Anonymous Giving Gains in Popularity as the Recession Deepens

By Ben Gose
Washington, DC (April 30, 2009)- At a time when many charities are desperately looking for new donors, an increasing number of philanthropists seem to be trying just as hard not to be found. Data compiled by The Chronicle of Philanthropy, and anecdotal reports from fundraisers and advisers to donors, suggest that a rising number of people are choosing to give anonymously.

During the past 10 months- a period that included a steep plunge in the stock market- the proportion of gifts worth $1-million or more that have been made anonymously far exceeds historic patterns, according to an analysis of data assembled by The Chronicle. Eighty gifts worth $1-million or more were made anonymously from June 2008 to April 2009, nearly 19 percent of the 422 total during that period.
Over the past decade, according to data compiled by the Indiana University’s Center on Philanthropy, the proportion of large gifts that were made anonymously has ranged from 3 to 5 percent.
The recent gifts from the so-called “mystery donor” to colleges headed by women account for only part of the increase. At least 14 colleges have reported receiving a total of $74.5 million from a donor who won’t even share his or her name with the institutions. (The identity of the vast majority of anonymous donors is known by at least one person at the recipient charity or institution.)
If all 14 gifts of those gifts were excluded from The Chronicle’s data, the proportion of $1-million gifts that have been made anonymously in the past 10 months would drop to about 16 percent.
Numerous studies conducted by the Indiana center over the past 20 years have shown that an aversion to solicitations from other charities, and a desire to keep a gift secret from family or friends are the two most popular reasons for giving anonymously.
Both concerns “get exacerbated when you have times in which people are feeling the pressures of less wealth,” says Dwight F. Burlingame, the center’s associate executive director.
Robert F. Sharpe Jr., a Memphis fund-raising consultant, says he’s heard about the rising interest in anonymous giving from several colleagues who work directly with donors.
He believes the severity of the current recession is also leading to new reasons for seeking anonymity. Individuals who have suffered little, or even prospered, during the downturn aren’t rushing out to buy expensive sports cars, even if they can afford to do so-for the sake of appearances. Such people might not want to stand out with a flashy, high-dollar gift either, he notes.
“Some people just don’t want others to know that they shorted the market [bet that stocks would decline] and that they now have more money than they’ve ever had,” Mr. Sharpe says.
He says he is aware of a woman who pledged $1-million in exchange for an arts center naming part of its facility in her honor. The woman recently called to reassure the group that the cash was still on the way, but she asked that her name be removed and that the gift be considered anonymous. Slapping her name on something by making a large gift would be “unseemly and gauche,” she explained, at a time when many people are suffering.
Meanwhile, people who have absorbed a financial hit in the past year may be narrowing their giving to the handful of groups that they like the most, Mr. Sharpe notes. By giving anonymously to favored charities, a donor could avoid angering other groups that he or she is dropping.
Shielded From Appeals
St. Augustine Catholic High School, in Tucson, Ariz., has received cumulative pledges of $5-million over the past 18 months from an anonymous donor. The gifts, which will pay for a new gym and other infrastructure needs, were made anonymously in part because the donor wants to avoid solicitations from other charities, says Teresa L. Baker, the school’s development director.
“In today’s economic environment, people like to be behind the scenes, as opposed to having their name plastered everywhere and having every nonprofit on the planet contacting them for donations,” Ms. Baker says.
The deep recession-and the resulting job losses-have prompted some wealthy people to begin supporting charities that provide basic services like food and shelter. Some of these gifts are coming in anonymously-perhaps, Mr. Sharpe says, because the donors think they may not have the money, or the desire, to repeat the gift in another year or two. “They don’t want to raise expectations,” he says.
In December, the North Texas Food Bank, which distributes food to charities in 13 counties, received its first-ever $1 million gift, from a woman who asked to remain anonymous. “She said she would not have been able to look herself in the mirror over the holidays had she not made the gift,” says Jan Pruitt, the food bank’s chief executive.
The donor does not typically support food banks or other providers of basic services, Ms. Pruitt says. The food bank is keeping the donor apprised of how it is using her money-it has spent $600,000 already, in part to expand a program that provides food in a backpack that low-income schoolchildren can eat over the weekend-with the hope that she will become a long-term supporter of its efforts.
“Once people’s eyes are opened to how much need there is, I think they will continue to respond in this area,” Ms. Pruitt says. “I can’t guarantee it will be $1-million every time.”
Feeling of Discomfort
While the economy may be helping to fuel the rise in anonymous giving, some charity officials see other factors at work.
The Bush School, a private school in Seattle, has received four anonymous gifts worth $1-million for a campaign to raise $34-million to build a new elementary school and bolster the endowment.
Cinthia Fischer, the campaign director, says that most gifts come from parents, and the biggest gifts often come in anonymously, because the parents feel that a large gift will make their child uncomfortable at the school.
Schwab Charitable, a San Francisco organization that runs a donor-advised fund with assets of $1.7-billion, saw anonymous giving rise to about 4 percent of gifts last year, up modestly from 3.5 percent of gifts in 2007.
The Pasadena Playhouse, a regional theater in California, recently received three anonymous gifts from board members who had previously made public gifts, says Brad Price, the theater’s development director.
Late last year, a higher-than-normal number of smaller gifts-in the $250 to $500 range-were also made anonymously. “Donors don’t want to expose themselves to a flood of solicitation activity,” Mr. Price says. “And there is definitely an increasing amount of that happening right now.”
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Anonymous Giving Gains in Popularity as the Recession Deepens