Tag Archives: philanthropy in Canada

Recognizing the reality of recognition

This post originally appeared on Hilborn’s Charity ENews

SpotlightDuring a coffee meeting last week a colleague of mine proclaimed that most philanthropists were raving egomaniacs who donated money either for their own self-aggrandizement or to further business interests. “All they really want is their name on something,” she said. It’s an opinion that’s widely held. It’s also largely unfounded.

A recent article by David Callahan in Inside Philanthropy focuses on the humility factor in major gift philanthropy. Interestingly, he reveals that a U.S. database of gifts of at least $1M made since 2000 lists over 1,000 donations that were given anonymously including 100 gifts of $20M or more. While those gifts may represent a small percentage of the total, it’s still a very significant number of donors who want their name left out of it.

Callahan speculates that the reason for the humility is two-fold. Many donors espouse anonymity as a matter of principle while others are simply trying to avoid the additional solicitations that notoriety brings. He correctly points out that this humility is not in the best interest of the organizations being supported. It starves them of the awareness that comes with major gift announcements and eliminates the potential for motivating other donors.

But what do philanthropists really think about recognition? Why do they or don’t they want their names attached to a gift? Our interviews with dozens of Canada’s top philanthropists revealed very sophisticated and, for the most part, very principled approaches to recognition.

Many donors downplayed the role of recognition in their philanthropic decisions. Carlo Fidani clearly felt that the impact of the gift was paramount when he posed and answered his rhetorical question.  “Is it about the name or is it about the reason for giving? It is always about the reason for giving. The name is a nice gesture, but it’s not a reason for giving.”

Hal Jackman ascribed respect to donors who remain anonymous when he told us, “I would say that it is more noble.”

The primary motivation for those donors who were open to receiving recognition was a combination of legacy and wanting to inspire their children. Issy Sharp, as a veteran in the philanthropic arena, was able to step back and sum it up astutely. “Probably one of the best ways to get big money is name recognition. Because that’s what people want. They want legacy and family tradition.” As if to confirm Sharp’s insight, David Cynammon said, “I will tell you that recognition is very important and I will give you the absolute honest reason for me and the only reason is for my kids to see it.”

Philanthropists are certainly cognizant of the benefits that recognition brings to the organizations they support. In talking about gifts made by her father and their family foundation, Julianna Sprott displayed a deep understanding of motivation. “It is not the ego-stroke, it is the ripple-effect outward. Someone might see the Sprott name on something and say, ‘I didn’t know Eric did that, and he doesn’t make bad investments, so maybe we should too.’ I think there is power in that.”

Does it really work that way? Are others ever incented to give because of the generosity of someone they know? According to Eddie Sonshine it does. In talking about a major gift made to and prominently recognized by a museum in Israel, he recounted, “To this day, there doesn’t seem to be a month that doesn’t go by that we don’t get a call or an email from someone who says, we walked through the museum, and we saw your name and we were so inspired.”

David Cynammon took a more cynical, and perhaps more realistic, approach to the way in which one gift can lead to others. “It might even create competition. You know somebody else who says ‘hey I don’t have my name on a hospital and I better get it up there.” That certainly sounds like the kind of celebrity in philanthropy that people find offensive. But Cynammon finishes his point with a no-nonsense reality check. “The bottom line is that money is going to worthwhile causes and is inevitably helping people. And if that means a game amongst rich people, so what?”

While anonymity is often a way of avoiding attention – either for practical or principled reasons, Jay Hennick presented no-name giving as a form of protest. He was forced to reconcile what he saw as the disconcerting fundraising behavior of an organization with his affinity for the cause and many of its board members. Characteristically he forged the path less traveled. “I have given a gift because one of the organization’s board members is one of our corporate board members and I love him. And there’s a big plaque that says Anonymous there. My wife thinks I’m crazy, but I say that I don’t want [them] to know the money is from me. Because somebody has to protest the way that they deal with their donors.”

Not surprisingly, our conversations with philanthropists provided a more nuanced understanding of the many facets of recognition. Their perspectives belie my colleague’s presumption of complete self-involvement but also deny the existence of totally altruistic humility.

There is no question that the issues surrounding gift recognition necessitate finding the balance between the needs of the donor and those of the organization. Organizations that get to know more about the philanthropists who support them and understand more about their personal motivation will have a better chance of overcoming the hurdle of humility.


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Should philanthropy be risky business?

risky-businessMany of the world’s most prolific philanthropists made their money by taking risks. But do they have the same appetite for risk when it comes to their philanthropic endeavours?

Certainly, many of the projects funded by the philanthropists we interviewed were groundbreaking and inherently risky. The joint JD/MBA programs that Jay Hennick wanted to create at both the Universities of Ottawa and Toronto were one-of-a- kind in Canada. Through his insistence on collaboration, Carlo Fidani frequently brings together individuals and institutions that have no prior experience working together, creating situations in which results are far from guaranteed. In his advocacy work on behalf of the charitable sector, Donald Johnson has staked his personal reputation on many initiatives with no promise of success.

Many of those we interviewed spoke directly about risk. In analyzing the risk versus the results of the medical research projects he funds, Mark Krembil told us, “…. but I am looking at getting results. So if I spend $100,000, I understand the risk. It’s like an investment. It may be worth nothing …. And if I’m lucky, more than skilled perhaps, I’ll hit a home run and that’s kind of what we’re after at the end of the day.” In describing his support for a new genre of educational institution, Gil Palter said, “So we are one of the handful of founders, people who effectively put up venture capital, the risk capital to open the doors …”

That’s a great segue to a very thought provoking item that recently appeared in the Stanford Social Innovation Review. The article, titled, Philanthropy: The New Risk Capital?, links the need for early stage research capital with the philanthropist’s “growing demand for more impact from their charitable dollars.” Author Christian Braemer draws this conclusion. “Providing donors with open access to research funding, increased giving efficiency, and facilitating greater engagement through a modern marketplace will boost innovation funding and increase overall giving, if for no other reason than by creating an experience that simultaneously appeals to both the heartstrings and fiscal sensibilities.”

What’s really intriguing is that this new approach to philanthropy “… allows savvy entrepreneurs-turned-philanthropists to incorporate the strategies, wise investments, and risk-taking that anchored their own successes in business, and at the same time solve major problems in the innovation life cycle.”

We’re not sure that all of the top Canadian philanthropists we interviewed are ready for this new giving paradigm. For many, however, the ability to use the risk-taking profile by which they earned their wealth as a means of maximizing its philanthropic impact will prove very attractive. For them, philanthropy as risky business may, in fact, be good business.

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Is philanthropy really altruistic?

hand_heartThat may seem like a ridiculous question. If someone donates money to help other people or causes, clearly he or she is being altruistic. But hold on a minute. What happens if you enjoy or take pride in the support you provide?

In our interviews, more than one of Canada’s top givers questioned whether philanthropy was truly altruistic. Honey Sherman made the point succinctly. “If you feel satisfied about your help with [causes] then you are no longer being totally altruistic.” Or as Aditya Jha put it, “Philanthropy is giving to yourself.”

For those who are uncomfortable with the tension between philanthropy and altruism, Honey provided reassurance when she told us, “It’s okay by the way to do a selfless thing for selfish reasons.”

Seth Godin picks up the point in a recent blog post appropriately titled Narcissistic Altruism. He rightly contends that, “Everyone who does good things does them because it makes them feel good, because the effort and the donation is worth more than it costs.”

It’s interesting that so many of those who give the most in Canada told us about the many ways in which they have benefitted from their philanthropy. Maybe Honey Sherman is right when she says, “there’s no such thing as true altruism.”

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