The last few years have seen an increasingly public critique of philanthropy, with books like Just Giving by Rob Reich, Decolonizing Wealth by Edgar Villanueva, and Winners Take All by Anand Giridharadas topping best-seller charts.
At the heart of these critiques is an indictment of the whole structure of philanthropy and the power dynamics that pervade it. As Edgar Villanueva puts it: “The field of philanthropy is a living anachronism. It is (we are) like a stodgy relative wearing clothes that will never come back in fashion. It is adamant that it knows best, holding tight the purse strings. It is stubborn. It fails to get with the times, frustrating the younger folks. It does not care.”
Taking some of these valid critiques a step further, some have suggested that we should do away with the charitable tax deduction and completely abandon philanthropy as we know it. But I’m not one of those people. I still believe that philanthropy done well—what we call forward-thinking philanthropy—has a fundamental and unique role to play in solving some of our most complex social challenges.
Forward-thinking funders seek to allocate their resources in ways that truly maximize impact and seed lasting solutions to deeply entrenched systemic challenges, from the inequity in education, housing, health and criminal justice systems, to fostering opportunity and sustainable economic development, close to home or around the world.
Our vision of forward-thinking philanthropy bears resemblance to the larger trust-based philanthropy movement. It’s about transforming the funder-grantee relationship away from the transactional norm marked by mutual suspicion to a partnership marked by mutual trust and respect.
Getting to the ideal of trust-based philanthropy will require major changes at the structural level, but it will also require changes on the personal level for individual funders.
One of the biggest barriers in the way of making the shift to trust-based philanthropy is fear.
Through the coaching and advising work that I’ve done with funders, I’ve come to believe that one of the most important things you can do as a forward-thinking funder is to develop yourself psychologically, and take the fear out of your philanthropy.
When it comes to figuring out what makes you feel satisfied with your own giving, it’s helpful to draw on human needs psychology. The model I use for this in my coaching practice draws a distinction between lower level human needs (security, status, social connection, novelty & entertainment), and our higher level drives for self-actualization (social contribution, personal growth and self-transcendence). There’s nothing wrong with these lower level needs—in fact, we all have to find healthy and positive ways to meet them as we go through life. On the flip side, it’s also true that our greatest fears are often connected to concerns that somehow we won’t be able to meet our ego-driven, lower level needs. This is one of the reasons why it is our higher level drives that most often bring us true fulfillment and joy in life.
Drawing from that higher and lower level needs framework, let’s look at the two kinds of motivations behind giving.
When philanthropists use their giving as a vehicle to meet their ego-driven, lower level needs, the impact of their philanthropy often suffers—and it’s often a much less fulfilling experience for them.
Security: I want to know for sure that my dollars will be used in a certain way and that my grantees will stick to the letter of every grant agreement, and hit every metric and milestone, so I tend to focus my giving on the big name brand institutions, or the folks I already know and trust.
Social status and connection: I want to receive recognition for my giving, or gain privileges and access to a social sphere through my giving.
Novelty and excitement: I want to give to projects that are exciting and innovative and new—when something turns out to work reliably and well, it gets less appealing. It’s not so interesting to give unrestricted operating grants year after year even if that’s what allows successful organizations to scale.
Now contrast that with what you see when philanthropists use their philanthropy to fulfill their higher level, self-actualizing needs:
Social contribution: Does my giving truly help others? What more can I do to really maximize its positive impact?
Personal growth: How can I elevate my own perspective and capability as a change agent through my giving? What past mistakes can I acknowledge and learn from next time around?
Self-transcendence: What role do I as a funder play in larger systems? How can I support a larger movement and a vision that’s bigger than my own?
On my Joyful Impact blog I take this psychological analysis further and share a framework for evaluating your giving along two dimensions: the impact it has in the world and the degree of personal satisfaction that it brings to you. The framework aims to help forward-thinking funders find a path toward giving that creates meaning and maximizes impact through expanded awareness of self and systems.
Taking the fear out of your philanthropy is about stepping back and getting a higher level perspective. It’s about coming to your philanthropy from a place of psychological strength rather than hunger. I believe it is the key to building a more equitable AND impactful model of philanthropy.