Nearly three-quarters of donors say measurable impact is the top priority, as giving landscape evolves
TORONTO, Dec. 1, 2021 /CNW/ - Disruptive philanthropists are taking a more active role in their giving, are aware of the vast inequities in the world, and are committed to making a difference on the major issues affecting society, finds a new KPMG report. According to KPMG's 2021 Global Philanthropy Report, almost three-quarters (71 per cent) of donors surveyed place measurable impact as key when selecting causes to support, with 42 per cent citing innovative approaches as a strong influence in their giving practices.
"Many successful individuals and families share a common belief that the opportunities that come with wealth should be balanced with a responsibility towards others," says Yannick Archambault, Partner and National Family Office Lead, KPMG Enterprise. "They are acutely aware of the immense needs that exist today and are focused on how they can meaningfully deploy their wealth for maximum impact. Increasingly, they are applying more rigor, analysis and data to their giving practices and leveraging their personal networks and skills to accelerate progress on some of society's most complex challenges."
The report, which examines key trends among prominent philanthropists internationally and within Canada, highlighted a greater willingness to embrace innovation.
"We are starting to see a reimagining of philanthropy in Canada, beyond the simple act of giving away money to deserving causes," says Arundel Gibson, Family Advisor, Philanthropy and Impact, KPMG Family Enterprise. "Modern philanthropists are becoming more intentional and informed about the causes they support and reexamining their giving strategies and funding practices. The inequities exposed by the pandemic, the ESG agenda, and new movements to dismantle racism and colonialism are creating this shift among donors and within the charitable sector itself."
Key survey findings:
71 per cent ranked measurable impact as key when selecting causes to support, with 64 per cent saying measuring that impact is their greatest challenge
58 per cent identified good governance practices as a strong influence when choosing a charity to fund
42 per cent cite innovative approaches as a strong influence in their giving practices
Two-thirds (67 per cent) have adopted data as part of their evaluation of impact; and 42 per cent want structured feedback from their beneficiaries
63 per cent agree that combining efforts with third-parties needs to happen to deliver true impact; however more than a quarter (28 per cent) find collaboration a challenge
60 per cent partner with other foundations, followed by like-minded philanthropists (40 per cent), for-profit businesses (28 per cent), government bodies (28 per cent), research/academia (16 per cent) and other allies
"From a very young age, I was taught the importance of giving back to your community, either through volunteering or financial contributions, big or small," says Laurie Rix, President of the Vancouver-based Rix Family Foundation. "I have longstanding, trust-based relationships with the charities I support, and help target my funding to areas that are meaningful to me and where it's needed most. These donations are structured in ways to maximize and deliver the greatest impact."
Maximizing impact through collaboration
Three quarters (77 per cent) of respondents consider strengthened family bonds as a major benefit of philanthropy.
"Families that participate in philanthropy together often create deeper bonds and can model the values of generosity and kindness for the next generation," says Archambault. "Beyond these important benefits, many philanthropic families recognize that collaboration, in all its forms, can be a highly effective way to help remedy complex social and environmental challenges, opening up opportunities for greater impact."
ESG lens influencing philanthropic practices
ESG investing principles are also influencing how philanthropists allocate their donations. Social and environmental responsibility, good governance practices, such as diversity on boards and among staff and beneficiaries, and sound financial practices are increasingly important funding considerations.
"In a changing giving landscape, we advise donors to embark on a process of continuous learning that allows for a deeper understanding of the people, communities and causes they aim to help. This can lead to less restrictive, more culturally-sensitive funding practices and empower charitable organizations to identify their own needs and direct funds where the need is greatest."
The priorities of today's philanthropists align with sustainability-minded consumers and responsible businesses. According to a recent KPMG in Canada survey, 78 per cent of small and medium-sized business owners say the pandemic has increased their company's commitment to social and environmental issues; while 70 per cent say their customers expect them to take the lead on societal challenges such as racial and gender inequality and climate change.
Newer ESG funding models may also help remove barriers for funding recipients that may be smaller, grassroots Black- or Indigenous-led organizations that were previously overlooked for funding through conventional application processes.
Need to address data deficit
Recent technological advances in data collection are leading to more data-driven decision-making and more effective evaluation of impact, however challenges remain. Two-thirds (67 per cent) of philanthropists believe increased data will make the measurement of impact more meaningful and have adopted data in their evaluation strategies.
Within Canada, leading national organizations and charities recently published a series of recommendations to the federal government, which highlighted the need for more data to increase transparency and equity within the charitable sector.
About the 2021 KPMG Global Philanthropy Report
During 2021, KPMG Global Family Office conducted surveys and in-depth interviews with select, prominent philanthropists from around the world, including Canada, to uncover how they support various causes, the approaches they adopt, as well as their successes and lessons they have learned along their journeys. The "Disruptive Philanthropists" report is the result of this research. The report highlights new approaches, collaboration strategies, and emerging trends amongst some of today's most active philanthropists, as well as broader macro trends shaping the giving landscape.
About KPMG Family Office
Backed by the strength of KPMG's 150-year heritage, KPMG Family Office works with individuals and families to help manage the complexities of their wealth, so they can continue on their success journey and achieve aspirations. We build deep-rooted relationships based on trust, integrity, and shared commitment. Our approach recognizes that every individual and family is unique, and our team across Canada and globally offers personalized advice for every stage of their lives.
Our diverse perspectives and collaborative approach make a world of difference for the many individuals and families we work with, giving them clarity, stability and peace of mind for today and for the future.
About KPMG in Canada
KPMG LLP, a limited liability partnership, is a full-service Audit, Tax and Advisory firm owned and operated by Canadians. For over 150 years, our professionals have provided consulting, accounting, auditing, and tax services to Canadians, inspiring confidence, empowering change, and driving innovation. Guided by our core values of Integrity, Excellence, Courage, Together, For Better, KPMG employs nearly 8,000 people in over 40 locations across Canada, serving private- and public-sector clients. KPMG is consistently ranked one of Canada's top employers and one of the best places to work in the country.
The firm is established under the laws of Ontario and is a member of KPMG's global organization of independent member firms affiliated with KPMG International, a private English company limited by guarantee. Each KPMG firm is a legally distinct and separate entity and describes itself as such. For more information, see home.kpmg/ca.
SOURCE KPMG LLP
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