The ages, motivations and interests of the most prominent and prolific philanthropists are changing. Welcome to the new generation of giving.
This article originally appeared in Blue & Green Tomorrow’s Guide to Sustainable Philanthropy 2014.
Philanthropy is changing. This is to be expected; even the wealthiest magnates age. As wealth – or some wealth, at least – passes down through the generations, it falls into the hands of a new breed of philanthropists with new ideas on how their money can do good.
Working with the Charities Aid Foundation (CAF), the Scorpio Partnership – a leading wealth management strategy firm – has recently surveyed the world of high net-worth and ultra-high net-worth philanthropy. The findings are not yet published, but CAF’s head of advisory Amy Clarke explains that the research sheds some light on a number of observed trends in the philanthropy world. It illustrates the rise of the under 40-45 philanthropist – the philanthropic emergence of the millennial generation.
“We have one of the largest transfers of wealth that’s ever happened between generations. Trillions of dollars of wealth are in the process of being transferred. Not all of it, but a lot of it is coming down the generations to the millennials, rather than across, so it’s a really exciting time for philanthropy because these guys do things differently”, Clarke says.
The under 40-45s are more engaged, she continues, eschewing the more traditional ways of giving, or “what we term the Dickensian philanthropy, which is mainly about cheque writing”. She goes on: “They invest in a cause but they also invest intellectually. They bring their expertise and they bring their networks. They’re very thoughtful, they’re very strategic and they’re very considered. They bring a lot more to the game.”
Cath Tillotson, Scorpio Partnership managing director, agrees. She notes that more high net-worths are becoming more hands-on. But why, exactly, is this happening? “I think it’s partly because those young people have grown up with much more awareness of these global issues and a more direct, personal connection with them because of the technology which has enabled them to be more connected.”
Tillotson notes that the advisory community is wising up to changing attitudes, as philanthropy appears more often in conversations regarding financial planning and lifetime goals, and supporting further engagement. She says, “I don’t think we’ve quite got so far yet that it’s regarded as a mainstream topic for discussion and a way of directing one’s investment portfolio, but certainly I think there’s a recognition within the advisory community that this may be a significant motivator for people.”
This revolutionary change in approach is perhaps best demonstrated by the emergence of social investment. Borne out of ethical and socially responsible investment, it combines financial returns with positive social outcomes – essentially making money from doing social good, rather than doing social good by philanthropically giving your money away. Because of this, younger high net-worths are becoming increasingly interested.
“We’re seeing a huge uplift in private clients interesting in using their philanthropic capital to stimulate growth in the charity sector but also to leverage that capital by making it available as repayable finance to charities, so it can then be repurposed time and time again. It’s a little bit like leveraged finance in the City, they’re pumping their philanthropic capital full of steroids and enabling it to do a lot more”, Clarke adds.
But it is not all about those millennials. Diaspora communities – populations who have left their more troubled homelands – are also a driving force in the new philanthropic order, Tillotson adds, citing Britian’s Indian community as a good example. “Many international Indians who are either born in India and now work here, or were born here and have parents who originate from India, have very strong links with the country. They may have business links with the country. You often find that they are particularly keen to support India in overcoming certain social challenges.”
Such a motivation, a driving force, is often key to true engagement with philanthropy, Tillotson argues. Diaspora communities, through their familial and emotional ties with entire populations who may not be as fortunate as them, have a natural incentive to give. In more comfortable communities, this driving force can be lost. Tillotson says, “I think this British community has been less engaged than either the previous generation or the future generations, simply because we’ve lived in a privileged society.”
However, Clarke suggests that older European generations are also playing an important part in the evolution of philanthropy, as concern grows that children’s princely inheritances may be poisoned chalices. “People are becoming concerned that the transfer of wealth down from generation to generation can be toxic and can destabilise individuals and families”, she says.
“There is a general awakening among ultra-high net-worths as they’re beginning to realise that there’s only so much money that one person ever needs in their lifetime. We’re seeing a lot of families, European families especially, starting to think about how they safeguard against the toxicity of wealth and philanthropy is playing a massive part in that.”
There is, however, some wisdom in the cliché that the more things change, the more they stay the same. Philanthropists’ methods may be changing, but their concerns remain fixed. Tillotson says, “The causes that attract the most attention are universal. Typically healthcare issues are very high on the agenda, followed by children and educational issues.”
Clarke lists a top three of “health, education and animals” as popular concerns among donors of all ages, genders and ethnicities. She notes that many experts expected a spike in philanthropy relating to environmental causes, as climate change became a more front-page issue, but if one is coming it is yet to arrive. “I wouldn’t necessarily expect huge change in the causes that people support, unless something catastrophic happens, and who knows what that could be?”
So in 10 years’ time then, when the next cohort of philanthropists emerges, what can we expect to see? “What we’re seeing with the millennials at the moment, that is only going to increase with generation Y and the generation after that”, Clarke says.
“In 10 years’ time, I think we’re going to see a very different kind of philanthropy. It’s not necessarily going to just be philanthropy, it’ll also be about investing for impact. It is very exciting.”
Cath Tillotson is managing director of Scorpio Partnership and Amy Clarke is head of advisory at the Charities Aid Foundation.
Photo – Andrew E Larson via Flickr
New Zealand to Switch to Fully Renewable Energy by 2035
New Zealand’s prime minister-elect Jacinda Ardern is already taking steps towards reducing the country’s carbon footprint. She signed a coalition deal with NZ First in October, aiming to generate 100% of the country’s energy from renewable sources by 2035.
New Zealand is already one of the greenest countries in the world, sourcing over 80% of its energy for its 4.7 million people from renewable resources like hydroelectric, geothermal and wind. The majority of its electricity comes from hydro-power, which generated 60% of the country’s energy in 2016. Last winter, renewable generation peaked at 93%.
Now, Ardern is taking on the challenge of eliminating New Zealand’s remaining use of fossil fuels. One of the biggest obstacles will be filling in the gap left by hydropower sources during dry conditions. When lake levels drop, the country relies on gas and coal to provide energy. Eliminating fossil fuels will require finding an alternative source to avoid spikes in energy costs during droughts.
Business NZ’s executive director John Carnegie told Bloomberg he believes Ardern needs to balance her goals with affordability, stating, “It’s completely appropriate to have a focus on reducing carbon emissions, but there needs to be an open and transparent public conversation about the policies and how they are delivered.”
The coalition deal outlined a few steps towards achieving this, including investing more in solar, which currently only provides 0.1% of the country’s energy. Ardern’s plans also include switching the electricity grid to renewable energy, investing more funds into rail transport, and switching all government vehicles to green fuel within a decade.
Zero net emissions by 2050
Beyond powering the country’s electricity grid with 100% green energy, Ardern also wants to reach zero net emissions by 2050. This ambitious goal is very much in line with her focus on climate change throughout the course of her campaign. Environmental issues were one of her top priorities from the start, which increased her appeal with young voters and helped her become one of the youngest world leaders at only 37.
Reaching zero net emissions would require overcoming challenging issues like eliminating fossil fuels in vehicles. Ardern hasn’t outlined a plan for reaching this goal, but has suggested creating an independent commission to aid in the transition to a lower carbon economy.
She also set a goal of doubling the number of trees the country plants per year to 100 million, a goal she says is “absolutely achievable” using land that is marginal for farming animals.
Greenpeace New Zealand climate and energy campaigner Amanda Larsson believes that phasing out fossil fuels should be a priority for the new prime minister. She says that in order to reach zero net emissions, Ardern “must prioritize closing down coal, putting a moratorium on new fossil fuel plants, building more wind infrastructure, and opening the playing field for household and community solar.”
A worldwide shift to renewable energy
Addressing climate change is becoming more of a priority around the world and many governments are assessing how they can reduce their reliance on fossil fuels and switch to environmentally-friendly energy sources. Sustainable energy is becoming an increasingly profitable industry, giving companies more of an incentive to invest.
Ardern isn’t alone in her climate concerns, as other prominent world leaders like Justin Trudeau and Emmanuel Macron have made renewable energy a focus of their campaigns. She isn’t the first to set ambitious goals, either. Sweden and Norway share New Zealand’s goal of net zero emissions by 2045 and 2030, respectively.
Scotland already sources more than half of its electricity from renewable sources and aims to fully transition by 2020, while France announced plans in September to stop fossil fuel production by 2040. This would make it the first country to do so, and the first to end the sale of gasoline and diesel vehicles.
Many parts of the world still rely heavily on coal, but if these countries are successful in phasing out fossil fuels and transitioning to renewable resources, it could serve as a turning point. As other world leaders see that switching to sustainable energy is possible – and profitable – it could be the start of a worldwide shift towards environmentally-friendly energy.
How Going Green Can Save A Company Money
What is going green?
Going green means to live life in a way that is environmentally friendly for an entire population. It is the conservation of energy, water, and air. Going green means using products and resources that will not contaminate or pollute the air. It means being educated and well informed about the surroundings, and how to best protect them. It means recycling products that may not be biodegradable. Companies, as well as people, that adhere to going green can help to ensure a safer life for humanity.
The first step in going green
There are actually no step by step instructions for going green. The only requirement needed is making the decision to become environmentally conscious. It takes a caring attitude, and a willingness to make the change. It has been found that companies have improved their profit margins by going green. They have saved money on many of the frivolous things they they thought were a necessity. Besides saving money, companies are operating more efficiently than before going green. Companies have become aware of their ecological responsibility by pursuing the knowledge needed to make decisions that would change lifestyles and help sustain the earth’s natural resources for present and future generations.
Making needed changes within the company
After making the decision to go green, there are several things that can be changed in the workplace. A good place to start would be conserving energy used by electrical appliances. First, turning off the computer will save over the long run. Just letting it sleep still uses energy overnight. Turn off all other appliances like coffee maker, or anything that plugs in. Pull the socket from the outlet to stop unnecessary energy loss. Appliances continue to use electricity although they are switched off, and not unplugged. Get in the habit of turning off the lights whenever you leave a room. Change to fluorescent light bulbs, and lighting throughout the building. Have any leaks sealed on the premises to avoid the escape of heat or air.
Reducing the common paper waste
Modern technologies and state of the art equipment, and tools have almost eliminated the use of paper in the office. Instead of sending out newsletters, brochures, written memos and reminders, you can now do all of these and more by technology while saving on the use of paper. Send out digital documents and emails to communicate with staff and other employees. By using this virtual bookkeeping technique, you will save a bundle on paper. When it is necessary to use paper for printing purposes or other services, choose the already recycled paper. It is smartly labeled and easy to find in any office supply store. It is called the Post Consumer Waste paper, or PCW paper. This will show that your company is dedicated to the preservation of natural resources. By using PCW paper, everyone helps to save the trees which provides and emits many important nutrients into the atmosphere.
Make money by spreading the word
Companies realize that consumers like to buy, or invest in whatever the latest trend may be. They also cater to companies that are doing great things for the quality of life of all people. People want to know that the companies that they cater to are doing their part for the environment and ecology. By going green, you can tell consumers of your experiences with helping them and communities be eco-friendly. This is a sound public relations technique to bring revenue to your brand. Boost the impact that your company makes on the environment. Go green, save and make money while essentially preserving what is normally taken for granted. The benefits of having a green company are enormous for consumers as well as the companies that engage in the process.