Foundations drive US philanthropy in tough climate

Americans donated $306.4 bn to charity in 2007, up 1% from last year and exceeding $300 bn for the first time, Giving USA reported in its annual survey of US philanthropy.

This slight increase was driven by foundations, which increased their grants by 7.3% to $38.5 bn. In the uncertain economic climate almost a third of US foundations have stepped up their giving as demand for aid has increased, according to the Council on Foundations (CoF). A survey of its members also reported that 15% of foundations are making grants to help people affected by the subprime-mortgage crisis.

In contrast, corporate giving fell 0.9% to 15.7 bn, largely reflecting the adverse economic conditions.

Individual giving was largely unchanged, declining slightly by 0.1% to $229.0 bn, while legacies grew 4% to $23.2 bn. 

Philanthropy amounts to around 2.2% of US gross domestic product (GDP), and is about half that in the UK.

A number of charities reported strong increases in donations. International charities raised nearly 13% more than in the previous year, while environmental organisations saw a 7.7% increase. Giving to religious groups grew by less than 2%, although religions charities still represent almost a third of all individual giving.

Despite these positive trends, there are concerns that the increase in giving levels will be difficult to maintain in the economic downturn, and charities are beginning to be more creative with their fundraising initiatives.

Examples include encouraging multi-year gifts, and expanding their base of donors by reaching out to philanthropists who are members of ethnic minority groups.  For instance, the Museum of Fine Arts in Houston, Texas raised $4m for an Islamic art collection from wealthy Muslims who live in the area.

Giving to charities, by source of donations