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We believe philanthropy is entering a whole new era and we are excited about the new year ahead. So, what will 2022 bring? Which trends will shape the philanthropic landscape? And, what else will it take to reach the UN Sustainable Development Goals (SDGs)? Let us share the trends that we believe our clients and philanthropists will be focusing on:
In the last few years, we have seen different groups of stakeholders coming together to build strategic partnerships, address issues jointly or pool their resources. (UBS)
Trend 1: Trust-based philanthropy
Trust-based philanthropy is rooted in values that help build mutually accountable relationships – similar to the way management teams often work towards shared objectives. The pandemic has accelerated the way philanthropists operate. Working within the context of a crisis, they have had to demonstrate more flexibility and trust vis-à-vis the implementing-partners – giving partners more leeway in how they are spending their grants. Thanks to high-profile philanthropists like MacKenzie Scott trailblazing the way, we believe that this trend is here to stay and that we will see more philanthropists following this movement.
Trend 2: Adding a lens
How can philanthropists unpack the myriad of issues they are concerned about and make the choices about where to focus their efforts? Given the interconnectivity between many of the issues, philanthropists can choose to add an extra lens to their giving without losing the focus for the issue they care most about – addressing several issues at the same time. Adding lenses, like gender equality for example, allows philanthropists to improve educational outcome and address gender-related issues topics like menstrual health, prevention of violence against girls, forced early marriage in the context of their education intervention.
Adding a lens not only means tailoring the intervention, but also setting up specific key performance indicators to measure how impactful their programs are on both education and interconnected issues within that setting, such as girls, people with disabilities or climate for example.
Trend 3: More Collective Giving
The world’s issues are too big and too complex for one person to address alone. In the last few years, we have seen different groups of stakeholders coming together to build strategic partnerships, address issues jointly or pool their resources. One way to do this is through collective giving circles, which allow like-minded individuals to pool their time, resources and knowledge to focus on a topic that jointly concerns them. We expect that this type of philanthropy will continue to grow as the big numbers are mobilized, important connections made and proven successes are realized – inspiring others to put their egos aside and team up.
Trend 4: Social Finance
While it is crucial to attract more capital to address social and environmental issues, deploying it effectively and more sustainably is equally essential. This has led to the development of blended finance approaches where the borders between the investment and the philanthropy worlds are blurred. Social finance, for example, is an approach to investment that focuses explicitly on generating (social) impact. It incentivizes and rewards the delivery of results, thereby putting impact first. Its rise is driven by the growing recognition that in order to solve the world’s most complex and intractable social and environmental challenges, a stronger focus on impact is required from investors. This requires tackling root causes, putting the benefit to the individual at the center of solutions, focusing on a rigorous and transparent measurement of results, and helping impactful local models become financially sustainable. For even greater impact, social finance can foster new partnerships with private investors to grow the funding pool available to scale and catalyze impact-oriented innovations.
Trend 5: Diversity of thinking
Philanthropy has seen an acceleration towards more diversity, equity and inclusion. We’ve seen more diversity among professionals in the philanthropic sector between 2018 and 20201 – including more women leading important philanthropic efforts and talent from minority groups and overlooked communities being better represented at the table where grants are being made. This effort towards more inclusiveness is changing power and interpersonal dynamics, and is calling for more self-reflection by the organizations, their boards and management about how they do their work, where and with whom. Ultimately, we can expect more people to confront their biases and make sure innovation in problem-solving is maximized through diverse talent applying their experiences and perspectives in tackling philanthropic issues.
Main contributor: UBS Editorial
For more 2022 philanthropy trends, see the original blog Ten trends for Philanthropy in 2022.
Click here for more on UBS Philanthropy.
Review code: IS2200793
This article is for informational and educational purposes only and should not be relied upon as investment advice or the basis for making any investment decisions. The views and opinions expressed may not be those of UBS Financial Services Inc. UBS Financial Services Inc. does not verify and does not guarantee the accuracy or completeness of the information presented.
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