The start of another year is a great time to reflect on your giving practice and take stock of emerging trends to inform your own approach.
With many funders and philanthropy experts having recently shared their predictions for 2023, I’ve compiled a list of trends I’m excited to see more of this year.
1. More ‘trust-based philanthropy’
It’s the buzzword that won’t go away, and for good reason. Trust-based philanthropy seeks to build more equitable relationships between funders and non-profits.
In Philanthropy Australia’s Better Philanthropy Telescope – a survey of the national peak body’s members – addressing power imbalances in these relationships is top of the list for ‘ideas that will matter’ in 2023.
In recent years, I’ve seen more givers embrace this approach, distributing more unrestricted multi-year funding with fewer reporting requirements, allowing grant partners to spend more time on their important on ground work.
Trust-based philanthropy is predicted to reach mainstream adoption in 2023 and continue to shift philanthropy’s focus from activities to outcomes. The Johnson Center for Philanthropy also predicts that trust-based relationships will help centre equity in capacity building.
2. More collaboration with communities
Extending the trust-based approach, funders are increasingly recognising the value of engaging communities in decision-making.
It’s another trend high on Philanthropy Australia’s list with respondents highlighting “the need for engaging those impacted by the problems we are trying to solve” and “recognising that having lived experience in philanthropy… is integral for the future.” ‘Creating solutions together’ is also one of five trends on global investment firm UBS’s list for 2023.
3. More collaboration with between funders
The rise of collaborative funding is first on the Johnson Center’s list of 11 Trends in Philanthropy for 2023. In the broadest sense, collaborative funding, or collective giving, refers to people giving together – something that community foundations have long enabled.
While giving together isn’t new, recent growth has been unprecedented. Kiplinger’s list of 2023 predicts there is even more growth to come, owing to collaborative funding’s capacity to remedy disconnection and isolation, especially post COVID-19, and the growth of technology to support collective giving.
4. More giving for First Nations
2023 is set to be a pivotal point in Australia’s history with the Voice Referendum set for later this year, and philanthropy has a key role to play. More support for First Nations communities is one of the key shifts championed by respondents in Philanthropy Australia’s Better Philanthropy Telescope.
As Australia approaches the Referendum, I look forward to working with the sector and being guided by First Nations leaders to support a powerful campaign in favour of the Voice.
5. More giving for the climate
While climate philanthropy represents less than two percent of global philanthropic giving, it is growing at four times the rate of overall giving.
Motivated by recent extreme weather events and rising energy costs, funders are directing more resources towards addressing climate change. Beyond this continued increase in giving directly to climate change mitigation, experts predict we’ll see more funders adding a climate lens across their giving without losing sight of the specific causes they’re passionate about (see Trend 4 in UBS’ list for 2023).
6. More legacy giving
Legacy planning is on the rise as the world prepares for the largest ever intergenerational transfer of wealth.
In Australia alone, it is estimated that $1.1 trillion will be transferred across a generation between now and 2030, and $2.6 trillion by 2040 (see Philanthropy Australia’s Giving Trends and Opportunities report).
In Australia, we’re expecting to see more legacy gifts made to community foundations from donors looking to leave a lasting legacy by having their funds invested and grown into an ongoing source of funding for communities.
7. Going beyond giving
In a shift driven strongly by the next generation, more funders are looking for ways to make a difference beyond their grant making.
Case in point: it’s increasingly important for funders that their charitable assets are invested ethically and do good in the community while they wait to be granted out. At the Australian Communities Foundation, 100 per cent of our investment portfolio is responsibly invested and we will continue to grow our impact investment portfolio in 2023 (read more in our latest Annual Report).
UBS also notes a trend towards more funders sharing their expertise, insight and connections in support of grant partners, and that’s something we certainly look forward to supporting at Australian Communities Foundation through our calendar of Learning Circles in 2023.
Resources and further reading
- Better Philanthropy Telescope | Philanthropy Australia
- 11 Trends in Philanthropy for 2023 | Johnson Center
- Philanthropy trends to watch in 2023 | Forbes
- Top five trends in philanthropy in 2023 | UBS
- What will charitable giving look like in 2023? | Kiplinger
- Philanthropy and Digital Civil Society: Blueprint 2023 | Lucy Bernholz, Stanford Center on Philanthropy and Civil Society