Disruptive philanthropists. How modern philanthropists are shaping tomorrow

Global philanthropy is changing. The simple act of giving away money to deserving causes, while still at the heart of philanthropic endeavour, is not enough. How wealth is applied is, for many, becoming more important than how it is preserved with philanthropy becoming an integral part of how success is defined and what it means to be ‘doing well’.

In 2021, KPMG’s Global Family Office and Private Client Group, undertook a global survey of philanthropists from more than 20 different countries. The report, Disruptive Philanthropists, captures the essence of what drives and motivates modern day philanthropists. As the world transitions to the new normal and societies seek to recover from the economic impact of COVID-19, the desire among many of the wealthy to create impact and leave lasting legacies in their communities and beyond remains.

We are seeing the emergence of a new wave of modern philanthropists, adopting innovative approaches, as varied as the causes themselves. For many successful philanthropists it is not sufficient to just support a cause; there is a desire to create long-lasting and impactful change.

Sitting alongside traditional philanthropic structures are a new wave of social entrepreneurs, disrupting the philanthropy landscape and creating a lasting legacy.

They are defined by both ‘selfish’ and ‘selfless’ motivations. ‘Selfish’, perhaps, to the extent that philanthropy is seen as personally rewarding and meaningful and an expression of family values, and selfless, as philanthropy involves a deep engagement of time and a commitment to the cause beyond the transfer of ‘financial’ resources.

Our research showed an increase in both the desire, and need, for collaboration. Philanthropy should not be a solitary activity. To endure and tackle the ‘knarly’ issues, our research clearly showed that it was important to work together with others; to harness technical knowledge, the interest and influence of politicians and the passion of community leaders and other philanthropists.

The dynamic is changing from just donations and the power imbalance between the benefactor and the recipient is being redressed. Partnerships are being formed with shared goals and shared expertise recognising the expertise of the recipient organisation.

Many philanthropists turn first to their family members (50 percent) for advice on philanthropic strategy, to other philanthropists (29 percent) and business colleagues (33 percent). Just 21 percent said they turn to their accountant and 17 percent to their lawyers for advice, suggesting that the professional community could be doing more.

How wealth is applied, comes from both within the family (as the new generation becomes involved) and without. Externally, at an economic and environmental level, our consciousness is provoked by inequality, resource scarcity and the sense that no one has a right to consume more than is justified as reasonable. Wealth now comes with a ‘social contract’ and a breach comes with consequences.

There is recognition that if not addressed ‘inequality’ will eventually create significant social issues and remove the licence to operate for many. This year, during Davos, more than 100 of the world’s super rich called for governments to tax the rich more to “to help reduce extreme inequality and raise revenue for sustained, long-term increases in public services like healthcare”.

The next generations are more and more dictating the agenda and what they want to see happen and are being given the licence to do so. Philanthropy is a powerful tool in helping the next generation prepare for the lives ahead of them. Philanthropists share stories of their own children embracing giving back from a young age, ‘pushing themselves outside of their comfort zones’, wishing to ‘stretch themselves’ and using philanthropy to ‘seek new experiences’. In one example, 10 families in one Australian city have come together to form a ‘giving circle’ where their children determine charitable giving and volunteering activities.

While today’s philanthropists may be driven by the same ‘altruistic’ desires as their forebears, they differ in the confidence of their ambition, their international reach, the structures adopted and the discipline of measuring the impact of their support. Just as many of these philanthropists have emerged as disrupters in the business world, so too are they looking to drive innovative new approaches to philanthropy. They are truly ‘societal’ entrepreneurs.

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