And nonprofits may not be ready…

A new initiative called Promote Giving just made waves in the philanthropic world, and it should shake nonprofit leaders awake.

Here’s the gist: Ares Management and several major investment firms are now pledging a percentage of their performance fees (their “promote”) directly to charities. The math is staggering, more than $35 billion in assets are already under this model, with up to $250 million projected in charitable donations over the next decade.

But what I find more intriguing than the number is the mechanism.

Unlike ESG or impact investing, which often trade financial return for social return, Promote Giving doesn’t ask investors to sacrifice anything. The donation happens after investors get their payout. It’s a built-in act of generosity that scales with success, a performance-tied philanthropy.

Now, we’ve seen versions of performance-tied philanthropy before:

• In the early 2010s, Social Impact Bonds (SIBs) attempted to link government payments to measurable social outcomes, investors were repaid only if the programs delivered results.
• Similar “Pay-for-Success” and impact-linked finance models followed, tying financial rewards to achieving social impact, from education reform to prison recidivism reduction.

The results? Mixed. They proved it was possible to tie giving to performance but also revealed how hard it is to scale when measurement, risk, and accountability blur.

So, no, performance-linked giving isn’t new. But Promote Giving might represent something different, not because of the mechanism, but because of the mindset shift it signals (Charitable Thinking to Structural Generosity).

Unlike many earlier experiments, Promote Giving isn’t about replacing philanthropy with investment logic. It’s about embedding generosity into the structure of wealth creation itself.

Instead of donations being optional or post-success gestures, they become part of the system – an automatic outcome of profit.

That subtle shift matters. It suggests a future where doing well and doing good aren’t parallel paths but interdependent outcomes.

For nonprofit leaders, this raises a crucial question:

Are we preparing our organizations to partner in an economy where generosity is built into performance or are we still chasing it as an afterthought?

If you lead a nonprofit, Promote Giving shouldn’t just interest you because it might produce more donations. It should challenge how you think about fundraising strategy altogether.

This is where disciplined innovation comes in. Through my framework, I often help leaders ask: What if the funding system itself was part of our mission design?

Here’s how I would begin reframing a nonprofits approach:

1. Redefine the Value Exchange

Move beyond “support our cause” messaging. Instead, design partnerships where your impact directly enhances a company’s performance metrics such as retention, reputation, or customer loyalty. Think: measurable shared outcomes, not charitable sympathy.

2. Align With the Flow of Capital

Instead of chasing philanthropic leftovers, tap into profit-linked cycles – recurring giving tied to transactions, fees, or success milestones. Ask: “What part of their performance could we help multiply, and then share in the return?”

3. Measure What Markets Understand

Funders and investors think in ROI. So, translate your outcomes into ROI-like terms – cost avoided, lives improved per dollar, engagement per investment. Make impact measurable in business language.

4. Build a Culture of Structural Partnership

Train your development and marketing teams to think like value designers. The next generation of giving will come from those who can bridge social good with market function – not simply those who write compelling appeals.

Why This Moment Matters Now

The nonprofit world doesn’t lack good ideas or committed people. What it lacks is capital alignment – a system that rewards effectiveness with sustainability.

Promote Giving , for all its financial nuance, may be signaling a new norm: Generosity that scales with success.

That’s not a fundraising gimmick. That’s a design principle.

And if nonprofits can position themselves inside that model – not as recipients but as co-architects of impact – then maybe we’ll finally stop talking about “fundraising innovation” and start talking about funding evolution.

Innovation in the nonprofit world isn’t just about doing new things. It’s about redesigning old systems to serve the mission better than before.

Stewart Severino