Gen Z is redefining the possibilities of generosity by demanding more bang for their charitable buck
- Charities would be wrong to neglect reaching out to those born after 1997 because of their relative lack of disposable income and their penchant for moral one-upmanship
- Instead, the humanitarian aid industry must answer the two questions Gen Z is posing: how do you measure impact? What’s in it for me?
Critics are quick to cast this as performative posturing void of any real-world impact. But it is a grave mistake for the global humanitarian community to dismiss this generation as self-absorbed virtue signallers.
Sadly, 20 years on, the urgency of World Humanitarian Day is as pressing as ever. Over 360 million people depend on tireless humanitarian workers to deliver basic necessities like food, water, education and safety.
Behind them stands a global machinery of giving, comprising local single-issue charities, wealthy philanthropists, family foundations and global non-profits. In the United States alone, the Giving Institute reports US$499.33 billion in total annual giving last year, and the Internal Revenue Service counts 1.48 million registered charitable organisations.
Surely, if the need for humanitarian assistance is ballooning proportionally to the world’s ills, Gen Zs moral one-upmanship will prove utterly fruitless in tackling them? Clearly, charities’ neglect in getting them on board as serious donors is justified given their lack of relative disposable income? Charities are wrong to think so.
Born between 1997 and 2012, the 68 million members of Gen Z who make up 20.6 per cent of the US population are quietly shaping a new paradigm in generational giving. Gen Z is already proving to be one of the most generous generations, when measuring total annual giving as a percentage of disposable income.
Gen Z dares to ask the two forbidden questions in the humanitarian aid industry: how do you measure impact? What’s in it for me?
They are unconvinced by NGOs saying “we’re trying” or “we’re on a journey”. A study by Paypal Giving fund in Canada found that more than any other generation, members of Gen Z care about being informed about the impact of their donations when giving online.
Recalibrating impact transparency as a governance priority, the US$8 billion impact measurement industry is predicted to grow 300 per cent by 2030. This is shattering the misguided frugality-at-all costs mentality, which holds that non-profits who spend the least on overheads create the most value for the communities they serve. Encouraging underinvestment in non-profit workers and technology, this overhead myth only exists to fulfil short-sighted donor satisfaction.
By asking how much moral bang they get for their buck, Gen Zs are redefining the possibilities of generosity.
We must not dismiss this as the generational trope of youthful naivety and entitlement. After all, their abandonment by the very institutions mandated to protect them has instilled a deep-seated distrust in them.
The advent of the internet filled the vacuum these institutions left behind. Creating a self-organising venue for alternative narratives, social media platforms pried open the black box of human misery, allowing the first-ever digital-native generation to take a deep look inside of it.
By bypassing the monopolised conflict reporting of non-profits, we can now directly engage with disaster victims. Crowdfunding sites offered viable alternatives to traditional fundraising methods: 43 per cent of Gen Zs in the US contributed to an individual’s personal cause on GoFundMe last year.
These postmillennials reject the view of aid recipients as hopeless objects predicated on an imperial understanding of charity, which divides the world into a check-writing “West” and a rule-abiding “rest”.
As a consequence of 40 per cent of Gen Zs in the US conducting significant research into non-profits before donating combined with the popularity of crowdfunding sites, the surface area for social causes to support grows dramatically. Individuals can simultaneously act as donors and actively champion social causes.
To survive, charities must understand Gen Z demographically, psychographically and behaviorally. They must find sticky engagement models and invest more in their workers and fundraising technology. Effective cause-based storytelling that sells social outcomes, not perceived effort, must be the norm.
Gen Zs are injecting a refreshing free-market ethos into a sector entirely devoid of market forces. It’s time we take them seriously. Let’s let them have their revenge.
Fabio Richter is a technology entrepreneur based in London, UK