What is Philanthropy?

In the first third of the 20th century, the philanthropic sector began a modernization process that accelerated during the transition from the 1970s to the 1980s. It took almost half a century before all the organizations that comprise it could constitute a relatively integrated sectorial system.

Canadian Philanthropy – an overview
The Canadian and Quebec philanthropic sector, regulated by the Canada Revenue Agency (CRA), includes approximately 86,000 charitable organizations, of which more than 11,000 are foundations.

In Canada, the recognition of charity in public policy, as a reflection of modern philanthropic actions that appeared in Europe in the 18th century, materialized with the entry into force of the Confederation Act of 1867. It was from this moment that the conditions became favorable for the appearance of a specific area of intervention supervised by the legislator and dedicated to providential actions qualified as charitable.

Organized or institutional philanthropy, under the terms “bienfaisance” (in the French context) or “charity” (in the English context), has its origin in the legal framework that was put in place following the creation of the Canadian Patriotic Fund in 1914. This fund is at the origin of the first federal tax law: the Income War Tax Act. This law was enacted in 1917 to support Canada’s war effort required by the country’s participation in the First World War.

In summary, philanthropy in Canada is defined as a voluntary commitment of resources, often in the form of donations or services, intended to promote public well-being and meet social needs. It is characterized by its orientation towards specific causes, such as education, poverty reduction, support for religious causes, or other objectives recognized by legal institutions. Regulated by laws that define charities according to their mission and impact, philanthropy in Canada is part of the British legislative traditions that shaped the modern framework of charity. Unlike charity, which is often more immediate and spontaneous, philanthropy takes a comprehensive, structured, and long-term planned approach, aiming to address social problems in depth and transform their root causes.

In 1948, the Income War Tax Act was replaced by the Income Tax Act. From 1917 to the late 1950s, private or corporate donations recognized by the federal government were mainly collected by the Canadian Patriotic Fund, the Canadian Red Cross, and the first foundations that were established: the Massey Foundation (1918), the Winnipeg Community Foundation (1921), and the McConnell Foundation (1937).

Around 1950, a legislative intervention by the Canadian government distinguished foundations from charitable works (mainly dedicated to the provision of charitable services). This legislation distinguished private foundations (governance controlled by a family or a corporation (one voice)) and public foundations (plural governance not giving control to a single voice). In fact, from the 1960s, and especially with the creation of the Canadian Charity Register in 1967, the two main families of charities had slightly different statuses and specific obligations.

From the beginning of the 20th century to today, the various laws relating to charity have not used or referred to the word philanthropy. The federal government inherited the notion of charity from the tradition of British legislation. According to this tradition, charities are recognized as such as long as their mission meets one of the four main purposes identified by the State, namely:

to act to facilitate education;
to work to alleviate poverty;
to support religious causes, and, finally,
to be part of any other cause deemed valid by a decision from a judge mandated for this purpose by the Supreme Court of Canada.

The fourth category was designed to give flexibility to the Act in order to integrate new charitable causes. In fact, there has been little expansion of the pool of types of causes that can be supported.

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