Both the wealth, and the combined philanthropic efforts, of Bill Gates and Warren Buffet have lifted the bar for civic generosity, already set much higher than any Australian could approach, to impossible heights. In spite of the anecdotes which circulate, we really don’t know how philanthropic the man touted as Australia’s richest, the late Kerry Packer, was in his lifetime, nor what he may have chosen to leave to the community after his death. For those who remain unconvinced that Packer’s generosity, when compared with his wealth, puts him in the class of the truly philanthropic, however, there are other indications that the climate for philanthropy in Australia is positive.
Some months ago I received an interesting phone call. The caller, whom I didn’t know, explained that he was a business man and volunteer fundraiser who had just helped attract a rather large donation to a medical research organisation with which he had a connection, and he wanted to know how this donation compared with others. How much was the donation, I asked? His reply: $32 million!
Details of the gift (by Sydney businessman Greg Poche to assist the work of the Mater Hospital’s melanoma unit) have since been made public, but I was able to assure this amateur fundraiser that, by any standards - at least in Australia - he had done well.
Recent years have been good for giving. The public and corporate response to the tsunami broke all records. A $37 million bequest left by Adelaide’s Marjory Edwards to a number of charities in 2005 is clamed to be Australia’s largest. The Poola Foundation announced a grant of $10 million to enable the establishment of a new organisation, The Climate Institute, to raise awareness about climate change. These gifts, Frank Lowy’s $15 million to establish the Lowy Institute of a few years earlier, and no doubt others of which we are not aware, do indeed suggest that the philanthropic renaissance which some have predicted is becoming a reality.
Speaking to the Financial Planners Association last November David Gonski, chairman of Coca-Cola Amatil and Investec Bank, suggested that the nation is riding on a “wave of giving”. In similar vein the Australian Financial Review recently quoted Peter Opie of Merrill Lynch: “Australia is still punching beyond its weight. One thing that makes us stand out is, while Australia might only have 1,000 ultra-high net worth individuals with $30 million plus, we do have mass affluence, with literally thousands of millionaires living out in the suburbs”.
Adding evidence to these predictions is the mass of data produced in the Giving Australia study commissioned by the Commonwealth and released last October. That study revealed an $11 billion industry, growing at a significant rate: individual giving by 88 per cent since 1997, and business giving doubling since 2001-2001.
Internationally The Economist has just published a special 15-page supplement on “the business of giving”, drawing attention to the international dimensions of wealth transfer, identifiying “venture philanthropy” as the different approach which the new generation of successful business people bring to their giving, and calling on universities to offer training in the field as part of the offerings of their business schools.
Five years ago, in developing the proposal for a university centre directed specifically at teaching philanthropy, social investment and grantmaking practice, I suggested that the market for this unknown and seemingly niche product might be found among several demographics. In fact, if our students of the last three years are a guide, four distinct categories have emerged, and each can be seen as emblematic of the new forces that are shaping the philanthropy - or, as I usually prefer to call it - social investment of the 21st century. Who are these new givers?
The first are individual donors. These may be inheritors of old wealth, or creators of new wealth. Increasingly many of them will be the beneficiaries of the wealth transfer which commentators predict will be of phenomenal size in the coming years as the savings of the parents of the baby-boomers, and of the early baby-boomers themselves, derived from industry, thrift, and escalating home prices, convert many who regarded themselves as modest middle class into people of real means.
Other age groups and demographics are also to be found here, and even many of those who are merely comfortable rather than rich will have a capacity and a will for generosity. Some will be early retirees who find themselves with wealth, time, business nous, networks and a desire to have another chance at saving the world, given the evident failure of their first attempts as students over 40 years ago. Others are thinking about the effective and meaningful extension of their commitments beyond their own lifetimes. Here too are to be found young people who, knowing of the financial advantage they have or can foresee, may see philanthropy as part of the way they will shape the world.
The second category is the corporate sector which is showing a real readiness to recognise its corporate citizenship obligations, and to invest in community partnerships. Employed in this sector are many who wish to develop their own skills in this field, realising that, sadly, their business and MBA degrees paid no attention to imperatives other than commercial ones.
A third emerging philanthropic demographic is the financial planning and advice sector. The more farsighted here see their high- or even medium-net worth (why can we no longer call them “wealthy”?) clients seeking, or perhaps responding to, information about the philanthropic possibilities that might be part of their financial portfolio. Professional advisers presently run the risk of being outsmarted by their clients in this area, losing a market opportunity, and missing the chance to do some real good for the community through the advice they give their clients.
The growing number of organised grant-making institutions - major foundations, newer family funds and Prescribed Private Funds (PPFs are a useful device recently created by the government to facilitate tax-effective giving) - which employ professional staff in their management, and rely on trustees for their governance, are another stimulus to increased and more strategic giving.
The picture, then, is an encouraging one. Within the Australian community there is the financial means to give at levels not seen before, a new generation of switched-on givers, and an ethos and an infrastructure ready to stimulate real thoughtfulness in giving. Perhaps the query from my telephone caller will, in a few years, appear to have been quite unremarkable after all.