An estimated $100tn (£82.3tn) wealth transfer will “reshape philanthropic giving” across the globe, new research concludes.
A report from the US bank Citi, called Philanthropy and the Global Economy, says a wealth transfer from the “silent and baby boomer generations” is resulting in new philanthropic values becoming priorities for donors.
The move will result in calls for changes in how the assets held by philanthropic organisations are used, authors said.
Karen Kardos, global head of philanthropic advisory at Citi, said: “An estimated $100tn wealth transfer from the silent and baby boomer generations is underway.
“Their successors — who include many more women — often have distinctive values and philanthropic priorities.
“Social inequalities, climate change and other areas of sustainability are set to be even greater areas of focus for the new generations of donors.
“They will likely call for further changes in how the estimated [£2tn] of assets held by the philanthropy sector is used.
“This may see a move toward a mission-related investment strategy, where assets are invested in ways that seek to enhance philanthropic causes.”
Kardos said artificial intelligence would play a big role in charity giving because the “needs of recipients will be better understood” and there will be a “greater quantity and quality of information about needs and results”.
“The future of giving is thus likely to be more socially aware, more targeted, more measured, and perhaps even more effective,” she said.
The report also finds that the global donor base is “shifting away from individuals” and becoming more “institutional”, which it says will result in “shifts in the causes supported by philanthropy, a trend towards larger non-profits and further growth in impact measurement”.
The report advises non-profits to adapt to the changes in donors by “building trust to boost smaller value donations”, investing more in communicating impact more effectively and exploring effective and reciprocally beneficial corporate partnerships.
The report also highlights how the geography of philanthropy is shifting, beyond the surge in international giving to people affected by Russia’s invasion of Ukraine last year.
It says: “Donors are showing an appetite to support locally-led organisations that are operated and governed in the regions that they work in, and non-profits are responding by shifting their operations closer to their beneficiary communities.”