Can it be? No new institutions will emerge from our crisis

What Matters

In this month’s Philanthropy Matters, we take a look at equity and philanthropy through the lens of institutional equity, how research counts—and doesn’t—certain philanthropists, and emerging research on Muslim-American giving.

Like the world, philanthropy is in a liminal state. After crises in the past, we have seen new kinds of institutions emerge.

Our public health infrastructure was forged in the embers of the influenza pandemic a hundred years ago; the welfare state followed the Great Depression and the World Wars, as did the United Nations system. In all of these instances, philanthropy provided models, funding, or expertise that helped bring about these transformational innovations.

What then, of our time? Will we see novel institutions emerge to meet the grand challenges ahead?

Despite heroic efforts in responding to the pandemic and the associated economic and social crises, I don’t see a coming surge in new institutional models. Instead, when I do see institutions being embraced, I see a devotion to current institutions, efforts to shore them up, and campaigns to recommit to the norms and principles that serve as their bedrock. Like a rubber band, we are stretching, poised to snap back when the stress subsides.

We know that our emerging generations are skeptical of institutions. Spontaneous, movement-like engagement, often mediated by technology, is more relevant to our youth. The recent Global Citizen Concert, eclipsing the annual meeting of the UN General Assembly in whose shadow it was initially conceived, raised $1.1 billion for global poverty while engaging people worldwide.

Our Declining Donors study shows that younger households are giving less to nonprofit organizations. We are only beginning to research the extent of direct giving to individuals that is taking place on the digital media platforms that absorb increasing amounts of our civic time and attention.

Our institutions have clearly been affected by digital media, perhaps none more dramatically than the news. The media as an institution in countries around the world is no longer what it was, even though philanthropic models have emerged to buttress local and independent media. The media represent one prominent instance of institutional decline, partially propped up by philanthropy, but other institutions are poised to follow.

The president of the Rockefeller Foundation, Rajiv Shah, is arguing for a new Covid Charter because “the world today needs an entirely new paradigm for global development.” Shah calls on governments, businesses, and philanthropists to rectify the great divergence that the pandemic has exacerbated between the fortunes of the wealthy countries and the “developing world.”

He harkens to the Atlantic Charter, agreed to by Roosevelt and Churchill in 1941, prefiguring many institutions that formed the post-World War II international order that still hangs on today. Shah evokes the kind of visionary commitment to a better future that can emerge from the depths of crisis, but he does not seek new institutions.

The five commitments he calls for are all about mobilizing more resources for existing—some might say, flagging—institutions, so that we can address the urgent challenges inequitably presented by climate change and future pandemics.

Climate change alone is the kind of global existential threat that hasn’t seemed urgent since the height of the Cold War, when the prospect of nuclear war seemed quite possible. Sadly, arms control institutions no longer attract the attention of major donors.

Still, those who control weapons of mass destruction are small in number compared to the multitudes whose behavior contributes to climate change. Are our current institutions prepared for a problem of such scale? It does not seem that the Bezos Earth Fund or other recent large gifts for climate change are proposing novel institutional ways of dealing with it.

MacKenzie Scott has made considerable commitments to institutions that serve the less privileged and has done so with no strings attached. Established foundations have moved in this direction after years of more rhetoric than action. During the pandemic, they have moved aggressively to grant “General Operating Support.”

Many are also following the Ford Foundation in boosting giving to racial and social justice causes, as well as organizations led by people of color and other disadvantaged groups. These efforts are giving new energy to institutions and talent that have been neglected.

In the U.S., Philanthropy-Serving Organizations that nurture the broad ecosystem of civic engagement are focusing on repairing the fundamentals of civil society. The Council on Foundations is advancing a program on values-aligned philanthropy to combat the hate speech and extremism that can threaten the foundations of a rights-based democracy. Through a different lens, the Philanthropy Roundtable seeks to protect the freedom of donors to deploy their wealth as they see fit without being subject to external “mandates.”

In both cases, there is a concern that something fundamental is amiss in our society. Cherished institutions are in danger, so a lot of attention is going to shore up exiting institutions, even as we disagree on which ones are most important or even how to describe them.

Belonging to an institutionalized religion has long been robustly associated with more giving. During the pandemic, social distancing added more stress to congregations who could not gather. Ironically, the decline in religiosity among many established faiths comes at a time when certain convictions that used to be open to debate are becoming articles of faith. Anne Applebaum has dubbed this fervor the new puritanism because it seeks to cleanse institutions of harmful offenders.

As many organizations seek to decolonize themselves and uncover systemic biases, they are not proposing entirely new institutions. What is happening instead is an effort to purge pathologies that will right the ship and enable institutions to thrive more equitably.

This leaves me perplexed. In a time of the most profound discontinuity in the lives of most of living humanity, I would expect an abundance of creative proposals and experiments to create novel institutions. I would also expect to see philanthropy in the thick of it.

Maybe I am looking in the wrong places, or maybe I am missing something big. But still I wonder. Do you share my puzzlement?

Best regards,

Dean Amir Pasic

Amir Pasic
Eugene R. Tempel Dean

How do we measure philanthropy in the U.S.? A look at who’s counted in Giving USA

Giving USA report cover

By Jon Bergdoll and Anna Pruitt, Ph.D.

Giving USA, researched at the Indiana University Lilly Family School in partnership with Giving USA Foundation, is the longest running and most trusted annual report about U.S. philanthropy. Each year, Giving USA publishes an estimate of total charitable giving in the U.S. In 2020, that estimate reached a record $471.44 billion.

What types of giving are counted in Giving USA?

Giving USA estimates charitable giving by individuals, foundations, estates, and corporations. For the purposes of Giving USA, charitable giving is defined as donations made to organizations designated as 501(c)3 by the IRS, which include public charities, private foundations, and religiously-exempt organizations such as congregations.

For the giving by individuals estimate, Giving USA includes a calculation for households that itemize deductions each year, as well as households that do not itemize their deductions, thus capturing a nationally representative picture of charitable giving by all households in the United States.

For estimating individual giving for those who itemize each year, the model begins with tax data, specifically, data the IRS received from individuals. The model incorporates various economic variables such as personal consumption and changes to the S&P 500 Index.

To estimate individual giving for those who do not itemize, as has been done for the past decade, Giving USA develops an estimate using the Lilly Family School of Philanthropy’s Philanthropy Panel Study (PPS) data, which is based on the responses of about 9,000 American households on their charitable giving behaviors.

We work hard to ensure that this picture of charitable giving to 501(c)3 and other charitable organizations is as thorough as possible. However, the most recent data from the PPS indicate that under 50 percent of all U.S. households made a charitable contribution in 2018. What does the picture look like for other types of giving back that do not go to 501(c)3 organizations?

What types of giving are not counted in Giving USA?

Of the ways to give back that are not captured in Giving USA, two of the most common approaches are informal giving and crowdfunding.

  • Informal giving

Informal giving is defined as giving directly to individuals, households, or businesses. One study found that the average Arizonan household gave $501 informally, and recent PPS data similarly found a mean of $441 for giving outside of child support and alimony to individuals living outside the home.

Unfortunately, informal giving is difficult to estimate since there is no formal and consistent way that this giving is being counted; unlike giving to a 501(c)3 organization, informal gifts cannot be deducted for tax purposes. One thing we do know, however, is that donors of color are more likely to participate in this direct form of giving.

  • Crowdfunding

Crowdfunding is a blanket term that simply refers to the practice of raising small amounts of money from a large number of funders to support a project. Crowdfunding can include campaigns that raise funds for nonprofits as well as campaigns that raise funds for individuals or businesses.

Crowdfunding campaigns that raise dollars for nonprofits are included in the Giving USA totals, and a recent study by our school found that about 22 percent of crowdfunded dollars went to nonprofits. However, the largest share of crowdfunding dollars (58 percent) went to helping individuals (family, acquaintances, or strangers). These dollars are not be captured in the Giving USA totals. We also know that women as well as younger and more diverse donors are likely to give to crowdfunding campaigns.

Unfortunately, like informal giving, there is no standard data collection on crowdfunding that could serve as the basis for an estimate.


While Giving USA does a great job of capturing giving to 501(c)3 and other formal charitable organizations, there is room for additional research. We see a growing, dynamic, and diverse donor base giving through informal channels as well as crowdfunding. Given the importance of these approaches to philanthropy, we also hope to see growth in the data collection in this area.

New study shows Muslim-Americans as vibrant contributors to American philanthropy

Muslim woman working on computer

By Shariq Siddiqui, J.D., Ph.D. and Rafeel Wasif, Ph.D.

According to the Institute of Social Policy and Understanding (ISPU), 1.1 percent of the U.S. population is Muslim-American. Muslim-Americans are a highly diverse minority with no one ethnic group making a majority.

Muslim-Americans are largely a community of color with African-Americans, Asians, Arab and Latinos making up the largest proportion of this small minority population. Muslim-Americans have a lower average income than the average American.

Prior research by the Muslim Philanthropy Initiative at the Indiana University Lilly Family School of Philanthropy shows that Muslim-American nonprofit leaders and nonprofits are under a great deal of stress and face a great deal of external prejudice and islamophobia.

Despite this external hatred of Islam and Muslims, a new report by the Muslim Philanthropy Initiative, Muslim American Giving 2021, finds that Muslim-Americans are vibrant contributors to American philanthropy. Despite being only 1.1 percent of the population they make up about 1.4 percent ($4.3 billion) of individual giving. The report is funded by Islamic Relief USA.

The study investigated the opinions of Muslims and the general population regarding faith customs, donation practices and attitudes, volunteer work, COVID-19, uncertainty intolerance, financial well-being, and discrimination. The survey also looked at how Muslims made decisions about donations. SSRS surveyed from March 17 through April 7, 2021. Overall, the team surveyed 2,005 respondents, including 1,003 Muslim respondents and 1,002 general population adult respondents.

Despite islamophobic tropes suggesting that Muslim-Americans are more aligned to international causes, only 15 percent of their giving is focused on such causes while 85 percent of their gifts support American charitable causes. Despite being poorer than the average American household, Muslim-Americans participated in charitable giving and volunteering at higher levels than the average household.

The survey finds that Muslims give more towards both faith-based causes and non-faith-based causes than non-Muslims. Overall, Muslim-Americans gave $3,200 for charitable giving compared to $1,905 for the general population.

The strongest motivations for American Muslims are a feeling of compassion towards people in need (average 4.31 out of 5). On the other hand, among the non-Muslim population, the largest motivation was the willingness to help others who are less fortunate (3.93).

Compared to the general population, Muslims have a more positive image of the charitable sector (4.08 versus 3.58). The lowest motivations to give among both Muslims and non-Muslims were getting a tax credit, recognition, financial strain, and the belief that giving money to charities is wasted.

Overall, while the mean amongst Muslims is higher for most motivations, the rankings for motivations among Muslims and non-Muslims are pretty similar.

Finally, Muslim-Americans have been on the front lines of COVID-19. Muslim Americans make up only 1 percent of the national population, but they play a more significant role in the front lines of COVID-19. For example, 15 percent of physicians and 11 percent of pharmacists in Michigan are Muslim Americans.

In New York City, Muslim Americans make up 10 percent of the city’s physicians, 13 percent of the pharmacists and 40 percent of cab drivers designated essential workers. Muslim-Americans’ top recipients of charitable gifts other than houses of worship were domestic poverty relief, COVID-19 related charities and civil rights.

The survey revealed:

  • Muslim philanthropy for both faith-based causes and non-faith-based causes is higher than non-Muslims. Muslim-Americans gave $3,241.96 for charitable giving compared to $1,905.23 for the general population. 
  • The findings of the survey also suggest that Muslims spend more hours volunteering every year when compared to non-Muslims. The volunteering comparison is also interesting, which suggests that generally American people spend 11.8 hours of faith-based volunteering and 13.72 hours for non-faith volunteering whereas Muslim-Americans spend 66.61 hours volunteering for faith-based causes and 45.93 hours volunteering for non-faith-based causes.

The study also shared important new information of where Muslim Americans donate.

  • Domestic relief equates to 12.70 percent of total Muslim charity in the U.S.
  • Civil rights protections for the members of their community is something in which Muslims spend quite generously. If we compare Muslim generosity concerning civil rights, Muslims pay approximately 10.14 percent of their contributions towards civil rights whereas this trend is 4.74 percent in the general public.
  • Muslims contribute 27.45 percent of their faith-based charity to houses of worship. In comparison, the non-Muslim population offers on average 51.28 percent of their faith-based charity towards the house of worship.
  • Muslim-Americans also gave a larger share toward COVID relief (14.26 percent) even for non-faith causes than the average population (6.65 percent).

The Muslim American Giving 2021 study also reveals interesting observations about Muslim philanthropy by race, gender, and age.

  • Males donate more than females towards faith-based causes ($3,444 vs. $976 for faith-based reasons, and $2,611 vs. $856 for non-faith causes).
  • Those 40-49 years of age give the highest average charitable giving.

Muslim-Americans are stepping up to play an important role in making our world and nation a better place despite facing prejudice, greater scrutiny and having fewer resources.

View the study