India Philanthropic report 2017 brings focus on the individual donor. The 150,000 odd households that today are investing about Rs 36,000 crores towards philanthropy in our country. More than all the CSR put together. While the report delves on the market segmentation from the investor philanthropist point of view, it would be good to take a step back and see the bigger picture. What kind of investments really bring change, irreversibly?
Traditionally philanthropy is divided into individual relief and institutional giving. Institutional giving usually is simply put finding, locating and then trusting a group of committed non profit organizations. On both aspects, there is a big ground level change, which merits deeper attention to HOW these philanthropic pathways may help reach full potential of the giver.
For individual relief and succor, efficiency of locating, dispensing, caring is key. That is traditional philanthropy which can benefit from an individual developing a long term commitment to a cause and assuring a set of non profits, a percentage of their total costs, while pushing them onward for learning, greater efficiencies and outreach. India today is a country go growing aspirations- no different from Bharat and India. While we need to keep caring and giving as the key words, we have the opportunity to bring focus more and more on investing in best and brightest, entrepreneurs from the communities that we are seeking to serve. Supporting entrepreneurship, scholarship and platforms for collaboration is key – areas which have very poor institutional mechanisms. Philanthropists should not hesitate to explore such new institutional mechanisms rather than going with the tried and tested route of finding and building trust with a non profit organisations.
For structural change and transformation particularly in areas of livelihoods, education, healthcare, much is already known in what works in our country. Issue is the lack of institutional mechanisms for this to happen.
Finally, individual philanthropy cannot replace the need for state investment in infrastructure, asset creation and other such large scale market making investments. How does your money influence or leverage the 150,000 crores being invested? In the absence of any good frameworks for this leverage, the possibilities of deep impact of individual philanthropists remain limited. Some possibilities lie in the development of marketplaces like the one recently pioneered by CII for sanitation. Development impact bonds that allow one investor with higher risk taking and longer term horizon create development outcomes, which the state only pays for if successful. Mission mode of functioning that aligns resources to specific goals in identified geographies has been used by government, multilateral and established philanthropic institutions in the country and overseas. Blended finance that encourages grant based cold money to be twinned with investment capital to fuel enterprises that can serve the bottom of pyramid as clients not as beneficiaries is another possibility.
It may be in the development of such vehicles that may unlock the real value of this 36,000 crores. Till then, while they may hold a growing percentage of the investment dollar, they will continue to fight below their weight unless some of them begin to take the risk and look at new institutional mechanisms.
Thoughts. Insights. Action 