Welcome to this edition of Connected Giving, Australian Executor Trustees update on current trends and news in philanthropy.
Philanthropy and a world in crisis
Bushfires, global pandemic and protests against racial inequality. It seems we are lurching from crisis to crisis in 2020. Foundations are proven vessels of goodwill and ideal structures to respond to crises and to achieve good outcomes for society.
However Philanthropy – like the rest of society – has faced significant challenges in responding to the events of the past six months. In this edition of Connected Giving we reflect on the impact the bushfires, the COVID-19 global pandemic and social justice have had on philanthropy.
We encourage you to read the fantastic and thoughtful piece by our friend and colleague at Rockefeller Philanthropy, Mae Hong, on the role philanthropy must play in future-proofing not for profits. We also consider the Federal Government’s measures to incentivise private and public foundations to distribute more funds this and next financial year in response to the impact COVID-19 pandemic has had on charities resources and the ability to fundraise. Finally, the recent Federal Court ruling into the application of funds raised by Australian media personality and comedian Celeste Barber for bushfire causes provides a timely reminder as we head towards the end of the financial year: obtaining the right giving advice upfront is essential in achieving intended impact. At AET we are here to help advisers and their clients do exactly that – please contact us for more information.
Jump to any one of the edition’s articles by clicking the links below:
- Philanthropy must ‘future-proof’ nonprofits with better shock-absorbers
- Philanthropy Australia members quick to help those in need
- Philanthropists given incentive to dig deep for struggling charities
- Leading foundations pledge to give more, hoping to upend philanthropy
- Celeste Barber’ $51 million bushfire money can’t be distributed to other charities
Philanthropy must ‘future-proof’ nonprofits with better shock-absorbers
Philanthropy’s response to COVID-19 has been unprecedented, with individuals, foundations and corporations giving more money, with less restrictions, and to new causes. Yet the aftermath of the pandemic will require great change as donors and funders assess the damage and form a plan for recovery. Funding to ensure survival will be a necessary phase, and one that we are currently in. Once the urgency of survival passes, funding for rebuilding is required. This phase is often one overlooked and underfunded, as donors tend to avoid supporting organisations in need of repair. Following the rebuild, should come funding for resilience. COVID-19 has shown how fragile nonprofits are who have little to no financial reserves. Funding needs to ‘future-proof’ nonprofits as well as support and build capacity for current goals. Read the full article (7 mins).
Philanthropy Australia members quick to help those in need
A survey of Australia’s leading philanthropic trusts and foundations shows that philanthropy is giving more than ever and has moved fast to support charities and the communities they serve. The survey of 101 grant-makers reveals that 88% of respondents have already moved fast to change how they support the community by increasing flexibility (72%), untying restricted funding (48%), increasing financial grant support (42%) and establishing dedicated COVID-19 grant programs (32%). The survey reveals that 40% of trusts and foundations have opened up new grant opportunities, beyond their regular programs, to communities and organisations needing immediate relief and recovery funding. Read the full article (6 mins).
A new survey from Philanthropy Australia shows that 88% of funders who responded to COVID-19 have changed how they support nonprofit organisations. The majority of survey participants indicated that they have increased flexibility (72%), untying restricted funding (48%), increasing financial grant support (42%), and establishing dedicated COVID-19 grant programs (32%). Respondents had taken other actions to address pandemic disruptions, including increasing digital capacity, supporting advocacy work for vulnerable groups, increased public and government advocacy work, reallocating funds to priority areas, and capturing learnings from the effects of the pandemic. Read the full article (6 mins).
Philanthropists given incentive to dig deep for struggling charities
Amendments have been made to the ministerial guidelines for private and public ancillary funds to increase support for charities during the COVID-19 pandemic. The changes are designed to encourage philanthropists to increase giving in the short term (1-2 years) while the economic impacts of the pandemic are still being felt by communities and nonprofits. Many organisations have seen funds drop off or stagnate while demand for services are peaking, and this amendment will hopefully counter some of this stress felt by responders to the pandemic. The philanthropic sector has welcomed this announcement, with the CEO of the Paul Ramsay Foundation Glyn Davis saying it was great to see some government initiatives. Read the full article (7 mins).
Leading foundations pledge to give more, hoping to upend philanthropy
The Ford Foundation plans to announce that it will borrow $1 billion to substantially increase the amount of money it distributes in this year of crises. Four other leading foundations will pledge to join the Ford Foundation and increase giving by at least $725 million. This move could end the tradition of the charitable world’s tradition of fiscal restraint during times of economic hardship. The four other foundations taking part are the John D. and Catherine T. MacArthur Foundation; the W. K. Kellogg Foundation; the Andrew W. Mellon Foundation; and the Doris Duke Charitable Foundation. The reluctance to spend more is a crisis reflects the desire to preserve their endowments in perpetuity, and because endowments tend to be invested, the amount they distribute typically declines during economic downturns. Unfortunately downturns are when the money is most needed. Read the full article (10 mins).
Celeste Barber’ $51 million bushfire money can’t be distributed to other charities
It has been ruled that millions of dollars raised by Celeste Barber’s record breaking bushfire campaign cannot be redistributed to other charities. The campaign nominated the NSW Rural Fire Service (RFS) and Brigades Donation Fund for the $51.3 million raised during the January bushfires. Many people were hoping that given the huge amount raised, the money could be more widely distributed to charities such as WIRES and The Red Cross. The deed governing the trust however only allows money to be spent on purchasing and maintaining equipment, training and administrative costs. Justice Slattery ruled that in this instance money could be also given to families of fallen firefighters and used for trauma counselling too. Read the full article (5 mins).