Christoph Courth, Global Head of Philanthropy Services
2021 proved to be an interesting year for philanthropy, with record levels of capital having likely to have been mobilised across the globe in a variety of ways, tackling a multitude of issues and dominated by the ever-present backdrop of the global pandemic.
From the US to China, we saw some big pledges and donations, a new wave of crypto philanthropy, the launch of some bold initiatives and ever greater digitisation of giving, specifically amongst the millennial generation.
Building on this, we see a few trends that we believe will dominate the philanthropic discourse in 2022.
1. Climate change mitigation rising up the list of priorities
In 2021, world leaders and non-governmental organisations declared climate change as the single biggest health threat facing humanity[i]. Yet, in spite of this stark warning, combatting climate change has historically received woefully little of our philanthropic attention, with just 2%[ii] of global philanthropy being dedicated towards it. In Asia, the world’s most vulnerable region to the adverse consequences of climate change[iii], that figure is less than 1%[iv].
However, this landscape is changing rapidly and ever more philanthropists are addressing this imbalance in their philanthropic portfolios and asking how they can do more. As one philanthropist we worked with noted, ‘all other philanthropy is for nothing, if we do not have a world fit for living in’.
2. Growing focus on inequality within our societies
The poorest segments of society have been disproportionately impacted by the pandemic, leading to its being referred to by some as the Inequality Pandemic[v]. From the digital learning divide to the loss of jobs and income and from healthcare access to the availability of vaccines, the pandemic has dealt a significant setback to efforts to end extreme poverty, reduce inequality and our global aspirations of achieving the 17 Sustainable Development Goals by 2030.
With increasing visibility of these disparities and growing understanding that widening social inequalities based on race, economic status, disability, or nationality are in no one’s best interest, we will likely see increasing levels of philanthropy that targets inequality in all of its many forms.
3. Continued demise of the benefactor/beneficiary dynamic
Traditionally, the relationship between a philanthropist and a non-profit organisation was that of the benefactor and the beneficiary, giver and receiver. This dynamic has an inherent, yet unintentional, power imbalance, with the power lying largely in the hands of the capital owner rather than in the hands of the experts.
While this isn’t a distinctly new trend, going forward into 2022 we expect to see the further breakdown of that dynamic. These means more partnerships built on shared visons and common goals, growing focus on funding outcomes rather than specific activities, less emphasis placed on ‘overhead’ costs, more unrestricted giving and an acceleration of application and grant-giving processes.
4. Bigger gifts and a brighter spotlight on philanthropy
Over the past few years, we have seen a rise in ‘mega’ donations and pledges, from Azim Premji's USD7+ bn donation to his charitable organisation, to the estimated USD8-9 bn in donations made by Mackenzie Scott since 2020. At the same time, we have also seen increased scrutiny of the philanthropic actions and inaction of society’s wealthiest, with opinions on whether they are doing enough and correctly abounding.
Given that 100 million additional people fell into extreme poverty as a result of the Covid pandemic whilst at the same time, the number of centimillionaires and billionaires multiplied, we will likely see an increase in systems-change-sized donations and pledges alongside questions of those deemed not to be doing enough.
5. Greater demand for and opportunities to collaborate
For too long in philanthropy ‘collaboration’ was merely a buzz word. Yet over the past several years, a growing number of philanthropists have come together to collaborate and consolidate, both amongst themselves and with the public sector.
From philanthropists and local governments partnering on hardship funds to the co-financing of research into vaccines, the pandemic has catalysed the demand for more and better collaboration and shown clear evidence of the power of public-private partnerships. With growth in high-level opportunities and infrastructure combined with greater understanding of the transversality of the challenges we face as a global society, we expect to see more examples in 2022.
6. Investments and philanthropic capital working closer together
In the past, for many investing and giving were two distinct activities. But there is growing acknowledgement that interlinking and mobilising investment and philanthropic capital to work together can be more powerful in advancing a given mission or set of aspirations.
Responsible investing is now mainstream but certainly not yet universally adopted. However, evidence shows us that this past year there has been a tremendous shift into more responsible investments as a direct result of the pandemic. We expect this to continue into 2022.
7. Continued growth of Asian philanthropy
Europe and the US has historically dominated the global narrative on philanthropy, both in terms of size of giving and the methodologies employed.
Yet over the past years, with the exponential growth of private wealth across Asia, a more established philanthropic ecosystem has flourished across the region. As we look to 2022, with China’s renewed focus on ‘common prosperity’, Singapore’s efforts to define its role as a global hub in Asia for philanthropy and the continued growth in private wealth creation, we see the global philanthropic story becoming distinctly more Asian.
[i] World Health Organisation, 2021[ii] Climate Works Funding trends 2021: Climate change mitigation philanthropy 2021
[iii] Panel on Climate Change, Sixth Assessment Report 2021
[iv] Harvard Kennedy School, Perspectives on Philanthropy in 21st Century China 2018
[v] World Bank, 2021 Year in Review in 11 Charts: The Inequality Pandemic
