Across many industries, for countless companies and for nearly every consumer, the outlook for 2021 is in stark contrast to our vision entering 2020. The new year presents challenges resulting from the pandemic, though it also offers opportunity. In the world of philanthropy, we’re on the brink of a technological revolution and the year 2021 is poised to be pivotal.
Just as COVID-19 has accelerated digital transformations in how we conduct day-to-day business, the pandemic has likewise sped up breakthroughs in philanthropic financial technology – as we call it, philantech. As we’ve watched charitable giving become increasingly core to today’s business and consumer culture, we expect several trends will be central to corporate giving in 2021.
There’s plenty of room for discussion and even debate as to whether other trends might impact the philantech space as we enter 2021. Will companies see significant growth in the digital giving sector? As companies recover from the pandemic, how will philanthropy be impacted? Will digital transformations help companies and charities meet or exceed expectations in the coming year? Here is our view:
Plan to Give
After an unpredictable 2020, we expect that giving will become more proactive in 2021, with year-round planned giving becoming more prevalent relative to more common reactionary giving.
When philanthropy is made easier, more individuals can contribute and, collectively, our impact on important causes is magnified. It will be essential that tools are put in place to make it easier to give consistently, making it part of a company’s core operations. These tools will also become tied into a company’s commitment to solve longer range and systemic “cause areas” through designated programs and calls to action. The idea is simple: instead of reactively donating to a natural disaster, business leaders should work to solve underlying issues through longer term commitments.
For instance, in August, Massachusetts’ largest group of tech companies, MassTLC, called on its members to double the percentage of Black and Latinx employees in the state by the end of the decade, as they believed the Mass tech sector does not adequately reflect the diverse population of the state. The initiative, labeled the “2030 Challenge,” has been welcomed by more than 60 companies that have accepted to date. Why not take this proactive approach to giving toward an important cause?
Giving and Technology Embrace
The COVID pandemic accelerated the way companies and individuals interact with technology – and we expect to see this technological embrace reach the world of philanthropy as well. With a sharp focus on how to achieve more impact in their local and global communities, companies can create that differentiation and infuse purpose by utilizing a best-in-class philanthropic platform that increases access for companies and their employees to engage in more meaningful causes on their terms. Such a platform can easily integrate into other features and offerings in their corporate structure, creating meaningful experiences that give back to the community in a time of need.
According to a Forbes.com article, early on in the pandemic total internet hits surged by between 50% and 70%, according to preliminary statistics. The philanthropy world was no different in adapting to the digital age, utilizing online tools to engage, live stream, and fundraise over social media. As an example, we recently read about Upaya Social Ventures, which raised 142% of their fundraising goal through a virtual gala, showcasing what is possible when companies think outside of the box and embrace digital methods. We predict that companies will continue to expand their use of technology to support their charitable and fundraising efforts, enabling more seamless and inspiring giving, even as the pandemic subsides.
What You See is What You Give
With increased access to information-in the digital age, it should come as no surprise that donors will expect full transparency and demand greater accountability. Companies will need to adapt by utilizing centralized, one-stop-shop technology to access, execute and analyze their giving programs, improving their ability to scale their impact while the platform handles all of the back-end functionality.
Transparency in fees and costs, delivery of funds, and charities supported will become core requirements.
Employees and customers will also demand transparency when it comes to corporate giving. Increasingly, employees want to be associated with companies that are community conscious, proactive and transparent with charitable endeavors and that draw their employees in with engaging philanthropic experiences. This subsequently helps companies build a strong culture in which their employees serve as brand ambassadors.
Power Profits by Empowering the Employee
In 2021, we expect to see charitable giving expand outside of personal donations, with wider adoption of charitable giving for small-to-midsize businesses as more SMB’s embrace workplace giving and view doing so as part of the company’s overall business strategy.
This growth is parallel to the trends we are seeing with micro donations, number of donors and DAFs. Additionally, we envision matching tools as a critical way to enhance this form of giving in the coming year. A 2019 study by Aflac found that more Americans believed it was more important for a company to “make the world a better place” than “make money for its shareholders.” This increasing pressure on American corporations to make meaningful contributions to the greater social good is here to stay.
The pandemic accelerated the shifts that were slowly emerging in philanthropy. The trends that we envision in the coming year will continue to push forward the seismic shift. We look forward to being at the forefront in helping to modernize giving. What do you think? We’d love to hear if you agree, disagree or see other trends impacting the philantech space in the year ahead.