Philanthropication thru privatization

Close readers of Alliance may recognize 30 July 1990 as the date the Italian Parliament passed the famous Amato-Carli Law, which opened the way to the privatization of the Italian savings banks and to the ultimate emergence of the now-famous Italian foundations of banking origin, which catapulted Italy into one of the leading philanthropic nations in the world in terms of foundation assets per capita.

What has been less well known is that this Italian experience is far from alone. A very similar phenomenon has occurred elsewhere but we’ve lacked a concept to bring it into focus. That concept is ‘philanthropication thru privatization’ or PtP, the capture of significant charitable assets in the course of privatization of formerly state-owned or state-controlled enterprises or assets. Armed with this concept, a PtP project has been launched that has so far identified well over 500 PtP foundations in 21 countries around the world.

Twenty-two of these foundations have now been examined in depth and a report prepared on the findings. What the report shows, among other things, is that:
•    Privatization is still very much under way around the world.
•    PtP can yield enormous foundations pouring significant resources into communities.
•    PtP foundations have generated an enviable record of innovation, good governance and multi-stakeholder problem-solving.
•    By reversing the tendency for privatization’s benefits to occur slowly and be spread broadly while its costs become apparent quickly and are concentrated narrowly, PtP offers important advantages to governments, businesses and civil society.

Under the leadership of Wilhelm Krull of the Volkswagen Foundation, a PtP Advisory Committee has been formed and efforts launched to disseminate the PtP concept and encourage its wider adoption. With billions of privatization deals in play and efforts to build indigenous charities going starved for funds, PtP seems clearly an option worth testing, especially where indigenous resources to seed philanthropic foundations are otherwise in short supply.

If you know of other PtP foundations or want to know more about bringing the PtP concept to your area, contact Naomi Hansen at nhansen@ewmi.org or Lester Salamon at lsalamon@jhu.edu

For more information
Lester M Salamon and Associates, Philanthropication thru Privatization: Building assets for social progress http://bit.ly/1brWDcL

 


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