Philanthropy is growing worldwide, according to the 2015 BNP Paribas Individual Philanthropy Index, increasing by 5 points on average over the last year. On 55.5%, with a strong increase in current and projected giving, Europe is now almost level with the USA on 55.7%. Asia scores 49.5% while the Middle East scores 30.3%.
The Index is based on a survey of some 400 high net worth individuals, divided equally among the four regions and with at least $5 million in investable assets. It was conducted by Forbes Insights from October to December last year.
Out of a maximum score of 100, 30% is for current giving, 20% for projected giving and 25% each for promotion and innovation. To get the highest giving score, a philanthropist would have to currently donate at least 25% of his or her annual income to charity and plan to leave at least 50% of his or her fortune to charitable causes.
Health is the most popular cause in all four regions, with environment rather surprisingly coming in second everywhere but the Middle East, where education comes second followed by religion in third place. When it comes to motivations for giving, sense of duty and desire to give back to society come top overall, but religious faith is the strongest motivation for giving in the Middle East. The accompanying emphasis on anonymity may well partly account for the lower score in the Middle East.
While ‘impact/mission investing’ is seen as the most promising trend by most philanthropists (52%) worldwide, with 51% mentioning ‘collaborative philanthropy’, I found the top trends in each region more interesting. In Europe 64% felt sharing of data and best practices was the most promising, while impact investing came top at 60% in the US (and just one percentage point behind in Europe). In Asia 59% mentioned collaborative philanthropy, while in the Middle East 61% favoured addressing the root causes of problems – suggesting more patient philanthropists, prepared to wait longer for results.
Overall, choosing among the largest number of causes was seen as the most difficult area for philanthropists to navigate, though finding suitable resources to learn about philanthropy was judged the biggest problem in Asia.
What is driving the closing of the gap between Europe and the US – almost seven percentage points in a year – asked one audience member at the breakfast meeting on 26 February at BNP Paribas’s London headquarters, where the new index was presented. The answer given was professionalization. While 67% overall believe that advisers are necessary to most effectively navigate the giving sector, in Europe the figure is 78%. By contrast, fewer people see family as ‘extremely helpful’ in Europe than in other regions except for Asia – despite the prevalence of old wealth and the importance of family legacy in Europe.