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Social Issues: Charitable Donations Essay

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Updated: Mar 17th, 2020

Introduction

Many people across the globe make charitable contributions. For instance, in 2000, nearly 90 percent of the Americans contributed to charitable organizations. In 2009, nearly $330 was donated to charitable organizations by individuals in the United States of America (U.S.A).

This constitutes 75 percent of the total donations made to charitable organizations in the US. Also, the amount makes up to 2 percent of the Gross Domestic Product and is the main source of revenue for charitable organizations (Vesterlund, 2006, p. 1).

The biggest question that lingers in the mind of many researchers is the reason why millions of individuals are simply giving away their hard-earned cash. What inspires them to act in such selfless or selfless manner? Vestlund tried to answer these questions from an economic point of view. Nonetheless, these questions are yet to be comprehensively answered (Steinberg, 1998, p. 1187; Vesterlund, 2006, p. 1).

The essay will explore the impact of social factors, particularly personal values on individual contributions to charitable organizations. The essay will also provide insight into the forms of interventions that are likely to be adopted by charitable organizations to attract new donors, as well as increasing the contributions of the existing donors.

Last but not least, a case study analysis of a charitable organization will be conducted. The case study will explore the techniques used to attract and increase donations from individuals. The essay will also look at how successful the techniques are.

Impact of personal values on charitable donations

Many studies have been carried out to establish factors that influence individual contribution to charitable organizations. These studies have significantly contributed to an empirical model of donor perceptions and their impact on contributions (Steinberg, 1998; Andreoni, 1989; Sergeant, Ford & West). According to Bekkers and Wiepking (2006, p. 534), there are six factors that influence charitable donations by individuals.

These factors include awareness of the need to contribute, solicitation, selflessness, cost of the benefit, status in the society, and personal values. These factors suggest specific measures that can be taken by charitable organizations to enhance individual donations and increase revenue. Nonetheless, the essay will mainly focus on personal values.

Strong personal and ethical values have, for a long time been linked to the distribution, size, and frequency of charitable donations. However, individual and ethical values have been specifically complex to study empirically since they are intrinsically not capable of being controlled. As a result, studies on personal values have been limited to donations among groups with different values (Kvaran, 2012, p. 21).

Bekkers and Wiepking (2006) produced significant research in this particular factor. They showed that people who are selfless or supported social values and those who support ethical values frequently give to charitable organizations.

Besides the above values being linked to altruism, values linked to the particular cause are prognostic of altruistic behavior to specific contributions. Kvaran (2012, p. 21) stress that personal value is the principal motivator of charitable contribution among the general public.

According to Kvaran (2012, p. 22), pro-social values have a positive correlation with altruistic contributions. Several sociology and philanthropic studies have shown that individuals with altruistic values, pro-social values, who are generally less materialistic and have moral principles, are more likely to give a huge amount of donations because they are inspired to make the world a better place.

The studies also show that people, who are concerned about the social order, harmony, social justice, social responsibility for a particular organization and the society at large, are likely to give frequent donations (Bekkers & Wiepking, 2007, p. 25).

The social, psychological and philanthropic studies not only link general personal values to the distribution and size of charitable donations but also specific values that are intrinsic (Bekkers & Wiepking, 2006, p. 538). Benevolence is a means of attaining the desired conditions that are close to an individual’s perspective of a better world. He adds that the model world depends on an individual’s value system.

Through charitable donations, donors may wish to donate regularly to minimize or get rid of the inequalities within the society (Kvaran, 2012, p. 5).

Bekkers and Wiepking (2006, p. 542) emphasize that donors values or objectives that may drive some individuals to contribute to particular organizations may be ill-informed, partisan or dangerous, for instance, religious values that have led to the radicalization of the youths and the spread of global terrorism. Nonetheless, most individual donors are always inspired by causes that are aimed at making the world a better place.

Kvaran (2012, p. 28) states that individual values are normally influenced by expressive social norms. The expressive norms are subjective views of characteristic behavior within specific conditions, that is, an individual’s belief about other people or phenomena.

Though habitually ill-informed, expressive norms have been continually identified to be significant predictors of a wide range of individual decisions. Several empirical studies have provided undeniable evidence that expressive norms have a substantial impact on the size and frequency of individual contributions to charitable organizations (Kvaran, 2012, p. 29).

Methods used to attract and enhance individual donor contributions

Charitable organizations use different methods to attract and enhance individual donor contributions. However, all the techniques used are mainly based on the perceptual mechanisms that influence charitable donations.

These mechanisms include awareness of the need to contribute, solicitation, cost and benefit, selflessness, reputation, and individual values. The impact of personal values on charitable donations has already been discussed. The essay will only focus on the most noteworthy mechanisms.

Awareness of the need to contribute to charitable organizations is the precondition for charity. Before an organization starts appealing to the general public to contribute, it has to make people aware of the need to contribute. This can be achieved through a vigorous campaign and advertising.

Philanthropists have classified these needs into material needs, social needs, and psychological needs. The material needs include basic needs like food, shelter, clothing, education, and medical care. On the other hand, social needs include the need for a social company. Lastly, psychological needs include the need for counseling and consolation, among others (Bekkers & Wiepking, 2007, p. 9).

Some organizations have taken their campaigns a notch higher by arranging for the donors to meet the needy victims. Studies have shown that when a donor meets one victim or two, he/she will be willing to give to other victims to whom he /she haven’t met individually. Therefore, the propensity to contribute can be enhanced when donors know the probable beneficiaries of a particular organization.

In most case, awareness of the needs is facilitated through social media and mass media. The two media channels are commonly used because they can reach the largest proportion of the targeted audience (Bekkers & Wiepking, 2007, p. 9).

Solicitation is another common method used to attract individual contributions. Solicitation precedes thoughtful consideration of all kinds of cost and benefits of charitable contributions. Solicitation means asking people to donate. The various methods of solicitation are covered under different mechanisms.

They include: issuing fundraising letters, sending direct or electronic mails, personal requests, advertising through the media, and interacting with the potential donors. Most charitable donations occur due to the solicitation. Studies have shown that active solicitation increases the size and frequency of an individual contributing to a given cause (Kvaran, 2012, p. 19; Bekkers & Wiepking, 2007, p. 12).

Cost and benefits approach is also used by several organizations to enhance the distribution and frequency of donations from the general public. Cost and benefits approach is associated with material costs and gains accrued from charitable donations. It is obvious that material donations cost money. Several organizations have lowered their cost of donations to attract a new bracket of donors to increase revenue.

This simply means lowering the amount requested and the associated cost. Many organizations have effectively achieved this by borrowing several marketing principles. The amount these organizations request depends on several characteristics, for instance, individual income, neighborhood and size of the organization, among others (Bekkers & Wiepking, 2007, p. 12).

In some occasions, contributions to charitable organizations come with certain incentives or benefits. For example, certain donations can earn an individual a holiday trip, exclusive dinners, or meetings with celebrities or prominent persons in society.

Such contributions may be portrayed as an exchange, especially when they are based on spending motive. The benefit mechanism has been extensively explored by marketing and economic researchers. Providing access to exceptional services or benefits increases an individual’s chance to contribute (Kvaran, 2012, p. 20).

Individual status is another significant aspect that affects the distribution and size of charitable donations. Philanthropists define reputation as a social consequence of contributing to charitable organizations. The consequences occur between an individual and the rest of the society, that is, the society can reward an individual for contribution or punish him/her for not contributing.

The impact of reputation on charitable contributions has been widely explored by psychological and economic studies (Bekkers & Wiepking, 2007, p. 12). Most charitable organizations normally target prominent members of society, large organizations, and institutions.

Prominent personalities, for instance, politicians always make contributions to enhance their chances of re-election. On the other hand, organizations normally consider such activities as part of their corporate social responsibility (CSR).

Case study Analysis: Care International

Overview of the Organization

Care International is a global humanitarian agency established in 1945. Care is one of the leading charitable organizations in the world, focusing on poor people in the society. The organization operates in over 87 countries across the globe, supporting nearly 1000 humanitarian and poverty alleviation projects.

The organization has helped over 100 million needy individuals since its inception. The organization is mainly concerned with material and social needs, for instance, food, shelter, clothing, education, medical care, women and youth empowerment and infrastructure development among others (Care International, 2014).

Care International’s Donor Attraction Strategies

Being an international aid and humanitarian organization, the organization applies almost all the available strategies. The most common strategies used by the organization include solicitation, awareness of the need to contribute, cost mechanisms, and reputation. Care International has used every means to make the global audience aware of the need to support the poor in society.

They have achieved this through vigorous campaigns and advertising through the mass media and the internet. At the moment, an individual can get a first-hand glimpse of the projects being undertaken by the organization in different parts of the world through its website.

Also, the organization has used various platforms to enable donors to meet the victims. These platforms incorporate online channels, newsletters, documentaries, and many more (Care International, 2014).

Care international also solicit funds from individuals, organizations, and governments. The organization normally solicits funds from other organizations, for example, the United Nations and the European Union through project proposals. This also applies to various countries across the globe.

Individuals can contribute through the online account available in the organization’s website, as well as through mobile applications. The company has also raised funds through fundraising and community mobilization campaigns. Also, the organization has lowered the cost of donations to attract a new bracket of donors. Nowadays, donations are made free of charge without attracting additional costs.

Last but not least, the organizations also targets prominent/wealthy individuals and large multinational corporations for major projects. The well-known personalities not only contribute to the organization but also help the organization to solicit more funds. The companies are targeted as part of their corporate social responsibility. In most cases, the companies targeted are those within the locality (Care International, 2014).

Corporate social responsibility is defined as the regular commitment by corporations to act morally and take part in economic development, whereas enhancing the quality of life of the employees and the surrounding community.

CSR occurs when businesses engage in operations that seem to present a societal agenda beyond the prevailing statutory requirements. In the earlier days, CSR was viewed as a corporate charity until the early 90s. Since then, companies are now seeing CSR as a strategy for surviving the current turbulent environment. In other words, businesses have now realized that CSR can be used to gain a competitive advantage within an industry (Baron, 2001, p. 7).

A survey conducted by the organizations has shown that its vigorous campaign to create awareness of the need to contribute has led to an increase in the rate and frequency of contribution among the donors. Particularly, this is true among the asylum seekers in the U.S and other European countries. Some of these people have experienced the same ordeal and therefore are very willing to join hands in fighting poverty.

Similarly, a survey conducted by the company shows that nearly 80 percent of the donations are attributed to the solicitation. The high number of solicitations has increased the distribution and size of donations within the organization.

Also, the lowering of the cost of donation has enhanced the frequency of donation, especially among lower income earners. Lastly, the adoption of a reputation mechanism has greatly enhanced the volume of donations. In a nutshell, the organization has benefited considerably from the above methods. For these reasons, the adopted techniques have fairly achieved their objectives. Therefore, the techniques have been relatively successful.

Conclusion

Many people have been wondering why millions of individuals are simply giving away their hard-earned cash for charity. Bekkers and Wiepking (2006, p. 534) attribute it to six factors. These factors include awareness of the need to contribute, solicitation, selflessness, cost of the benefit, status in the society, and personal values.

Numerous methods that have been used by donor organizations to attract and enhance individual donor contributions have been based on the above factors. The most common strategies used by Care International include solicitation, awareness of the need to contribute, cost mechanisms, and reputation. The use of these mechanisms has proven to be relatively successful.

References

Andreoni, J 1989, ‘Giving with Impure Altruism: Applications to Charity and Ricardian Equivalence’, Journal of Political Economy, vol. 97, no.6, pp. 447-58.

Baron, D 2001, ‘Private politics, corporate social responsibility and integrated strategy’, Journal of Economics and Management Strategy, vol.10, pp.7-45.

Bekkers, R & Wiepking, P 2006, ‘To Give or not to Give, that’s the Question. How Methodology is Destiny in Dutch Data’, Non-profit and Voluntary Sector Quarterly, vol.35, pp.533-40.

Bekkers, R & Wiepking, P 2007, A literature review of empirical studies of philanthropy: Eight mechanisms that drive charitable giving, University of Amsterdam, Amsterdam, Netherlands.

Care International 2014, What We Do, viewed 2 June 2014, <http://www.care-international.org/>.

Kvaran, T 2012, The Influence of Social Norms and Personal Values on Charitable Giving Behaviour, University of Arizona, Arizona.

Sergeant, A, Ford, J & West, D 2005, ‘Perpetual determinants of non-profit giving behaviour’, Journal of Business academic research, vol. 2, pp. 3-11.

Steinberg, R 1998, ‘Towards a theory of charitable fundraising’, Journal of Political Economy, vol. 106, pp. 1186-1213.

Vesterlund, L 2006, Why do people give? viewed 2 June 2014, <http://www. pitt.edu/~vester/whydopeoplegive.pdf>.

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