With philanthropic giving on the rise, New Zealanders are fostering a culture of generosity that is making a significant social impact to the communities in which we live. In recognition of this, Guardian Trust has launched a new Centre for Philanthropy with the purpose of advancing private philanthropy in New Zealand by helping those with the means to make a difference turn their good intentions into worthwhile results.
When international headlines were made in 2006 by the world’s then second richest man, Warren Buffet, giving away the bulk of his fortune – some US$30 billion – to the charitable foundation of the world’s richest man, Bill Gates, it was possible to think that social reform from philanthropy might be the sole domain of the ultra-rich. While Buffet has since overtaken Gates in the wealth ranking stakes, the philanthropic pursuits of the pair continue to reflect, at a high level, the prominence that the practice of philanthropy is having around the globe and across the wealth spectrum.
Although the US are still global leaders in philanthropic terms, donating almost 2 per cent of GDP in aid of charity, recent research shows that philanthropy is alive and well in New Zealand with the generosity of everyday New Zealanders on a par with other OECD countries for philanthropic giving.
The 2006 research project ‘Giving New Zealand’ undertaken on behalf of Philanthropy New Zealand confirms that New Zealanders gave the equivalent of 0.81 per cent of our GDP to charitable causes in 2005/2006. That puts us on a par with the UK for charitable giving, the British donating 0.9 per cent of GDP to charity, and ahead of Australia and Canada which donated 0.68 and 0.46 per cent of GDP to charity, respectively. Of the almost $1.3bn total pool of philanthropic funds raised in New Zealand in that period, almost $560m or 43 per cent was donated, bequeathed or granted by individuals and private trusts.
Unlike the US, trusts play an important role in philanthropy in New Zealand. Whereas the majority of philanthropy (some 83 per cent) in the US is undertaken by private philanthropists (compared with 35 per cent in New Zealand), trusts – whether family or individual trusts, community trusts or other independent voluntary and statutory organisations - make up 58 per cent of philanthropic giving in New Zealand compared to only 12 per cent in the US. Private philanthropists in New Zealand are often in a position to begin a charitable trust that will provide for the particular cause and beneficiaries they wish to support long into the future.
Guardian Trust, as a leader in the charitable trust sector, introduced the Centre for Philanthropy earlier this year as a means to assist these individuals with developing planned giving programmes and setting up appropriate charitable structures to enable them to choose the best way to structure and target their giving. The Centre provides strategic advice based on three core processes: smart giving, strategic investment and effective granting.
What is Smart Giving?
Smart giving is the process of developing giving strategies that maximise a donor’s philanthropic objectives throughout their lifetime and beyond. Individuals will have access to Guardian Trust’s proprietary ‘knowledge base’ that enables philanthropists to marry up their philanthropic objectives with the charities most aligned with their personal goals.
What is Strategic Investment?
Strategic investment provides for the long-term growth of funds allocated for philanthropic purposes using Guardian Trust’s investment management acumen. The reality is that for philanthropy to succeed, a commercial outlook is necessary to ensure the practical application of investment techniques that will generate funds far into the future.
What is Effective Granting?
Effective granting ensures that funds are directed to the right cause for the right purpose and in keeping with the original intentions of the donor, even after the donor is no longer around to direct its purpose. Guardian Trust has established processes for assessing the impact of clients’ funding and measuring the social return of their philanthropic investment.
Mark Cassidy, National Manager – Philanthropy who heads up the Centre said the establishment of the Centre is timely in light of changes to the Charities Commission and new tax legislation for charities to be introduced in mid-2008. “While the Charities Commission has set up a governance and accountability framework for all charitable enterprise, the real consequence has been to put a spotlight on the concept of giving and promoting generosity in general. Our message is that “it’s good to give”, and the Centre for Philanthropy helps further that approach by helping donors give in the most knowledgeable and sustainable manner. It’s about strategic investment for sustainable philanthropy – we’d like people to think of philanthropy as a form of prudent social investment.”
Guardian Trust has represented private philanthropists for most of its 125-year history, acting as trustee to more than 450 charitable trusts providing in excess of $26m in funding to more than 530 charities each year.
Spending money on others promotes happiness
Not only is it good to give but a recent Canadian study has found that it’s also good for you too. Despite the dramatic surge in income experienced by people in Western societies over the past several decades there have been few corresponding gains in overall happiness levels, according to research studies. However, in a report published in the 31 March issue of ‘Science’, researchers from the University of British Columbia found that individuals who donate to charity or give to others get a boost in their own happiness level, though they experience no such boost if they spend money on themselves. The researchers found that even giving as little as $5 may be enough to reap a happiness dividend. Which just goes to prove that it doesn’t matter how much you have, it’s what you do with it that counts.
