Does philanthropy have too much influence? Or not enough?

Alliance magazine

Pandemic response around the globe has elevated and centred philanthropy, causing many bystanders to pay attention to the sector for the first time.

From recognising the influence of the Gates Foundation on global public health to understanding the public-private funding of the WHO to communities relying on mutual aid – philanthropy and funding have been in the public eye more than ever before.

As part of Alliance’s 25th anniversary, we wanted to understand how philanthropy’s influence on society has changed over the last quarter century – as well as what expert practitioners want to see from it in the future.

What is philanthropy’s place in a rapidly developing Chinese society?

Changbo Fu, Beijing Normal University, China

Since the outbreak of Covid-19 in early 2020, Chinese social organisations have taken the initiative to fight the pandemic. According to incomplete statistics, over 5,000 charitable organisations and the Red Cross have raised almost 40 billion yuan ($6.1 billion) in donations and over one billion items of materials. After the outbreak stabilised in China, Chinese social organisations actively participated in the global anti-epidemic campaign, covering more than 100 countries and regions, while helping restore the order of production and living. We have not only donated many medical supplies to foreign countries, but also supported the global fight against the pandemic by setting up special funds, building online medical platforms, carrying out cross-border volunteer services, and compiling Covid-19 prevention and control manuals.

During the pandemic, the Chinese public has paid more attention to public welfare and charity. Most of the attention is about care and support, but of course there are also doubts about public welfare and charity organisations. According to incomplete statistics, from January to May 2020 alone, nine million registered volunteers participated in epidemic prevention and control in China, with more than 460,000 volunteer service projects and over 290 million hours of recorded volunteer service.

In China, the integration of philanthropy with national priorities will be significantly enhanced; wealth for good and business for good will go hand in hand; strategic philanthropy with system thinking will become the mainstream; the philanthropic support industry will see great development.

Read our September 2016 issue on the subject of philanthropy’s influence

About 1,000 years ago, the rudiments of charity appeared in China, which were manifested in the aid for the poor among the clans and villages such as the establishment of Yizhuang (charitable estate), Yixue (charitable school), Yiqiao (toll-free bridge), and Yiidu (free ferry boat). Since the founding of the People’s Republic of China, with the reform and improvement of the functions of the Chinese government, modern philanthropy has developed gradually. The 2008 Wenchuan Earthquake in southwest China aroused the philanthropic enthusiasm of many high-net-worth individuals. Large donations at the level of 10 million ($1.5 million), 100 million ($15.5 million) and over one billion yuan ($155 million) began to appear, and new charitable forms such as family foundations and equity donations began to appear. The promulgation and implementation of the Charity Law of the People’s Republic of China in 2016 marks a milestone in the development of philanthropy in China. In recent years, there have been tens of billions (millions in USD) of donations to family charities. Donation or charity based on rich mobile Internet application scenarios is very popular. In 2019 alone, almost 11 billion people participated in online charity. Charitable trusts are growing rapidly, and business is becoming more and more charitable.

China has embarked on a new journey to fully build a modern socialist country. The ruling party of China and the central government call for better use of the role of the third distribution to promote common prosperity and high-quality development of philanthropy. In general, the scale and quality of China’s philanthropic development is not in line with the government’s plans, people’s expectations, and its potentials, and relevant government departments are working on new policies to promote the healthy development of philanthropy.

Looking ahead to the next ten years, I believe that China’s philanthropic incentive policies and management system will be improved. The integration of philanthropy with national priorities will be significantly enhanced; wealth for good and business for good will go hand in hand; strategic philanthropy with system thinking will become the mainstream; the philanthropic support industry will see great development.

Compared to 25 years ago, there are now five times as many billionaires. How has this explosion of individual wealth influenced our reception of philanthropy?

Rhodri Davies, Charities Aid Foundation, United Kingdom

Awareness of the influence of philanthropy has increased over the last 25 years. The accumulation of vast fortunes, particularly in the tech sector, has led to a surge in big giving and initiatives like the Gates-Buffett Giving Pledge have helped to bring it to mainstream attention.

At first this was welcomed, with some commentators claiming that a new breed of ‘philanthrocapitalist’ donors looking to combine business savvy with a desire to do good were driving a ‘new golden age of philanthropy’ that could ‘solve’ the world’s problems.

More recently, however, we have seen a growing wave of scrutiny, scepticism (and in some cases even cynicism) about philanthropic influence as concerns over how that relates to rising inequality and the fragile state of democracy have come to the fore. Books like Anand Giridharadas’s ‘Winners Take All’ and Rob Reich’s ‘Just Giving’ have helped to bring philanthropy critique to the mainstream.

We should guard against the dangers of big giving being used to exert undue influence; but in doing so we must ensure that we don’t inadvertently stifle the wider ability of philanthropy to influence our society in positive ways through its vital support for civil society around the globe.

This backlash is an inevitable part of a recurring historical pattern in which ‘golden ages’ of growth in philanthropy are accompanied by increased scrutiny and debate over the legitimacy and role of big giving. In the early 20th century, for instance, the philanthropy of industrial titans like JD Rockefeller and Andrew Carnegie was far from universally lauded, and concerns about its damaging effects on democracy led to fierce scrutiny from the US Congress and the media.

There are justifiable concerns once again today about the undue influence of big money philanthropy on our society and democracy; particularly since a lot of philanthropy is still lacking in transparency. However, as critiques that apply primarily to a handful of ultra-wealthy donors (and are often quite Global North/US-centric in nature) get filtered through the simplifying and polarising mechanisms of online debate, the danger is that we are left with an over-simplistic message of ‘philanthropy = bad’ filtering out into the public consciousness.

In reality, philanthropy is made up of a huge range of activity – most of which has nothing to do with elite super-donors or mega-foundations. This long tail is not really the focus of current critiques, but there is a risk that it could become collateral damage if a default cynicism about philanthropy takes hold.

Which is not to say that philanthropy should get a free pass. We should certainly guard against the dangers of big giving being used to exert undue influence; but in doing so we must ensure that we don’t inadvertently stifle the wider ability of philanthropy to influence our society in positive ways through its vital support for civil society around the globe.

How has the influence of philanthropy developed in India?

Amitabh Behar, Oxfam, India

Philanthropy in India is growing rapidly and increasingly playing an important role in reshaping the contours of Indian civil society through the funding priorities set by philanthropic institutions and individuals in the context of receding foreign support by international agencies and global philanthropies. This moves towards dilution of the richness of organically grown civil society anchored in the ethos of national movement and peoples’ power, in favour of more techno-managerial approaches to development and social change.

The philanthropic sector is also influencing the developmental discourse in the country including privileging of specific solutions to some of the big developmental challenges faced by the country. It is also attempting to fill in the stark service delivery gap in specific locations though this remains almost an insignificant fraction of the service delivery needs of the poor and vulnerable communities in India.

Read more: Amitabh Behar asks ‘What role for philanthropy in a democratic India?’

Much of these trends of philanthropy need to be analysed and critiqued to make sense of its impact in India. Organised philanthropy in India is still nascent and is primarily engaged in questions of poverty and developmental deficits through a service delivery lens. Except for few, it has not adopted a rights-based systemic approach to analysing and addressing the wicked problems of poverty, injustice, and indignity. For example, the caste question, so central to India, is addressed as an issue of developmental deficits and not as a function of inhuman and oppressive caste system that needs to be dismantled.

It is surprising and saddening to note that philanthropy in India is oblivious to the battle for the ‘soul of India’. Maybe it is complicit by its silence or at best a neutral by-stander to the battle of ideals that would define the future of the country. All the core values and ethics, the philanthropic world stands for are under deep stress and are reaching a break point. The necessary conditions, like rule of law, separation of power, robust civic space, independent media; for the philanthropic sector to exist, function and to do any meaningful work are under threat.

Still, philanthropy in India has chosen to remain silent and disengaged at this critical juncture. History will judge it harshly.

Half of philanthropic organisations in Latin America were launched within the last 20 years. What influence will the young philanthropy sector have on this region?

Rodrigo Pipponzi, Mol Instituto, Brazil

With the pandemic widening social inequality in Brazil, philanthropy was a breather for the search for immediate solutions and a change in mentality in the way we see collective participation in the country. With a record of more than $7 billion donated by individuals and companies, the culture of giving has become part of the lives and strategies of people and companies, rekindling a debate that could have great consequences for years to come.

On one hand, we can see an explosion in partnerships between companies and the third sector, which valued social organisations in times of enormous difficulty. This brought important reflections on social investment strategies – not only due to a more active process of listening to problems by those who own the capital, but also due to the urgency of looking at problems more locally, creating more agile solutions and putting on the radar causes that until then were marginalised.

On the other hand, we started to observe every day great examples of intersectoral mobilisation, expanding formats and fostering innovation in the social field. This allowed an appreciation of the collective perspective, a firmer discourse around our needs for collaboration and greater empathy from society to the social difficulties we face every day. It is a fact that, after the pandemic, the notion we have about the need to face the problems together and be part of the solution will never be the same again.

This is encouraging for the context of a country so used to ignoring its inequality and expecting the state or other agents to solve the problem. The pandemic seems to have awakened Brazilian philanthropy, making it increasingly strategic, collaborative and community based. The big challenge now is to keep the flame burning and use the power of one of the largest economies in the world in favour of this society that needs so much.

How should philanthropy wield its influence in the future?

Halima Mahomed, Independent philanthropy consultant and researcher, South Africa

As we try and survive the onslaught of a devastating third wave of Covid-19 in Africa, the reality is that while we have all entered this pandemic around the same time, many will exit it years apart. In a world that is forever changed, rethinking institutionalised philanthropy’s role and influence is thus imperative.

In the development arena, money translates into power and influence. While we are increasingly talking about the importance of ceding power and influence downwards to those experiencing injustice, we don’t talk enough about where and how power is voluntarily or inadvertently ceded upwards – be it to the to the nation State, private sector, external States or to international governance architectures.

Reflecting on the role of African philanthropy during this pandemic, it has been our saving grace. It is also our achilles heel. It is philanthropy – both the everyday type and the institutionalised forms – that has (and continues to) swiftly and steadily rally to plug in the gaps in many African government’s responses to the pandemic, on issues ranging from humanitarian support to information dissemination and even vaccine purchasing, providing lifelines in a context none could realistically imagine. The vital roles played by different forms of philanthropy in response to the pandemic, sometimes in partnership with the state, at other times alone, must be acknowledged for its sheer scale and range.

Read more: Halima Mahomed writes ‘Big philanthropy and policy change in Africa’

But, beyond the immediate responses, where institutionalised philanthropy has certainly wielded clout, the influence on policies and agendas targeting systemic injustices driven by or exacerbated by the pandemic appears to be even more muted than before. Generalisations are tricky and there are exceptions, but relatively speaking, issues that are deemed to carry political risk – governance, accountability, financial transparency, civic freedoms, and rights violations – issues avoided in normal times, are less surfaced under a pandemic agenda. Even less so are topics such as aid architecture, global governance regimes, and intellectual property on vaccines – though again, there are exceptions. Overall, the enormous potential institutionalised philanthropy holds to enable space for much deeper systemic change is still highly underutilised.

In the pandemic response, whether by omission or commission, the potential influence to challenge the thorny issues is being subsumed under the banners of partnership, of the collaborative crisis agenda, or the common good. In effect, this translates into a ceding of power. At a time where a devolution of philanthropic power is the consistent demand from the ground, the ceding of power upwards calls for attention.

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