One of the most surprising aspects of last week's announcement that a group of billionaires is donating part of their fortunes to charity is the amount they are pledging: The group, led by Warren Buffett and Bill and Melinda Gates, say they'll donate half - or more - of their wealth.
The billionaires on the Giving Pledge list, including Star Wars creator George Lucas, New York Mayor Michael Bloomberg and CNN founder Ted Turner, have the kind of wealth most people can only imagine. Some, such as hotel magnate Barron Hilton, have said they hope their actions will inspire others to do their part to give back.
Are Canadians up to the challenge?
Experts say the answer is complicated. Although Canadians are typically generous and often give at least something to a charitable organization, the recent economic downturn has caused some to turn away from making donations.
"I think people are concerned about the economy," said Brad Offman, vice-president of strategic philanthropy at Mackenzie Financial Corp., an investment management firm in Toronto. "They're concerned about the financial markets and as a result many have chosen to not eliminate their giving entirely but to postpone it until things are a little more stable."
Mr. Buffett said organizers of the Giving Pledge expect to eventually bring $600-billion (U.S.) into philanthropy.
Compare that to $10-billion (Canadian), the total amount Canadians donated to charity in 2007. Nearly 23 million Canadians, or roughly 84 per cent of the population aged 15 and older, gave an average of $437 that year, up from $400 in 2004. Of those, the top 25 per cent provided 82 per cent of all donations.
The figures may not compare to the massive wealth of the Giving Pledge billionaires. But they demonstrate that most Canadians are committed to giving back to their communities, experts say. They also highlight new trends that are changing the face of philanthropy in Canada.
"We've had a lot of very generous giving over the last five or so years," said Marvi Ricker, vice-president of philanthropic services at BMO Harris Private Banking. "Research indicates people are not going to stop giving."
Although reasons for giving vary, most experts say the primary driving force is a desire to give back to the community. Others are drawn by the fact that charitable donations can offer significant tax benefits, while some are motivated by ego, according to experts.
The 2007 figures are the most recent available, and don't account for a donation drop that likely occurred as a result of the economic downturn. However, experts in the philanthropy field say they reflect the fact that people with the highest amounts of disposable income are driving philanthropy.
But those who give are no longer content to simply give funds to their favourite charity. "It's not like cheque-book philanthropy," said Nicola Elkins, CEO of Benefaction Canada, a charitable foundation that focuses on helping wealthy Canadians with philanthropy. "The desire [is]really to maximize the value of their gift and making sure that those gifts are achieving maximum impact."
Increasingly, donors have specific ideas they will communicate to the charity about how they want their donation used. They want to be actively involved in the decision-making process and will conduct painstaking research to ensure their money is in good hands, said Monica Patten, president and CEO of Community Foundations of Canada, which represents charitable groups across the country.
"It's not just about the work of the charity, it's about the charity itself," she said.
There is no common formula Canadians use when making a donation, experts say. Rather, it's a personal decision that is often based on a series of factors, such as whether the donor has children or wants the money to be put to work now or in the future.
People who donate a few dollars to charities here and there shouldn't expect to have a big say in how their money is spent, Ms. Patten said. Still, they should research the charitable organizations they're considering to make sure they seem credible and will use donations responsibly, she said.
But Canadians shouldn't pat themselves on the back just yet, argues Mr. Offman at Mackenzie Financial. Even though many people donate at least something to charity, the amounts are often small and often fall short of the potential many have to give, he said.
"I think we've got a long way to go when it comes to philanthropy in Canada," Mr. Offman said. "I think there's a lot of room for the average Canadian to consider giving at a higher level."Report Typo/Error