This theory explains that individual’s give because they want to gain some private advantages; thus, a donation is the mode to fulfill a donor’s ego instead of the public. It is an action people or organizations do on the foundation of altruistic aspiration to enhance human well-being. The well-off people at times create foundations to aid in their philanthropic activities (Greenlee 199-210). An example of consumption philanthropy theory is when John Winthrop of Massachusetts Bay Colony told Puritan settlers in 1630 that the wealthy people have a responsibility to take care of the less fortunate in the society.
In the meantime, the poor should strive to improve their circumstances. Some years later, John Eliot did a letter to Sir Simonds D’Ewes requesting for cash to establish a tertiary institution in Massachusetts. Five years later, John Harvard did the basics for Harvard University after donating half of his land to develop the institution. Therefore, surprisingly, this is the mainly widespread kind of giving since people are looking for recognition, links to other individuals on the same wavelength in society and feeling good
This a traditional perception on the charity that states that one gives just because they want to help other people. In this case, this kind of donor desires public benefits while consumption Philanthropists desires for personal gains. It can also be termed as the code and practice of concern for the contentment of other individuals or even animals ending up in excellent life both materially and spiritually. It is an attractive traditional feature in various cultures and a core feature of different religious customs and secular perceptions, but the notion of others towards the person who concerns is aimed at can differ amid religions and culture.
In very extreme instances, altruism may be a synonym of unselfishness. In the usual way of life, it does not refute the singular personality of the subject but recognizes the characters of a person’s personality in relation to other people with an actual direct and individual interaction with each of them. It focuses on both an individual and the whole community. It is commonly the statute of love directed to the ego and his neighbor.
Social Relations Theory
The social relations theory has it that someone gives, as a result of a mutual relationship amid donor and the receiver (nonprofit/fundraiser. One gives aid to their preferred nonprofits frequently because they know the organizations that they want to give charity too very well. . These kinds of charity donations aim to gratify both a donor and a receiver nonprofit. For instance, a friend of a founder of a charitable organization will feel free to make donations to that particular organization often just because they are in a good relationship with the founder, i.e. family, friend, extended relative, etc. (Webb 299). The donor will feel good to donate items to an organization that is being led by his ally at no cost, and the associate will be contented with the donations given to him by a great friend.
Recent Study on Charitable Giving
There is hope for any non-profit organization that depends on donations for financial aid. A new study has it that retirement does not have a negative impact on charitable giving. The research done at the Women Philanthropy Institute at Indiana University deducted that if a sequence of giving on the basis of charity has been founded before one retires, it is likely to go on after one retires. It continues even when other economic alterations take place.
It dismisses the myth that retired couples usually don’t have the money or never gives donations. The details drew information from studies that trailed charitable gifting for some years, beginning in 2001. The sample investigated included approximately 600 single, cohabitating households, married where people were from age 55 to 101 years of age (Baber 679-693). The goal of this research is to heighten comprehension of women philanthropy and widely share the outcome to enhance charitable gifting.
To see the effects of retirement on expenditure and donations to charitable organizations, the research looked at households of single women and men and married individuals in the preceding years, during and after the decision of retiring. It also made a comparison of the quantity and occurrence of charitable gifting to expenditure and buying. The study deducted that the possibility of gifting decreases by 4% in a period of five years before and after an individual retires.
This sum is significantly a lesser amount than aver. It is indeed an encouraging piece of information for fundraisers and for the people who are indulged with the dealings in the non-profit section. It also reveals that planning is continuing in household financial planning for charitable gifting.
The research also deducted some critical differences in gifting remain true after one retires. Firstly is that married people and single women give greater donations to charitable organizations than men who are single. Secondly, there are also other variations in how males and females gift. Thirdly is that single women investigated were possibly likely to broaden their expenditure and gift large amounts per annum to different charity organizations.
On the contrary, men were possibly likely to gift hugely periodically. Fourthly, the females are equivalent and appear to gift across various organizations in regular sequence. They are likely to be more strongly dedicated to gifting all through their whole lives and strategize well for it. All in all, from the experience of women in working, they are very likely to move in and out of the labour market and strategize according to social frameworks that instruct women to be more democratic and unselfish.
Some of the variations in gender deducted in the research of retirees have some truth in other generations. The single women of the Generation portray strong gifting which is similar to the single women of generation X gifting in the 70s. Moreover, technology has altered how the younger generation participated in charitable gifting. Direct gifting via mass funding social media movements, for instance, Giving Tuesday has altered how people relate with charity and donations.
For the non-profits, the study has great news and ensures a lot to be thought about in terms of how various groups are engaged. Do they aim at the male species, women and married people differently? What of the various age groups? How do they perceive volunteering time against the donation of money? Therefore, this study reveals that charitable gifting should go on to be part and parcel of a retirement strategy. It has really opened ways for wealth advisors and strategized giving consultancies to aid people in planning how they will maintain charity gifting.
Importance of Understanding Charity Gifting Theories
To Know the Expectations of the Organization
A manager should be in the know that a charity organization aspires to create an expectation of an encouraging action in return for the donation. Timing is also significant since one may be the verge of concluding a massive deal with a consumer that is gotten, would escalate the end of year bonuses by a significant amount.
Therefore it is not just gifting that the manager should focus on but should accept gifts and hospitality that is punishable under the bribery statute. The manager should consider the suitability of the donation and whether it is comparative to the level of the organization.
The manager should comprehend what comprises of a lavish donation or hospitality which is usually very difficult to judge. For instance, the responsibility of a manager may necessitate him to be present at an occasion where hospitality is generous. What may appear minor to a manager may be very important to a mere employee. At times the value of a gift can be very difficult to determine (Trussel 263-285). The manager should also consider the cross-cultural issues, for example, a gift valued at$20 is regarded as of low quality in the UK though can be considered to be very important in some developing nations.
A manager needs guidance on the corporation‘s protocol on gifting. They get these approvals from their seniors. At times large donations may be required to be donated to the organization. Guidance is usually got in an organizations code of ethics or gift policy. It will highlight the organization’s viewpoint on gifts. The manager will, therefore, understand what constitutes donations and set out good practice for the other workers below him or her.
A gift policy should be consistent with all the other features of an organizational ethics strategy in the encouragement of great standards of truthfulness and integrity in making decision and behavior. So there is a necessity to be a Grinch. The manager should ensure communication of gift policy to the employees and his equals. The employees should be encouraged by the manager to regard the ethical repercussion before receiving or giving donations. They should also offer extra support for the people with customs with a different gift-giving norm.
A number of organizations may perform various operations where only some of them are charitable dealings. Generally, to attain the charity test and do registration as a charity, the organization will have to put a stop to the non-charitable dealings. The non-charitable operations can go on and be performed by another non-charitable organization that can, in turn, donate help with the profits to the charitable organization.
There are also strict rules that should be adhered to, that apply to doing business by charity. Guidance concerning this can be got in the Charity Commission’s Guidelines Charities and Trading. Trustees are disallowed to be in receipt of financial benefits like salaries, services or awarding of contracts for businesses from the charity organizations they manage unless authorized by the authorities concerned. However, the trustees should be paid back their own reasonable expenses from their pockets like traveling expenses.
Difference Between Community Foundation and Private Foundation
A community foundation is an organization that receives charity with broad public support; it can actively be responsible for giving aid to another community charity or devoted ultimately to the safety of the public. Most of the community foundations depend on the donations from the public.
These donations are tax deductible according to the law. Private foundations are also charitable institutions that are not eligible to be called public charity organizations. Practically they usually are non-profits that were founded with money from a particular source like family and corporate funding rather than the general public.
- Greenlee, Janet S., and John M. Trussel. ‘Predicting the financial vulnerability of charitable organizations.’ Nonprofit management and leadership 11.2 (2000): 199-210.
- Webb, Deborah J., Corliss L. Green, and Thomas G. Brashear. ‘Development and validation of scales to measure attitudes influencing monetary donations to charitable organizations.’ Journal of the academy of marketing science 28.2 (2000): 299.
- Trussel, John M., and Linda M. Parsons. ‘Financial reporting factors affecting donations to charitable organizations.’ Advances in Accounting 23 (2007): 263-285.
- Baber, William R., Patricia L. Daniel, and Andrea A. Roberts. ‘Compensation to managers of charitable organizations: An empirical study of the role of accounting measures of program activities.’ The accounting review 77.3 (2002): 679-693.