Giving circles wield greater influence, stronger advocacy

When it comes to charitable giving, most of us assume that corporations and foundations carry the load. However, according to the Giving Institute/Giving USA Foundation, 75% of the $307 billion contributed in 2008 came from individuals and 7% from bequests. Corporations and foundations provided 5% and 13% of charitable contributions, respectively.

Individuals tend to be even more generous when they take part in an increasingly popular phenomenon known as “giving circles.”

A giving circle is a social group in which individual participants pool their donations and decide together where the money should be distributed. A study released in May 2009, “The Impact of Giving Together,” shows that those within a giving circle tend to contribute more than if they were to give on their own. Giving circles exert significant influence in other ways, as well. According to the study:

• Giving circle participants are more strategic about cause selections. Members put more effort into researching organizations and give toward a specified vision for change.
• They have a more long-term perspective and are more likely to make multi-year gifts.
• Members give to a broader array of causes, especially those that support women, ethnic and minority groups, the arts and culture, neighborhood development, advocacy and international aid.
• Giving circle members also express a stronger sense of civic responsibility, channeling their energies into community involvement and changing government policies.
• Participants gain a greater understanding of philanthropy and the issues that nonprofits face in serving their constituencies.
• They believe they have better leverage in affecting change in the community, that giving can have a positive impact on the health of the community, and government should do something to reduce income differences.

If you’re interested in starting your own giving circle, start by researching through the Minnesota Council on Foundations or your own regional resource. Make it your primary goal to help foster a greater level of commitment from members, thereby increasing your ability to influence positive results. Also, think about the size of the group; larger groups tend to focus more on the strategic giving aspects, whereas smaller circles value civic engagement and volunteerism.

– LuAnne Speeter