After digesting Paul Brest’s brilliant essay, the reader is left with a nagging question. It is, in fact, the same question that the author asks at the outset: If the term “strategic philanthropy” is synonymous with outcome-oriented, result-oriented, and effective philanthropy, why isn’t it more widely adopted in the world of organized philanthropy?

I would like to ask that question in an even more pointed way. If we assume that many philanthropists made their fortunes in business, always taking an outcome-oriented, result-oriented, and effective approach to asset building, why do they dispense with these success criteria the moment they commit to the common good?

In his essay, Brest refers to William Schambra’s critique in providing one possible explanation. Schambra’s descriptive critique suggests that psychological reasons such as the desire for public recognition or requests from members of personal networks cause people to behave non-strategically as philanthropists. I would like to propose that there may be additional behavioral economics aspects at play. Research conducted by Duke University professor Dan Ariely, in particular, has revealed that people respond differently in identical decision situations depending on whether they are acting in accordance with market norms or social norms. When physically fit individuals are spontaneously asked to help unload a sofa from a car, most of them will be happy to help out. However, if they are offered a ridiculously low amount of money, such as 10 cents, as a reward for their efforts, the majority will say no. The moment a price is brought into the equation they leave the world of social norms, where people help each other out and reciprocity is not a requirement, and enter a world of market rules, where prices have to reflect performance.

I would like to add another hypothesis to Schambra's observation. It is theoretically possible that philanthropy is attractive to donors and professionals precisely because rigid market rules do not apply. The world of philanthropy is diametrically opposed to the world of fortune building and career making. The key question is, therefore, whether to normatively exaggerate the spontaneous acts of non-strategic philanthropy that develop in this “other world“ as the lifeblood of a society with abundant social capital, or whether to find means to overcome the obvious problems associated with such a diagnosis.

If the alternative to spontaneous, chaotic, and human network-oriented philanthropy is not philanthropy at all, then the answer is simple. However, the alternative to a chaotic, unplanned trip—to use Brest’s travel analogy—is a planned journey with a departure point and destination, not the abandonment of the trip. So even if there is merit to Schambra’s description of reality and my hypothesis, they do not rule out strategic philanthropy. The evolutionary process towards the strategic philanthropy doctrine will involve overcoming both psychological and behavioral economics barriers.

Given that human behavior is explicably irrational, the strength of the better argument is unlikely to suffice. The only way to change the situation, albeit somewhat arduous, is to educate donors and managerial staff at foundations and other philanthropic institutions. Relevant educational approaches and concepts already exist, though they are still small-scale and thin on the ground compared to the omnipresent business schools. Professional schools, academic institutions, and other renowned establishments will therefore make a decisive contribution to the wider adoption of strategic philanthropy. And a breakthrough will have been achieved when a donor’s social status is measured in terms of the extent to which his philanthropic acts are founded on strategic considerations.

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