Counting on the rich

Philanthrocapitalism is quite a large word to pronounce, and the idea it represents may be hard to swallow. It signifies the change in the world economic order when all bluffs about state social responsibility are called. The state steps away from what we have generally understood to be its duties, such as providing for public welfare, and redesigns itself into a regulator. The business of public welfare is left in the hands of business - more specifically, to philanthropic instincts of businesspersons. The wheel of capitalism-as-democracy comes full circle, with the appropriated social surplus being redeployed - but without the aid of a mediating state. This seems to be the shape of the world that Bill Gates and others who have joined hands to form the Giving Pledge see in the future. Over $200 billion has been pledged by the 92 billionaires, mostly American, who are part of this pledge. However, at least one European billionaire critic of this Pledge has pointed to the tax incentives (in the United States) for such donations, and asked whether citizens should pay tax or make donations.

This and many other interesting issues emerge from the otherwise-heavy pages of the book under review. Here's an interesting point: despite being far richer and more influential than even the largest philanthropic foundations in Europe, foundations of the Roman Catholic church are exempted from all of the numerous definitions of charity extant under different laws in Europe. As a result, it is not possible to ascertain "what their assets or income are, who controls them or whom they control".

So it is interesting to see that "giving" is more than a civil act; it is a political statement, a mobilisation. One does not read a book on global fundraising with the hope of learning about the cultures and histories of people in different parts of the world, but guess what: fundraising is all about understanding cultures, histories, political contexts as well as economic potential. Giving by the middle class, high net worth individuals (HNI), ultra-high net worth individuals (UHNI), corporations and by governments is the subject of careful analysis and estimation by the world's large resource mobilisers, including the International Committee of the Red Cross, Unicef, HelpAge, Cry, World Vision, Save the Children and so on.

Wealth distribution and giving to the needy are, of course, exalted in ancient cultures. Zakat is part of the Islamic code of conduct, mandated by law in Islamic states; the Japanese admire Intoku-no-bi, a Confucian precept whereby one gives anonymously and refuses recognition; and Confucian, Taoist and Buddhist values of sharing are embedded in Chinese culture. Africans give on the basis of need, irrespective of the wealth they possess (this is the concept of ubuntu). Parsi humanitarian values are amply demonstrated by the Tata trusts. In Indian culture, I would like to add, we are taught to act according to dharma, which may include supporting those who are exempt from labour (students and teachers); however, the state was never exempt from its duty to provide. We learn that Anglo-Saxon political culture prevalent in the UK, US and Australia favours private philanthropy, as against the North European model of the welfare state, which is also dominant in Canada.

The book offers a bird's-eye view of the fundraising climate in countries across the world: the dualism of a tightly regulated NGO framework vis-a-vis booming HNI donor potential in China; a public resentful of the rich lifestyles of NGOs in Nigeria; a public mistrustful of donations in Russia; a vibrant giving culture, led by church organisations in South America; an innovative culture of giving that is overtaking middle-class India; and Kenya where safari-type events have generated more fundraising money than anywhere else on the planet. Corporate donations are going neck and neck with individual donations worldwide.

There are at least seven giant global fundraisers, each raising more than $1 billion each year; and there are at least eight local fundraisers that raise over $1 billion in the US alone. From the bottom of the pyramid to UHNIs, everybody is giving. But where does all this money go? Most of it goes towards disaster relief, poverty, children's issues, education, health and religion. Impact investment is the buzzword in the non-profit sector, with HNI giving being increasingly tied to this requirement. So the challenge seems not so much to raise money as to figure out what to do with it.

GLOBAL FUNDRAISING
How the World is Changing the Rules of Philanthropy
Penelope Cagney and Bernard Ross
Wiley; 394 pages; $60