Philanthropy: Three reasons why global giving is reaching its limits

In a report titled "Philanthropy: Three Reasons Why Global Giving Hits Limits," a key issue highlighted is the challenge faced by the American aid organization in accepting foreign donations. While the organization has successfully convinced numerous supporters, the funds must still cross the border into the United States. European donors are unable to initiate donations due to the lack of a receipt for their donations in the US.

Moreover, the Trump administration's threats of freezing donations to organizations deemed "woke" further dissuade European donors. As a result, the organization decided to establish a branch in the Netherlands, leading to an inefficient dual structure for accepting funds. This scenario is not unique; many large nonprofit organizations grapple with this issue, creating multiple branches across the globe.

The reasons for the proliferation of these duplicate structures remain unclear, but they are estimated to be in the hundreds.

One notable example is the Belgian-founded King Baudouin Foundation's American subsidiary, which manages over 500 European friends' circles. This allows the organization to avoid establishing a separate entity in each country. However, for those seeking to avoid this process, intermediary foundations exist. These foundations issue receipts in the donor's home country and then transfer the funds to a partner organization in the target country. However, these intermediary networks charge around five percent for their services.