Who’s Doing Good?

19 March 2018 - 25 March 2018

THE GIVERS

Chinese philanthropist donates US$3 million to alma mater. Ming Mei, co-founder and CEO of GLP, a leading provider of global logistics solutions, is donating US$3 million to Indiana University. Half of the donation will endow a tenured chair in Chinese economics and trade in the Department of East Asian Languages and Cultures, while the other will establish a tenured chair position in logistics.

Singaporean philanthropists come together to develop facility for assisted living. A group of five philanthropists from Singapore have joined forces to set up the first purpose-built assisted living facility that will allow seniors with mobility issues to live independently.This announcement was made by Laurence Lien, chairman of the Lien Foundation, at the inaugural ASEAN Philanthropy Dialogue. The facility is expected to be completed by 2021.

THE THINKERS

“Philanthropy in Pakistan: Why civil society organizations get bypassed in favor of donations to individuals.” In this article, Shazia M. Amjad and Muhammad Ali of the Pakistan Centre for Philanthropy explain why Pakistanis prefer to donate directly to individuals over nonprofit organizations. Four major reasons are cited: 1. Compassion spurs in-the-moment giving in small cash. 2. Religious institutions receive the bulk of giving that goes to organizations. 3. There is a lack of trust in nonprofit organizations. 4. It is usually with more wealth that giving to formal organizations become more common.

Malaysian Sultan states Islamic finance can be combined with impact investing and philanthropy. Speaking at a forum themed “Enhancing the value of Islamic capital market through social and impact investment” co-organized by the Securities Commission Malaysia and the Oxford Centre for Islamic Studies, Sultan Nazrin Muizzuddin Shah said that the Islamic finance sector must remain relevant by being involved in the global agenda to alleviate poverty and inequality. Impact investing was one channel through which Islamic finance could contribute to social causes, while he also cited philanthropy as another area that can be combined with Islamic finance via institutions such as sadaqah (voluntary charity) and waqf (endowment).

“Money or Mission? The Fight about Big Tobacco’s Philanthropy” In this article, Erin Rubin discusses the International Labour Organization (ILO)’s conflict of interest with the tobacco industry. While tobacco companies provide roughly US$15 million in donations for social projects sucha s programs to end child labor, they are also notorious, according to the International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and Allied Workers’ Associations, for “poor working conditions, exploitation of workers, and abuse of their rights.”

THE NONPROFITS

Lien AID leads a collective effort to provide clean water access in rural Myanmar. Lien AID, a Singapore-based international nonprofit committed to enabling sustainable access to clean water and sanitation for Asia’s rural poor, is planning to create more clean water projects in Myanmar. To do so, Lien AID believes tackling the problem of sustaining access to clean water must be a collective effort. That is, it seeks to work in close partnership with governments, businesses, individuals, other nonprofits, and academia in order to increase the impact of its own programs.

THE BUSINESSES

AmorePacific hosts marathon for breast cancer awareness. AmorePacific, South Korea’s beauty and cosmetics conglomerate, hosted a marathon in Busan to raise public awareness about breast cancer. According to the company, about 5,000 participated in the marathon, and funds raised during the event from ticket sales have been donated to the Korea Breast Cancer Foundation to cover surgical expenses and medical examinations for cancer patients.

THE INNOVATORS

Three Southeast Asian social entrepreneurs win inaugural social impact award. Three social entrepreneurs were chose as the winners of the inaugural ASEAN Social Impact Awards in recognition of their social impact and innovation. Indonesia’s Tri Mumpuni won first place for her efforts in providing access to electricity, as well as training villages to run the plants independently. Cherrie Atilano from the Philippines and Somsak Boonkam from Thailand were runners-up. Atilano was recognized for her role in increasing farmers’ access to finance, technology, and information on the best farming practices for the purposes of fair trade, as well as working with farmers on sustainable farming methods to protect the environment and farmers’ future livelihoods. Boonkam was recognized for his work with local communities to build their capacity for community-based tourism.

THE VOLUNTEERS

Zhou Xun announced as TOMS giving ambassador. Zhou Xun, a renowned Chinese actress who is also a UNDP Goodwill Ambassador, will become the American footwear company TOMS’ Goodwill Giving Ambassador in Asia. Zhou and the company’s founder Blake Mycoskie went on a trip to Yunnan province late last year to donate shoes to primary school students.

THE TRUSTBREAKERS

Former Korean President’s private foundation comes to the spotlight amidst corruption allegations. Founded by former President Lee Myung-bak, Lee & Kim Foundation (known as “Cheonggye Foundation” in Korean) was recently criticized for receiving tax benefits as a charitable organization when only 0.7% of its total assets were used for scholarships. This criticism comes at a time when President Lee is currently under investigation for a corporate corruption scandal involving his family members and cronies.

Pragmatic Philanthropy: Asian Charity Explained

Palgrave Macmillan, January 2018

“We must create a civilization where we can realize the best of human potential. This book helps us to understand how this vision is being realized in Asia today.” (Muhammad Yunus, Nobel Laureate and Founder, the Grameen Bank)

“In today’s world, leaders must rely on partnerships that connect across business, government and civil society. In Asia, partnerships are in evident display. Ruth Shapiro tells us how they help address our shared problems in ways that create win-win solutions.” (Dominic Barton, Managing Director, McKinsey & Company)

“Charity has had a long and noble history in Asia.  It has not however, been the study of much research or documentation.  Pragmatic Philanthropic makes an important contribution to understanding the way in which social investment in Asia takes place.” (Victor K. Fung, Group Chairman of the Fung Group)

“Kiva is working in 80 countries.  While some aspects of our work are consistent throughout the world, we have learned that it is essential to have on the ground knowledge in each of the localities where we make loans available.  We must have trust worthy local partners and be familiar with local laws and practices. Dr. Ruth Shapiro’s insights come from decades of work in Asia. This book provides a very helpful view into the way philanthropy and other types of social investment gets done in the region.” (Premal Shah, Co-Founder & President, Kiva)

“As every great social entrepreneur knows, and as the Skoll Foundation has learned from our work with them, context matters. What works in Bangladesh may not translate to Indonesia, and vice versa. Successful social investment depends upon local knowledge and uptake, as Ruth Shapiro demonstrates in this valuable volume. Here she shares insights gained from her work in Asia together with some of the world’s most promising philanthropists. Pragmatic Philanthropy: Asian Charity Explained is essential reading for change-agents working across the Asian continent, and for those seeking to support them.” (Sally Osberg, President and CEO, Skoll Foundation)

“We are beginning to see dramatic increases in interest and activity in philanthropy in China and throughout Asia.  We also need to see a commensurate degree of research and understanding of the sector.  This book is a worthwhile effort to help close the gap between interest and impact.” (Xiulan Zhang, Professor and Former Founding Dean, School of Social Development and Public Policy, Beijing Normal University, China)

“Although non-profit corporations have been in existence in legal sense since 1898, the Kobe earthquake of 1995, followed by other natural disasters have been a wake-up call for Japan. We see the need for citizens to be active in addressing our shared concerns whether they are helping vulnerable people or reconstructing a devastated area.   Studies like the one carried out by the Centre for Asian Philanthropy and Society help us to learn valuable lessons about what works in taking on these roles.” (Tatsuo Ohta, Chairman, The Japan Association of Charitable Organizations)

“This book exemplifies the reason that I agreed to go on the board of the Centre for Asian Philanthropy and Society – it provides world-class analysis to a field that is understudied and misunderstood.  For too long, philanthropists have worked from the premise that the rigor and analysis they use in their businesses are not applicable to their charitable investments.   The opposite is the case as these types of investments are more difficult to measure and can touch the lives of many.  Dr. Ruth Shapiro’s book helps us to understand the dynamic nature of the Asian philanthropic sector and make more informed choices about how we invest our time and our resources.” (Elizabeth Eder Zobel de Ayala, Chairman, Teach for the Philippines)

“More and more people are thinking about philanthropy in a more methodical, intelligent way.  It is important to understand deeply the issues you are dealing with and support solutions that make the most impact.  Grounded in  research and evidence, this book helps us to see how this trend is accelerating across Asia.” (Jamshyd Godrej, Chairman, Godrej and Boyce)

“Our own Trust Barometer shows that trust is in crisis around the world.  Non-profit organizations tend to be more trusted than governments and companies but even their numbers are going down.  In Asia, this lack of trust has significant ramifications for philanthropy and the charitable sector.  This book helps us to understand why trust is in such short supply, why this matters and what we can do about it.” (Richard Edelman, Chief Executive Officer, Edelman)

“The Djarum Foundation’s work is grounded in community help, tolerance and mutual assistance.  These are values that are integral to who we are and are shared by many in Indonesia and throughout out Asia.   Pragmatic Philanthropy explains how these values underpin programs and practices of helping each other in Asia.” (Victor Hartono, Chairman, The Djarum Foundation)

Philanthropy in Asia needs a push from good government policies

South China Morning Post

Ruth A. Shapiro says that governments in the region must send strong signals that they value philanthropy through tax incentives and other policies. This could encourage a more systematic approach to giving and spark innovation in the social sector.

The Centre for Asian Philanthropy and Society has just released its inaugural Doing Good Index, which looks at the factors that both enable and hinder philanthropy and other kinds of private social investment in Asia. We found that Asia has enormous potential to do good. If Asia were to donate the equivalent of 2 per cent of its GDP, the same as the United States, it would unleash US$507 billion (HK$3.9 trillion) annually. This is more than 11 times the foreign aid flowing into the region every year and one-third of the annual amount needed globally to meet the sustainable development goals by 2030.

We did this study after understanding several important dichotomies affecting Asia and its social sector. First, there is enormous wealth being created in Asia but still incredible and at times tragic need. Second, while there is a long history of charity in Asia, philanthropy, or the systematic approach to doing good, is relatively new. Third, while many on the ground are carrying out extraordinary efforts to help relieve suffering and need, there is often a debilitating lack of trust towards the sector. Last, many Asian governments realise that philanthropy is growing and are reacting by crafting new policies and regulations that both encourage and control its flow.

The Doing Good Index is an ambitious initiative. Supported by donors in Asia, the team worked with 34 partners from 15 economies to survey 1,516 social delivery organisations and 80 experts. They answered questions about a range of factors that influence philanthropic capital. The questions fell into four categories – regulations, tax and fiscal policies, procurement and ecosystem. The first three are government-driven, while ecosystem looks at the role that people, communities, companies and universities are playing in addressing social challenges and nurturing the social sector.

We find that people are ahead of government: on average, Asian economies perform better in the ecosystem category than in the other three. Society is rewarding philanthropists and organisations in the social sector. Public recognition and awards are becoming more prevalent in most economies we studied. Many are volunteering both through their companies and on their own, people are serving on boards, and universities are offering classes in philanthropy and non-profit management.

Our study also shows that the right policies and incentives do matter. Tax subsidies contribute a great deal towards the propensity to give across income levels and have an important signalling effect. Asian philanthropists are pragmatic. People want to help their communities but also want to do this in ways that are aligned with their own government’s goals. When a government signals that philanthropy is appreciated, it has a positive influence on giving.

The right policies can address the trust deficit and mitigate the deleterious effect on philanthropy. Many social delivery organisations in Asia are endeavouring to become more transparent and accountable. In our study, 75 per cent of those surveyed have a website and 86 per cent have a board of trustees with nearly all reporting regular board meetings. Organisations in 13 of 15 economies are required to submit an annual report. The right regulations create a culture of accountability and facilitate the ability of organisations to report.

However, regulations need to be calibrated to reduce friction in the social sector and facilitate its growth. In some economies, organisations need to work with many government agencies, with one country having 15 different ministries all with different reporting requirements. This puts a burden on non-profit organisations and encourages underreporting.

Last, the social sector is vastly understudied. There is very little reliable data. For the Doing Good Index, we had to create the data from scratch. More information about philanthropy can help address the trust deficit and showcase which practices, models and policies are best in class. There is no dearth of humanity, creativity and commitment in Asia.

The key is to put systems and practices in place that allow us to learn from each other, contribute to our communities and help Asia become a global philanthropic leader and a centre for social innovation.

Ruth A. Shapiro is founder and chief executive of the Centre for Asian Philanthropy and Society.

This article appeared in the South China Morning Post print edition as: Right policies can boost Asian philanthropy.

This article ran originally in the South China Morning Post.

Doing Good Index 2018

Maximizing Asia's Potential

The inaugural Doing Good Index examines the enabling environment for philanthropy and private social investment across 15 Asian economies. Composed of four areas–tax and fiscal policy, regulatory regimes, socio-cultural ecosystem, and government procurement–the Index reveals how Asian economies are catalyzing philanthropic giving.

If the right regulatory and tax policies were in place, Asian philanthropists could give over US$500 billion, contributing to the US$1.4 trillion annual price tag needed to achieve the Sustainable Development Goals.

The Index serves as a unique and useful body of data for Asian governments, as well as for nonprofits, foundations and charities in Asia, to learn from each other. At a time when policy is evolving, the social sector is growing, and interest in philanthropy is rapidly developing, the DGI shows the potential for Asia to leapfrog and become a leader in social innovation.*

*The latest version as of 19 January 2018 is available for download now.

*Please note that for Korea the 10% rate of tax deduction for corporate donations refers to the limit on corporate income eligible for deduction. The rate of tax deductions for corporate donations in Korea is 100%, with a 10% limit. This change has no effect on the results of the index. For further information, please contact us.

Asian companies develop new forms of philanthropy

Nikkei Asian Review

Anxiety about the gap between rich and poor has spread to Asia.

Rising joblessness led South Koreans to replace the dominant Saenuri Party in April. Even in the Philippines, with the healthiest economic growth since 1970, voters rejected the ruling elite in favor of the anti-establishment Rodrigo Duterte, who campaigned on profanity-laced vows to cut poverty. Yet not all solutions to social problems are political. Around the world, companies are seeing community engagement as not only in their own interest but also as an important part of their role in society.

Donations already play a large role. Corporate philanthropy has been on the rise for a decade and continues to grow. In 2012, 66% of all charitable giving in China came from corporations, as estimated by the Conference Board, a non-profit business research group.

India now requires top companies to pay 2 percent of after-tax income into certified philanthropic activities. According to Finance Minister Arun Jaitley, such giving totaled Rs 8,347.47 crore in the last year, about $1.5 billion USD. We do not know if the money is being spent wisely or efficiently, but it is clear that the bottom line is massive and will trickle through to increase the impact of many charitable programs throughout India.

Companies can help in at least four other ways, starting with sharing technical expertise. Some companies are already using their skills alongside financial resources to build capacity and bring about sustainable change. In India, the Axis Bank Foundation (ABF) opened a strategic partnership with Dilasa Sanstha, an organization devoted to helping farmers increase production and earn stable livelihoods. The ABF helped Dilasa expand rural credit, strengthen internal budgeting and create an evaluation system. For the first time, Dilasa could collect critical data on beneficiary income, household assets, education levels, diet and investment plans.

Similarly, support from Khazanah Berhad, Malaysia’s sovereign wealth fund, helped improve the capabilities of Mercy Malaysia, a medical response group active after natural disasters. Khazanah helped Mercy develop systems that assist it in managing people and resources and deploying them efficiently to disaster zones. The partnership has helped Mercy become an internationally acclaimed provider of disaster assistance.

Social delivery organizations may be non-profits, but they need to think more like businesses. To maximize their impact, they should be concerned with transparent accounting, financial forecasting, strategic planning, organizational management and development and a host of other skills that have traditionally been labeled as business skills. The private sector has plenty of these skills. In both of these cases, the companies provided financial resources and technical resources. They committed to the social delivery organizations for the longer term.

Another way companies can help is through shared value initiatives. Shared value, a term coined in 2006 by Harvard professors Michael Porter and Mark Kramer, is a strategy in which companies bring economic value to themselves while addressing a social need. In the Philippines, Manila Water figured out how to decrease siphoning and protect the pipeline so that clean, cheaper water reached those in the poorest districts of Manila. This successful project improved water access for the poor and increased Manila Water’s bottom line.

Uniqlo owner Fast Retail provides another example of shared value. With garment factories in Bangladesh, Fast Retail knows first hand the difficult circumstances facing many workers there. Uniqlo has launched a line of products inspired by traditional designs. Proceeds from these clothes go toward continuing education for women working in their factories.

Not surprisingly, there is considerable excitement around the notion of shared value. When the company and the community both prosper, the initiatives are more sustainable. Still, shared value initiatives are new globally and very new in Asia, and we can expect to see much more innovation of this kind.

A third strategy for community engagement is when companies work on their own. They believe and with some justification, that they have the skills to deliver a social good more efficiently than by working through an NGO. Shopping mall operator SM Prime Holdings in the Philippines is building clinics and schools, through its BDO Foundation, in the typhoon-ravaged areas of Leyte and Samar. The Reliance Foundation, the philanthropic arm of India’s Reliance Industries, carries out work through its own rural development, health and education initiatives.

Lastly, in some cases, corporations find it useful to develop alliances to bring about change. In China, corporate leaders have come together to create the SEE Foundation to work on environmental issues and the Ai You Foundation to provide medical aid to children. The Philippines’ largest conglomerate, the Ayala Group, and the telecommunications firm PLDT together created the Philippine Disaster Recovery Foundation to build a disaster operations center to coordinate the private sector relief efforts during major disasters.

How can companies evaluate whether they are doing enough? There are several key questions to ask.

First, how robust is your volunteer program? According to a Deloitte survey, 90% of HR managers believe that volunteering aids in building an employee’s leadership skills and according to a Price Waterhouse Coopers study, employees are less likely to resign if they feel engaged with their companies including through volunteer programs. A robust volunteer program can assist local charities while at the same time boosting employee company pride and loyalty.

Second, what subject areas best align with a company’s strengths and goals? Community engagement is much more sustainable when aligned with key competencies. It makes sense for Uniqlo to be utilizing clothing to engage with the community or for Axis Bank to focus on livelihoods and financial inclusion. Not everything a company does must be aligned with its interests and strengths, but it is helpful to know what these are and how they can be utilized to benefit the community.

Third, tone from the top is critical but innovation at all levels of the company is equally important. Employees have ties to the community and understand the needs of those living there. Creating programs that allow some latitude in addressing community concerns can harness this knowledge.
The rise in corporate involvement is clear. There is no question about whether a company should engage with the community, the only question is how. With their technical expertise, shared values and productive partnerships, Asia’s corporations are poised to be constructive, long-term stakeholders in the region’s continued growth.

Ruth Shapiro is chief executive of the Centre for Asian Philanthropy and Society, an organization dedicated to facilitating excellence in philanthropy.

This article ran originally in the Nikkei Asian Review.

 

Spotlight on Squash

SRAM: Growing a Game

From humble beginnings, the Squash Racquets Association of Malaysia (SRAM) popularized a little known club-based sport played by a few enthusiasts and put a nation on the world sporting map with a series of international champions.

Nicol David, the superstar of squash in Malaysia and seven time world champion, is one notable result of a commitment a group of squash enthusiasts made 41 years ago: to popularize the sport in the capital city of Kuala Lumpur and in clubs around the country. Today, thanks to the SRAM, more than 4,000 young people play squash in Malaysia, including many inspired by David’s unprecedented success.

The government of Malaysia, through the National Sports Council (NSC), is the biggest sponsor of SRAM’s programs and its athletes. It is through NCS’s sponsorship that SRAM continues to pursue its founders’ vision: transform a sport and develop world-class players.

Response and Recovery

MERCY Malaysia: Healing the Wounds of Disaster and Conflict

With emergency relief and long-term intervention, a humanitarian aid organization helps treat the physical and emotional wounds of people and nations across the Global South.

MERCY Malaysia, also known as the Malaysian Medical Relief Society, started from a small group of well-meaning doctors to a humanitarian aid organization respected across the Global South. In the beginning,  MERCY Malaysia focused on emergency relief and its aftermath, and on medical care. Those remain priorities, but in consultation with its partners, it has also developed a systematic approach to areas hit hard by disaster – going beyond emergency relief to recovery, prevention, and preparation.

Private Philanthropy in Multiethnic Malaysia

Elizabeth Agee Cogswell (Macalester International)

As with most other social and economic activities in Malaysia, private philanthropy in multiethnic Malaysia also remains to be determined by the division between ethnic groups of Malays, Chinese, and Indians. By interviewing philanthropists, private foundation staff members, charity fund raisers, non-governmental organization executives, professional fundraising staff of international NGOs, and employees in charge of corporate foundation and direct giving programs. Cogswell teases out the status quo, the intricacies, and issues that private philanthropy in multiethnic Malaysia as it further develops.

Click here to read the full publication.