Many people who develop philanthropic intent begin with periodic, one off, donations. Gifting in this manner is very important. Not only does it assist the beneficiary, for the giver it can be the start of a greater awareness of the benefits of philanthropy. Over time, it can lead to the donor becoming more engaged with their philanthropy and give it a greater focus and structure.
Many people aspire to make a real impact in the world. Yet, with all the problems societies face —poverty, pollution, climate change, inequality, to name just a few— it can be easy to feel that your funding is merely a drop in the ocean. But by setting objectives, and measuring specific outcomes to gauge success in achieving goals, that can be a great motivator in ensuring your philanthropy makes a difference and you meet your purpose.
The Greek playwright Aeschylus coined the term philanthropy in the 5th century BCE. It meant “love of humanity.” Today, philanthropy means generosity in all its forms and is often defined as giving gifts of “time, talent and treasure” to help make life better for other people.
Yet creating a strategy for philanthropy can be complex. Philanthropists are faced with a multitude of choices about what they can fund and how the funding will be made. Choices about which causes to support, how much money to give and for how long are some key questions to address. Once you decide on a cause, you need to determine what influence you want to have and the outcomes you would like to see through your philanthropic journey. You also need to decide how to measure if your money is making a difference. Your wealth adviser can help you with this journey by narrowing down the causes you are interested in, define your goals and determine the structure of your philanthropy.
Measuring outcomes is an important part of this. Just as every philanthropist has their own values, individuals will have a different definition of success. Knowing what you want to achieve is key to getting results. The complexity of many of society’s problems means that there may be no easy solution to alleviating a problem completely, but thinking about specific outcomes can help to break down the task and ensure your philanthropic giving makes a real impact. A first step is often thinking about your purpose. Research outcomes you want to see. Articulate those goals in the most concrete terms possible.
Meaningful results can be a great motivator in philanthropy. While the needs of others may be significant,if you can break down those needs into much smaller and discrete goals, then you are more likely to achieve success and feel good about achieving a specific outcome, rather than being overwhelmed by competing goals and feeling that your funding is merely a drop in the ocean.
While there are no standardised criteria or methods to measure impact, we can learn from how businesses are run and think about goals. Defined goals or outcomes can help you measure the return on your philanthropy and the difference it makes. Outcomes may be the benefits that individuals or groups receive after they receive philanthropic funding or it may have something to do with how much carbon emission you have reduced or research projects you have supported. It depends on your cause, but either way, measuring outcomes helps to determine your impact.
For example, a potential outcome for education philanthropy for financially disadvantaged students may be measured by success in exams or school attendance. You need to have realistic expectations about the kind of outcomes that can be achieved and once you have those, you measure them.
In addition, as you define outcomes with your private wealth adviser, keep in mind that there are different levels of outcomes: initial, intermediate and long-term. Think about what your philanthropic goals are over your chosen timeframe. Set outcomes indicators, which are specific items of information or data that can track the success of your philanthropic projects.
If you feel as though you’ve made an impact, that can help keep your philanthropy moving ahead and focussing on what can change, as well as the goals you have accomplished. If you find some outcomes are not possible, then you can make the necessary changes to your program so it remains effective.
LGT Crestone’s private wealth advisers can help you realise your philanthropic goals and help you determine solutions to social and economic problems. If giving is right for you, our wealth advisers can help you make an impact.
