Indian investors are lagging behind their global as well as Asian counterparts in terms of social investments as the country does not have a robust culture of philanthropy that redirects billions of dollars to societal needs, Asian Venture Philanthropy Network (AVPN) CEO said.
According to Singapore-based AVPN, despite Asia's economic prosperity, the region is falling behind on nearly two-thirds of its sustainable development goals (SDG) and some of the top concerns for the region include -- inequality, environmental preservation and climate action.
AVPN is holding a gathering of social investors in Asia on June 4-7, 2018, at Suntec City, Singapore, that will bring together 800 of the world's leading social investment players from over 40 countries.
Moreover, there is a funding gap for early stage social enterprises. Besides, only 1 per cent of funds are leveraging environmental, social and governance (ESG) practices in Asia.
"There is a definite scope of looking at increasing investing as per ESG guidelines. We are seeing a change in other markets, where the change is driven by millenials and women, and I am hoping that the same thing happens in India, and it should also be driven by regulators.," AVPN Chairperson and CEO, Naina Subberwal Batra told PTI.
Citing examples she said the Singapore Stock Exchange has signed a UN agreement on sustainable investing and that's one of the reasons why companies that are listed on the Singapore Stock Exchange are expected to make an ESG declaration.
"I think Sebi and Indian stock exchanges need to do something similar so that opportunities and financial instruments are available for Indian investors," she added.
Moreover, there is also a problem of income inequality in India. Going by statistics, 22 per cent of India's national income is accrued by the 1 per cent of its population.
"But India does not have a robust culture of philanthropy that redirects billions of dollars to societal needs. The top 1 per cent in India has only begun to donate strategically," Batra said and added that in term of actual investment into social causes, a lot of that investment is still coming from the west.
"The result is weaker network of community groups, NGOs and social services that lack the ability to serve India's poor at the scale necessary. India must address inequality, and one way to do so is to simply give back a large portion of what is earned," she added.
On a question as to why Indians are not that open to philanthropy, she said, "There is a rise in wealth in India, but a lot of that is still first generation wealth and so they are still not that generous in terms of their philanthropic spend.
Moreover, when they spend on philanthropy, its mostly "brick and mortar" philanthropy like setting up a school and putting their name to it. They are just ticking the box.
However, the trend in philanthropic spend in India is changing, she added.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)