Practice Leader Perspectives on the Marts&Lundy $10M+ Gift Report 2024
$10M+ giving in 2023 was strong, but not as strong as it was in 2021 and 2022, when giving reached historically unprecedented levels. When excluding the top gift from 2023 and from 2022 (each a gift made by Bill Gates to the Bill & Melinda Gates Foundation), $10M+ giving in 2023 was down approximately 21% from 2022. However, when excluding each year’s largest gift dating back to 2013, giving in 2023 exceeded $10B for just the fourth time during that period.
Bottom line? Mega giving remains a significant force in the ecosystem of philanthropy, even as giving at these levels fluctuates year over year.
We asked Marts&Lundy’s Practice Leaders for their thoughts on this year’s $10M+ Gift Report in light of their respective expertise in higher education, healthcare and school philanthropy. Speaking with us were:
- Don Fellows, Leader, Higher Education Practice
- Mark Kimbell, Leader, Healthcare Practice
- Karen Callahan, Leader, Schools Practice
Q. What do the findings in the $10M+ Giving Report suggest for the future of mega gifts?
Don Fellows: While giving at the $10M and above level has declined over the past two years across sectors, including higher education, health and schools, this mostly has to do with factors other than the growth of assets and wealth during the same period. Donors are expressing concerns about the still fragile economy and the U.S. political landscape, causing them to be more cautious about their philanthropy despite growing personal wealth. These concerns will likely continue through this election cycle given the usual concerns that arise historically during presidential election years as well as the extremes and disruption that this election promises to bring. Donors are concerned about economic and global security, which typically causes them to temporarily pull back on their philanthropy. I wouldn’t be surprised if we see a similar decline in top-level giving this year as well given the significant consternation around these issues, even if the economy continues to grow and improve.
Mark Kimbell: Economic and political uncertainty, particularly during the past two years, is also affecting academic medical centers that are part of universities. The political and cultural issues around women’s health have caused institutions in conservative states to pause or rethink how to prioritize this issue for philanthropy. Interestingly, however, such caution has not been raised much in donor interviews. With regard to the health systems sector specifically, C-suites increasingly recognize philanthropy as a viable revenue source – something that academic medical centers realized long ago. And while health systems are moving away from the traditional “bricks and mortar only” focus for philanthropy, there continues to be a reluctance to pursue big ideas that will attract big gifts. This is less a failure of imagination than a hyper-focus on the financial bottom line and the desire to target philanthropy for operations most appealing to donors. This approach could potentially result in a missed opportunity to maximize a donor’s gift.
Karen Callahan: The schools data captured in the $10M+ Report includes charter and public schools. The significant increase in 2021 and 2022 was due to McKenzie Scott’s gifts to public schools. The 2023 data shows us returning to previous ranges of support at this level, which suggests mega giving to schools remains strong.
Q. What sentiments are emerging from Marts&Lundy’s campaign planning studies – particularly as regards personal interviews with major prospects and donors?
Don Fellows: Specific to higher education, we have been hearing concerns from some $10M+ prospects and donors relative to the war in the Middle East and the public responses coming from major university leadership. Donors expressing concern about the role of many top universities and their leaders relative to these emotionally charged issues may well affect giving in the current year. We are also hearing widespread concern about the uncertain state of the economy and the presidential election, suggesting further temporary restraint in giving as I mentioned previously. We also hear great enthusiasm from many donors who continue to be supportive of the institutions they believe in. Top-level donors continue to show increased interest in supporting people and work that will have direct impact on solving large problems rather than more traditional support for endowment and facility needs.
Mark Kimbell: While the political and cultural issues around women’s reproductive health have caused institutions in conservative states to pause or rethink how to prioritize this issue for philanthropy, interestingly, such caution has not been raised in donor interviews. High-level donors who are interviewed tend to have great confidence and trust in their physician and care teams but less so when it comes to the institution’s leadership, mainly because these leaders have not engaged often enough, or at all, with these donors. This is less the case among academic medical centers but especially true among health systems. Health system CEOs haven’t traditionally prioritized philanthropy or the donors. Our studies among health systems consistently contain recommendations around an increased percentage of CEO time given to meaningful donor engagement.
Karen Callahan: In schools we are also experiencing two important shifts: realignment of philanthropy to global issues and withholding of significant gifts where there is not alignment with school leaders’ approach to social and political issues. Both require that school heads and their chief advancement officers work together to engage in personal conversations with parents, alumni, donors and leadership volunteers to listen to and acknowledge their perspectives. Sometimes this might mean prioritizing relationships over gifts with the long-term view of a shared belief in the School’s mission even if current events preclude shared priorities.
Q. What strategies should institutions consider given the trends we see in this report? Or, if not specific strategies, what actions can they take to inform conversations with leadership and boards? What questions should they be asking themselves?
Don Fellows: In light of recent pressures on higher education related to the Middle East conflict, universities must continue to be more transparent and specifically address and clarify the role of major donors and other constituents in such controversies. As trust in colleges and universities has declined in recent years for many reasons, these institutions must address the tough issues and do so in a transparent manner. Increased focus on fundraising priorities that address societal challenges must continue to grow as major campaigns are planned and executed as they relate to both mission and donor intent.
Mark Kimbell: Large healthcare institutions with massive assets and income statements must make extra effort to focus on demonstrating the impact of philanthropy. Helping big donors acutely understand how they can uniquely solve a problem and make a difference is a critical strategy. Inviting such donors into regular and substantive conversations with healthcare executives and board members can create stronger alignment between an institution’s goals and the donor’s philanthropic objectives. This also places a premium upon stewarding donors in a highly personalized way. Most roads lead back to a donor or family being grateful, so the physician/care team partnership is essential.
Karen Callahan: Strategies for schools should mirror what is shared by colleagues in the other sectors. Trust in leadership, as demonstrated by the actions and communications of school heads and boards, will continue to be a key success marker in philanthropic efforts in and outside of campaigns. Key to gaining trust is transparency in policies and practices and commitment to the mission, vision and values of the institution.