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Philanthropy is a form of altruism that consists of "private initiatives for the public good, focusing on quality of life".
Philanthropy contrasts with business initiatives, which are private initiatives for private good, focusing on material gain; and with government endeavors that are public initiatives for public good, such as those that focus on the provision of public services. A person who practices philanthropy is a philanthropist.
During the Middle Ages, was superseded in Europe by the Cardinal virtues of charity (Latin: caritas) in the sense of selfless love, valued for salvation and escape from purgatory. Thomas Aquinas held that "the habit of charity extends not only to the love of God, but also to the love of our neighbor".
Sir Francis Bacon considered philanthrôpía to be synonymous with "goodness", correlated with the Aristotle conception of virtue as consciously instilled habits of good behaviour. Samuel Johnson simply defined philanthropy as "love of mankind; good nature". This definition still survives today and is often cited more gender-neutrally as the "love of humanity."
In 1739, Thomas Coram, appalled by the number of abandoned children living on the streets of London, received a royal charter to establish the Foundling Hospital to look after these unwanted orphans in Lamb's Conduit Fields, Bloomsbury. This was "the first children's charity in the country, and one that 'set the pattern for incorporated associational charities' in general." The hospital "marked the first great milestone in the creation of these new-style charities."
Jonas Hanway, another notable philanthropist of the era, established The Marine Society in 1756 as the first seafarer's charity, in a bid to aid the recruitment of men to the Royal Navy.
By 1763, the society had recruited over 10,000 men and it was incorporated in 1772. Hanway was also instrumental in establishing the Magdalen Hospital to rehabilitate prostitutes. These organizations were funded by subscriptions and run as voluntary associations. They raised public awareness of their activities through the emerging popular press and were generally held in high social regard—some charities received state recognition in the form of the Royal Charter.
Financial donations to organized charities became fashionable among the middle class in the 19th century. By 1869 there were over 200 London charities with an annual income, all together, of about . By 1885, rapid growth had produced over 1000 London charities, with an income of about . They included a wide range of religious and secular goals, with the American import, YMCA, as one of the largest, and many small ones, such as the Metropolitan Drinking Fountain Association. In addition to making annual donations, increasingly wealthy industrialists and financiers left generous sums in their wills. A sample of 466 wills in the 1890s revealed a total wealth of , of which was bequeathed to charities. By 1900 London charities enjoyed an annual income of about .
Led by the energetic Lord Shaftesbury (1801–1885), philanthropists organized themselves. In 1869 they set up the Charity Organisation Society. It was a federation of district committees, one in each of the 42 Poor Law divisions. Its central office had experts in coordination and guidance, thereby maximizing the impact of charitable giving to the poor. Many of the charities were designed to alleviate the harsh living conditions in the slums. such as the Labourer's Friend Society founded in 1830. This included the promotion of allotment of land to labourers for "cottage husbandry" that later became the allotment movement. In 1844 it became the first Model Dwellings Company—an organization that sought to improve the housing conditions of the working classes by building new homes for them, while at the same time receiving a competitive rate of return on any investment. This was one of the first housing associations, a philanthropic endeavor that flourished in the second half of the nineteenth century, brought about by the growth of the middle class. Later associations included the Peabody Trust, and the Guinness Trust. The principle of philanthropic intention with capitalist return was given the label "five per cent philanthropy."
The International Committee of the Red Cross (ICRC) played a major role in working with POWs on all sides in World War II. It was in a cash-starved position when the war began in 1939, but quickly mobilized its national offices to set up a Central Prisoner of War Agency. For example, it provided food, mail and assistance to 365,000 British and Commonwealth soldiers and civilians held captive. Suspicions, especially by London, of ICRC as too tolerant or even complicit with Nazi Germany led to its side-lining in favour of the UN Relief and Rehabilitation Administration (UNRRA) as the primary humanitarian agency after 1945.
The Pasteur Institute had a monopoly of specialized microbiological knowledge, allowing it to raise money for serum production from private and public sources, walking the line between a commercial pharmaceutical venture and a philanthropic enterprise.
By 1933, at the depth of the Great Depression, the French wanted a welfare state to relieve distress but did not want new taxes. War veterans devised a solution: the new national lottery proved highly popular to gamblers while generating the cash needed without raising taxes.
American money proved invaluable. The Rockefeller Foundation opened an office in Paris and helped design and fund France's modern public health system under the National Institute of Hygiene. It also set up schools to train physicians and nurses.
Religion was divisive in Germany, as Protestants, Catholics, and Jews used alternative philanthropic strategies. The Catholics, for example, continued their medieval practice of using financial donations in their wills to lighten their punishment in purgatory after death. The Protestants did not believe in purgatory, but made a strong commitment to improving their communities there and then. Conservative Protestants raised concerns about deviant sexuality, alcoholism, and socialism, as well as illegitimate births. They used philanthropy to try to eradicate what they considered as "social evils" that were seen as utterly sinful. All the religious groups used financial endowments, which multiplied in number and wealth as Germany grew richer. Each was devoted to a specific benefit to that religious community, and each had a board of trustees; laymen donated their time to public service.
Chancellor Otto von Bismarck, an upper class Junker, used his state-sponsored philanthropy, in the form of his invention of the modern welfare state, to neutralize the political threat posed by the socialistic .
The middle classes, however, made the most use of the new welfare state, in terms of heavy use of museums, gymnasiums (high schools), universities, scholarships, and hospitals. For example, state funding for universities and gymnasiums covered only a fraction of the cost; private philanthropy became essential. 19th-century Germany was even more oriented toward civic improvement than Britain or the United States, when measured in voluntary private funding for public purposes. Indeed, such German institutions as the kindergarten, the research university, and the welfare state became models copied by the Anglo-Saxons.The heavy human and economic losses of the First World War, the financial crises of the 1920s, as well as the Nazi regime and other devastation by 1945, seriously undermined and weakened the opportunities for widespread philanthropy in Germany. The civil society so elaborately built up in the 19th century was dead by 1945. However, by the 1950s, as the "economic miracle" was restoring German prosperity, the old aristocracy was defunct, and middle-class philanthropy started to return to importance.
When the war ended in late 1918, Hoover took control of the American Relief Administration (ARA), with the mission of food to Central and Eastern Europe. The ARA fed millions. U.S. government funding for the ARA expired in the summer of 1919, and Hoover transformed the ARA into a private organization, raising millions of dollars from private donors. Under the auspices of the ARA, the European Children's Fund fed millions of starving children. When attacked for distributing food to Russia, which was under Bolshevik control, Hoover snapped, "Twenty million people are starving. Whatever their politics, they shall be fed!"
Benjamin Franklin (1706–1790) was an activist and theorist of American philanthropy. He was much influenced by Daniel Defoe's An Essay upon Projects (1697) and Cotton Mather's Bonifacius: an essay upon the good (1710). Franklin attempted to motivate his fellow into projects for the betterment of the city: examples included the Library Company of Philadelphia (the first American subscription library), the fire department, the police force, street lighting, and a hospital. A world-class physicist himself, he promoted scientific organizations including the Philadelphia Academy (1751) – which became the University of Pennsylvania – as well as the American Philosophical Society (1743), to enable scientific researchers from all 13 colonies to communicate.
By the 1820s, newly rich American businessmen were initiating philanthropic work, especially with respect to private colleges and hospitals. George Peabody (1795–1869) is the acknowledged father of modern philanthropy. A financier based in Baltimore and London, in the 1860s, he began to endow libraries and museums in the United States and also funded housing for poor people in London. His activities became a model for Andrew Carnegie and many others.
His final and largest project was the Carnegie Corporation of New York, founded in 1911 with a endowment, later enlarged to . Carnegie Corporation has endowed or otherwise helped to establish institutions that include the Russian Research Center at Harvard University (now known as the Davis Center for Russian and Eurasian Studies), the Brookings Institution and the Sesame Workshop. In all, Andrew Carnegie gave away 90% of his fortune.
Rockefeller retired from business in the 1890s; he and his son John D. Rockefeller Jr. (1874–1960) made large-scale national philanthropy systematic, especially with regard to the study and application of modern medicine, higher education, and scientific research. Of the the elder Rockefeller gave away, went to medicine.
Their leading advisor Frederick Taylor Gates launched several large philanthropic projects staffed by experts who sought to address problems systematically at the roots rather than let the recipients deal only with their immediate concerns.By 1920, the Rockefeller Foundation was opening offices in Europe. It launched medical and scientific projects in Britain, France, Germany, Spain, and elsewhere. It supported the health projects of the League of Nations. By the 1950s, it was investing heavily in the Green Revolution, especially the work by Norman Borlaug that enabled India, Mexico, and many poor countries to upgrade their agricultural productivity dramatically.
The Ford Foundation in the 1950s wanted to modernize the legal systems in India and Africa, by promoting the American model. The plan failed, because of India's unique legal history, traditions, , as well as its economic and political conditions. Ford, therefore, turned to agricultural reform. The success rate in Africa was no better, and that program closed in 1977.
Muslims in countries such as Indonesia are bound zakat (almsgiving), while Buddhists and Christians throughout Asia may participate in philanthropic activities. In India, corporate social responsibility is now mandated, with 2% of net profits to be directed towards charity.
Asia is home to most of the world's billionaires, surpassing the United States and Europe in 2017. Wikipedia's list of countries by number of billionaires shows four Asian economies in the top ten: 495 in China, 169 in India, 66 in Hong Kong, and 52 in Taiwan ().
While the region's philanthropy practices are relatively under-researched compared to those of the United States and Europe, the Centre for Asian Philanthropy and Society (CAPS) produces a study of the sector every two years. In 2020, its research found that if Asia were to donate the equivalent of two percent of its GDP, the same as the United States, it would unleash () annually, more than 11 times the foreign aid flowing into the region every year and one-third of the annual amount needed globally to meet the sustainable development goals by 2030.
Two foundation types for which some data is available are Private Ancillary Funds (PAFs) and Public Ancillary Funds (PubAFs). Private Ancillary Funds have some similarities to private family foundations in the US and Europe, and do not have a public fundraising requirement. Public Ancillary Funds include community foundations, some corporate foundations, and foundations that solely support single organisations such as hospitals, schools, museums, and art galleries. They must raise funds from the general public.
A suggested explanation for the preference for impact investment philanthropy to traditional philanthropy is the gaining prominence of the Sustainable Development Goals (SDGs) since 2015. Almost every SDG is linked to environmental protection and sustainability because of rising concerns about how Globalization, consumerism, and population growth may affect the environment. As a result, development agencies have seen increased demands for accountability as they face greater pressure to fit with current developmental agendas.
The rise of philanthrocapitalism can be attributed to global capitalism. Therefore, philanthropy has been seen as a tool to sustain economic and firm growth, based on human capital theory. Through education, specific skills are taught that enhance people's capacity to learn and their productivity at work.
Intel invests in science, technology, engineering, and mathematics (STEM) curricular standards in the US and provides learning resources and materials for schools, for its innovation and revenue. The New Employment Opportunities initiative in Latin America is a regional collaboration to train one million youth by 2022 to raise employment standards and ultimately provide a talented pool of labour for companies.
Scholars have examined the importance of philanthropic support in promoting equity in different areas. For example, Christopherson et al. highlight the need to prioritize underrepresented groups, promote equitable partnerships, and advocate for diverse leadership within the scientific community. In the healthcare sector, Thompson et al. emphasize the role of philanthropy in empowering communities to reduce health disparities and address the root causes of these disparities. Research by Chandra et al. demonstrates the potential of strategic philanthropy to tackle health inequalities through initiatives that focus on prevention, early intervention, and building community capacity. Similarly, a report by the Bridgespan Group suggests that philanthropy can create systemic change by investing in long-term solutions that address the underlying causes of social issues, including those related to science and health disparities.
To advance equity in science and healthcare, philanthropists can adopt several key strategies:
This is sometimes termed as "celanthropy"—the fusion of celebrity and cause as a representation of what the organisation advocates.
Public interest groups, not-for-profit organisations and the United Nations now budget extensive amounts of time and money to use celebrity endorsers in their campaigns. An example of this is the People's Climate March of 2014. The demonstration was part of the larger People's Climate Movement, which aims to raise awareness of climate change and environmental issues more generally. Notable celebrities who were part of this campaign included actors Leonardo DiCaprio, Mark Ruffalo, and Edward Norton.
Along with diaspora-led foreign direct investment, diaspora philanthropy is a force in the development of a country. Members of a diaspora are familiar with their community's needs and the social, political, and economic factors that influence the delivery of those needs. Studies show that those who are a part of the diaspora are more aware of the pressing and neglected issues of their community than outsiders or other well wishers. Also given their deep ties to their country of origin, diaspora philanthropies have greater longevity than other international philanthropies. Due to diaspora philanthropy, diaspora philanthropy is more willing to address controversial issues found in their country of origin compared to local philanthropy.
African American philanthropists have made significant contributions across various fields, including mental health, education, entrepreneurship, and disaster relief. Taraji P. Henson's Boris Lawrence Henson Foundation focuses on mental health awareness and support for those affected by mental illness, particularly within the African American community. Shawn Carter's Shawn Carter Foundation provides scholarships and educational opportunities to underserved youth, aiming to improve access to higher education and support students in achieving their academic goals. Damon John's FUBU Foundation promotes entrepreneurship by offering mentorship and resources to aspiring business owners. Additionally, Rihanna's Clara Lionel Foundation provides disaster relief and humanitarian aid, helping communities in need during crises and supporting global emergency response efforts. While there are dozens more examples, each of these foundations reflects the African American community's commitment to addressing critical issues and improving the lives of individuals in diverse and impactful ways.
Jane Mayer highlights how wealthy donors, like the Koch network, use philanthropy to promote policies that serve their financial interests. Their donations, targeting Think tank and educational programs, influence public opinion on issues like tax cuts for the rich, deregulation, slashing the welfare state, and climate change denial, shaping American politics without being traditional campaign contributions. Mayer criticizes the anonymity of such donations, made through organizations like Donors Trust, which are not required to disclose their sources, enabling hidden political influence.
The ability of wealthy people to deduct a significant amount of their tax liabilities in the form of philanthropic giving, as noted by the late German billionaire shipping magnate and philanthropist Peter Kramer, functioned as "a bad transfer of power", from Democracy elected politicians to unelected , whereby it is no longer "the state that determines what is good for the people, but rather the rich who decide". The Global Policy Forum, an independent policy watchdog which functions to monitor the activities of the United Nations General Assembly, warned governments and international organisations that they should "assess the growing influence of major philanthropic foundations, and especially the Bill & Melinda Gates Foundation… and analyse the intended and unintended risks and side-effects of their activities" prior to accepting money from rich donors. In 2015, Global Policy Forum also warned elected politicians that they should be particularly concerned about "the unpredictable and insufficient financing of public goods, the lack of monitoring and accountability mechanisms, and the prevailing practice of applying business logic to the provision of public goods".
Giridharadas also argues that philanthropy Distraction the public from some of the immoral and exploitative tactics used to derive profit. For example, the Sackler family were known for their generous philanthropic giving to various cultural institutions worldwide. However, their philanthropic giving functioned as a distraction and propaganda to the public, as their legacy of generosity was tainted by the subsequent exposure of Purdue Pharma's role in encouraging and exacerbating the opioid epidemic. As a result of their exposed ill-gotten gains from the caused by the philanthropic donors, the British institutions of the National Portrait Gallery, London and the Tate, along with the American institution Solomon R. Guggenheim Museum, announced their rejection of charitable giving from the Sackler family trusts. Thus, some argue that philanthropy is merely a distraction and temporary relief, both physically and spiritually for those who receive it, in replacement of facing the true causes of the issues that it attempts to relieve, such as high housing costs and economic inequality, as philanthropy typically offers no long-term solutions. According to Harvard Political Review, philanthropy currently "is only a band-aid to a much larger and deeper structural issues."
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