“The rich get rich, and the poor get — less philanthropic?” OK, that’s not exactly how the F. Scott Fitzgerald line from “The Great Gatsby” goes, but it does describe the feeling many people have about the stats showing our shrinking philanthropic largesse. Increasing wealth disparity is driving more people toward poverty — or at least to serious belt-tightening — with philanthropic giving by small donors falling by the wayside. At least, that’s what conventional wisdom holds.
But is this true? Muneer Panjwani, CEO of Engage for Good, said he thinks the stats seriously underestimate the many types of giving done by everyday folks. Engage for Good runs one of the nation’s largest membership programs for people working in corporate social responsibility. It also holds an annual conference and an awards program for CSR initiatives called the Halo Awards.
From his seat at the nexus of corporate giving and nonprofit receiving, Panjwani points to evidence that a lot of charitable money and time is going out in new ways — and not necessarily to 501(c)(3)s. He cites not just employee involvement in the CSR programs that his company helps develop but also more activity on social platforms that connect small donors to individuals or groups in crisis. “If you contribute to someone whose house has burnt down through GoFundMe, that’s not on a 990. It goes directly to the person,” he said.
Social media increasingly allows today’s impulse buyers to be impulse givers, operating like the Amazon one-click “buy now” version of donating. “An individual will say, ‘I’m looking to raise money for someone attacked in a transphobic attack. Here’s their Venmo.’ It’s not at a large scale, but I am seeing more of this than in the past,” Panjwani said.
GoFundMe says that it and the fundraising platform it acquired in 2022 called Classy have together raised $30 billion since 2010.
Evidence of less giving
Still, there are plenty of hard numbers supporting the dominant narrative of less giving — not just of money but also of time — a “concentration of agency,” as Aspen Institute’s Jane Wales told IP last year. Giving USA’s annual report on the state of charitable giving, released in June, found that while giving from individuals, bequests, foundations and corporations increased 1.9% to $557.16 billion in 2023, when adjusted for inflation, that’s actually a 2.4% drop, as IP’s Mike Scutari reported. A 2023 report published by Indiana University Lilly Family School of Philanthropy showed a steady decline in the percentage of households giving to charity ever since the recession of 2008. This is true across all racial and ethnic groups and includes the sharpest drop in giving to religious organizations “ranging from 15 to 25 percentage points” between 2000 and 2018.
The Trump-era tax cuts, which disincentivized itemized returns, contributed to a $20 billion annual drop in donations to nonprofits in 2018, and a permanent annual drop of $16 billion, according to a recent study, with direct service organizations hit the hardest. The popularity of holding money in donor-advised funds is further stemming the flow to nonprofits.
A call for innovation on the nonprofit side
But while fewer people are going to religious organizations — and opening their checkbooks to support charities in general — that doesn’t mean they’re not giving in other ways. “The standard that we’re comparing is that 2% that Giving USA came up with. It’s an estimate, and one that leaves out too much of the charitable activities happening in the country,” Panjwani said. “Historically, a lot of the fastest-growing organizations were those with the biggest brands, like St. Jude Children’s Hospital, IRC, Red Cross, Feeding America. These are fantastic organizations doing incredible work, and Feeding America is very community based, but not everyone wants to give to those big organizations.”
Nonprofits have long struggled to retain individual donors. Panjwani thinks they should pivot harder to better capture today’s would-be givers. “People are much more willing to give to crises that they feel connected to, like a hurricane. It’s more localized and closer to their values than giving to an organization by responding to a mailer. We need to market to people interested in smaller organizations,” he said.
“It would be valuable for the nonprofit sector to have more innovation in terms of how to retain donors and how to be expansive in terms of what we count. Volunteer activities are not counted in a way that shows a nonprofit saved $50,000 because they had $50,000 worth of volunteer hours doing the work.” To this end, Panjwani’s company is launching a new consulting arm to help nonprofits build corporate partnership programs that position them as “strategic partners” rather than just recipients of charity. Which brings us to the role of corporate giving in this story.
“Do well and do good” is trending
Another sign that giving is going up, according to Panjwani, is the normalization of partnerships between companies and nonprofits. Take point-of-sale asks, those now-ubiquitous credit card reader requests that you “round up” for a specific charity when checking out at stores. Engage for Good did a “Charity Checkout Champions” survey in 2022 that evaluated point-of-sale campaigns that reach $1 million and above. “In 2022, we calculated $749 million raised for charitable giving at the point of sale, among those that raised more than $1 million. That was a 24% growth from 2020, and that’s pretty significant. And this continues to go up.”
Well, I care about all kinds of causes, but I resent companies pushing their CSR onto me whenever I’m trying to buy a carton of eggs. “I think there is point-of-sale fatigue, definitely,” said Panjwani, who sees the solution as more linking between brand and cause. “We tell companies, you don’t want to run campaigns that are just a moment in time. You want to run campaigns that are movements. You want to engage your employees, your marketing, your CSR. Look at your customer journey and at what point you want to engage them. Look at it as a business campaign that has a charitable element. Look at your cause-based work as a strategic advantage to your overall business strategy. That’s where you’ll be successful.”
Panjwani’s outlook fits well with what we’ve often observed about corporate giving more broadly over the past decade or so: It’s getting more strategic, with companies funding nonprofit causes in ways that complement their business, benefitting the bottom line. In Amazon’s case, that even meant ditching its point-of-sale option.
On the level of individual American “consumers” — today’s repositioning of “we the people,” formerly known as “citizens”— many want to feel moral alignment with the products they buy. A 2022 special report by the market research firm Edelman shows that consumers are four to 4.5 times more likely to buy or use a brand if it demonstrates a commitment to social causes. Many people trust brands more than they trust the government. As Edelman’s 2024 “Brands and Politics Special Report” put it, “To navigate today’s volatile environment, brands must engage with consumers and other stakeholders based on shared values… 71% of global respondents say brands must take a stance on issues when under pressure.”
All of this desire to feel one with one’s shampoo and sunblock makes cause marketing ever-more effective — and makes people like me view CSR partnerships as another way for corporations to rake in more money.
“Yes,” Panjwani said, “and what’s wrong with that? If we can help them make money and do good, why wouldn’t we want them to? Altruism has to be extremely selfless. I don’t think that’s a winning strategy. Caused-based work is who we are. All cultures in the world have charity built to them. Companies are combining the two elements. In a capitalist environment, we need to find a way for businesses to do good.”
