Philanthropy’s New Form

We live in an age of increasing global inequality. The gap between rich and poor has grown and some say that there is now a new global and cosmopolitan class of the ‘super rich’. In fact, in a recent interview with CNN, billionaire Ray Dalio announced that the “top one-tenth of one per cent of the population’s net worth is equal to the bottom 90 per cent combined.” In these circumstances what can philanthropy do to help those who are in need?Philanthropy has a long history in modern societies and has often stepped in where governments have been unable to help the poor and vulnerable. But does it make a difference? Many of those with the wealth to support major philanthropic efforts think that it can. Philanthropy, in fact, has become fashionable, if not obligatory for the wealthy. It has been adopted by politicians, celebrities, and business leaders, and has become part of consumer culture. In fact, consumer culture has never been more closely aligned with good causes from the Starbucks Foundation committed to strengthening communities to PepsiCo’s commitment to “strengthen the communities in which we live and work”. And if we look to high fashion,every respectable house has its own foundation from Gucci’s Chime for Change to Fondation Louis Vuitton.

Renowned Peruvian photographer Mario Testino recently opened Parques Teresita in Urubamba, Cusco, his new social responsibility initiative in association with Natalia Vodianova, the founder of Naked Heart Foundation

It’s not just fashion houses – models, themselves, have become philanthropic: the term ‘model-philanthropist’ is ubiquitous, with ‘rags to riches’ supermodel Natalia Vodianova well-known for her charity – the Naked Heart Foundation – and Noella Coursaris Musunka, the international model-turned-human rights activist. In Europe giving was previously regarded as an important, yet private affair; while in the US a tradition of millionaire businessmen such as Rockefeller, Ford and Carnegie forming their own charitable foundations has been taken up by today’s billionaire generation, which includes Facebook’s Mark Zuckerberg and Warren Buffett; the latter has been labelled the ‘most charitable billionaire’. Culturally, the novels of Charles Dickens highlighted the plight of England’s 19th Century poor, Bob Geldof’s Band Aid put pop music into the frame for supporting causes through global communications, and cinema has powerfully dramatised humanitarian efforts against blood diamonds and human trafficking. Actress and UN special envoy, Angelina Jolie has tirelessly spoken out about violence against women and children throughout the world. It was whilst she was in Cambodia, filming Laura Croft: Tomb Raider, that Jolie first became aware of the plight of the poor and dispossessed. In 2001, Jolie donated AED 3.7 million to a UN emergency appeal to help international refugees, the largest sum ever given by an individual donor.

Whether spurred by an emotional connection, societal pressure, guilt, or an invitation to a celebrity gala, most of us like to think we are charitable. And the ways in which we give are just as diverse as the motivations. It can be on an individual or localised level, through volunteer work, or a direct funds transfer to a charity. But there are also efforts on a much grander scale such as that of Egyptian entrepreneur, Naguib Sawiris, who offered to purchase a Mediterranean island to shelter Syrian refugees, or Warren Buffet, who pledged to give away 99 per cent of his wealth to charitable causes. Cynics, however, point to the fact that in some countries charitable work can be a way to avoid taxes or death duties, and that celebrities can use it to seek the limelight. Powerful and effective as the big charitable foundations may be, critics also argue that the big American foundations have been a way of preserving the family wealth over long periods of time (most inherited wealth tends to disappear in a few generations). Even so, shouldn’t the point be how effective charitable work is in achieving its own aims? This is more difficult than it might seem at first sight.

Determining how to make sure your money is well spent, that it reaches the right beneficiaries, and that it has the maximum impact can be more than problematic. There have, in the past, been major issues concerning tax, transparency, output and concern over high salaries for top ranking officials that have cast a shadow over philanthropic efforts. In the last two decades, however, we’ve seen a new wave of philanthropists who take a systematic and evaluative approach. Think Mark Zuckerberg who, in a Facebook post dedicated to his newborn daughter Max, announced one of the largest philanthropic pledges ever made. Together, with his wife Priscilla Chan, he promised that they would commit over 99 per cent of their Facebook shares — with a then value of around AED 165 billion – to the mission of “advancing human potential and promoting equality for all children in the next generation.”

Technology – particularly social media – has been a major facilitator of philanthropy by both big businesses and celebrities. While it has created some of the fortunes – such as Facebook – that underpin contemporary philanthropy, it also facilitates engagement and interaction at a global level. “It used to be that to help someone on an individual level you either had to live in a small community, or know that person directly. Thanks to the internet, and social media, it’s easier to help others without actually having ever interacted with them in person,” says Jeff Pies, The Nourafchan Foundation’s director of operations and outreach. “I can read an article tomorrow about someone in another state who was in a tragic car accident, and their family has set up a website to collect donations for medical bills. I can make a donation and share their story with my friends. This is very exciting because it represents the future of philanthropy.”

Generationally speaking, giving is a priority amongst millennials who tend to question more and expect companies to support the causes they care about. So concepts like the gift cards offered by dlyte.com, a fundraising platform that utilises the spending power of consumers who are supporters of charitable causes, make for seamless interaction, while new services that help you screen organisations that match your objectives facilitate targeted giving. Crowd funding, which funds a cause or venture by raising small amounts of money from many individuals via the internet, is another innovative form of giving which has only become possible because of the revolution in global communications.

The moral dilemmas of charitable giving have been addressed by Australian moral philosopher Professor Peter Singer. He founded the non-profit organisation The Life You Can Save (TLYCS), which is designed to “inspire and empower people to take action in the fight against poverty”. Singer has been a major influence on modern movements such as effective altruism, bioethics, and animal rights. TLYCS “was based on a book Peter wrote of the same name, which relates to a thought experiment that went viral even before going viral existed,” says Charles Bresler, TLYCS executive director. “It asks this question: if you passed a pond in which a little girl was drowning, would you jump in to save her, even if it meant ruining your nice suit and expensive shoes? Of course, most of us would say yes,” he continues. Singer then goes on to ask why, if this is so, do so few people make donations to charities that do work that is proven to reduce preventable suffering and death for those living in extreme poverty around the world?

However, as already noted, even if you have the desire to give, there are many obstacles to giving, such as the problem of which organisations to support and whether to go for short or long-term objectives. “Our organisation does two things,” says Bresler. “The first is that we promote effective giving. Few people do any research into how effectively their donations are used, so we provide tools for doing that. And second, we publish a yearly list of about 20 nonprofit organisations that do some of the most effective, efficient work at addressing causes and effects of global extreme poverty.” Part of a small but rising movement, TLYCS represents a new school of thought that comes under the heading of meta-charity or effective altruism: a charity that urges people to donate to charities, but giving as effectively and rationally as possible.

GiveWell is another such meta-charity founded in 2007 by Elie Hassenfeld and Holden Karnofsky, who had been working in the finance industry and were interested in donating. They wanted to find information about where their offering could do the most good in terms of lives saved or improved but that information wasn’t readily available. They left their jobs and founded GiveWell, a full-time project that drew upon their analytical background to discover effective giving opportunities for other donors. “Many charity evaluators focus on evaluating a very large number of charities at a shallow level,” says Catherine Hollander, GiveWell research analyst. “We spend hundreds, and sometimes thousands, of hours vetting each charity we recommend.” Their donors range from Good Ventures, a large foundation that gave AED 185 million to GiveWell’s recommended charities in 2016, to – at the other end – donors giving just AED 185. Today’s donors are, then, looking to become actively engaged, immersed in their projects, and interactive with both other donors and beneficiaries. In the past, someone might have made a donation to UNICEF, for example, and those resources would then be distributed without much understanding of the complexities and difficulties involved.

While tech facilities streamlined and enhanced interaction with philanthropy
for many, like Robert Flaxman, there’s no substitute for a physically immersive experience

Now, donors can directly help others in many ways – from micro- grants that support female entrepreneurs like the UAE’s WOMENA platform, to individuals seeking donations on crowdfunding sites like GoFundMe – and philanthropy has accordingly become more personal in its nature. The Nourafchan Foundation (TNF) has outposts in the Middle East, the US, Asia, and Africa and is one example that has attracted much interest because of its unique model described as the world’s first kind of ‘Participatory Philanthropy’. “One of our donors, Robert Flaxman, does so much more than just write cheques,” says Emily Shagley, TNF director. “He took his 18-year-old daughter on an immersive philanthropic expedition to Kenya that was a paradigm shift for them both. They not only witnessed challenges first hand and saw where their funds were used, but also fully immersed themselves.” An experience that acted as a catalyst for further positive impact; his daughter was so moved by her participation that she wasted no time in collaborating with TNF to start a social enterprise to create opportunities for the women of Kibera, often victims of devastating circumstances: widows; victims of sex trafficking; those exposed to HIV.

The philanthropic community is learning from the business world, uptaking best practices from technology and finance

Using craftwork as a platform, the vision is to help the women create a path out of poverty affording them with an unprecedented opportunity to financially support themselves and their families. “A lot of us have big ideas about helping others but a common concern with philanthropy is impact,” says Robert Flaxman, co-founder of Crown Realty and Development and TNF donor. “TNF’s participatory approach stood out to me as it offered more than just an opportunity to donate. It led me to Kenya and put me right into the heart of things where I could ask questions and examine processes. Once on the ground, I was able to fully analyse the range of issues that affect Kenyans on a daily basis.” Flaxman’s expertise in real estate and infrastructure met with TNF’s ability to innovate impact. Their partnership saw the initiation of a first- of-its-kind, sustainable water project for a school in Kibera, known for being hampered with unreliable water sources at onerous prices. “While providing a safe and sustainable water source for the schoolchildren, we plan to supplement that further by developing a water business around this initiative that will allow the school to extract, distribute and sell water for additional revenue, thereby uplifting the community at large. It was only through TNF’s participatory model that we were able to take this project to the next level,” says Flaxman. What TNF does differently is that it encourages their supporters to take an active role in providing philanthropy at the local level. “It’s a win-win because in return, TNF receives more data about best practices that can then be replicated and applied elsewhere,” says Pies. “To give just one example, suppose there’s a really great nonprofit in your community that’s doing some amazing things, but doesn’t have the capacity to expand. TNF can assist, and in return, can take that concept and help promote it elsewhere around the world. Incubators are popular in the private sector, but surprisingly I’d never heard of it being used in the nonprofit world. TNF is establishing itself as the world’s first philanthropic incubator and accelerator.”

Philanthropy has entered a new era. The entry of billionaire-supported foundations via Bill Gates, Warren Buffet, and Mark Zuckerberg has opened up new possibilities for nonprofit organisations to be underpinned by vast personal fortunes. Opposed to founding a new aristocracy of business families that contribute little to their community because they live off of inherited wealth, they propose to use their own wealth to fund programmes of social transformations. At the same time, new ways of raising money such as crowd funding and increasing donor and beneficiary awareness have changed the landscape of philanthropy forever. As the priorities of the next generation increasingly drive companies to be socially-conscious, philanthropy is becoming an almost seamless aspect of everyday culture. Philanthropy cannot replace the efforts of governments and international organisations to support the wealth and welfare of their citizens, but celebrities such as Angleina Jolie can draw attention to major problems at the global level more effectively than politicians, and donors with the awareness and organisation to ensure that their donated money is used sensitively and effectively can make a difference where governmental organisations have fallen by the wayside. The new names to listen out for are those implementing best practices from the fields of tech and business, permeating the field of philanthropy to create seismic change through innovation.