By Nate Hoekstra
A new report from researchers on charitable giving has found that the growing trend of collective giving is helping foster diversity in philanthropy.
Collective giving groups, which are often known as giving circles, have become an increasingly popular way for donors with diverse backgrounds to support charitable organizations or projects of mutual interest.
The study was conducted by the Collective Giving Research Group (CGRG), which includes Jason Franklin, the W.K. Kellogg Community Philanthropy chair at Grand Valley State University’s Johnson Center for Philanthropy.
The study focused on the current scope and scale of collective giving groups in order to understand their impact on donor giving and civic engagement.
Researchers found that giving circles have engaged at least 150,000 people in all 50 states and given as much as $1.29 billion since their inception. A majority of giving circles are created around a particular identity — including groups based on gender, race, age and religion. Giving circles have become more inclusive of income levels as the average and most frequent amount given by individual donors may be decreasing, while total dollars donated by giving circles are increasing.
“Giving circles are a powerful tool to democratize and diversify philanthropy, engage new donors and increase local giving,” Franklin said. “This research sheds critically needed new light on this popular form of collective giving. In a time when philanthropy is increasingly focused on the giving habits of billionaires, this research is an important reminder that everyday givers are coming together and pooling their resources to make a difference in their communities and for the issues they care about.”
Other key findings include:
• Collaborative giving is becoming more inclusive with donors from a wide range of income levels.
Giving circles have always provided avenues for those without substantial means to participate in significant giving, but this latest study suggests these groups now attract members from a wider range of income levels. Today, minimum dollar amounts required for participation range from less than $20 to $2 million, and the average donation amount was found to be $1,312 – compared to $2,809 in 2007.
• Identity-based groups make up 60 percent of giving circles and drive much of the growth in collaborative giving.
Giving circles attract many types of people, including those who may not typically engage in institutional philanthropy. Most groups are formed around a specific identity including groups based on gender, race, age and religion.
• Women dominate giving circle membership, making up 70 percent of all members. This collective model of giving is particularly popular among women. While men have a presence in 66 percent of giving circles, they are only the majority of members in 7.5 percent of groups.
• Giving circles are connected to each other and to philanthropy.
Networks of giving circles have emerged since 2007, with 25 networks now in existence. Today, 45 percent of identified giving circles participate in a network or alliance group. Community foundations, corporate partners and other outside donors view these collective giving groups as an effective way to give, with 52 percent of giving circles receiving additional funds or grants from these sources.
The study was conducted by the Collective Giving Research Group and was funded by the Bill & Melinda Gates Foundation, via the Women’s Philanthropy Institute at the Indiana University Lilly Family School of Philanthropy, and by the Charles Stewart Mott Foundation. Researchers who co-authored the report with Franklin include Jessica Bearman from Bearman Consulting; Julie Carboni, Syracuse University; and Angela Eikenberry, University of Nebraska at Omaha.
