As Dr. Andy Polaine describes on his website, About Mental Models, mental models are the tools behind smart decisions and breakthroughs – that’s why our mental model of philanthropy and how we give matters.
As global wealth accumulates at the top of wealth pyramid, so too does the changing behaviours in giving yet our mental model and perception of philanthropy remain largely the same.
It’s no secret that the intergenerational wealth transfer is gaining momentum globally. The Annual DAF Report 2025 reported that total assets from DAFs (Donor Advised Funds) grew 27% reaching USD 326.45 billion in the US. With trillions on the cusp of transfer in other wealthy countries in the next decade, philanthropy is set to play an even more important role on the global stage.
Australia alone, is set for a massive intergenerational wealth transfer over the next decade and beyond. Estimates suggest a conservative AUD 3.5 trillion to over AUD 5 trillion set to pass hands from Baby Boomers to younger generations, primarily driven by property and superannuation growth.
In the midst of this mass wealth transfer are the financial vehicles that facilitate the tax efficient treatment of funds. Structured giving (a strategic planned approach to philanthropy) is a growing trend worldwide and increasingly becoming a popular choice for philanthropic investment and distribution, offering many favourable tax incentives to give. This is reportedly encouraging the giving behaviour of HNW individuals and families resulting in larger more strategic contributions.
Perception is all we have
To quote Stephen Covey’s phase ‘perception is all we have’, which is wildly problematic when we think about the act of giving because giving it’s often driven by our emotions and altruistic desires, so our perception of philanthropy in the moment we make giving a decision matters.
With more giving and a greater distribution of the wealth comes a greater variety of giving styles and behaviours and herein lies the issue of perception. Most of us are stuck with deep-seated, internal frameworks, beliefs, and assumptions about how philanthropy works that are simply outdated.
With the continuing increase in wealth transfer, it’s time to refresh the philanthropy zeitgeist and introduce a new narrative for the next generation that reflects what’s really happening on the ground.
What’s your philanthropy style?
The word ‘philanthropy’ is often used as shorthand when referring to the generous giving behaviour of individuals. The reality is that the practice of philanthropy (how we give) is not fully understood with many of us engaging in the act of giving, quickly finding ourselves on a steep learning curve in unknown territory – accidental tourists in the land of generosity.
Behind this hazy understanding sits the list of known giving styles that we all engage in, knowingly or not. This list includes John D. Rockefeller’s Venture Philanthropy (currently experiencing a resurgence), Mark Kramers’ Catalytic Philanthropy (that never goes out of fashion for serious practitioners distributing multi-year grants to place-based community initiatives), right through to more Traditional giving that is simply a one-off donation to a cause that you care about.
The challenge is, that majority who give their wealth so generously do just that. They give and think of philanthropy at its most puritan mental model – for the love of mankind.
And yet, as we are all acutely aware, times are changing fast. If we want to help, don’t we owe it ourselves and those we want to support to understand how our own giving style works in the broader global system?
Shifting old patterns for greater global impact
If we want to shift old patterns of thinking and select the right giving style for the problem we want to help solve and improve our decision making;
Know your giving style: There is great power in understanding the different giving styles that we adopt, regardless of whether you are dropping a dollar in the hat of someone living on the streets or distributing a seven-figure gift to a charity.
Find your giving allies: we need to become acutely aware of the role we play in the philanthropic ‘system’ so that we can actively leverage our own giving styles through strategies such as selecting charity programs that would benefit from our giving style, or selecting values aligned co-funding partnerships.
Talk more openly about your giving: Sharing your giving story is free and has massive potential to positively influence your peers and their giving behaviour. It’s widely understood that if we want to achieve greater impact there is power in numbers so finding and influencing your values aligned philanthropy allies and for-purpose partnerships is key!
If we want to break through some of the barriers to our understanding of philanthropy and work smarter together as a sector for greater global impact, changing our mental model of philanthropy and understanding our own giving style is an important step in the evolution in the practice of philanthropy that should not be missed
