Do the Wealthy Have to Learn How to Say No?

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Saying-no

droplets / Shannon Kringen

March 25, 2016; New York Times

Last Friday’s New York Times piece, “The Art of Saying No When Giving,” coached private and family foundations, along with individual philanthropists, on the importance of turning down the requests of nonprofits that aren’t a strong fit for their support. Frankly, we are not so sure the piece deserved an article of its own.

It always makes sense to review the traditional protocols: being clear about funder values and giving priorities, saying no before making the organization move through a time-intensive proposal process, and providing frank and candid feedback that strengthens the organization and potential future proposals. But are these helpful guidelines really worth a page in the Times?

There are bigger fish to fry in expanding the pool of just whom philanthropists are saying “yes” to. The fact is that just about the only time the impact of saying “no” among private and family foundations, along with individual philanthropists, comes with a hefty social and emotional price tag is if the askers are social peers. This is old news: The rich often give in response to one another or institutions or pet causes with which they have prior contact; they rarely show up on the rolls of your local community-based group, and that creates as much of a wealth gap in nonprofits as we see in the economy overall.

The social aspect of giving, at least among the mega-rich, appears especially active in the U.S. The results of a recent survey of ultra-high-net-worth individuals reflect that; in North America, these philanthropists are more likely to give to an organization or cause tied into their social activities (42 percent of respondents in the region, versus 23 percent globally). The same study also suggests that the absolute volume of philanthropic dollars coming from this group is increasing, even though we’re still not sharing lockers at the gym with them.

But more broadly, as the general philanthropic environment becomes more social—with giving circles, crowdfunding, and initiatives such as The Charity Network becoming the new norm—the base of donors with the potential to be informed by social connections and pressures is broadening.

Giving circles, an increasingly popular model wherein members come together to decide collectively what they want to invest in, tend to target smaller organizations and philanthropists with more moderate incomes. Models such as Dining for Women have arisen partly in response to the stereotypically disconnected world of traditional private philanthropy (that is, the “ladies who lunch”) as a way to support less well-known organizations and introduce philanthropy to younger and less wealthy donors. Still, the social and networking component of giving circles is a large part of what drives their success.

The motivations, giving behaviors, and social circles of these more moderate philanthropists may be different than those of more traditional donors. Nevertheless, they raise the same important questions: What’s driving the next generation of giving, how do social context and personal relationships inform such giving, and which organizations will benefit and lose as a result?—Danielle Holly