This multiplier effect ends up broadening the scope and reach of philanthropy throughout the community.
Mining magnate Andrew Forrest was aiming for precisely this impact when he announced his latest philanthropic donation of $400 million – which included $75 million for universities and $75 million for combating cancer.
When the donation was unveiled in Canberra, Forrest said part of his motivation was to encourage more Australians to give. He also wanted to make a difference “in addressing some of society’s most complex challenges”.
If you want to help solve some of society’s biggest challenges – disease, food and water security, our future energy needs – you must invest in new knowledge and innovation.
Which is perhaps why this latest high-profile donation is part of a trend of philanthropic support for universities.
A trend which is on the rise.
A jump in bequests
New funds secured from bequests to universities jumped by 156 per cent from 2014 to 2015, according to the Council for Advancement and Support of Education (CASE).
Of course, philanthropic giving could never replace direct government investment in universities which funds the core missions of education and research. Nor should it.
Donations usually provide additional money for scholarship programs or specific research projects that need initial government funding to get started.
For example, if a university project has national government funding, that initial capital can help bring others to the table, including private donors.
But while there are many factors behind the growing interest in philanthropic support for universities, one element is the compelling story we can tell.
Universities at heart of the nation
University education and research has the power to change lives and to drive economic growth.
Universities are also at the heart of soft diplomacy and create an engaged community of alumni, academics, and leaders across the world.
And increasingly, in Australia, high-profile donors are inspiring their peers.
Andrew Forrest has said he was influenced by US philanthropists like Bill Gates, who last year gave more than $US200 million to the University of Washington.
Forrest also acknowledged the large donations of Australian financier Graham Tuckwell and his wife Louise Tuckwell, who gave a record donation of $200 million to ANU.
A decade ago, high-profile donations to Australian universities at that scale simply did not exist.
When philanthropy in Australia was in its infancy, institutions had few professionals whose role it was to lead large-scale outreach activities.
Moore’s law of philanthropy
The US has one of the strongest philanthropic cultures in the world. But it’s taken them 400 years to get there.
One of the first university gifts was from John Harvard, who bequeathed his library and half of his estate to the newly founded school.
That was in 1638. Less than 10 years later in 1643, Harvard conducted reportedly America’s first recorded fundraising drive. It raised £500 and was considered a success.
These days Harvard has the world’s largest endowment fund, at $US37.6 billion ($50 billion).
In the UK, the 900-year-old University of Oxford’s first professional fundraising campaign in the 1980s raised £342 million. Only 20 later, it launched a campaign to raise £1 billion. Instead it reached £2 billion.
What counts though, are not the amounts raised but the speed with which philanthropy and university advancement have become professionalised. The US took hundreds of years, the UK took decades, and Australia, a matter of years. The Moore’s Law of Philanthropy.
In the process of reaching out to donors, an exciting engaged university community is created. That community has the power to change lives and the destinies of nations. Not to mention the lives of the givers.
That’s the ultimate impact of giving for living and living to give.
Belinda Robinson is Chief Executive of Universities Australia.
Published in The Australian Financial Review.