U.S. Foundations Are Giving More Abroad
Recently, the Council on Foundations and the Foundation Center released its five-year study, The State of Global Giving by U.S. Foundations: 2011-2015, which showed that grant-making by U.S. foundations to charitable organizations outside the United States reached an all-time high in 2015 with $9.3 billion in grants compared with $2.1 billion in 2002 (an increase of over 300%). International giving represented over 27% of all grants made by U.S. foundations, and the average grant size during this period tripled from just over $200,000 to over $604,000.
Top Foundation Givers
Over half of all international giving by foundations during the five-year period of 2011-2015 came from the Bill & Melinda Gates Foundation ($17.9 billion of $$35.4 billion), and Sub-Saharan Africa benefited from the largest share of global grant-making by U.S. foundations, accounting for 25% of the total grant dollars during this five-year period.
Besides the Bill & Melinda Gates Foundation, other major U.S. foundations making international grants were the Susan Thompson Buffett Foundation, the Ford Foundation, the Foundation to Promote Open Society, the William and Flora Hewlett Foundation, the Walton Family Foundation, the Rockefeller Foundation, the David and Lucile Packard Foundation, the Open Society Institute, the Silicon Valley Community Foundation, Bloomberg Philanthropies and the Gordon and Betty Moore Foundation.
Top Corporate Foundations Givers
While the report covered all U.S. foundations giving abroad, including independent foundations, community foundations, corporate foundations and operating foundations, it did not include gifts made by companies directly (i.e., not through a corporate foundation), but the top ten corporate foundations making international gifts were the Coca-Cola Foundation, the Citi Foundation, the JPMorganChase Foundation, the Caterpillar Foundation, the GE Foundation, the ExxonMobil Foundation, the UPS Foundation, the Wall-Mart Foundation, the Johnson & Johnson Family of Companies Contribution Fund and the Goldman Sachs Foundation.
Causes and Populations Impacted
Equally interesting were the causes funded by these foundations. Health-related causes took in over 52% of all dollars given with Economic Development (12.5%), the Environment (10.9%), Agriculture & Food Security (8.3%) and Education (7.9%) rounding out the top-five. While natural disasters appear to be on the rise, the assistance for international disasters represented a little over just 1% of total giving outside the United States.
Populations impacted included: Children & Youth (29.1%), Women & Girls (13.8%), People with Disabilities (7.1%), People with HIV/AIDS (6.1%) and Migrants & Refugees (1.3%), Indigenous Peoples (1.2%) and LGBTQ People (0.2%).
Despite continuing calls by nonprofit leaders for unrestricted grants from foundations, the majority of grants made by these foundations were project-focused (65.2%) followed by Research & Evaluation (38.7%), Policy, Advocacy & Systems Reform (26.7%), General Support (17.7%) and Capacity Building & Technical Assistance (10.6%). (Because grants can often benefit multiple strategies, these number necessarily add up to more than 100%.)
Likewise, despite the continuing call for grants to be made to local organizations directly, over 88% of grants were channeled through intermediaries (organizations that re-grant money to other organizations) with only 12% going directly to organizations based in the country where programs were implemented.
Implications for Foundation Leaders
For leaders of U.S. foundations who want to make grants abroad, the fundamental question that this data suggests is whether to run with the pack or apart from it. Does a foundation have more impact if it joins with other foundations in the causes, countries and strategies receiving the most support or does it have more impact going it alone and supporting causes and countries that don’t receive as much support?
That decision may have more to do with donor intent or the size of one’s grant-making budget, but in my experience there’s no right or wrong answer as long as the grant money is truly having an impact and making a difference. As a corporate foundation leader, I tend toward wanting to differentiate our funding from other sources, but many of my colleagues believe that banding together is the only way to really get things done.
This study includes valuable information about what foundations are doing and how they are doing it, but not why. That topic remains fodder for follow-up reports and analysis.
Portions of this blog post first appeared on Forbes.com
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CSR Now! Is a weekly blog by Timothy J. McClimon, president of the American Express Foundation, designed to get at what's happening in corporate social responsibility today -- from the point of view of a corporate practitioner.