By Chitwan Khosla, Features Editor
Philanthropy in recent years has under gone a sea change. Almost 200 billionaires from around the world are pumping much more money into charity than ever before with the hope of solving the immediate problems of our times and changing the face of society, hopefully in their lifetimes.
As with anything, discussion is essential for progress. Events such as the Forbes 400 Summits bring the philanthropists and social entrepreneurs of the world together to ponder over the problems being faced by humanity and how to overcome them.
Warren Buffet, chairman-CEO of Berkshire Hathaway and the first philanthropy Award recipient, is one who has been most forthright in his opinion that we should try to solve today’s problems rather than next century’s. According to him, as reported by Forbes: “I don’t know the important issues necessarily 50 years from now. I do know what I consider the important issues now. And I know some terrific people who operate in those fields. Everything I have will be spent within 10 years after the closing of my estate. There will always be plenty of philanthropists in 10, 20, 50, 100 years from now. They can look at the problems of that day and the people of that day and pick out the best managers.” Buffet’s argument is not only pragmatic, but it also brings to the forefront that true philanthropists don’t believe in mere funding, but have solid plans to do something.
Melinda Gates, one of the world’s most influential philanthropists, is in agreement. She has found that today, women account for the highest percentage of victims of almost all global issues related to health, social status, hunger, violence, and poverty. She chose to become the voice of women and girls, and is investing billions to bring women out of their miseries everywhere on the planet. In an interview with Forbes, she said that to end poverty, women and girls need to be put at the centre of charity focus. The same interview reported that Melinda, along with her husband Bill Gates, has $41.3 billion in endowment, which the pair can position in any way they deem fit. And with so much power, Gates is exceptionally emphasising women’s empowerment.
Philanthropy is, these days, no longer restricted to running schools and hospitals. Philanthropists now recognize that it is more valuable to help bring the poorest of the poor above the poverty line, so that they can feed themselves and their families and afford education and healthcare. In countries like India, which has the second highest number of billionaires in Asia, the government has made it mandatory for industries and corporate businesses to spend two per cent of their profits on corporate social responsibility (CSR). To humanity’s credit, the overwhelming response that has gone beyond the mandatory law, with some companies giving more than the stipulated percentage. It is expected that about $20 billion will be collected every year for the social causes. Deval Sanghavi, founder-partner of Indian philanthropy foundation Dasra is hopeful that once the CSR mechanism falls into place, and areas of funding are identified, businesses and other funders will focus on long-term strategies. At present in Asia—other than education and health care—sanitation, hunger, and water scarcity have been identified as the issues that need the most attention. If proper strategies are put into effect, it will ensure that not only the money is spent in the most efficient way, but also that it reaches the right people. CSR mechanism shouldn’t be considered a law, because philanthropy is an act of paying back to society what one has received from it. It should rather be considered a technique or a tool that has been successful in increasing the engagement of the corporate world to channel their funds in a more productive manner and create social awareness.
Big companies, who give away millions and billions to charities each year, are obviously capable of making a greater impact than regular funders. Pouring their money to charity organizations is just a fraction of the help that they can offer—it is also incredibly important that they can help create awareness and provide other resources. Therefore, the focus has clearly shifted to giving more personal time, effort, and manpower. As reported by Forbes, Bill Gates said: “I have had a lot of fun jobs, but none of them has been as fun as partnering with Melinda and seeing real results… I see philanthropy as the venture capital for government functions. There are certain things the private sector will never fund, like fighting malaria or fixing primary health systems, because there is no profit model there. Governments want to fund those things, but it’s difficult for them to work on really long-term issues and to attract the right scientists to solve those problems. Philanthropy can take the risks, do the research and development, and fund the pilot programs to tackle some of the most critical issues in the world.”
With his explanation for why it is important to fund the “critical issues” for the philanthropy, he also underlined the need of involvement of the right people.
It is a positive change that philanthropy has become a very well-organized sector in its own. Young philanthropists are bringing professionalism and implementing business-like models to maintain a sustainable philanthropy cycle. Many charitable organizations are investing in stocks to establish a continuous money flow to fund projects in various countries. Not only does this help in solving the issues at hand, but it also improves the local economies by generating employment. Professional marketing campaigns are also invested in creating awareness and involving the general public in working together for global causes. Other than being able to generate funds, the big names bring a value of trust. Public outreach programs become successful as people trust celebrities like Gates, Buffet, and Fox, and because of this trust they agree to get involved much easily and profoundly. Their foundations and non-profit organizations also become channels for the common people to reach the needy directly. You can sponsor a child for their education and be kept updated about their development if you wish to. You can feed 10 families each day with as little as $1 a day in Uganda. All this is possible because of the efficient business models that the philanthropists have been able to set up with their money and expertise.