Giving through foundations: an opportunity for impact

By 3 September 2009

Warren Buffett’s gift to the Gates Foundation raised the profile of giving to established foundations as an option for individual donors. Buffett’s gift is not an isolated case – in the UK, Robbie Williams, formerly of pop group, Take That, asked Comic Relief, an experienced grant-maker, to distribute a fund on his behalf to help disadvantaged people in the area where he grew up.

NPC’s recent report, Achieving More Together, explores the potential for such collaborations.

At NPC, it has struck us that, although the performance of foundations varies, many have built the knowledge, networks and infrastructure to make them experts. For individual donors that care about impact, making donations through them is an attractive option. Community foundations already work with donors on this basis, as experts on the communities they serve.

From a foundation’s perspective, working with individual donors enables them to direct more funding to the causes and organisations they support, and to get a greater return on the infrastructure and knowledge which they have invested in developing. But there are also potential dangers. Among them, foundations should ensure that working with individual donors does not distract them or distort their strategy.

However, most individual donors are unaware that giving through an established foundation is an option. There is very little available information for them to find foundations, as Jacob Harold of the Hewlett Foundation notes in his article in this September’s edition of Alliance Magazine.

NPC has brokered some relationships between individuals and foundations. One couple we work with built a relationship with the Cripplegate Foundation, which has been helping communities in a deprived part of London since 1500 (proving that it’s not just celebrities and the ultra-wealthy who can do this).

Collaboration between foundation and individual donors can yield great results. The Environmental Funders Network, which welcomes both foundations and individual donors, is a potential model for how relationships can be built between around a shared interest. We should be open to such options to improve philanthropy.