Could giving circles rebuild philanthropy from the bottom up?

Grassroots giving could provide a healthier way of funding social change, but it also has its limitations.

Angela Eikenberry
19 January 2016

Credit: Coburn. All rights reserved.

“We talk about them [the charities] quite often you know. Say for example it’s about a project to help children being abused. So …one member…a teacher will say yeah you know I have problems with that with my kids in class, they bring problems in from home….or somebody else will talk about a third world health initiative and somebody will say well I know a bit about that….you know we think about clean water or good eyesight or famine or…so we give some thought to all of these issues.”

This is Jennifer, speaking about the workings of a small ‘giving circle’ in the United Kingdom. Giving circles are voluntary groups that enable individuals to pool their money (and sometimes their time as volunteers) to support organizations of mutual interest. They also provide opportunities for education and engagement among participants about philanthropy and social change, connecting them to charities, their communities, and each other.

While giving circles come in many shapes and sizes, their key attribute is that members decide on which organizations they want to support collectively, engaging each other in discussions and decision-making and taking direct responsibility for grant making and running the group. In this sense, they form a more democratic, grassroots-based, bottom-up alternative to conventional top-down philanthropy such as a foundation or an NGO.

At a time when conventional philanthropy is being criticized for being distant, overly hierarchical and out of touch with grassroots realities, giving circles might provide some of the building blocks of a healthier and more effective system of funding for social change. But is this really true? That’s one of the questions I’ve been researching in the UK and the USA for the past ten years.

In theory, giving circles represent a promising avenue for grassroots philanthropy in environments where public provision of social welfare is declining, services are being marketized, and societies are increasingly individualized overall. They emphasize collaboration across groups and sectors, close relationships between funders and partners, and hands-on, unconventional modes of giving and volunteering. Giving circles accommodate people who want to do something more active than simply writing a check, and who want more of a say in their giving in the context of busy and hectic lives.

In the US for example, Washington Womenade raises money by holding potluck dinners at which people donate about $35 to a fund that provides financial assistance to individuals who need help in paying for their prescriptions, utility bills, rent, food and other priorities. Another network of circles called Dining for Women was inspired by Washington Womenade and now has more than 400 chapters across the country in which women eat together monthly and pool the funds they would have spent dining out to support programs that help women around the world. They raised more than $4.1 million between 2003 and 2014.

BeyondMe is a network of circles made up of young professionals working at major corporations in the UK. Each one selects a charity or social enterprise to support for one year, on average donating £4,000 and 150 volunteer hours to the organization of their choice, whose remit has included jobless young offenders, homeless youth, and women who have experienced abuse and sexual exploitation. Since its inception in 2011, BeyondMe has generated over £200,000 and 12,000 hours of volunteer time.

Globally, one of the largest international networks of giving circles is The Funding Network, which has affiliates across Europe and North America that have raised over £8 million since 2002. The Network specializes in hosting live crowd funding events that bring donors together to support small charities that address poverty and injustice. A selection committee chooses three to five organizations or projects for each event, with members pledging donations during a fast-paced session almost like an auction.

What are the broader implications of these new forms of engagement for philanthropy and social change?

The first issue is diversity. As these three examples show (out of a much larger universe), giving circles may share certain operational characteristics but not a common social or political background in their membership or agenda in their giving. Instead, they attract people from diverse professional backgrounds; include experienced givers as well as those who are new to philanthropy; and come from a wide range of income levels, racial and ethnic identities—although in my sample and seemingly in the larger population of giving circle members, women (in the US) and young professionals (in the UK) tend to predominate.

Due in part to this diversity, giving circle members are significantly more likely to support women and ethnic and minority groups than other donors. Giving circles also provide opportunities for democratic participation through agenda setting, decision-making and face-to-face debates and deliberation, and they build the capacities of their members through education about issues, organizations, and the skills of grant-making.

Given these democratizing effects, one might expect that participation in giving circles will lead to greater civic and political action among their members, thereby feeding indirectly into processes of social change including efforts to change government policy. However, the evidence on this point is not conclusive.

My surveys show that giving circles encourage their members to give more (and maybe to give more strategically by considering the effectiveness of different organizations), but not that they necessarily promote greater participation in politics. In the UK groups I studied, members gave significantly more per month than similar donors who were not in a giving circle, and more than three-quarters said that their giving had increased. In addition, about half of the members surveyed in both the US and the UK said that they had increased their volunteering as a result of participation in a giving circle, especially over time.

About two-thirds of the members I spoke to in the US also said that they had increased their efforts to address problems in their communities; about half said the same thing in the UK. However, only one in three members in the US said that participation in a giving circle had led them to expand their efforts to change government policy; in the UK the figure was less than one in six. And while participation in activities such as voting and signing petitions was higher for giving circle members than non-members in the US, there was little difference between the two groups in the UK.

This may be because members were already politically active before joining a giving circle, but overall the research suggests that there is no or little ‘political talk’ in meetings. As Nigel, a member of a young professionals’ giving circle in the UK told me:

“A debate might come up during an initial discussion session when you’re trying to think about different interests and…what…part of the NGO sector needs funding. Maybe that might lead to politics. Otherwise, I don’t think so…it’s not really…into political discussion basically.”

These findings raise questions about the degree to which groups like giving circles can contribute to larger social change or the transformation of philanthropy. They might help to democratize giving and serve as small-scale ‘schools for democracy,’ but they seem unlikely to challenge the problems and processes that lead to the need for philanthropy in the first place.

More radical models of giving such as The Edge Fund or the Red Umbrella Fund aim to acknowledge and address issues of power and privilege explicitly, thereby increasing the contribution that funding can make to social and political change. However, these models constitute only a small minority in philanthropy more broadly.

The challenge is to move beyond encouraging more giving (even if it’s channeled to marginalized groups and decided by democratic processes), to enhancing the ability and willingness of donors to engage in deeper efforts to change themselves and the structures that perpetuate poverty, inequality, violence and discrimination.  

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