The new philanthropy

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All the major religions urge kindness and generosity, and all cultures seem to like stories that celebrate these qualities; for example, the Good Samaritan, Simpson and his donkey and the almost universal obligation to be hospitable to visitors. Sometimes we assess the virtue of a society by the way it cares for its poor, its disabled and its vulnerable. By this measure India probably rates quite highly and the United States rather low, with Australia somewhere in the middle.

Some people see giving as a moral imperative. Philosopher Peter Singer sums it up with characteristic bluntness: ‘We need to challenge the idea that you can live a morally decent life just by looking after your own family and not actually causing harm to others. We need to develop a sense that if we have an abundance, we are actually doing wrong if we don’t share it.’

These thoughts are partly provoked by the indignant reactions to Kerry Packer’s recent publicly funded send-off. It is said that Packer avoided paying tax, an impression that probably arose from his famous 1991 comment when he appeared before a parliamentary committee: ‘I pay what [tax] I’m required to pay; not a penny more, not a penny less. If anybody in this country doesn’t minimise their tax, they want their head read.’

Actually, this seems pretty reasonable. I don’t pay more tax than I have to either. I don’t think I know anyone who does.

Anyway, when Kerry went off to confirm his assertion that there is nothing beyond the final curtain, many of his eulogisers spoke of his philanthropy. Writing in The Monthly (February 2006) Bridget Griffen-Foley asserted that ‘no Australian has left behind such a distinctive gift as “the Packer whacker”—the defibrillator with which he helped equip the New South Wales ambulance fleet’. Putting aside the matter of whether the Myer Music Bowl, the Felton Bequest or the Murdoch Institute might better deserve this distinction, was all this praise warranted?

Well, it seems that he was generous to his employees and was sometimes spontaneously kind. According to Phillip Adams, he was once on the point of creating the El Gordo of Australian philanthropic foundations, until the Costigan Commission’s ‘Goanna’ allegations caused him to change his mind.

Perhaps James Packer will presently announce the establishment of the Packer Foundation, but in the meantime the evidence suggests that Kerry was somewhat less generous than, say, a pensioner who gives away a dollar a week. But this is no surprise. Rich Australians are generally rather mean with their money, especially compared with their counterparts elsewhere. Kerry Packer stands out only because he was the richest.

In 2004 Forbes magazine calculated that the 20 richest people in the US had, over time, given away about 15 per cent of their total wealth. If Australia’s wealthiest 20 individuals and families (as listed in the Business Review Weekly Rich List for 2005) had given the same proportion of their wealth to philanthropic foundations, a total of $6.1 billion would have been added to the estimated $10 billion which (according to Philanthropy Australia) is held by Australian foundations.

This is not to say that all wealthy Australians are ungenerous. Richard Pratt, for example, distributes about $12 million a year through his family foundation, and in December 2005 Greg Poche gave $32 million to Sydney’s Mater Hospital. However, these admirable models do not seem to have inspired many of our current millionaires. The top 20 Australian foundations include just a handful of living donors.

The really odd thing about this is that people who do give almost always find that the experience is, on all levels, a deeply satisfying one. It leads to intellectual adventures, a stronger sense of self-worth, happier families and more motivated employees.

It certainly doesn’t impoverish the donor. Daniel Petre, a wealthy and generous Australian, has remarked that a person who gives away ten per cent of a $100 million fortune will not experience a noticeable decline in his or her lifestyle.

Some people believe that philanthropy holds greater appeal for people who are moving towards the end of their lives and want to secure some credit points while there’s still time. Perhaps they have the opportunity, the maturity and the inclination to reflect on life’s bigger questions once the powerful preoccupations of youth (building a career, buying a house, sex) have receded.

A recent issue of The Economist carried an excellent series of articles that described the great change that is now taking place in philanthropy. As people have become more financially literate, they are less content to donate money to organisations that will distribute it. Increasingly they want to see a direct connection between their giving and some social outcome. They want to feel that they have given their time, their knowledge and their wisdom, as well as their money.

They are discovering that the more they invest in philanthropy, the more they and their families can get in return. They want writing a cheque to be part of the process, not just the outcome.

Modern philanthropists are not donors, they are social investors.

Denis Tracey works at the Asia-Pacific Centre for Philanthropy and Social Investment at Swinburne University



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Existing comments

I believe in philanthropy but I have no time for living off the earnings of philanthropy or from compensating for personal limitations by creating a feeling of moral superiority from public involvement in philanthropy. Doing good needs no publicity and no public endorsement. And building a career as a do-gooder is a psychological con and a dead end.

Unconvinced | 06 July 2009  

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