Why Women Should Lead in Philanthropy

Due to longevity, women inherit 70% of all estates

If you’re wondering about women and wealth, consider:

• Women now control 51% of private wealth and by 2010 are expected to own half of the wealth in the United States. Due to longevity, women inherit 70% of all estates.

• Women own 6.2 million businesses, and women of color own 1.2 million of them. More than half of high net worth women business owners and executives contribute more than $25,000 to charity each year, including 19% who contribute $100,000 or more.

• More than one-third of all the existing 60,000 foundations have been formed since 1996. Worldwide, 150 women’s funds have combined assets of $630 million.

Yes, the collective wealth is there, but so are problems:

• Women are two-thirds of adults living in poverty.

• Only one-third of teen moms graduate from high school.

• Women aged 46 to 64 are twice as likely as men to lack health insurance.

• Economic justice issues are linked to health disparity issues, which are then linked to racism, classism and other forms of discrimination.

Tori O’Neal McIlrath is the interim president/CEO of the Washington DC-based nonprofit group Women & Philanthropy. She updated a presentation by her predecessor, Kim Otis, who addressed the 7th biennial Forum on Women and Philanthropy in Madison WI in November, sponsored by the University of Wisconsin Foundation.

No stranger to the philanthropic world, McIlrath has been on both sides of the fence, as a non-profit executive and as a foundation insider. “I’ve worked with the recipients of grants and I know just how far $10,000 can go and how far funds can be leveraged,” she said.

A golden opportunity

It’s expected that $41 trillion will soon transfer to the next generation in the largest intergenerational shift of money ever seen. That incredible amount offers both promise and challenges. “The IRS reported in 1998 that 2.5 million of the top wealth holders in the country were women with a combined amount of $4.2 trillion,” said McIlrath. “With that many women with those assets, what type of impact could they have?”

But “If women aren’t empowered and don’t learn how to give effectively, what will that mean for the world?” she asked.

For many years, funders and even nonprofits tended to focus on a narrow set of issues. But as research is showing, putting money to work at the intersection of these various problems actually helps leverage the dollars. For example, improving the status of women can improve child health and well being, reduce illiteracy and raise the standard of living for the entire family. And supporting the family begins to make positive changes in the life of those in the community and ultimately, an entire country.

Women are moved to give for very different reasons than men. “Women are focused on the work that the contribution is going to do,” said McIlrath. “Their philosophy is to have the recipient take this gift and leverage it.” Men view their giving in a more competitive way.

There’s also another significant difference. In general, when men give substantial amounts of money, their names will be on a building or at the very least, on a plaque that will visually recognize their gift. “There’s a trend for women to give anonymously,” she said. Women & Philanthropy wants women givers to let people know about their gifts and encourages them to see the power that their philanthropic leadership has on the community.

Three reasons for philanthropy

Fairness framework. Based on the equal justice movements of the 1960s and 70s, this framework launched the organization nearly 30 years ago. “Women & Philanthropy really worked to make a clear case that discrimination against women was rampant and that it was wrong,” said McIlrath. The group pushed for more women on the boards of trustees and increases in the number of women-led organizations, hopes their voices would be heard.

Today, women make up 52% of foundation CEOs, 72% of program officers and 31% of foundation board members. While the numbers represent a definite improvement, “Unfortunately, they haven’t translated into increases in funding going to women and girls’ issues,” she added.

Effectiveness framework . Most popular among funders today, this framework is based on disparate effect. Women and men experience the problems that philanthropy seeks to remedy differently. Improving a woman’s life also betters the lives of others in a way that is not true for men.

The effectiveness framework believes that if foundations want to be more effective with their grant making, they cannot ignore gender issues. Issues like poverty and HIV/AIDS have a disproportionate affect on women. Women and girls generally occupy different social roles that call for different program designs. We’re also socialized to expect to play dif-ferent roles, especially leadership ones, from those of males.

Too many times, funders simply adopt the philosophy of “universal” funding and don’t examine the target populations carefully. One way of ensuring effective grant-making is to require gender impact statements, which report the effect of programs on both females and males.

Human rights framework . This framework provides advocates and funders a way of tying gender issues to other topics. It looks at issues holistically, focuses on intersections and is measurable.

One solution does not fit all. Take for example, a poor woman living in a rural community who lacks health care and is harmed by pesticides sprayed on area fields from an agri-business. What will improve her life? The human rights framework realizes that in addition to civil and political rights, women and girls also have social, economic and cultural rights.

With the Kellogg Foundation, Women & Philanthropy plans to publish a book on effective philanthropy in 2006. 

Contact: toneal@womenphil.org or 202.887.9660.

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