Giving circles are putting a new twist on an old idea.
They’re based on community giving traditions dating back centuries — groups of individuals who pool their own money or the money they raise and then together select community projects and nonprofits to fund.
Individuals are the primary source of charitable giving in Minnesota. In Giving in Minnesota, 2013 Edition, the Minnesota Council on Foundations reports that $3.8 billion or 70 percent of the state’s charitable contributions in 2011 came from individuals (mcf.org/research).
Giving circles encourage collective giving by community members to local causes and can create and promote a culture of philanthropy in any sector. Giving circles also increase diversity in philanthropy by introducing women, people of color, LGBT givers and other “nontraditional” philanthropists to charitable giving with a bit of structure and strategy.
Make no mistake — members of communities of color are generous. In 2012, W.K. Kellogg Foundation released the “Cultures of Giving” report, which found 63 percent of Latino households make charitable donations, and African Americans give away 25 percent more of their income per year than whites.
Asian-Americans /Pacific Islanders in Philanthropy (AAPIP) is a leader in creating and supporting giving circles. Since 2005, more than 1,200 donors nationally have formed 23 affiliated giving circles and pooled their money to award $1.3 million to 210 nonprofits (aapip.org/what-we-do/national-giving-circle-campaign).
AAPIP provides technical assistance, training and leadership to giving circles in order to leverage community resources and grow grass roots philanthropy. Currently, as part of a five-year campaign, AAPIP aims to grow a national movement of 50 circles and is actively raising matching funds to leverage giving circle contributions.
“We’ve been actively promoting giving circles since 2004,” explains Noelle Ito, director, community philanthropy, AAPIP. “Giving circles are a form of philanthropy that has really resonated with our communities, especially once people learn that nationally less than 1 percent of foundation funding supports AAPI communities.”
One of AAPIP’s newer giving circles is Minnesota-based. Building More Philanthropy with Purpose (BMPP) was founded by several multigenerational Asian-American immigrant and refugee families to support innovative social change work that creates conditions for whole communities to thrive in a democracy. Members believe all adults serve as examples for children and that families grow together when they learn, share and give together.
Kaohly Her, a founding member of BMPP, says there are 10 families involved. “As Hmong people, we already give a lot. A few of us got together and decided we wanted to be more conscious about who we give to and formalize our giving,” she says. “It was also important for me to involve my husband and my daughters.”
In the BMPP circle, each family has one vote in decisions. Funds are managed by the Headwaters Foundation for Justice.
The membership and structure of a giving circle can take many forms and is determined by the values and goals of its members and by the size of the group. Small groups might simply select an organization to support and then have each member write an individual check.
Larger circles of up to several hundred participants may house their money at a local community foundation or nonprofit, which acts as a fiscal agent and can provide staff support. Circles may support organizations recommended by members, or they may invite a wide group of nonprofits to apply for funds. Sometimes members also donate their time and expertise to organizations they fund. Each circle sets its own guidelines; there is no one size fits all.
As with membership in other social circles, women seem to outnumber men in giving circles. For example, GIVING WoMN — a circle founded in 2005 as Women of Courage and now more than 100 strong — educates women about philanthropy and uses collective giving to address pressing community needs in education, health and human services. To join, women make a two-year commitment to give $1,100 per year. The group awards grants annually to organizations nominated by members (givingwomn.org).
Whatever your cause, consider pooling your contributions with friends and neighbors to make a bigger impact. Check out the Giving Circles Knowledge Center at bit.ly/1crdQ6v for online resources that can help you get a circle up and rolling.