Affluent young dig deeper in downturn

Published on Saturday 12 September 2009 14:12

AN AMBITIOUS younger breed of wealthy philanthropists, known as "go givers" are emerging despite the recession.

The Tomorrow's Philanthropist report by Barclays Wealth has revealed 75 per cent of wealthy individuals have not cut their contributions to charity during the downturn, and 25 per cent are actually giving more money to good causes.

Mark Little, managing director of Barclays Wealth Scotland and Northern Ireland, said adversity made investors more socially aware and boosted the amount they donate to charity.

Barclays questioned 500 investors in the UK and the US with assets worth 500,000 or more and found they are still committed to giving, saying they can make a bigger impact by donating directly to charity instead of through taxation.

When asked where they would make cuts if the downturn continued, respondents identified luxury goods, eating out, holidays and travel and staff as more expendable than charitable giving.

The "go givers" are described as having a stronger commitment to philanthropy than older generations and feeling more responsibility to support good causes. A high number of younger respondents believe giving will become more incumbent on the wealthy as governments are burdened with debt. Almost half of respondents said they had more responsibility to help because of public debt levels, rising to 72 per cent among younger philanthropists.

The next generation of philanthropist is keen to support global causes. Little said: "In the past, people gave money and then stepped away. This new generation are a lot more ambitious and proactive."

Rather than just contribute to charities and causes, respondents emphasised how much they want to see the impact of their giving. Some 45 per cent of donors said they would prefer to have given their wealth away before they die, so they can see its impact.

Little said: "In some ways, the recession and its knock-on effects have galvanised the attitudes and approaches taken by wealthy donors, who are in a bullish mood to not only carry on giving, but make an even bigger impact in the future."

Fraser Doherty, who founded SuperJam after uncovering his gran's recipes when he was just 14, is an example of a young Scottish entrepreneur who sees himself as a philanthropist. His company, which supplies jam to supermarkets, saw its sales hit 750,000 last year.

Also last year, Doherty, now 20, launched a charitable project called SuperJam Tea Parties for elderly people. Since then, more than 120 tea parties have been held, reaching thousands of elderly people who live alone or in nursing homes.

Doherty said: "As the SuperJam brand grew, I felt a strong inclination to give something back. Although the entrepreneurs of my generation have great ambitions for success and wealth, they are often equally motivated by philanthropy."

He added that socially conscious younger entrepreneurs are more interested in spreading their wealth than in "get-rich-quick" schemes.

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