Americans expand the idea of giving – and goodness

Giving to charity hit another record last year, but a new form of giving – impact investing – is catching up fast.

Reuters
"Square Roots" co-founder Tobias Peggs stands inside one of 10 hydroponic farms growing inside repurposed shipping containers where entrepreneur farmers enrolled in the "Square Roots" program are growing and selling a variety of greens in the parking lot of a former factory in New York City.

For the third straight year, Americans have hit a record high in their giving to good causes. Last year, according to a Giving Institute survey released June 13, donations or grants by individuals and philanthropies totaled $390 billion. The biggest increase, or 6 percent, went to animal-welfare and environmental groups.

Yet these measurements of altruism have a new problem. More people are not limiting the idea of supporting good causes to only charities, churches, or other nonprofits. In the past decade, another type of giving – called “impact investing” – has taken off. This involves people putting their values into action through financing of for-profit companies involved in social causes, from reforestation to prisoner rehabilitation – while also accepting smaller returns than other investments.

An estimated one-third of affluent families now hold impact investments, according to Indiana University’s Lilly Family School of Philanthropy and U.S. Trust. And in a survey by the Global Impact Investing Network, the size of this market reached more than $113 billion last year.

The type of impact investors varies widely. They include social entrepreneurs, who apply business practices to pursue a social cause, such as sustainable farming. Or they can be traditional grant-giving foundations that direct part of their endowments toward worthwhile causes, such as solar-panel innovations. Or they can be wealthy families that invest in bonds that finance housing for the homeless.

But one type of investor could greatly increase this type of doing good. In a survey last year by Greenwich Associates and American Century Investments, one-third of institutional investors planned to increase portfolio allocations to impact investing over the next three years.

Defining what is “social good” is not always clear in such investing. Yet many nonprofits, such as the Sustainability Accounting Standards Board, are establishing metrics for these investors to follow.

For now, the trend at least breaks up old thinking about what is a nonprofit and a for-profit organization. Most of all, it expands notions of how to achieve the public good and challenges the idea that goodness itself has limits.

You've read  of  free articles. Subscribe to continue.

Dear Reader,

About a year ago, I happened upon this statement about the Monitor in the Harvard Business Review – under the charming heading of “do things that don’t interest you”:

“Many things that end up” being meaningful, writes social scientist Joseph Grenny, “have come from conference workshops, articles, or online videos that began as a chore and ended with an insight. My work in Kenya, for example, was heavily influenced by a Christian Science Monitor article I had forced myself to read 10 years earlier. Sometimes, we call things ‘boring’ simply because they lie outside the box we are currently in.”

If you were to come up with a punchline to a joke about the Monitor, that would probably be it. We’re seen as being global, fair, insightful, and perhaps a bit too earnest. We’re the bran muffin of journalism.

But you know what? We change lives. And I’m going to argue that we change lives precisely because we force open that too-small box that most human beings think they live in.

The Monitor is a peculiar little publication that’s hard for the world to figure out. We’re run by a church, but we’re not only for church members and we’re not about converting people. We’re known as being fair even as the world becomes as polarized as at any time since the newspaper’s founding in 1908.

We have a mission beyond circulation, we want to bridge divides. We’re about kicking down the door of thought everywhere and saying, “You are bigger and more capable than you realize. And we can prove it.”

If you’re looking for bran muffin journalism, you can subscribe to the Monitor for $15. You’ll get the Monitor Weekly magazine, the Monitor Daily email, and unlimited access to CSMonitor.com.