Giving is giving is giving. Yet, traditionally the term ‘philanthropy’ has been the domain of the wealthy. It doesn’t have to be that way, though. You no longer need to be wealthy and prominent like the Bill Gates‘ of the world to set up foundations or make strategic decisions about granting funds.

Moving from giving to philanthropy

First, it’s important to define what ‘philanthropy’ is and distinguish it from ‘giving’. “A lot of people don’t understand the difference,” says Shawn Poland, executive director of the Cambrian Foundation at Cambrian College in Sudbury, Ontario. “I look at philanthropy as an exchange of values that results in a donation. It’s an investment in a cause, giving to a solution. It’s a longer term commitment.”

Donors to post-secondary education in Ontario have the opportunity to make a big difference with any sized donation thanks to a matching program from the provincial government. There have been two incarnations of the Ontario Student Opportunity Trust Fund with an expected third round to be announced soon. “Where else can you instantly double your investment?” asks Poland. “The matching program makes a difference to both the wealthy and average philanthropist. It’s a strong carrot for donors to consider a philanthropic pursuit to a college or university. I think this helps the average philanthropist to step forward.”

Boosting the level of personal engagement

There’s a mental leap that moves someone from the act of giving to the act of making a grant or acting philanthropically, explains Hilary Pearson, president of Philanthropic Foundations of Canada. “It’s what’s involved in the sort of giving you are doing. The act of giving is giving to [a local appeal], it’s putting money in the collection plate. It’s giving, but it doesn’t require personal engagement or a lot of thought.” Philanthropy is about transitioning from a person who gives to a person who really thinks about how they can make a difference with their giving.

One example that interests Pearson is the ‘giving circle’. In its simplest form, a giving circle is a group of people who get together and each commit to give a certain amount over a period of time (for instance, $1,000). They agree to pool the money and together choose an organization or project to which they will grant the money. The circle then follows that organization/project over time and engages with it. That may involve a monthly meeting to talk about what’s happening with the organization, bringing in a speaker, reviewing their newsletter, or going for a site visit. In the United States, giving circles are quickly growing in popularity and Pearson hears about how groups that traditionally viewed themselves as low income and, therefore, the ones who receive the money, are now actively involved in giving out funds.

Empowering youth

In the same way that giving circles are empowering individuals to make strategic philanthropic decisions, an exciting new program aims to do the same for youth. The three founders of MAC Cosmetics – Julie Toskan-Casale, Victor Casale, and Frank Toskan – launched the Toskan Foundation in 2001. Explains executive director Diane Elliot, “Julie didn’t want to just sit in an office and write cheques. She knew there was a vast array of charities out there that she didn’t know about and she wanted to make a bigger change. So she thought of this Youth and Philanthropy Initiative (YPI) to get into the high schools and open the eyes and minds of the students about issues going on in their community.” They piloted the program in one private school in Toronto in 2002. Now for 2005/06, there are almost 80 schools signed up, including several in British Columbia.

YPI consists of 15 lessons – typically fitting into the Grade 10 curriculum – that explore topics such as how to analyze a financial statement, the ethical and accounting practices of charities, communication skills, interviewing skills, personal values, decision-making, etc. Three-quarters of the way through the lessons, students form groups and each group picks a local charity. They research the charity, do a site visit, interview staff and clients, and do an initial presentation to their classmates. One finalist is chosen from each classroom and goes on to a school-wide competition in front of a judging panel. Based on the presentations, the panel picks one group and the Toskan Foundation gives a $5,000 cheque for the winning students to present to their charity. “The program gets youth to think strategically,” sums up Elliot, “so when they are adults and they have the funds to donate, they can remember what they’ve learned.”

Whether you have millions of dollars or $10,000 to donate

Jo-Anne Ryan, executive director of the Private Giving Foundation, deals with both wealthy and average-incomed philanthropists. The Private Giving Foundation – an independent public charity – is a unique initiative of TD Bank. A lot of TD clients have significant wealth from stock they’ve owned for years and years. They don’t want to sell it and pay all the capital gains tax. But Ryan also sees a whole class of people who have stock from the company they work for or that they have held for a long time. They may not necessarily sit on a lot of cash, but they are asset-rich and also looking for tax efficient ways to give to charity. Initiatives like the Private Giving Foundation allow individuals to donate the stock and qualify for preferred capital gain treatment.

“Philanthropy used to be something for the super wealthy,” remarks Ryan. “Setting up foundations and strategic approaches to giving was something very wealthy families did, like the Iveys and Bronfmans. The trend is that people want to be more strategic about their giving, even if they are not a foundation of $20 or $30 million. Both are looking for an easy and efficient way to make a philanthropic difference.” Not only do people want to be more strategic in their giving, they want simplicity in the administration, along with flexibility and control to direct which charities receive their funds on an annual basis.

Generally, private foundations start with a minimum $1-million investment and can sometimes be tedious, involve a lot of upfront legal costs, and be a big administrative burden, says Ryan. Instead, the Private Giving Foundation requires a minimum $10,000 investment (which is invested into a donor-advised account), and because donors are investing in an existing foundation there is none of the legal and administrative work for the donor. A $10,000 investment means about $400-500 per year to distribute to a charity of choice, and Ryan anticipates that donors will add to their initial investment, which increases the annual grant amount to charities.

In the end, the size of the gift is not the issue. Encouraging Canadians to think strategically about their giving is the point. As Poland remarks, “What might be meaningful to one person is entirely different to someone else. Our objective as agents of philanthropy is to help each individual donor to determine what is meaningful to them. What will engage them in the life of the organization? What will make them a stakeholder in the organization’s success and mission? The terms ‘average’ and ‘wealthy’ aren’t necessarily relevant. You have to make your cause relevant.”

Louise Chatterton Luchuk is a freelance writer and consultant who combines her love of writing with experience at the local, provincial and national levels of volunteer-involving organizations. For more information, visit www.luchuk.com.