Today, there are more than 4,500 United Ways or affiliated organizations in 47 countries around the world. The very first United Way-type organization was formed in 1887, in Denver, Colorado. The Industrial Revolution had created unprecedented wealth and opportunity as well as unprecedented need. Communities responded by creating more and more charities, but they competed with each other for scarce resources to such an extent that donors became discouraged.
This was what led the citizens of Denver to create a community-wide ‘united’ fundraising campaign for multiple charities. For the first time, charities were able to coordinate fundraising and stretch meagre budgets. The idea of ‘one campaign for all’ was born.
This turned out to be an attractive proposition. Other communities quickly followed Denver’s example and formed united appeals of their own. Fundraising methods varied from community to community, as did the needs addressed and the charities supported, but there were common characteristics. The appeals were always led by local volunteers who kept the community’s collective charitable needs in mind. The appeals were community-wide, and everyone was encouraged to contribute. Funds were pooled and redistributed according to a community-led central process.
The idea expands
Expansion was driven at grassroots level because it was a successful idea, not because of a centralized national or international effort. While people who worked on these appeals started meeting at the national level to exchange ideas during the 1910s, it wasn’t until the 1920s that a formal national organization was established. Even then, it was a voluntary association, not a ‘national headquarters’ in any sense. Over the years, national initiatives would ebb and flow at the organization that was eventually called United Way of America, but the root of the movement continued to be based at community level.
United Way first spread beyond North America with the 1928 founding of the United Community Chests of Southern Africa in Cape Town, South Africa. Influential people from South Africa saw the idea work in America and adapted it to their own culture and needs.
The Second World War also drove international expansion of the movement, as war-ravaged cities looked for ways to help cope with the needs resulting from the conflict. In Japan, for example, hundreds of locally based community chests were created to help rebuild communities and augment top-down efforts from the central government.
Giving through the workplace
People tend to associate United Way primarily with workplace giving, but it was only after the war that United Ways in America began to make alliances with businesses and organized labour in order to have employees give in the workplace via payroll deduction – whereby employees could have a small contribution taken directly out of each paycheque. This boosted revenues significantly, and gave communities certainty about how much they would be able to distribute. It also made philanthropy possible for everyone, not just the wealthy.
Responding to donor demands
In recent years, the United Way ‘one campaign for all’ model has been challenged in the US. Donors today are looking for more control over where their donations go, rather than deferring to centralized decision-making, community-based or otherwise.
In response to these challenges, United Ways are re-focusing on convening communities to create strategies that get results on a few compelling issues. If they wish, donors can choose which issue they want their United Way donation to address rather than having their contribution go to a ‘general’ fund. This strikes a balance between the centralized, strategic approach to solving problems and being merely a pass-through for donations. Despite changes, the idea of a ‘United Way’ to deal with local community issues lives on.
United Way International
As more corporations become multinational, they have increased interests in community success around the world, and many are looking to United Way as a global philanthropic partner that can respond to human needs at the community level. Currently, there are more than 4,500 United Ways or affiliated organizations in 47 countries around the world, and the model has been able to adapt to each country and community’s unique circumstances and culture. Globally, United Way raises and distributes just under US$5 billion a year.
To serve these organizations and administer international grants from global corporations and others, as well as to foster creation of more United Way-type organizations, United Way International (UWI) was founded in 1974. UWI provides international leadership in validating the quality and legitimacy of United Ways everywhere.
The GE Foundation and Philip Morris International have recently provided resources to UWI to create a set of Global Standards that will help to define and codify the work of United Way organizations, laying out some of the values, principles and standards that underpin their work.
United Way in Hungary …
In Hungary, the United Way movement was founded in 1991, as the dissolution of the Soviet Union created openings for Western ideas. An influential Hungarian was introduced to the United Way in the US and decided to take it back to Hungary and adapt it to its culture.
Currently, there are three local, autonomous United Way organizations in Hungary plus a national organization, Eroforras United Way. The local organizations focus on many issues that are typical in developed countries – children and youth programmes, home care for the elderly, etc. But, unlike in North America, much of the work of United Way in Hungary happens at the national level. This is due to the centralized nature of the Hungarian economy, a legacy of the previous system of government, and the relative newness of the NGO sector there. As new systems are built, a great deal of the decision-making occurs in Budapest, so a national-level presence is critical to the ability to have impact in local communities.
Much of United Way’s work in Hungary centres on simply developing and strengthening the capacity of the NGO sector, and the culture surrounding it. Eroforras United Way was instrumental in helping to initiate some of the laws governing non-profits and donations in Hungary. In addition, it has four major strategies: to foster a culture of individual giving and voluntarism; to work with Hungarian and multinational corporations on corporate social responsibility programmes; to help strengthen NGOs of all types by training them in how to operate, raise funds and deliver services; and to build relationships between the different sectors.
… and in China
In China, the United Way movement is still very nascent, but growing rapidly. The China Charity Federation (CCF) became a United Way affiliate in 1998 after studying various philanthropic models around the world and deciding that United Way’s methodology was most appropriate. Since then, UWI has worked with CCF to focus programme strategies and to align fundraising and fund distribution strategies against them. Since becoming part of UWI’s international network, CCF has grown from a single headquarters in Beijing to more than 160 local organizations, and a nationwide total of more than US$200 million raised in 2004 alone.
Like any non-profit (or any other business, for that matter) just starting out, the CCF is still feeling its way, both in its fundraising methods and in the needs it addresses. The 2004 tsunami led to a telethon where more than $2.5 million was raised in a single weekend. They also fund NGOs that are helping with issues such as access to water for drinking and bathing, care for seniors and orphans, and other poverty relief work. CCF was involved in working with corporate partners like General Motors to raise funds during the SARS epidemic in 2003.
CCF also plays a significant role in the development of the NGO sector in China, helping to create the minimum standards, based on UWI’s membership requirements, that are applied to all charities in China. It also fosters relationships between charities throughout China, and builds relationships with other international charities.
What makes United Way unique?
United Way organizations differ somewhat from other community-based philanthropy organizations such as community foundations. Local volunteers govern the organization and are involved in all major decisions, ensuring that it is representative of the community, its needs and wishes. United Ways focus almost exclusively on human needs – health and social services – rather than culture, arts, education or other areas that community foundations also address. In addition, while United Ways do seek support from wealthy individuals, their hallmark is the mass fundraising appeal to which everyone can respond. They’re also more likely to focus their efforts on an agenda determined by community volunteers rather than focusing on the wishes of donors.
Finally, while fundraising and fund distribution are often a United Way’s main lever for community change, it’s not the only one they employ. Because of the very nature of their work, they foster relationships with entities throughout the community – businesses, service providers, community leaders, volunteers, government representatives, academics, the media, and others. Often the ability to convene these entities to address important issues and coordinate responses exceeds the value of the resources raised and distributed.
Matthew Gaston is a freelance writer based in Alexandria, Virginia, USA. He can be contacted at Gaston500@aol.com