The ‘boomerang effect’: How strategic philanthropy pays a purpose premium

IN THE conventional ledger of philanthropy, the accounts appear straightforward. Capital flows in one direction. Donors – whether individuals or institutions – allocate financial or human resources to a chosen cause. The return on investment is tallied in social good: lives improved, ecosystems preserved, knowledge advanced. Any benefit to the giver is typically recorded as reputational enhancement or moral satisfaction.

This model, however, is incomplete. It overlooks a fascinating and powerful anomaly I have observed in the micro-dynamics of fundraising, particularly for causes with significant social externalities. The act of giving can generate a substantial, non-pecuniary return for the fundraisers and donors themselves – an “altruism dividend” that flies back, enriching the giver in unexpected ways, much like a boomerang.

Uncharted waters

My most recent and moving encounter with this boomerang effect came through an initiative to establish Singapore’s first dedicated counselling centre for individuals with attention-deficit/hyperactivity disorder (ADHD). In a city-state synonymous with precision, efficiency and productivity, the experience of ADHD can feel like a profound kind of systemic friction. In Singapore, an estimated 6 per cent of children and 3 per cent of adults live with this neurodevelopmental condition, yet societal institutions – from schools to workplaces – often fail to accommodate their distinct cognitive patterns. The result is a persistent, costly gap in our social infrastructure.