The next big thing in Israeli philanthropy

©The Jerusalem Post

Yad Ezra V’shulamit CEO Benny Lurie operated a forklift loaded with donations (photo credit: YAD EZRA VESHULAMIT)

Israeli society was built by the sweat of pioneers. Today, it’s time to take the task of building the Jewish state into the philanthropic digital age.
Jewish history is distinguished by the role of mutual aid, solidarity and communal giving. Rooted in the Hebrew Bible, tzedakah (charity) has been part and parcel of Jewish life throughout the ages.
Here in Israel, so many of the institutions we rely on were built by that proud tradition. Even before the existence of the state, land was acquired, hospitals were staffed, and educational institutions were built via a web of organizations that provided essential services to meet the population’s growing needs.
What characterizes these initiatives is that where there is a need, people join together to meet it. Visionaries, funders and doers converge to serve their fellow Jews.
While Israel boasts a far healthier and more prosperous society than it once did, there remains much to do. Rapid population growth alongside rising life expectancy means that demand for nonprofit services and support only grows. Charitable giving can augment governmental action in a time of shrinking government coffers. It can also lead societal change and encourage innovative models in ways the government simply cannot. Philanthropy is thus not merely an obligation, but an opportunity to create, inspire and engineer change.
Since the pre-state period, most philanthropic support was sourced from generous Jews around the world. Yet over the last two decades, homegrown philanthropy in Israel has developed remarkably.
As Israeli society becomes wealthier, giving capacity grows, the number of NGOs increases rapidly and our philanthropic endeavors demand greater sophistication. We Israelis tend to react to immediate causes and campaigns.
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According to a study by Tel Aviv University’s Institute for Law and Philanthropy, more than 50% of Israelis give spontaneously on the street, to door-to-door charity collectors, or to fund drives at supermarkets. Yet only 30% of Israelis give strategically and donate “proactively,” earmarking sums in advance for specific charities and causes.
An inspiring example of the Israeli impulse to give in response to immediate causes is the positive giving trend evident during the current coronavirus crisis. Israelis have stepped up in an amazing way, continuing to give at or above previous levels.
During the third quarter of 2020, Israeli donors made 106,381 donations through JGive’s platform, totaling in excess of NIS 32.8 million, a 43% increase in the number of donations and a 26% increase in the amount donated compared to the same period last year.
WHILE THIS generosity is inspiring, the lack of suitable philanthropic vehicles results in certain shortcomings. “Reactive” giving – such as fishing out a coin or bill to give to a needy passerby, writing an unplanned check to a door-to-door collector, or making a credit card donation by phone in response to a telephone campaign – tends to occur in smaller amounts than planned donations, reaches a narrower spectrum of charitable causes and fails to harness an individual’s increases in income and financial windfalls. The net result: Giving to Israeli causes by Israelis lags far behind other advanced countries, according to the Israel Central Bureau of Statistics, with 65% of charitable giving to Israel still being sourced from overseas.
So how can we foster a more proactive – and thus effective – approach to giving? How can Israelis be encouraged to plan and think more holistically about charity?
Nearly 90 years ago, the first donor-advised fund (DAF) was established in the US. This unique giving vehicle provides a framework that encourages donors to treat charitable giving strategically. When a donor opens a DAF, they create something akin to their own private foundation – but without all the paperwork and fees. DAFs allow donors to “bank” sums designated for charitable giving when convenient for them, and claim the full tax credit immediately. Then, when they are ready to give – whether a modest gift or a legacy-establishing grant – they can draw on funds from the DAF. And during the time period that a contribution is waiting to be gifted, that contribution may be invested and grow tax-free inside the DAF.
When donors create a pool of funds for nonprofit endeavors in a DAF, it enables them to think strategically about the process of giving. It engenders planning, engagement and a conscious investment, and often greater familial (and multi-generational) involvement. It helps donors think about what problems in Israeli society they wish to address, what causes to support, and what challenges to tackle.
This year especially, when the nonprofit sector has been hit hard, the DAF model of success is being introduced and adapted to Israel by JGive – making giving not only strategically advantageous, but also completely digital and easy to use.
And while a change in how people can give might seem trivial, the results speak for themselves. In the US alone, contributions to DAFs have grown annually by 13.5% in the last few years and now stand at above $121 billion. Year over year, the number of accounts increases, contributions grow and donations to worthy causes multiply. Today, DAFs are the fastest-growing segment in the US philanthropic landscape.
So much of what we take for granted and rely on today, from healthcare to education to the environment and beyond, is thanks to the good works of those who came before us. To create the next generation of Israeli pioneers, we need to take advantage of the opportunity – and new tools available that empower us – to take more responsibility, think more strategically and fund those causes that will create the society we want for future generations.
The writer is CEO of JGive, a nonprofit dedicated to fostering Israeli philanthropy. JGive has recently launched Israel’s first donor-advised fund, which you can learn more about at platinum.jgive.com.
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