on many levels
Financed by donors with a cause, philanthropy tackles with success the roots of social issues
By Jean-Luc Burlone
Health and education are the most important domestic issues to be addressed for healthy and productive future generations. They also represent the highest share of a government budget. In Quebec, health and education represent over 35% and 21% respectively of the provincial budget.
Advances in medical research are essential to reduce health cost. Moreover, according to the financier and philanthropist Michael Milken, “50 percent of all economic growth in the world has come from public health advances and medical research” (February 2016).
Philanthropy spearheads effective educational approaches and medical research.
Education empowers people to enjoy a decent life and to be more productive at work. Better educated, people become more conscious about health issues, they live longer, happier and add positively to society. Both health and education benefit from technology particularly with respect to the dissemination of information and AI.
Philanthropy spearheads effective educational approaches and medical research. Its successes bring valid arguments that entice governments to act in the public interest by disseminating information, financing new approaches and services or by approving proven medication. Governments also alleviate substantially the tax burden of donors, either during their lifetime or for their estate.
However, financial interest is rarely the main motivation. Donors act first and foremost for personal reasons. They may be touched by the plight of others, acquaintances or dear ones. Or they seek to improve the lot of those in need in an effective way.
‘Donors can fulfill their will to help through countless possibilities and an increasing number now give while living to follow the impact of their gesture.’
Most appreciate the historic resonance of philanthropy that answers partially questions such as: What is success for? What is my wealth for? Or what am I accountable for? Donors can fulfill their will to help through countless possibilities and an increasing number now give while living to follow the impact of their gesture.
Numerous causes are worth considering according to one’s values and beliefs. The well known Bill & Melinda Gates Foundation acts internationally to give the poor in developing countries access to decent education and health services. Rich countries are in need on several fronts as well.
In Canada for instance, one Canadian out of 340 lives with multiple sclerosis and 75% of the affected are women. Sadly, our country ranks first among all nations affected by this dreaded, autoimmune disease. Multiple sclerosis degrades the body insidiously. It comes and goes or progresses continuously. In both cases, the affected slowly but surely looses his or her ability to function at home and at work.
Today, donors can invest wisely to tackle specific goals. They donate once the due diligence process confirms that their donation is in line with their objective and they can follow and assess how their donation reaches it.
‘The funding of research on multiple sclerosis (MS) and programs offered to people living with MS are largely made possible by various fundraising activities.’
Louis Adam, Executive Director, Quebec Division, Multiple Sclerosis Society of Canada
Donors to the Multiple Sclerosis Society, for instance, support one of the most rigorous research centres in the world and they can finance a specific research with a defined objective. Or they can participate in a project that alleviates the suffering of affected families.
“The funding of research on multiple sclerosis (MS) and programs offered to people living with MS are largely made possible by various fundraising activities,” explained Louis Adam, Executive Director of the Quebec Division of the Multiple Sclerosis Society of Canada. “Planned giving is another way for donors to make a difference in the lives of people affected by MS. It is an investment towards a future free of MS. Charitable bequests, gifts of life insurance, charitable annuities and gifts of listed securities and real estate are among the options that a donor can select to create his legacy,” added Louis Adam.
‘… though the financial benefit is worth mentioning, philanthropists argue that giving by itself brings an unparalleled satisfaction.’
Once the objective of the gift is stated, the donor considers financial strategies to reduce the after tax cost of his or her gesture. A well-planned donation can transfer, to a large extent, tax money to the philanthropic goal. For example, the capital gain tax is eliminated when publicly traded shares are given. In addition, the donor receives a tax credit for the fair market value of the shares.
Again, though the financial benefit is worth mentioning, philanthropists argue that giving by itself brings an unparalleled satisfaction.
For more information on the MS Society Legacy Gift Program, call 514 849-7591 or visit mslegacy.ca
Read also: Setting your financial risk
Jean-Luc Burlone, Ms. Sc. Economy, FCSI (1996)
Economic Analysis – Financial Strategies
The text above is my personal view, based on a review of the economic and financial press on the subject. October 25th, 2017. JLB
Fellow of the Canadian Securities Institute (FCSI), Jean-Luc Burlone has an excellent knowledge of financial product management and holds a Master’s degree in economics from the Université de Montréal with a dual specialization in development economics and International economy – finance and trade.