Can COVID-19 revive philanthropy’s risk appetite?

 By Clare Woodcraft, Executive Director, Centre for Strategic Philanthropy, Cambridge Judge Business School


This blog is part of a series on tackling COVID-19 in developing countries. Visit the OECD dedicated page to access the OECD’s data, analysis and recommendations on the health, economic, financial and societal impacts of COVID-19 worldwide.


Covid-19-philanthropyPhilanthropic capital is risk capital – an attribute often overlooked amidst the race to secure measurable positive outcomes to report back to donors and boards. Philanthropy has always accepted investing for zero financial return and with the advent of Venture Philanthropy that mimics the principles of Venture Capital, can readily embrace and learn from failure. Indeed, perhaps the most powerful proposition of philanthropy is this ability to focus primarily on social impact rather than financial gain. In theory, this could drive innovation, radically new ways of thinking and experimental ways of finding new solutions to old problems. Unfortunately, this is rarely the case.

The OECD’s “Private Philanthropy for Development” 2018 report notes that larger foundations working in development actually favour investing in stable, middle-income economies through large, established partners rather than in riskier environments with untested actors. Only a few foundations provide unrestricted funding that might encourage trial and error. And long-term commitments – those of five or more years – are still scarce. Eric Stowe reiterates this point arguing in the Stanford Review that ambitious systemic approaches are rare: “Most non-profits have little appetite for risk. Small, one-off initiatives, isolated pilot projects…are the norm…[and]…rarely ever go to scale.” Continue reading “Can COVID-19 revive philanthropy’s risk appetite?”

The role of philanthropy for the SDGs is not what you expect

By Benjamin Bellegy, Executive Director, Worldwide Initiatives for Grantmaker Support (WINGS); Michael Mapstone, Director of International, Charities Aid Foundation (CAF); and Lorenzo Pavone, Deputy Head of Networks, Partnerships and Gender Unit, OECD Development Centre

philanthropy-SDGsWhat will philanthropy do to get the world closer to the Sustainable Development Goals (SDGs) by 2030?

When doctors see symptoms that are associated with common ailments, they are told to think that a typical disease, not an exotic one, is the cause. If a child arrives to a clinic with a fever, doctors first look for a common infection that could explain the symptoms, not Kawasaki. The general thinking is that the most likely explanation is often the correct one. When you hear hooves, for example, think that a regular horse is nearby, not a zebra. What does this have to do with philanthropy and development?

To many, philanthropy is a welcome source of funding for development programmes across the world. The size of philanthropic funds heading to developing countries is anything but trivial and has increased markedly over time: Recent OECD estimates show that philanthropy for development between 2013 and 2015 was around USD 8 billion a year, most of it directed towards health and reproductive health programmes, but also sectors like education and agriculture. The Foundation Center finds similar results for US foundations, estimating international giving at an average of USD 7.5 billion for the same period. Moreover, measures of generosity are increasing on a global scale, particularly in Africa according to the World Giving Index; with the expansion of the global middle class, the possibility for domestic philanthropy to play an even larger role in development is becoming even more salient. These sizable private resources are tackling social issues that other private international flows, like private investment, often can’t reach or aren’t interested in doing so. Because of all this, many are beginning to see philanthropy as a key financing source that could help close the SDG funding gap, estimated at USD 2.5 trillion up until 2030. Continue reading “The role of philanthropy for the SDGs is not what you expect”

The New World of Development Foundations

By Simon Scott, Counsellor, OECD Statistics and Data Directorate

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One of the compensations of growing old is that you may eventually find out what you always wanted to know.

Fifteen years ago I wrote an OECD study on Philanthropic Foundations and Development Co-operation which – despite its many glowing virtues – was decidedly thin on systematic financial and sectoral detail. Most of all, I found it almost impossible to get a handle on what the biggest development philanthropy of all, the Bill and Melinda Gates Foundation, was up to.

Now, in my dotage, my questions are answered by an excellent new study, Private Philanthropy for Development, a joint project of the OECD’s Development Centre and Development Co-operation Directorate.

How large is private philanthropy’s financial contribution to development? Answer: USD 24 billion from 2013 to 2015 inclusive, or USD 8 billion a year. What is the share of the Gates Foundation? 49%, which goes mostly to health, with agriculture next. And, by the way, the authors of these figures are not just guessing: they developed a special new data survey completed by 77 philanthropies and also gathered publically available information on many more. All the data – partly aggregated to protect confidentiality – are available here, and constitute a major new information resource.

Continue reading “The New World of Development Foundations”

Who will end global poverty?

By Michael Sheldrick, Vice President of Global Policy and Government Affairs, Global Citizen 1

shutterstock_249974521For the second year in a row, the Trump Administration has proposed slashing U.S. development assistance programs by almost a third. Even though strong support on both sides of the U.S. Congress may prevent many – but not all – of these cuts becoming law, it is clear that the best hope for this period may be maintaining current levels of support. As the largest donor country, U.S. leadership on foreign aid is incredibly impactful. For example, based on our experience at Global Citizen, business leaders and policy makers announced 390 collective commitments in response to campaigns we either led or supported between 2012 and 2017. These commitments totaled more than USD 35 billion with nearly half of that, USD 15 billion, coming from just 5 countries, including the United States. And of the total number of new commitments, the United States makes up a nearly a quarter. In fact, the United States has been one of the largest contributors to many of the causes we champion, be it polio eradication, water and sanitation, or food aid.
Continue reading “Who will end global poverty?”

The three circles of philanthropy: Taking a tiered approach to achieving the SDGs

By Bathylle Missika, Senior Counsellor to the Director of the OECD Development Centre and Head of Unit – Partnerships & Networks, Organisation for Economic Co-operation and Development (OECD)

the-three-circles-of-philanthropy2People around the world have little faith in the ability of just governments to deliver on the promise of the Sustainable Development Goals (SDGs). They know governments alone can’t promote sustainable development and prosperity for all. What will make a difference is involving new partners. Philanthropic foundations, with their resources, expertise and quest for innovation, are prime partners in development. But how do we unleash the power of philanthropy to be agents of development change? How can we tap into this community of philanthropists and leverage their ability to take risks and to innovate in sectors like education, gender or youth empowerment? Better understanding foundations and how they view the 2030 Agenda will help us better partner with them. That’s why the OECD’s Network of Foundations Working for Development (netFWD) unveiled a new circle typology to outline a fresh way to think about and understand philanthropies and their role in advancing the SDGs and well-being overall. Continue reading “The three circles of philanthropy: Taking a tiered approach to achieving the SDGs”

More than money: Optimising philanthropy’s potential to fast-track development

By Bathylle Missika (Acting) Head of Policy Dialogue Division, OECD Development Centre The Sustainable Development Goals (SDGs) have such scale and complexity that they require governments to strengthen co-operation with a broad range of development actors. Foundations, among others, may play a role both in financing development as well as in designing and implementing innovative projects. On the one hand, North-South flows from foundations based … Continue reading More than money: Optimising philanthropy’s potential to fast-track development