The exact recipe for guiding the younger generations in philanthropy is frequently discussed among high-net-worth families across the country, as well as within the walls of multi- and single-family offices.
While this conversation is happening, Canada is experiencing a growing “charity gap,” where the demand for charitable services is outpacing funding. Myriad studies and reports show charitable donations dropping over the last couple of decades.
One trend that has remained consistent over the years is the diminishing engagement of younger Canadians in charitable giving and an increasing reliance on older donors. According to CanadaHelps’ 2024 Giving Report, 39 per cent of individuals aged 18 to 24 reported making charitable donations. This percentage increases progressively with age, reaching a high of 80 per cent among Canadians aged 70 and older. In other words, seniors remain the most charitable demographic.
That high-net-worth households account for over 40 per cent of the total donation value underscores a crucial dynamic: Canada’s charitable sector is heavily dependent on a small, aging segment of the population with considerable wealth.
Ron Bernbaum, Founder and CEO, PearTree Canada, confirms that the majority of PearTree donor clients are a part of this demographic, but he points out that one reason the younger generation doesn’t give as much is simply that they don’t have as much to give. After all, prices are sky high across the board for many Canadians, especially housing, which tends to eat up a big chunk of younger families’ budgets. That said, Bernbaum notes that PearTree is seeing a reassuring indicator that early achiever entrepreneurs and professionals are as generous as their parents and grandparents and are open to donating more in tax-efficient ways.
The great generational wealth transfer in Canada is under way—with an estimated $1 trillion expected to pass from Baby Boomers to their Millennial and GenX offspring over the next few years. That presents a unique opportunity for the older generation of affluent families to guide second and third generations in charitable giving.
“That kind of mentorship around values is so important in cultivating the next generation of philanthropists and donors,” says Ruth MacKenzie, president and CEO of the Canadian Association of Gift Planners (CAGP). She points to recent research at CAGP that suggests high-net-worth individuals are looking for deeper conversations around philanthropy. “The older generation of legacy donors wants to find ways to create more meaningful relationships with their children around philanthropy,” she says.
Among the most effective ways to create those relationships, says Jean-Marc Mangin, president and CEO of Philanthropic Foundations Canada, is to start early. “The sooner younger generations get involved, the better for a culture of giving to be firmly rooted.” What’s more, Mangin says, when children are exposed to their parents’ passion for charitable work, they naturally absorb that enthusiasm. “Sharing with young people a sense that something is achieving impact and creating hope,” he explains, “is a critical component of getting new generations involved.”
“Giving is learned behaviour,” states Imagine Canada’s 30 Years of Giving. The report asserts that “Canadians who participate in community-oriented activities when they are young or observe people they admire helping others are more likely to donate as adults.”
Participating in community-based events is often how the older generation became involved in philanthropy in the first place, says Imagine Canada’s president and CEO, Bruce MacDonald. “Fifty or more years ago, there were places in society that fostered conversations and action about your neighbour, your community and your church,” says MacDonald.
With fewer young people engaging with traditional institutions such as places of worship or community centres, the responsibility to instill charitable values increasingly falls to families to nurture these ideals at home. Neglecting to do so could be a lost opportunity.
MacKenzie, Mangin and MacDonald agree that high-net-worth individuals can foster a legacy of philanthropy by encouraging their heirs to view charitable giving not just as an obligation, but as a meaningful part of their identities and values. Here are a few of their suggested strategies for cultivating a culture of giving:
Ruth MacKenzie, president and CEO, Canadian Association of Gift Planners
“The younger generation often wants to be more involved; they want to see the impact of their donations and engage with charities differently from previous generations. The younger cohort has a greater level of trust in charities than some of their parents might have had, and they want to be part of a charity. They want to hear about the difference they’re making.”
Bruce MacDonald, president and CEO, Imagine Canada
MacDonald suggests high-net-worth families encourage their kids to attend recognition events. “Bring them in as a family, so that the younger generation—whatever their age—experience both the joy that’s realized by giving and the impact it’s having.”
Jean-Marc Mangin, president and CEO, Philanthropic Foundations Canada
Mangin suggests families make room for the younger generation to explore different ways of approaching philanthropy.
“To get collective buy-in, older generations must create space for younger generations to learn and even influence strategy. This way, second and third generations will understand how philanthropy is a critical component of the ties that bind us together as a society. While recognizing the value and the impact of what’s been done in the past, the younger generation must be allowed to approach philanthropy differently.”
As best practices for creating a lasting culture of giving evolves, PearTree Canada continues to partner with philanthropists and charitable organizations to advance the conversation. PearTree’s core value and mission is helping generous Canadians increase donations specifically through its flow-through share donation platform, which enables high-net-worth Canadians to donate in a tax-efficient way. More than 2,500 charities are supported annually via PearTree’s platform, while simultaneously funding a half a billion dollars annually in northern job creation in Canada’s mineral exploration sector.
Yet the driving force at PearTree is a fundamental belief in the value of giving. That’s why Bernbaum and his team sponsors events and initiatives working closely with Imagine Canada, Canadian Association of Gift Planners, Philanthropic Foundations Canada, and other charitable organizations to promote and protect philanthropy in Canada.
Bernbaum views PearTree as an enabler for the sector. “And we are keen to help people give money away,” he adds, “whether it’s through us or through other techniques.”
Disclaimer: This story was created by Canadian Family Offices’ commercial content division on behalf of PearTree Canada, which is a member and content provider of this publication.