The Resource Alliance Philanthropy blog http://resource-alliance.posterous.com Most recent posts at The Resource Alliance Philanthropy blog posterous.com Fri, 29 Jun 2012 01:00:00 -0700 Bridging philanthropy and development forum: day two http://resource-alliance.posterous.com/bridging-philanthropy-and-development-forum-d-3117 http://resource-alliance.posterous.com/bridging-philanthropy-and-development-forum-d-3117

Day two kicked off with a presentation by Rob Garris, Managing Director of Bellagio Programs, of key findings from the paper on risk and philanthropy commissioned following the Bellagio Summit in 2011. The group then split to discuss key areas of risk identified in the report, and to address how to reduce operational and impact risks in philanthropy. 

Anchors for philanthropic decision-making

Defining ‘anchors’ as the intrinsic biases we hold, it was agreed that anchors influencing philanthropic decision-making can be based on: 

  • Past experience 
  • Perceived outcomes
  • Karma 
  • Relationships and trust

A venture philanthropist from Singapore spoke of how his experience running a foundation shifted the anchor he had from his experience in the financial world which had made him only consider quantitative results to be important. He now also appreciates the significance of qualitative indicators when applied to development. 

Risk and return for philanthropic investors

Discussion focused on the return expected by philanthropic investors, which is social rather than financial. Philanthropists explained that they are not risk-averse but are only willing to take informed, not blind, risk. They require organisations to demonstrate that their investments will be used effectively, using business planning principles such as key performance indicators. Philanthropists also expressed that they are willing to work in partnership with organisations to support and advise them to reduce risk. 

Some development actors spoke of the difficulty of demonstrating tangible outcomes for ‘risky’ causes such as advocacy, rights and social justice. Alternative methods were discussed for measuring the change that the organisations make, such as happiness indicators. 

Business as alternative to aid for development

Some development actors admitted their mistrust of the business sector, which came as a surprise to some of the philanthropists. Suspicion exists in Africa about the ulterior motives that they may have for investing there. 

A venture philanthropist presented a case study of his work setting up a game reserve in the poorest part of South Africa and spoke of the need to focus less on the causes of poverty and more of the creation of equitable wealth, including job creation and making employees shareholders of the business. This not only expands the tax base so the government can provide more services such as healthcare and education but also provides the employees with capital they can invest to improve their and their family’s future.  

Taking it forward beyond this meeting and towards more strategic philanthropy for development

Discussions identified actions that could make future philanthropy more strategic. Takeaways from the two days included specific actions for the Resource Alliance and the Rockefeller Foundation to look at putting into practice, including:

 

  • Credible directory/knowledge bank with data on both philanthropic and development actors
  • Case studies documenting both successes and failures in philanthropy
  • Guidance for new generation philanthropists, and mentoring from those with more experience
  • Additional forums to bring together philanthropists and development actors.

 

The Resource Alliance and the Rockefeller Foundation will now set to work on ensuring that these ideas are prioritised and developed.

What changed for these philanthropists and development actors

The final session closed with a reflection from the participants on what they would do differently as a result of their experience at the forum. Some of the changes included: 

 

  • A development practitioner from Kenya sceptical of the motivations of business has become more open to the potential for enterprise solutions to development
  • A retail entrepreneur/philanthropist from India is planning to change his business model to make it more sustainable 
  • A venture philanthropist from Singapore is now more encouraged to engage in cross-border philanthropy.

 

Thank you!

We would like to thank all of the participants in this forum for their valuable contributions over the past two days, and to wish everyone a safe journey home from Bellagio.

We feel that some of the bridges this forum set out to build have already begun to take shape. We are now looking forward to working on the actions outlined for supporting more strategic philanthropy for development in Africa and Asia. 

Continue the #futurephilanthropy discussion on Twitter and Facebook. 

 

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Tue, 26 Jun 2012 04:30:00 -0700 Bridging philanthropy & development: June Forum Agenda http://resource-alliance.posterous.com/june-forum-agenda http://resource-alliance.posterous.com/june-forum-agenda

Following last week’s Rio + 20 conference on sustainable development, the post-2015 agenda is very much at the centre of the international stage. So our meeting in Bellagio comes at a great time. Bringing together a small group of philanthropists and development actors from across Asia and Africa, we will be exploring how these two groups can work together to achieve sustainable change.

The agenda we’ve put together covers the broader issues affecting sustainable development and philanthropy as well as some more specific questions relating to collaboration, innovation and risk.

We’ll begin by introducing some of the key questions which will provide context to the discussions throughout the rest of the forum and inviting the participants to share their own experiences on the types of issues they focus on, how we might place more emphasis on investing in organisations rather than individual projects in the future and what philanthropy looks like in an interdependent world, where many development issues are borderless.

We’ll then move on to look at examples where collaboration between philanthropists and development entities has worked well and reflect on why these examples succeeded. We’ll also look at what we can learn from examples that didn’t work so well. By the end of these discussions we aim to develop a list of factors that influence the success of collaborations.

During the first afternoon, we also have a debate planned to address the question of who is driving the development agenda. We aim to provoke a lively discussion on who is setting the agenda, the relevance of such an agenda for philanthropists and whether we need a global case for support for development. Social innovation systems will also be examined, considering what they might look like and how such systems could be scaled.

The first day will end with a short presentation on the critical issues in risk and philanthropy. It will highlightsome of the key findings from the paper on risk and philanthropy we commissioned following the Bellagio Summit, which is published today.

The second day will take an in depth look at the critical issues in risk and philanthropy, picking up on some of the issues emerging from the report. We’ll be encouraging the group to come up with recommendations on reducing operational and impact risks. By the end of the forum, we hope to have a more concrete idea about what it would take to support people so that they can learn from the successes and failures of others and scale up the fundamental idea of our forum to give others the same experience.

We’ll keep you up to date as the discussions evolve and will really welcome your own perspectives and questions on these issues in the comments below and via Twitter and Facebook.

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Wed, 20 Jun 2012 03:27:00 -0700 Observations on Bridging Philanthropy and Development in Asia http://resource-alliance.posterous.com/observations-on-bridging-philanthropy-and-dev http://resource-alliance.posterous.com/observations-on-bridging-philanthropy-and-dev

Next up in our series of guest posts we hear from Usha Menon, Executive Chairman of Usha Menon Management Consultancy, about the changes she believes could bridge philanthropy and development to create a thriving world for us and future generations: 

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This illustration is at the heart of my reflections for this blog, as I prepare for the forum to be held next week at the Bellagio Centre on Bridging Philanthropy and Development in Asia and Africa. 

For Asian development practitioner and philanthropists living in very interesting times, some even labelling it the Asian century, I believe we have a responsibility to be the change we want to see in this world.  Here are some of the changes that I believe could bridge philanthropy and development:

Participation: One that genuinely empowers the community, rather than as a tool for establishing power relationships between the donor and the charity or development agency. Despite the attempts and experimentation with bringing about collaboration between donors and implementing agencies, my observation in that in most cases it’s merely an attempt to integrate indigenous views into pre-determined positions of the donor or even the development intermediary, without much say from the impacted community.

Asian philanthropists and development practitioners have a great opportunity to put authentic empowerment into practise. The profile of an Asian philanthropist is very different from that of their western counterparts and leadership within funding agencies.

Bain & Company in their India Philanthropy Report 2012 reports that of the 400 high-net-worth individuals (HNWIs*) and emerging HNWIs in Delhi, Mumbai, Hyderabad and Pune surveyed:

•    More than 70% of the donors have less than three years of philanthropic experience. Majority were 40 years old or younger
•    Among families who participate in philanthropy, 76% have younger relatives who have assumed an active role in choosing charities, while 69% say young members shape or spearhead the family’s charitable mission
•    Private foundations are beginning to play a major role in Philanthropy

Process Innovation: Over the past few decades the dependence on ‘foreign aid’ has developed a whole generation of Asian development practitioners who are conditioned by the linear thinking and reporting requirements of their western funders. Despite these processes, the grant makers are often unable to receive the quality and quantity of written information that they seek of their grantees. At the same time, the application and reporting requirements have made these funding impractical for many grassroots organizations or the time and effort expended to get a grant is at times not proportionate to the size of the grant. Donor reporting requirements driven by matrixes and frameworks, do not consider stories from the ground as sophisticated theory, thus losing out on the possibility of hearing the real voices.

Asian philanthropists and development practitioners have a tremendous opportunity to close this gap by looking innovatively at the processes needed for engagement, tracking and celebrating the impact with the community.  Philanthropists have an opportunity to foster open, empowering, and flexible relationships with their grantees that could leverage on technological advancements in communications while at the same time build on our rich tradition of oral storytelling.

Perception:

The profile and motivations of the Asian philanthropists differ in many ways from the donors that development practitioners are used to dealing with, in the past. UBS-INSEAD Study of Family Philanthropy in Asia that covered over 200 surveys and over a hundred personal interviews with wealthy Asian families from 10 Asia Pacific countries, found the following motivations of Asian philanthropists: 

•    42% of respondents said their major reason to engage philanthropy is to make sure they ensure the continuity of their family values and to create a lasting legacy for future generations.
•    They tend to donate to their own countries, with roughly 70% of donations on average in 2010 given to national causes. However the younger philanthropists seemed more open to national and international causes.
•    36% of donations went into education, while poverty alleviation accounted for 10% and healthcare for 9%. However younger philanthropists seemed more open to sectors such as the arts, civil rights and the environment
•    Family business remains an important source of funds with 22% of the families studied reporting company profits as providing funding for their philanthropy and prefer maintaining operational control, rather than working collaboratively or as grant-making entities
•    36% of survey respondents ranked Social Entrepreneurship as the most important trend that will affect philanthropy in Asia, with a growing interest among family philanthropies in the sustainable and transformative potential of social ventures with earned income strategies.

Hence it is the mutual responsibility of both the philanthropists and the development practitioners to forge collaborations that will take us all to our common goal – a thriving world for us and our future generations.

Usha Menon is Executive Chairman of Usha Menon Management Consultancy, an international training and consultancy service for the non-profit sector across Asia, specialising in strategic management, inspirational leadership development and mission driven fundraising. Usha is a keen observer and an active global participant in the non-profit sector for the past 25 years.

Join the #futurephilanthropy debate online on Twitter or Facebook, or share your comments below. 

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Mon, 18 Jun 2012 05:40:00 -0700 Risk – A Very Personal Perspective http://resource-alliance.posterous.com/risk-a-very-personal-perspective http://resource-alliance.posterous.com/risk-a-very-personal-perspective

Ahead of our bridging philanthropy and development forum next week, Adrian Sargeant, Professor of Nonprofit Marketing at Bristol Business School, tells us why philanthropy needs to become more accepting of risk - and why trust is so important: 

"One of the key conclusions from the last Bellagio Summit was the philanthropy needs to become more accepting of risk. Governments, it was argued, are ill placed to take risk because of the discipline imposed by elections and/or the impact that a failure might have on the careers of officials deemed to have ‘squandered’ public resources. Equally, while many new forms of social enterprise can and do take risk, they frequently can’t take the kind of risks necessary to achieve systemic change because of the need to secure some form of financial return. Philanthropy, by contrast, can assume a greater degree of risk, engaging in projects that offer the potential to transform an entire development ecosystem.

Unfortunately, they appear not to and the evidence that philanthropists are risk averse is not just anecdotal. A Bank of America study of philanthropy (2010) tells us that virtually no high value philanthropists want to take substantive risks with their philanthropic assets (a mere 3.8%). To compound the issue it seems that philanthropists are more risk averse with their philanthropic assets than they are with their personal financial assets. Some 26% are not willing to take any risks with their philanthropic assets, compared with only 10% who take a similar view of their other financial investments.

So why should this be? There are a multiplicity of possible motives for supporting philanthropic initiatives, but one notable motive in this context is what the economist Andreoni refers to as the ‘warm glow’ that derives from giving. Individuals, quite understandably, want to feel good about their philanthropy and thus select projects that will best deliver this feeling of self-worth. As human beings we are naturally drawn to short term certainty and rather than convince us otherwise, many in our nonprofit community have been beavering away,  actively encouraging this perspective. Instead of being honest with people about the work we should be doing, we’ve focused instead on projects that offer our supporters the greatest prospect of feeling good, neglecting the real interests of the communities we serve. As a Professor of Fundraising I read many appeals, but I can’t recall the last one that opened with the glorious headline – we’d like you support this because it might just solve a long term problem, but the chances of it working are slim.  

The desire to feel good may also play a role in the context of small business or family foundations, where the decision making unit is small and individual passions predominate. It offers less insight though into the behaviour of larger and multi-national foundations. These organisations too, can be risk averse. There are a variety of reasons why this might be the case ranging from the inadequate training or support of key personnel, to the continuation of a culture which fails to regard occasional failure as an essential precursor to successful innovation. From my personal perspective however, I am struck by the current fervour within the sector to adopt ever more of a commercial approach to grantmaking. Impact evaluation and assessments are now the order of the day, with a concomitant rise in the use of often meaningless metrics that are unaligned with genuine community need and/or the drivers of long term prosperity and wellbeing. We seem to have become obsessed with the imposition of ever greater management controls, many of which stifle innovation and deplete a critical force at the very core of our sector’s existence. In short we’ve forgotten trust;  how to trust, the different kinds of trust, and why trust is so important."

Join the conversation on Facebook or Twitter, or share your thoughts in the comments below.  

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