Health Tops List of Causes Supported by International Grant Makers

Grant makers have been pouring a growing share of their overseas dollars into health projects, replacing

economic development as the international cause that gets the most from foundations, according to a new report.

The rise in the proportion of grant dollars for health-related causes can be explained by “a growing philanthropic response to the global AIDS crisis,” as well as by “huge increases in support for disease prevention, public health, and reproductive health-care programs,” said the report by the Foundation Center and the Council on Foundations. In particular, it noted that two of the biggest U.S. foundations, the Bill & Melinda Gates and David and Lucile Packard Foundations, have been pouring a lot of money into overseas health care in recent years.

The report examined international grant making from 1998 to 2002. It found that in 2002 foundations gave an estimated $3.1-billion to nonprofit groups abroad and to U.S. charities that operate overseas. Adjusted for inflation, that represents a 76-percent increase from 1998.

However, U.S. foundation giving overall slipped last year, declining an estimated 0.7 percent from 2001, and support for international programs shrank 5 percent, to $3.1-billion, from $3.3-billion in 2001.

The decline in international grant making was the first in 12 years. One reason for the drop in 2002 was that several foundations did not repeat big multiyear grants they had made the previous year. For example, in 2001 the Ford Foundation, in New York, gave $275.5-million to its International Fellowship Program.

Outlook for Future

The report said the outlook for donations abroad in 2003 and beyond was mixed. It noted that a “heightened focus on peace and security” could prompt more foundations to send money overseas, but it added that “new U.S. Treasury Department guidelines designed to prevent the funding of terrorist organizations” could make some grant makers more reluctant to give overseas.

However, a continuation of the sluggish economy would be a more likely reason for a sustained decline in overseas giving.

In addition to examining giving by all foundations, the report took an in-depth look at grants of $10,000 or more by 1,007 foundations in 2001.

Grant makers in the sample contributed $2.5-billion for international programs, more than double the amount in 1998. However, the rise in international grants by five large grant makers — the Ford, Freeman, Packard, and William and Flora Hewlett Foundations, and the Carnegie Corporation — accounted for 40 percent of the increase. In addition, a sixth grant maker, the Bill & Melinda Gates Foundation, donated more than one-fifth of the total given by the sample group.

The biggest share of gifts in 2001 went to health-related causes (29 percent), followed by education (17.2 percent) and overseas development (11.6 percent).

Both the number of grants made to international groups and the number of foundations supporting international causes rose from 1998 to 2001. The analysis found that grants for international programs increased by 25 percent and the number of foundations giving overseas rose by 10 percent. Community foundations saw the biggest gains in support for international programs, up 248 percent to nearly $22-million, and corporate gifts almost doubled, to $108-million.

Copies of the four-page report, “International Grantmaking Update, 2003,” are available free from the Foundation Center, Attn: Leslie Marino, Research Department, 79 Fifth Avenue, New York, N.Y. 10003-3076; (800) 424-9836, or in New York (212) 807-3690. Copies are also available online at http://www.fdncenter.org/research/trends_analysis/index.html.