In his article, Paul Sullivan discusses charitable contributions and their impact on society. According to Sullivan, most philanthropists aim for social change but do not actually follow through; rather just keeping to the norm and donating their millions to safe bets like universities and hospitals. Sullivan notes,

Paul Connolly, director of philanthropic advisory services at Bessemer Trust, said many philanthropists can finance social change through institutions. Ms. Jones, for example, said she still gave to Dartmouth College, which she and her husband attended, but she focuses on scholarships and entrepreneurial programs.

The riskier issue, though, is when philanthropists donate too heartily to a social change organization without thinking through how that donation could affect that group.

“There’s a limited number of nonprofits that can absorb a very large gift,” Mr. Connolly said. “There are 1.4 million nonprofits, but two-thirds have less than a $500,000 annual budget and only 5 percent have a budget of $10 million or more. If you’re going to make a $10 million gift, you can do harm.”

And even if a single big donation doesn’t overwhelm a small organization, it could wipe out its base of smaller donors, who feel the group no longer needs their money. Mr. Connolly said he was working with a client who wants to give $350 million to 20 organizations. He said his team’s goal is to make sure those donations are not split equally among the groups but scaled to each organization’s size.

Read the full story here: Making Big Donations to Change the World

Posted by Allison Trupp, Associate Editor, Wealth Strategies Journal