With many different names for charitable organizations – charities, foundations, non-profit – you might be wondering what the differences are between all of the not-for-profit organizations out there. Or is there any difference at all? In this blog post, we take a look at what a charity is, a brief history of how they developed, different types of charities, and things to consider when choosing a charity to support.

What Is A Charity?

A charity is a non-profit organization whose primary goal is to undertake activities serving the public interest. These are often philanthropic or social welfare objectives focused around themes, such as health, environment, education, poverty, and so forth, with many charities working to achieve specific goals within their areas of focus. Most charities depend on donations and fundraising activities in order to operate.

The definition of a charitable organization varies between countries and is based on the charity taxation law of each individual country. In the United States, the Inland Revenue Code divides organizations into two general classes: private foundations and public charities. The big difference is funding, with public charity funding derived from multiple sources, whereas private foundation funds usually come from a single major source.

Private foundations are characterized as typically receiving gifts or grants from one individual, family or corporation, and most private foundations are dedicated to providing grants to other charitable organizations and individuals, rather than operating a primary charitable program or programs.

Conversely, public charities often solicit funds from a range of sources to fund specific programs that the charity operates. The public charity designation covers a wide range of organizations including:

  • Hospitals and medical research organizations affiliated with hospitals; schools including colleges and universities; and churches,
  • Organizations that have an active program of fundraising, with multiple sources of funding including corporate and public donations,
  • Charities that operate as a support to one or more existing public charities.

According to the National Center for Charitable Statistics (NCCS), there were 1,406,786 Nonprofit Organizations operating in the United States in 2013. Just over 67% of those were public charities, almost 7% were private foundations, and the remaining approximately 26% were designated as other non-profit organizations.

A Brief History

Until the last four hundred years or so, charity was mainly provided through churches and the philanthropic efforts of the wealthy. In Medieval Europe, the Church was the main purveyor of charity for the poor until the State began to take over this responsibility. In England, this came in the form The Charitable Uses Act of 1601, the country’s first charity law.

During the Enlightenment Era, voluntary associations and societies became a widespread practice in Europe, driving an attitude of social activism that saw the development of formal charitable organizations such as the Foundling Hospital founded in 1741, which was dedicated to helping the city of London’s homeless children.

Many notable philanthropists ensured the establishment of other well-known charities and over time, charities evolved from a strictly humanitarian role to activism for causes such as the abolishment of the slave trade or law reform for the protection of animals. The growth of charities was further fueled in the 19th century by the abhorrent treatment of the working poor and the rapid escalation of slum living conditions, particularly in the United Kingdom.

Philanthropy became somewhat fashionable amidst the wealthier classes both in Europe and the United States, although it was focused primarily on efforts to assist the poor or disadvantaged rather than the wide range of causes found today. This growth of philanthropic efforts led to greater formalization of charitable organizations we see today, such as The Red Cross, UNICEF, Doctors Without Borders, and Amnesty International.

Types Of Charities

Along with the different naming conventions, there are a lot of different types of charities. Some have a focused mission such as saving a specific species of animal in a particular area, while others may be quite broad, delivering humanitarian relief for example, which could involve anything from food to medicine to housing anywhere around the world.

Below is a general overview of the main types of charities:

  • Animal Charities: these charities may include animal welfare and wildlife conservation organizations.
  • Culture & The Arts Charities: these charities are dedicated to the furthering of art, learning and media as well as the preservation of art and cultural heritage. These may include historical societies, performing arts groups, museums, galleries, sponsorships and more.
  • Educational Charities: often focused on making education accessible to underprivileged students, educational charities may provide scholarships or tuition assistance, but may also take the form of support groups or scholastic institutions.
  • Environmental Charities: these charities focus primarily on the preservation and protection of the environment.
  • Health-Focused Charities: there are many types of health charities. Some provide support or funding for those suffering from particular illnesses, while other types fund medical research, medical treatments and services, or public awareness campaigns.
  • International Non-Governmental Organizations: these international charities operate in countries outside of their home country, providing a large range of charitable services such as human rights protection and advocacy, disaster relief, humanitarian relief and conservation.
  • Religious Charities: churches make up the majority of this charity group as they are designated as non-profit organizations. Other religious charitable organizations may include religious private school foundations and philanthropic religious charities.

Choosing A Charity

With so many charities operating in today’s world, it can be hard to decide which organizations to support. It goes without saying that the most important factor is defining the causes that are important to you. This could be anything from animal welfare to humanitarian relief, human rights abuses to the eradication of a particular disease. You can pick a single cause or charity or a number of them, depending on how you wish to give.

The second step is to learn more about the charities you are considering. What is their mission? What are their goals? What are their operating procedures? How do they use the funds they solicit? Are they transparent? There have been reports in the past where only a small fraction of the funds donated to charities actually reached the people they were intended to help, which has forced charities to become more transparent about their operations. But that doesn’t mean they are now all created equal. Do your research to make sure your money is being used in the most effective and meaningful way.

The final step is to consider how you wish to support the charity or charities of your choice. While financial donations are always welcome – and often the most helpful – there are other ways you can contribute, such as volunteering, donating specific requested items or taking on an active role in a charity.

The David & Teresa Disiere Foundation

The David & Teresa Disiere Foundation is dedicated to community and charitable activities that benefit children across Texas and the nation. Created by David Disiere and his wife Teresa, their foundation is focused on philanthropic efforts that “help change the world one child a time”.

Charity programs include donations and sponsorships for educational institutions, scholarship funds that benefit young people in need, relief funds for those affected by natural disasters, and assistance for children from at-risk families.

To learn more about the foundation or make a donation, visit www.daviddisiere.org.