have enabled his organization to increase its grant making substantially, but also noted that competition for foundation grants continues to increase as government funding for nonprofit organizations becomes scarcer. Nancy Ali corroborated his observation with her experience at BGCA, also noting that they and many human services agencies are working to increase support from both foundations and individual giving.
- Corporate giving decreased 7.6 percent (10.6 percent adjusted for inflation). This decline reflects a return to expected levels of giving after a very strong corporate response to disasters in 2005. With 2005 disaster giving removed, corporate giving is estimated to have risen by 1.5 percent (a decline of 1.6 percent adjusted for inflation). Half of corporate giving was in-kind. Several audience members commented that some Chicago corporations were holding off on grant decisions until they learn whether or not the 2016 Olympics would be held in Chicago. This case illustrates a trend toward more comprehensive corporate cause marketing strategies. Corporate donors increasingly are considering broader community development goals and opportunities for international exposure in selecting grant and sponsorship recipients.
- An audience member commented on the importance of increasing minority participation in philanthopy. All panelists cited inclusiveness in development staff hiring as an ongoing top priority; BGCA's Nancy Ali agreed that it was one of the most effective ways to connect with the specific values of minority donors.
Giving USA 2007 also provides in-depth data on giving by sector, including the following highlights:
- Giving to arts, culture and humanities organizations rose the most - 9.9 percent - of any sector in 2006, reaching an estimated $12.51 billion. This reflects a return to growth after several years in which other organizations and disaster relief chipped away at philanthropy to the sector.
- Education achieved a 9.8 percent rise to an estimated $40.98 billion, or 13.9 percent of total giving.
- Gifts to foundations rose an estimated 7.4 percent to $29.50 billion, or 10,0 percent of the total. This includes the fair-market value of medical supplies and medicines donated by pharmaceutical firms, many of which have in the last decade established operating foundations.
- Human services and international affairs organizations both saw declines in the range of 9 percent, to $29.56 billion and $11.34 billion, respectively. Both of these sectors saw strong disaster relief giving in 2005, which partly explains the drop.
Giving USA is published by Giving USA Foundation and prepared by the Center on Philanthropy at Indiana University. The study amasses data from a broad survey of the nonprofit sector, tax data, government estimates and information from other research institutions including the Foundation Center and the Council for Aid to Education. Campbell & Company CEO and Chair Edith Falk again served on the Foundation's Editorial Review Board, and Campbell & Company is proud to sponsor this year's Giving USA study.
For more information on these data and how they may apply to your organization, please call 877-957-0000 toll-free, visit www.campbellcompany.com. To order a copy of Giving USA 2007 visit www.givinginstitute.org.
