The crucial, growing role of women in philanthropy

Philanthropy is becoming more diverse, collaborative and sustainable than ever before. Mark Greer, CAF’s Managing Director of Philanthropy Services, explores how women are leading this approach and breaking the mould with their giving.

The world of philanthropy is changing. There’s more emphasis on causes like gender equality and sustainable development than before. A more diverse, representative range of voices are starting to influence decision making. And it is high-net-worth female donors who are among the key drivers.

With numerous female entrepreneurs emerging and more intergenerational wealth transfers going to daughters, rather than just sons, around ten per cent of ultra-high-net-worth individuals (UHNWIs) globally are now women. Their numbers rose 36% to 328 on Forbes’s 2021 list of billionaires.

From Melinda Gates to the second-highest rated UK philanthropist on the 2020 Sunday Times Giving List, Dame Janet de Botton, many are having a huge impact on causes that matter particularly to women. Female benefactors are contributing around 14% of UHNWIs’ total donations towards social justice, for instance. They are also helping charities and philanthropy evolve in a hugely positive way.

Thinking long-term

Wealth advisors have noticed that female clients tend to carefully investigate causes and charities before putting money into them, to see exactly what they’re about and what specific impact they personally can have. They usually favour making regular, long-term donations, too. This is may be because they want to see a project through to the end or pass the baton of helping an organisation on to their family, rather than spending all the available funds at once. Many men, by contrast, often prefer big one-off donations and are happy to be guided by friends, business contacts or their wealth advisor as to which causes to support.

There are, of course, benefits to all these approaches. But a more cautious, long-term commitment can bring tremendous financial stability to charities and has a greater chance of going beyond simple donations into the likes of substantial advocacy work.

A shift of focus

The rise of wealthy female philanthropists means more money is being directed towards causes that may previously have been slightly marginalised or underfunded.

Women’s issues, such as reproductive health or fairer workplaces, are coming more to the fore. The Women’s Funding Network now has more than 110 member organisations supporting gender-equality projects, and, with its partners, invests $420 million worldwide annually. British charity Rosa supports dozens of grassroots women’s organisations working with the likes of female immigrants and domestic-abuse victims.

Female donors often fund international-development projects, too. This is perhaps driven by a desire to improve the life chances of vulnerable children, and because it is frequently women and girls who benefit most from the likes of new schools or improved sanitation in places such as sub-Saharan Africa.

The 2019 Charities Aid Foundation UK Giving Report found that animal charities are the most popular cause for 31% of women, against 20% of men. They are also slightly more likely to give to projects benefitting young people and the homeless. And, since Covid-19, wealth advisors’ female clients have been generous supporters of causes such as providing kids with meals and helping families deal with bereavement.

Their concern for the next generation means that sustainability causes, though popular with men, are boosted by high net worth female donors. British-based philanthropist Nazanin Alakija recently founded S.A.G.E Innovation, which works to find solutions to climate change, for instance. Other female donors are helping to clean up UK rivers or protect endangered species.

A Morgan Stanley poll found that 84%  of women were interested in investments that would bring social and environmental benefits, along with market-rate financial returns, against 67% of men. So female donors often direct funds towards important impact investing, such as affordable housing and innovative agricultural methods such as vertical farming. 

Collective action

Many female philanthropists embrace working collaboratively. This is increasing the prominence of initiatives such as giving circles.

The women’s collective-giving network Philanos, for instance, now includes 80 grant-making groups across the UK, US and Australia. Women Moving Millions has 340 individual members internationally – all of whom have given more than $1 million to female-orientated organisations. The Maverick Collective invites well-off women to fund the work of Population Services International, which targets problems such as HIV, poor public hygiene and gender-based violence.

Families are also becoming bigger players in philanthropy because of female donors, with women more likely to involve their children in decisions about which charities to fund. This has hugely valuable effects including creating long-term support for organisations and a more altruistic next generation of wealthy people. It has the added benefit of strengthening family bonds as they share those issues dear to their hearts.

Organisational improvement

Many donors are increasingly uncomfortable supporting charities whose leadership teams or policy-making structures don’t adequately represent the groups they are trying to help. Women, particularly younger women, frequently choose to channel their funds towards organisations who have several female or Black and ethnic minority managers, if they are dealing with gender or minority issues. Or they might be more inclined to help organisations that genuinely consult and listen to the residents of overseas towns and villages they are working to improve.

This will play a vital role in making the charitable and development sector in the UK and around the world more empathetic and effective, and less Western-male dominated.

Prominent female philanthropist Fran Perrin is effecting another important kind of organisational change with her 360Giving initiative. By inviting charities to make their funding details public and accessible, donors can identify areas of need and charity leaders can potentially see how their organisations can be more efficient.

Good advice needed

Though high net-worth female philanthropists have extraordinary potential to change the world, like any donor, they need reliable, informed advice to maximise their effect. An advisor who can help them decide which charities to focus on, how much they can afford to give and how to do it efficiently, taking in issues such as taxation and legal structures.

Wealth management has long been male-dominated, so it’s crucial for women to find advisors who can empathise with their concerns. Advisors who realise that this client may have a slightly different set of priorities and goals than what they are used to.

Working with specialist philanthropy advisors, such as the Charities Aid Foundation, can help female donors find a more purpose-driven approach to giving. It can unearth causes that will truly resonate with them and that they’ll want to commit to for years to come.

High-net-worth female philanthropists are demonstrating that women can have powerful leadership roles in making the UK and wider world a better, more equitable place. They signal that they can do something about the injustices that may have stood in their way earlier in their careers and which are still impeding millions. They are inspiring people, no matter how well-off, to take positive, altruistic action and help make society more inclusive, prosperous and caring.

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