private giving, philanthropy and the changing landscape of development
DESCRIPTION
The purpose of this dissertation is to explore philanthropy within the context of private giving vis-à-vis changes in Official Development Assistance (ODA). While private giving has escalated, ODA has fluctuated and even regressed over the last 20 years. Further, the gap between the richest of the rich and the poorest of the poor has continued to widen. This has precipitated in a crisis of development. I explore the terrain of private giving from the viewpoint of both ‘hard’ and ‘soft’ influences. I suggest that hard factors refer to the verifiable and measurable, such as economic growth, income levels and advances in Information and Communication Technology (ICT). By soft factors, I refer to socio-cultural elements which influence such motivations for private giving. Recognizing that socio-cultural elements influence assistance is to acknowledge that development thinking is fluid and organic; a product of the prevalent dominant forces of thoughts at any given time. I argue that how we perceive philanthropy and humanitarianism has evolved; it has heightened to a point where to participate in humanity is to be a member of a moral community. I explore how such influences have converged to promote personal agency and self-reliance. This is amplified in the philanthropic acts of the wealthy, who possess hyper agency or the ability to not only influence the institutions within society but are producers of such institutions. I conclude by considering how new approaches in philanthropy, known as philanthrocapitalism, have changed the landscape of development and may possibly even portend a new paradigm of development. In examining this concept, I explore the issues and challenges which exist at the present time.TRANSCRIPT
Graduate Institute of International Development and Applied Economics
Private Giving, Philanthropy and the
Changing Landscape of Development
Frances Tay
Dissertation prepared in partial fulfillment of the requirements for the
MA Social Development and Sustainable Livelihoods
25 August 2008
Contents
Introduction............................................................................................................1
1.0 Private Giving and Official Development Assistance ...................................5
1.1 Private assistance flows .................................................................................5
1.2 The advent of super philanthropists...............................................................7
1.3 Crisis of development ....................................................................................9
1.4 Official development assistance ..................................................................11
2.0 The Influence of Hard Factors on Private Giving ......................................18
2.1 Economic growth and income levels ...........................................................18
2.2 Technology and the rise in e-giving.............................................................25
2.3 Government incentives, the wealthy and the Third Sector ..........................28
3.0 The Influence of Soft Factors on Private Giving.........................................36
3.1 Philanthrophy and humanitarianism ............................................................38
3.2 Public culture and personal spirituality of care............................................44
4.0 Philanthrocapitalism: A New Development Paradigm? ............................53
4.1 The double bottom line ................................................................................56
4.2 The business of giving .................................................................................59
4.3 Issues and challenges ...................................................................................64
Tables
Table 1. GDP based on purchasing power parity share of world total ..................21
Table 2: Changes in GDP per capita between 1970 and 2004...............................22
Charts and Illustrations
1: Total private, official and remittance flows from OECD donor countries and
multinational agencies to developing countries, 1990 – 2006.................................6
2. Private aid to developing countries.....................................................................7
3. ODA from DAC donors to developing countries and multilateral organizations.
(Net disbursements, US$ million at 2004 prices, 1960-2005)...............................15
4.Official and Private Flows, ODA as a Share of GNI, Major Events on Aid
Targets and Major Economic Events (1960-2005)................................................17
5. Wealth distribution of dollar millionaires by region, 2005-2007. ....................25
6: Remember Charity advertisement - “I will. Will you?” ...................................49
7: ECO video - "Island Home" ..............................................................................51
8: Illustration - "Roasted" ......................................................................................52
9: How RED Works ...............................................................................................63
Abbreviations and Acronyms
AAFRC American Association of Fundraising Council
ACF Association for Charitable Foundations
BLSP Business Leaders for Sensible Priorities
CAF Charity Aid Foundation
CSR Corporate Social Responsibility
DAC Development Assistance Committee
ESCAP Economic and Social Commission for Asia and the Pacific
FPO For-Profit Organization
GDP Gross Development Product
GPC Global Philanthropists Circle
GNI Gross National Income
HHI Hand in Hand International
ICT Information and Communications Technology
IBRD International Bank for Reconstruction and Development
IDA International Development Association
LDC Less Developed Countries
MNC Multinational Corporation
NCCS National Center for Charitable Statistics
NCVO National Council for Voluntary Organisations
NPO Nonprofit Organization
ODA Official Development Assistance
OECD Organisation for Economic Co-operation and Development
PPP Purchasing Power Parity
TSO Third Sector Organizations
UN United Nations
UK United Kingdom
UNCTAD United Nations Conference on Trade and Development
US United States (of America)
VCO Voluntary Community Organization
Summary
The purpose of this dissertation is to explore philanthropy within the context of
private giving vis-à-vis changes in Official Development Assistance (ODA).
While private giving has escalated, ODA has fluctuated and even regressed over
the last 20 years. Further, the gap between the richest of the rich and the poorest of
the poor has continued to widen. This has precipitated in a crisis of development. I
explore the terrain of private giving from the viewpoint of both ‘hard’ and ‘soft’
influences. I suggest that hard factors refer to the verifiable and measurable, such
as economic growth, income levels and advances in Information and
Communication Technology (ICT). By soft factors, I refer to socio-cultural
elements which influence such motivations for private giving. Recognizing that
socio-cultural elements influence assistance is to acknowledge that development
thinking is fluid and organic; a product of the prevalent dominant forces of
thoughts at any given time. I argue that how we perceive philanthropy and
humanitarianism has evolved; it has heightened to a point where to participate in
humanity is to be a member of a moral community. I explore how such influences
have converged to promote personal agency and self-reliance. This is amplified in
the philanthropic acts of the wealthy, who possess hyper agency or the ability to
not only influence the institutions within society but are producers of such
institutions. I conclude by considering how new approaches in philanthropy,
known as philanthrocapitalism, have changed the landscape of development and
may possibly even portend a new paradigm of development. In examining this
concept, I explore the issues and challenges which exist at the present time.
Word count of this dissertation: 14, 908 words.
1
Introduction
Despite almost 60 years of intentional development, large-scale interventions on
the part of world governments have not eradicated poverty and its accompanying
ills. We have arrived at a “crisis of development” (Salamon, 2002, p. 12). We are
at a stage in development history where private giving is on the rise even as
Official Development Assistance levels stagnate. Increasingly, the wealthy are
giving more through a strategy of active philanthropy; they not only apply their
funds but also their entrepreneurial skills and business acumen to the causes of
their choice (Schervish, 2006b). These conditions raise a plethora of questions:
What has contributed to the escalation in private giving? Is private giving
necessarily more effective than official assistance at dealing with development
issues as some proponents claim? Adelman (2007) for example suggests that “the
most effective aid programs… are run by private donors while being based on
local initiative and involvement” (p. 62). In contrast, official aid is portrayed as
unwieldy, wasteful, and too bureaucratic and out of touch with those it is meant to
help, and lack comprehensive performance assessment measures (Norris, 2008).
In the following chapters, I will explore these questions.
Philanthropy as it has evolved and emerged in the 20th century onwards is
a product of the vast surplus of wealth in the advanced economies of the West;
beginning primarily in the United States (US) and now encompassing other
developed nations. They refer to tax-exempt organizations “that have broadly
defined charitable purposes, substantial capital assets, and income derived from
gifts, bequests, and capital investments” (Horowitz and Horowitz, 1970, p. 220).
2
Throughout history, philanthropy has played multiple roles within society. When
the State has been unwilling or unable to provide, philanthropy has provided
supplementary relief for the poor (Braithwaite, 1938). In such circumstances, “the
function of charity is to demonstrate the desirability and practicability of
particular forms of services until such time as the State is willing to finance these
services” (p. 25) Indeed, philanthropy has been accredited with leading the way on
many experimental and innovative social services, even controversial ones
(Braithwaite, 1938; Rodgers, 1949). In the case of the black minority in the US,
Reid (1944) suggests that private philanthropy pioneered pluralism and that “in
many instances no innovative and ameliorative program has been undertaken by
public agencies until this private aid has been forthcoming” (p. 266 - 267).
However, the relationship between philanthropy (and philanthropists) with
the State and society sectors have always been one which generates mixed
reviews; eliciting admiration and awe on one hand, and fear and suspicion on the
other. The general public often perceives philanthropic money as “tainted” and
foundations as “dangerous extensions of business power” (Horowitz et. al., 1970,
p. 221). The massive wealth commanded by a philanthropy can also raise fears; its
activities viewed as attempts to monopolize the market or secure social control
(Garside, 2000). The influence of philanthropy also extends beyond state borders;
for example, Bell (2002) claims that “for many years, the Rockefeller and Ford
foundations carved up the world into spheres of influence, the former
concentrating its activities in Latin America and the Far East, the latter
specializing in Africa, the Middle East, and the Indian subcontinent” (p. 510).
3
And yet, without the generosity and vision of wealthy industrialists and
society-minded entrepreneurs, many of the modern advances made over the last
two centuries would not have been possible. For example, the eradication of
hookworm and yellow fever in South America can be accredited to the
Rockefeller Foundation (Abel, 1995). If not for the provision of public education
in the town of Cambridge by the Hopkins Trust, the “sons of craftsmen, farmers,
teachers and tavern keepers” would not have gained social mobility (Burton,
1997, p. 156). If not for such philanthropic activities, the study of the social
sciences may not be what it is today, or the relations between North-South exist in
their current form. (See Berman, 1977; Fisher, 1986). However, it is precisely
because of the scale and scope of the impact of such organizations that
philanthropies should be evaluated with an unbiased eye. In the politics of
knowledge, philanthropies play not merely a gatekeeper’s role but also an
umpire’s (Lagemann, 1997). As Arnove (1980) elucidates:
“Through funding and promoting research in critical areas,
(philanthropies) have been able to exercise decisive influence over the
growing edge of knowledge, the problems that are examined and by
whom, and the uses to which the newly generated information is put.
Through the education programs they fund, foundations are able to
influence the world views of the general public as well as the orientations
and commitments of the leadership which will direct social change” (p.
17).
4
Further, we should never be naïve about the proximity of business and
politics; the boards of foundations often comprise the business elite (Berman,
1977). And as Persell (1994) reminds us, in the “three legs of the social tripod
consisting state, economy and society,” there are “thousands of points of
connection between the political and economic orders” (p. 642). We should never
be complacent about what philanthropists set out to do, for as Schervish (2006b)
observes, “wealth holders are capable of both extraordinary care and carelessness
in carrying out their philanthropy” (p. 175). If the aspirations and priorities of
recipients are not addressed, meaning well does no good; instead, careless aid
often harms (Chambers, 2004). We should also be vigilant if philanthropic acts
reflect a form of manipulative generosity. This is because philanthropy, according
to Ross (1968), has
“…always been the reflection of a class society because it has depended on
a division between rich givers and poor recipients…. The wealthy have not
only given because they have more, but because, by alleviating distress,
they have secured their own positions against those who might displace
them and thus have avoided revolt” (p. 78; cited in Arnove, 1980, p. 1)
5
1.0 Private Giving and Official Development Assistance
This chapter discusses private giving and Official Development Assistance
(ODA). The relevance of exploring this topic is compelling for the following
reasons: the rising trend globally in private assistance flows, the increase in
participation of the wealthy classes in philanthropic activities, the lack of results
from official development efforts and the potential downtrend in Official
Development Assistance (ODA). Collectively, these conditions portend a greater
role for philanthropy in the field of development assistance.
1.1 Private assistance flows
Over the last two decades, private assistance flows1 have outpaced ODA for the
most part. Further, there has been a marked increase in the last few years. (See
Chart 1 for a comparison with ODA and Chart 2 for a breakdown in volume of
private giving by OECD country). While mega-sized gifts from the wealthy have
contributed to this spike in giving, there has also been an overall increase in
giving by the less wealthy. In India, for example, more than 75 million households
now give to charity (Raymond, 2008b). In absolute terms, those with higher
income make more significant contributions. However, in terms of levels of
1 Private assistance flows are derived from the philanthropic sector through foundations, corporations, private and voluntary organizations, universities and colleges, as well as religious organizations (Hudson Institute, 2008). Throughout this dissertation, the term ‘assistance’ is used interchangeably with that of aid and giving.
6
income, those with lower income give disproportionately more. In 2004, for
example, families in the bottom income bracket in the United States (US) on
1: Total private, official and remittance flows from OECD donor countries and multinational agencies to developing countries, 1990 – 2006.
average contributed six percent of their incomes to charity; in comparison, the
richest one percent, who own two-fifths of the nation’s wealth, donated two
percent of their incomes (Conlin, Gard and Hempel, 2004). Similarly, in the
United Kingdom (UK), higher-income donors contributed 0.8 percent of their
income compared to the total average of 1.2 percent (NCVO-CAF, 2006). In
2005, American contributions to philanthropy jumped 6.1 percent with a sizeable
$15 billion increase according to the 2006 Giving USA report (Soller, 2006). In
the UK, from data gathered from the Individual Giving Survey conducted by the
National Council for Voluntary Organisations (NCVO) and Charities Aid
Source: Hudson Institute (2008).
7
Foundation (CAF), it is estimated that more than half of the adult population give
to charity while 29 percent give regularly; total estimated giving amounted to £8.2
billion in 2004/05; £9.4 billion in 2005/06 and £9.5 billion in 2006/07 (NCVO-
CAF, 2007).
2. Private aid to developing countries.
(Source: Economist, 2008)
1.2 The advent of super philanthropists
This upsurge in overall private giving is echoed and amplified among the ranks of
those whom journalist Stephen Moss refers to as “super philanthropists” (Moss,
2008). Increasingly, individuals with “GDP-sized fortunes” have directed their
8
wealth towards philanthropic endeavors (Conlin, et. al., 2004). In 2007, 21
Americans gave at least $100 million, creating a new record in philanthropic
giving (Di Mento and Lewis, 2007). Further, this generosity is not limited to
individuals in rich countries; the newly-minted rich in the developing countries of
Latin America, India and China are giving back as well (Raymond, 2008b;
2008d). Economic growth in developing countries has led to greater economic and
social freedom, which has, in turn, perpetuated the growth of a thriving middle
class and greater participation of civil society, evidenced by the increasing
numbers of non-profit organizations (NPOs) and formal philanthropies (Salamon,
2002; Dulany and Winder, 2001).
Individually and collectively, the wealthy wield enormous influence
through the sheer size of their wealth and the wide associational networks which
they inhabit and operate from. They are producers of, rather than mere
contributors to, philanthropy as they “shape rather than merely support a
charitable cause” (Schervish, 1997, p. 86). The immensity of their wealth endows
them with ‘hyperagency’ or the capability to establish or control the institutional
frameworks within which they and others live (ibid.). In short, they are capable of
not only setting the agenda according to their philanthropic interests; they can also
make the rules. And most do, usually through the creation of trusts and
foundations. In China, for example, three-quarters of the funds contributed by the
country’s leading 100 philanthropists in 2007 were disbursed through private
foundations (Wang, 2008). In the US alone, there are 72,477 grant-making
foundations; collectively they control assets exceeding $669.5 billion (Foundation
9
Center, 2008). In 2007, giving by these US private foundations amounted to $42.9
billion (ibid.). In the United Kingdom, there are an estimated 8,800 trusts and
foundations; the total assets of the top 500 amounted to £33.3 billion in 2005
(ACF, 2007). In that same year, these top 500 organizations disbursed £2.7 billion
in grants (ibid.). Globally, the aggregated scale of funding available through trusts
and foundations is immense. In contrast, the total amount of ODA contributed by
the members of the Organisation for Economic Co-operation and Development
(OECD) in 2007 was $103.7 billion (Blanchflower, 2008).
1.3 Crisis of development
The shape and form of development as prescribed by the governments of the
developed North has proven to have had only limited success, leading to a “crisis
of development” (Salamon, 2002, p. 12). It has been almost 60 years since the
launch of the first UN Development Decade in 1960, and still a “vast gulf
divide(s) one sixth of humanity today in the richest countries from the one sixth of
the world barely able to sustain life” (Sachs, p. 50). The gap between the world’s
richest and the world’s poorest continues to defy simple prescriptions. In 1960, the
richest 20 percent in the world had 30 times as much as the poorest; by 1990, the
gap had widened 70 times (Galeano, 1998).
Despite best efforts, growing disenchantment with the inability of
governments to consign poverty to history confirms that there are no simple
answers to development problems. This is evidenced by the multiple and
divergent development theories and strategies that have since evolved. For the
purposes of demonstration, I will provide a brief summary. The development
10
ideals of the 1950s to 1960s were based on the assumption that economic growth
was the panacea for the ills of the underdeveloped; it was believed that the
underdeveloped could lift themselves out of poverty by following a common path
to development modeled after the experience of the more advanced nations
(Esteva, 1992; Escobar, 1995; Power, 2002). However, uneven growth and the
continued widening of the gap in income disparities imploded the myth of linear
development (Corbridge, 1995; Willis, 2002). From the 1960s to the 1970s,
mainstream development thinking was challenged by ideas about dependency and
ethnodevelopment (Esteva, 1992). Dependency theories attempted to explain the
state of underdevelopment in Latin America as a result of the capitalist system;
that underdevelopment was due to exploitation by the developed (Frank, 1995).
Alternately, ethnodevelopment championed development based upon local
capacity and context rather than merely borrowing foreign ideas (Esteva, 1992).
The 1980s saw a backlash to hitherto formulaic, top-down development strategies.
This period heralded the ascendancy of neo-liberal theories and is characterized
by a retreat from heavy-handed government intervention; the free hand of the
market was seen to be more effective at promoting economic growth and
redistributing resources (Arce, 2003; Midgley, 2003). The 1990s onwards to the
present is defined by an awakening towards sustainable development, largely as a
result of the Bruntland Report in 1987 titled Our Common Future. It raised
awareness of the effects of globalization, the interconnectivity of relations and
resources, and the challenges of climate change. Thus, current development
thinking is dominated by a mélange of sustainable growth and post-development
11
theories; local, national and grassroots solutions co-exist alongside neo-liberal
sentiments (Wallis, 2002). Due to the lack of consensus on a unitary approach to
development, as well as the lackluster results obtained thus far, I propose that a
space has opened up for social actors from the private sector and civil society to
exercise greater influence on contemporary development thinking. This is
evidenced by the introduction of innovative approaches such as “social
entrepreneurship,” “venture philanthropy” and “creative capitalism;” concepts
which will explore in a later chapter (Hudson Institute, p. 3).
1.4 Official development assistance
ODA has proven to be an unreliable and unsustainable form of aid to the
developing world. Too often, fluctuations in ODA are dictated by the political
economy of state relations and the world (economic) order. In contrast, the Third
Sector2 – which comprises “a vast collection of institutions and relationships that
lies between the market and the state” – is assumed to be relatively free from the
political economy encumbrances which plague state approaches to development
(Salamon, 2002, p. 10). Instead, Third Sector Organizations3 (TSOs) are
perceived to embody universal humanitarian values which include “altruism,
compassion, sensitivity to those in need and commitment to the right of free
expression” as well as the values of individual initiative for the public good; of
2 The Third Sector is also known alternately as the nonprofit sector, civil society sector, voluntary sector, social economy sector, NGO sector and charitable sector. For more details, see Salamon, 2002; Staples, 2007). 3 Throughout this dissertation, a variety of Third Sector Organizations (TSOs) are mentioned. These include Voluntary Community Organizations (VCOs), Nonprofit Organizations (NPOs), Civil Society Organizations (CSOs) and Non-government Organizations (NGOs); these terms are used alternately depending on the context.
12
solidarity or community, and of obligations to themselves and to each other
(Salamon, 2002, p. 12).
In order to understand how political economy impacts upon ODA, it is
useful to understand what underpins this concept. From a historical perspective,
the current world order has evolved from the aftermath of the Second World War,
where several powerful nations emerged to “collectively establish and enforce the
rules of the global order” (Klak, 2002, p. 110). In this global order, what Eduardo
Galeano refers to as “the upside-down world,” the process of development has
maintained the status quo of the powerful while other countries intending to
benefit from development assistance must play by the rules set by these core
countries, even if it ultimately proves to be to their detriment (Galeano, 1998).
Acquiescence is assured through a “system of reward and punishments” where aid
maintains its potency as both a carrot and a stick (Chaves and Stoller, p. 8). In
short, development is not neutral. It is inter-related with the concepts of
globalization, hegemony and imperialism (Kiely, 20074). Viewed through a
political economy lens, “the tensions between allocative and distributive
objectives and the collective action problems of coordinating disparate interests”
are heightened (Doner, 1991, p. 821). Hence, while development aid may benefit
recipients, it is also “justified by a combination of moral, political and economic
considerations relating to the interests of donors” (World Bank, 2007, p. 35).
4 Kiely (2007) elucidates development in the post-war era as one in which politics and economics represented by the state and the market cannot be separated. He argues that the shift in state-led capitalist development to its subsequent displacement in the 1980s onwards by a neo-liberal globalization paradigm reflects “the continued realities of a US-led, imperialist international order” (p. 12).
13
Donor interests may include advancing security interests, creating new and stable
markets for trade to creating alliances with potential partners.
When deciding between national interests and international commitments,
it appears that governments often decide in favor of the former. Macdonald and
Hoddinott (2004), in reviewing the determinants of aid from the Canadian
government to beneficiaries, conclude that there is a bias towards nations with
similar governing models and there is a tendency for trade partners to receive
higher allocations. Riddell (1999), in studying the influence of donor interests on
ODA distribution in sub-Saharan Africa over the 1990s, arrives at a similar
conclusion and warns:
“The consequence is that the link between aid and poverty alleviation is
severed: aid will be used increasingly not to help uplift the poor but rather
to accelerate the growth of those countries with the greatest trade and
investment potential, leaving the ‘basket’ cases not only marginalized from
global markets but also marginalized from aid.” (p. 324)
Thus, aid is a two-edged sword in the arsenal of state policy, used not only
to ensure compliance, but also to marginalize and punish ‘basket’ cases or pariah
states. Arguably, aid is also a yardstick of sorts to measure the importance of a
particular developing country to donors. For example, during the contraction in
aid in the 1990s, 10 of the 13 less developed countries (LDCs) in the Economic
and Social Commission for Asia and the Pacific (ESCAP) region experienced a
reduction; half of these suffered cuts of 25 percent or more in ODA per capita.
Countries listed within this group include Afghanistan, Bhutan, Bangladesh,
14
Kiribati, Samoa and Vanuatu. Myanmar was the sole exception – ODA per capita
was halved. (See UNESCAP, 2001). Contrast this with the two countries which
received $19 billion in ODA between 2004 and 2005 – Iraq and Nigeria; this
amount represents the bulk of the increase in ODA during that time (World Bank,
2007). Understandably, the reconstruction of Iraq after the deposition of Saddam
Hussein is of prime importance to the US and her allies. So is the concern for
Nigeria’s stability. Both are oil producing nations and the latter has remained at
the forefront of the U.S. State Department’s agenda for more than a decade. In the
words of then-Assistant Secretary for African Affairs George E. Moose:
“Nigeria is too important to ignore. It has Africa's largest population, and it
has vast natural resources and economic potential…. Social decay and
government malaise could, if unchecked, lead to a collapse of civil and
social structures in the long term and harm the interests of the United
States and U.S. business, as well as those of the entire West African
region” (Moose, 1995).
Looking ahead, all signs appear to point towards a continued decline in
ODA in the near and foreseeable future. Recent figures from OECD indicate that
ODA has fallen for the second straight year since 2006. In 2007, total ODA
amounted to $103.7 billion, a fall of 8.4 percent in real terms; Third Sector critics
argue that this was inevitable due to the inclusion of debt-relief in ODA figures
(Blanchflower, 2008). This is hardly surprising. As mentioned previously, the
1990s was marked by declining official aid flows. The increase from the late
1990s onwards has been due primarily to debt relief as opposed to any substantial
15
increase in funding; for example, between 2004 and 2005, debt relief accounted
for 70 percent of the increase in ODA. Further, the upturn from the late 1990s to
2005 has been fairly dismal in real terms; 1997 ODA levels were equivalent to
1983 levels. (See Chart 3 below.)
3. ODA from DAC donors to developing countries and multilateral organizations. (Net disbursements, US$ million at 2004 prices, 1960-2005).
These disappointing trends point to an inability to match rhetoric with
action, despite the often publicized periodic commitments to increasing aid flows.
At the 2005 Gleneagles Summit, the G8 group of developed nations committed to
doubling aid by 2010; however, Oxfam predicts that at current levels, there is a
shortfall per annum of $30 billion. Similarly, since the introduction of the 0.7
percent of Gross National Income (GNI) target by the United Nations (UN) in
1970, only 7 of the 23 DAC members have achieved or exceeded this target. (See
Source: World Bank (2007)
16
UNESCAP, 2001; Blanchflower, 2008). And yet, it is estimated that total ODA
needs to double merely to stay on track to meet the Millenium Development Goal
of halving global poverty by 2015 (United Nations, 2008). However, the current
economic climate does not augur well for such hope.
With a protracted economic downturn currently underway in the US and
threatening to develop into a full-blown recession, prospects for the economies of
other DAC member nations are similarly bleak (Times, 2008; Elliot, 2008). Under
these circumstances, it is difficult to imagine that there will be sufficient political
will among governments to get back on track and make up the shortfall. Studies
on ODA trends show conclusively that ODA levels are directly related to the
economic trends in donor countries (Riddell, 1999). This finding is also supported
by a historical review of ODA levels against a backdrop of major economic
events; fluctuations from the 1960s onwards can clearly be linked to periods of
economic crises. (See Chart 4).
17
4.Official and Private Flows, ODA as a Share of GNI, Major Events on Aid Targets and Major Economic Events (1960-2005)
4. O
ffic
ial
an
d p
riv
ate
flo
ws, O
DA
as a
sh
are
of
GN
I, m
ajo
r ev
en
ts o
n a
id t
arg
ets
an
d m
ajo
r eco
no
mic
ev
en
ts (
19
60-2
005)
S
ourc
e:
Ad
apte
d fro
m W
orl
d B
ank (
200
7)
18
2.0 The Influence of Hard Factors on Private Giving
The uptrend in private giving, I propose, can be attributed to several ‘hard’ and
‘soft’ factors. The reason why I have chosen to term these as hard and soft is to
highlight that hard factors are verifiable, while soft factors refer to the less-
definable. Hard factors derive their bases from factual evidence such as the
substantial income per capita levels in the developed countries, the rise in income
levels since the post-war era and the dot com boom of the 1980s. These factors,
coupled with supportive government policies, have encouraged philanthropy. By
soft factors, I refer to aspects of contemporary culture vis-à-vis its relation and
response to philanthropy. In short, I will discuss how contemporary culture
reflects a “contemporary globalized humanitarianism” which lends itself to
promoting assistance by assuming responsibility for the welfare of others
(Lambert and Lester, 2004, p. 320). This topic will be explored in depth in the
next chapter. It is my contention that the confluence of both these hard and soft
factors has precipitated the escalation in private giving.
2.1 Economic growth and income levels
On the eve of the new millennium, academic researchers John Havens and Paul
Schervish at the Social Welfare Institute of Boston College released a report
portending a new golden age in philanthropy (Havens et. al., 1999). Pointing to
the era of unparalleled wealth creation amidst the dotcom and technological boom
of the Eighties onwards, they predict that the vast amounts of wealth generated
will transpire into a wave of unprecedented intergenerational wealth transfers.
19
Utilizing the Wealth Transfer Microsimulation Model (WTMM) across a 55-year
range between 1998 and 2052, the researchers predict that wealth transfers will
range from $41 trillion to $136 trillion; of these, an estimated $6 trillion to $25
trillion in charitable bequests will be channeled towards philanthropy. These
figures are colossal and supersede the scale of charity-giving encountered at any
time in world history. However, beyond the immensity of the projected scale of
future private giving, this report also serves to underscore the speed and scale of
wealth accumulation over the last three decades. Further, it should be noted that
the report excludes projections for inter vivos giving. If this was taken into
account, the projections for giving would be even more staggering. In figures
published by the American Association of Fundraising Council (AAFRC) in 2001,
for example, the richest 5% of households provided 40% of the $152 billion total
amount of inter vivos giving to charity, while 2% of estates contributed 75% of
the total $16 billion in charitable bequests (Schervish, 2004).
So why has there been such a rapid accumulation of wealth? I point to
increasing levels of disposable income in the developed countries as a compelling
reason. As mentioned in the previous chapter, the rise in private giving has not
been limited to those from the top-most income brackets. Private giving, by and
large, has increased the level of individual gift-giving across the entire socio-
economic strata in both the developed and emerging economies (Raymond,
2008a; 2008b; 2008c; 2008d; Hudson Institute, 2008). One plausible explanation
for this can be found in the divergence between income levels in developed
countries and that of less advanced countries. Another occurrence conducive to
20
acts of generosity is that globally there has been a rise in income levels.
Consequently, this has led to substantially larger disposable incomes available at
individual and household levels, and because basic needs are met at lower
proportions of income, this frees up spending towards non-essentials, including
gifts to charities.
To emphasize the differential between income levels in the developed
countries and less developed countries, a comparison of Gross Domestic Product
(GDP) across a range of countries is useful. GDP measures production or output
on a national level, hence comparisons provide a relative view of wealth
distribution (Willis, 2005). When calculated on a per capita basis, GDP provides
an indication of the average disposable income of its citizens. In terms of global
distribution of wealth, the advanced economies and especially that of the G7
nations continue to dominate. For example a review of GDP, in terms of share of
world total, clearly shows that the concentration of global wealth resides largely
with the advanced economies. (See Table 1).
Further, the changes in income levels can be ascertained from comparing
GDP per capita levels over a set period of time. To identify these changes, I have
extracted available comparative data for the time period between 1970 and 2004
from the World Development Indicators database. This data is available for a total
of 100 countries. The results are displayed in Table 2. Reviewing these results
yields several conclusions. Firstly, the differences in GDP per capita between
developed countries, developing countries (including emerging economies) and
less developed countries are acute. For illustration purposes, a selection of
21
random, cross-continental examples is presented here: Luxembourg ($58,360), US
($41,440), and Australia ($27,070), compared to India ($620), China ($1,500) and
Brazil ($3,000), versus Libya ($4,400), Philippines ($1,170), Sri Lanka ($1,010),
Senegal ($630), Kenya ($480) and Burundi ($90).
Table 1: GDP based on purchasing power parity share of world total
Group 1980 2007
Major advanced economies (G7)5 51.47% 43.50%
Advanced economies6 63.61% 56.37%
Other advanced economies (Advanced economies excluding G7 and euro area)
7
5.43% 7.03%
Source: International Monetary Fund (IMF), 2008.
At first glance, positive changes in GDP per capita have occurred in a mix of
countries, from the developed to the least developed. What is of particular
significance though is that all of the developed economies from the pre-war era
experienced relatively larger increases; this ranged from 7.1 times (Australia) to
18.6 times (Luxembourg). However, 42 percent of the countries listed here
experienced GDP per capita growth of less than 5 times; GDP per capita in
Liberia and the Democratic Republic of Congo actually halved compared to 1970
5 Canada ; France ; Germany ; Italy ; Japan ; United Kingdom ; United States 6 Advanced economies: Australia ; Austria ; Belgium ; Canada ; Cyprus ; Denmark ; Finland ; France ; Germany ; Greece ; Hong Kong SAR ; Iceland ; Ireland ; Israel ; Italy ; Japan ; Korea ; Luxembourg ; Malta ; Netherlands ; New Zealand ; Norway ; Portugal ; Singapore ; Slovenia ; Spain ; Sweden ; Switzerland ; Taiwan Province of China ; United Kingdom ; United States 7 Australia ; Denmark ; Hong Kong SAR ; Iceland ; Israel ; Korea ; New Zealand ; Norway ; Singapore ; Sweden ; Switzerland ; Taiwan Province of China
22
levels. Further, the majority of these countries encountering growth of less than 5
times represent less developed countries from the sub-Sahara Africa continent
where development intervention has been substantial during this time period.
Between 1970 and 2005, for example, this region received more official aid than
any other region; in 2005, aid disbursed amounted to 38 percent of total ODA
(World Bank 2007). In 2007, funding from the International Bank for
Reconstruction and Development (IBRD) and the International Development
Association (IDA) was a record-breaking $5.8 billion for the region (IBRD/World
Bank, 2007). However, despite these interventions, these countries continue to
achieve relatively low levels of GDP per capita and their economic growth
relative to other nations has been the least pronounced.
Table 2: Changes in GDP per capita (US$) between 1970 and 2004
Countries 1970 1980 1990 2000 2004 Change
Luxembourg 2,880 14,540 29,640 43,560 56,380 19.6
Norway 3,110 15,450 25,670 35,660 51,810 16.7
Switzerland 3,740 20,080 34,230 40,110 49,600 13.3
United States 5,000 12,980 23,330 34,400 41,440 8.3
Iceland 2,540 15,120 23,430 29,960 37,920 14.9
Japan 1,940 10,430 26,960 35,140 37,050 19.1
Sweden 4,390 16,050 25,750 28,650 35,840 8.2
Ireland 1,450 6,080 11,960 22,990 34,310 23.7
Finland 2,410 10,940 24,760 24,920 32,880 13.6
Austria 2,060 11,210 20,180 26,010 32,280 15.7
Netherlands 2,750 13,650 18,750 25,200 32,130 11.7
Belgium 2,720 13,430 18,520 24,900 31,280 11.5
France 3,060 13,090 20,160 24,470 30,370 9.9
Canada 3,870 11,170 19,840 21,810 28,310 7.3
Australia 3,340 11,730 17,710 20,060 27,070 8.1
Hong Kong, China 940 5,750 12,520 26,820 26,660 28.4
Italy 2,000 7,870 17,420 20,160 26,280 13.1
Singapore 950 4,830 11,840 22,890 24,760 26.1
Kuwait 3,340 19,420 .. 16,480 22,470 6.7
Spain 1,180 6,170 12,090 15,320 21,530 18.2
Israel 1,750 5,350 10,860 17,090 17,360 9.9
Greece 1,330 5,610 7,770 11,290 16,730 12.6
23
Countries 1970 1980 1990 2000 2004 Change
Portugal 820 3,010 6,450 10,940 14,220 17.3
Korea, Rep. 270 1,810 6,000 9,800 14,000 51.9
Malta 760 3,380 6,780 9,540 12,050 15.9
Saudi Arabia 760 14,790 7,220 7,830 10,140 13.3
Oman 310 3,850 5,610 6,610 9,070 29.3
Trinidad and Tobago 810 5,160 3,730 5,230 8,730 10.8
Seychelles 350 2,080 5,020 7,320 8,190 23.4
Mexico 700 2,520 2,830 5,110 6,790 9.7
Chile 860 2,240 2,180 4,860 5,220 6.1
Malaysia 400 1,830 2,420 3,430 4,520 11.3
Costa Rica 530 1,980 1,770 3,700 4,470 8.4
Libya 1,860 10,460 .. .. 4,400 2.4
Botswana 130 960 2,450 2,870 4,360 33.5
Panama 710 1,620 2,210 3,740 4,210 5.9
Gabon 640 4,790 4,780 3,090 4,080 6.4
Venezuela, RB 1,200 4,200 2,570 4,100 4,030 3.4
Belize 430 1,410 2,210 3,100 3,940 9.2
Uruguay 800 2,860 2,870 6,150 3,900 4.9
Turkey 580 1,920 2,270 2,980 3,750 6.5
South Africa 780 2,510 3,390 3,050 3,630 4.7
Argentina 1,320 2,940 3,190 7,470 3,580 2.7
St. Vincent and the Grenadines 210 630 1,710 2,730 3,400 16.2
Jamaica 720 1,230 1,790 2,940 3,300 4.6
Brazil 440 2,190 2,770 3,590 3,000 6.8
Fiji 400 1,870 .. 2,040 2,720 6.8
Tunisia 270 1,360 1,430 2,080 2,650 9.8
Thailand 210 730 1,540 1,990 2,490 11.9
Peru 520 1,050 770 2,050 2,360 4.5
El Salvador 320 760 930 2,000 2,320 7.3
Algeria 350 2,060 2,420 1,570 2,270 6.5
Ecuador 310 1,420 890 1,340 2,210 7.1
Guatemala 350 1,190 950 1,740 2,190 6.3
Dominican Republic 340 1,160 880 2,170 2,100 6.2
Colombia 310 1,190 1,190 2,060 2,020 6.5
Morocco 270 970 1,030 1,220 1,570 5.8
China 120 220 320 930 1,500 12.5
Egypt, Arab Rep. 210 500 760 1,460 1,250 6.0
Syrian Arab Republic 360 1,560 880 910 1,230 3.4
Philippines 230 690 740 1,040 1,170 5.1
Indonesia 80 500 620 590 1,140 14.3
Paraguay 260 1,470 1,190 1,460 1,140 4.4
Honduras 270 700 710 860 1,040 3.9
Guyana 360 780 380 870 1,020 2.8
Sri Lanka 180 280 470 810 1,010 5.6
Bolivia 300 590 740 1,000 960 3.2
Nicaragua 330 640 330 750 830 2.5
24
Countries 1970 1980 1990 2000 2004 Change
Cameroon 160 620 960 580 810 5.1
Congo, Rep. 220 820 880 520 760 3.5
Cote d'Ivoire 290 1,120 730 650 760 2.6
Lesotho 90 490 640 630 730 8.1
Senegal 200 500 660 450 630 3.2
India 110 270 390 450 620 5.6
Zimbabwe 400 930 850 460 620 1.6
Pakistan 170 330 420 480 600 3.5
Papua New Guinea 240 780 830 650 560 2.3
Sudan 140 450 550 310 530 3.8
Mauritania 170 450 540 460 530 3.1
Kenya 130 460 380 430 480 3.7
Benin 120 390 330 340 450 3.8
Nigeria 180 810 280 280 430 2.4
Zambia 430 600 420 290 400 0.9
Ghana 240 410 380 330 380 1.6
Burkina Faso 90 310 350 250 350 3.9
Mali 70 250 260 220 330 4.7
Central African Republic 110 340 460 270 310 2.8
Togo 130 410 380 270 310 2.4
Madagascar 170 440 230 240 290 1.7
Gambia, The 110 370 310 320 280 2.5
Nepal 70 140 200 220 250 3.6
Chad 140 230 260 180 250 1.8
Rwanda 60 250 360 250 210 3.5
Niger 150 390 280 160 210 1.4
Sierra Leone 160 380 200 140 210 1.3
Malawi 60 190 180 150 160 2.7
Liberia 260 530 .. 130 120 0.5
Congo, Dem. Rep. 230 600 220 80 110 0.5
Burundi 70 220 210 110 90 1.3
Key
Change > 10 times
Change > 5 to10 times
Change > 0 to 5 times
Source: World Development Indicators database, World Bank (2008).
To put it in more stark terms, the rich have become richer. For further
evidence of this, we can point to the number of dollar millionaires around the
world; this number now exceeds 10.1 million individuals (Teather, 2008). While
25
the number of millionaires has grown most markedly in the emerging economies
of India, China and Brazil, the majority of them are to be found in North America
and Europe (see Chart 4). This group magnifies the disparity in income levels
between the developed North and the underdeveloped South; their rapid wealth
accumulation is evidence of increasing inequality. That is, the poor have also
become poorer relative to the rich.
5. Wealth distribution of dollar millionaires by region, 2005-2007.
0.8 0.9 1.01.3 1.4 1.7
4.2
5.1
6.2
7.68.4
9.59.410.2
11.311.7
10.110.6
0.0
2.0
4.0
6.0
8.0
10.0
12.0
14.0
2005 2006 2007
Year
US
$ t
rill
ion
s
Africa
Middle East
Latin America
Asia-Pacific
Europe
North America
2.2 Technology and the rise in e-giving
The technological revolution of the 1980s has made the internet and mobile phone
commonplace. Information can be transmitted and received in seconds. Disasters
are recorded in real time and broadcasted as they happen. The potential to connect
with someone else from another place and a different time-zone has become
Source: Adapted from Teather (2008)
26
instantaneous. This information and communications technology (ICT)
breakthrough has aided the cause of philanthropy in several ways.
ICT has had a huge impact on philanthropic organizations; it has “lowered
the cost, increased the speed, and improved the transparency of charitable
donations” (Hudson Institute, 2008, p. 7). For donors, the reduced cost and ease of
donating has resulted in an explosion in “armchair giving” (Baker, 2008, p. 8).
Increasingly, NPOs are utilizing the internet as a means to not only promote their
causes effectively and cheaply but also to raise their profiles. For less well-
endowed and lesser-known organizations, the internet has been a boon. By
leveraging on viral marketing techniques, participating in social networking sites
or channeling payment through other online fundraisers, NPOs have been able to
defray the costs of their campaigns as well as reach out to a potentially younger
generation of donors (Inman, 2008). For example, Baker (2008) suggests that
“Facebook is a vast network of potential young philanthropists” (p. 8). The
internet makes it easy to engage in prolific campaigning; consequently, the
number of individuals giving towards worthy causes has increased and the results
have been significant. In the UK, online fundraiser justgiving.com has channeled
more than £250 million to the non-profit sector since its launch in 2001 (ibid.).
Charity Navigator in the US, a charity evaluation non-profit, monitors and lists
5,300 charities on its website. It has channeled an estimated $2.6 million in 2007
to these charities (Charity Navigator, 2006).
The internet is also a powerful tool to convey immediacy. In this way, the
spectacle of distant suffering is brought close, resulting in a “reduction of…
27
otherness” which promotes fraternity (Boltanski, 1999, p. 189). Examples abound
of how people have responded to this immediacy. These are proven most
dramatically during times of disaster and crisis. After 9/11, the American Red
Cross received $60 million through online giving within the first two weeks of the
attacks (Charity Navigator, 2006). Further, the internet can also promote
immediacy by connecting donors directly to recipients. This elevates the act of
giving into a highly personal experience. By comparison, giving to a charity
campaign fund may seem remote and distanced. Baker (2008) cites the example of
kiva.org which allows small businesses registered with local microfinance
institutions to post profiles on its website. Potential lenders browse the profiles
and pick who to invest in. As of February 2008, a total of $21,694,710 was
committed in 32,824 loans to businesses, with a repayment rate of 99.86 percent.
The ease of connecting, disseminating and sharing information has also
encouraged the mushrooming of NPOs globally. Activists are able to interconnect
and forge alliances, share experiences and trade expertise, resulting in a “global
associational revolution” (Salamon, 2002, p. 11). The increase in the number of
NPOs globally from the 1980s onwards is staggering. In France, 60,000 NPOs
were established annually in the 1980s and 1990s; in Russia, 100,000 NPOs were
formed in the 1990s; in Hungary, 23,000 between 1989 and 1993; and in India,
there are now more than 1 million NPOs (ibid.). In the US, the National Center for
Charitable Statistics recorded 1,478,194 NPOs in 2006. This represents a 63%
increase since 1996 with more than 80,000 organizations applying for public
charity-status in that same year (NCCS, 2008; Charity Navigator, 2006). Further,
28
the ICT revolution has enabled NPOs to expand their remit by breaking down
barriers which existed before. Amnesty International for example collects human
rights data globally; even in countries where it does not have direct access. As
Irene Khan, Head of Amnesty International, puts it: “In today's world, thanks to
information technology, physical access is not the only means of gaining
information” (Cochrane, 2008). All these factors combined have resulted in a
more robust and expansive global philanthropic community. Salamon (2002)
reports that “the nonprofit sector has, consequently, emerged as a major economic
force throughout the world” (p. 18). The Johns Hopkins Comparative Nonprofit
Sector Project researched NPOs in 26 countries and concludes that if the nonprofit
sector was a national economy, it would be the eighth largest in the world, with
$1.2 trillion in expenditures (ibid.). In addition, I would propose that globally the
nonprofit sector has become an international hyper (and cyber) marketplace of
sorts. Potential donors are able to pick and choose among millions of international
NPOs to give to. The internet has made this possible – at a mere click of a mouse.
2.3 Government incentives, the wealthy and the Third Sector
Government policies have proven to decisively influence private giving. For
example, when tax deductions for charitable giving increases, so does charitable
giving (Campbell, 1993; Leonhardt, 2008). However, the effects of tax on
donations are not simply that of cause-effect because donors contribute for a
variety of reasons and motivations: “to enhance personal or family prestige,
preserve family unity, memorialize themselves or other family members, support
causes in which they believe strongly, and because they are embedded in networks
29
that promote giving” (Campbell, 1993, p. 180). Further, the impact of tax
incentives appears to affect various socio-economic groups differently. Low to
middle income groups show a predisposition to give more when tax deductions
increase; for the wealthy, on the other hand, the effects are more muted (Boskin,
1977; Havens et. al., 1999).
Schervish (1997) suggests that because the effective minimum wealth tax
is at least 60 percent in the US, “the only effective tax shelter for the very wealthy
is philanthropy” (p. 108-109). So far, research on the impact of reduction in estate
taxes on charitable giving has proven to be neither decisive nor conclusive. In a
study spanning 1992 to 2003, Schervish, Havens and Whitaker (2006) found a
distinct divide between those who are merely wealthy and those who are mega-
wealthy. Their study showed that when estate taxes were reduced in 2001, those
with net estates of $1m < $2.5m left 7 percent to charity in 1992 compared to 11
percent in 2003; while those with net estate exceeding $20m or more, left 34
percent to charity in 1992 compared to 32 percent in 2003. That is, the impact of
estate tax reductions is not predictable or uniform. Nevertheless, some
governments are resorting to creative means to encourage private giving and some
of these measures have produced positive results. In the UK, for example, the
Labour government has incentivized private giving towards community
organizations by offering an endowment challenge program of £50 million; its
objective is to attract wealthy philanthropists to act as local funders to community
foundations (Brindle, 2008b). Through match-funding and tax-relief, it is
envisaged that such gifts can increase almost three-fold. In essence, the program
30
seeks to encourage seed funding from potential wealthy philanthropists. Similarly,
in a step that mimics the way US universities attract private funding, the
government earmarked £200m in match-funding grants to English universities; for
every £2 a university attracts in private funding, the government tops it up by £1.
(McCaffrey, 2007).
In the US, individuals may deduct charitable donations in a year up to 50
percent of their annual gross income. However, special tax packages have been
created to incentivize more giving beyond the confines of the current law. In a
recent bill passed by the House of Representatives this year, charitable giving
provisions from the Charity Aid, Recovery and Empowerment (CARE) Act were
reconciled with tax measures to allow for tax free contributions from Individual
Retirement Accounts (IRA) for donors aged 70 ½ and above; in effect, this allows
individuals to shelter savings intended for charitable giving from income tax laws.
(See AFP, 2006).
It is clear therefore that governments are eager to promote private giving,
especially among wealthy philanthropists. This trend is particularly evident in
developed countries with a pluralistic welfare regime; where the provision of
public services is met by a mix of public, private and corporate interests. But why
is this so? The answer may lie in the reasons behind the growth of the Third
Sector. As mentioned earlier, Salamon (2002) suggests that a crisis of
development has occurred. This has led to “growing consensus about the
limitations of the state as an agent of development and the advantages of engaging
Third Sector institutions” (p. 12). Perception of state impotence has stimulated
31
private initiative. However, there are signs to suggest that governments are intent
on influencing the shape, form and extent of such private initiative. This is most
evident in state relations with the Third Sector.
Further, this growing consensus appears to include advocates across
diverse sectors, not least from within the corridors of power. Phil Hope, UK
minister for the third sectors, claims that “the third sector can play a vital role in
developing high-quality services the public rightly expects. Charities, voluntary
groups and social enterprises have particular strengths, such as reaching the most
disaffected people, finding innovative solutions and offering a personal touch…
the government and the sector must work as partners, not rivals” (Hope, 2008).
Carol Adelman, director of the Center for Global Prosperity, goes even further.
Official government aid, she claims, is now “a minority shareholder in the growth
and development of poor countries;” instead, “the savviest government aid
agencies are rapidly changing their business model to leverage official aid with
activities launched and run by private businesses, foundations, charities, religious
groups, and universities” (Hudson Institute, 2008, p. 3).
What is intriguing about these statements is Hope’s referral to innovative
solutions and Adelman’s suggestion of an alternative business model. What
innovative solutions and savvy business model could these sorts of statements
possibly allude to? I would argue that they are of the brand prescribed by super
philanthropists such as Jacqueline Novogratz of Acumen Fund, Ben Cohen of
Business Leaders for Sensible Priorities (BLSP), Arpad Busson of Absolute
Return for Kids (ARK), Larry Page and Sergey Brin (Google.org), and Percy
32
Barnevik of Hand in Hand International (HHI), just to name a few. (See
Novogratz, 2005; Palmeri, 2006; Moss, 2008; Rana, 2008; Brindle, 2008a). To
provide a sense of the kind of solutions these individuals ascribe to, I will utilize
the case of Barnevik, “Europe’s most respected chief executive,” as an example.
(See Brindle, 2008a). He derides the “big plans” hatched by government officials,
the G8 countries, the UN, and even well-meaning activists like Bono and Bob
Geldof as “naïve and useless” and the majority of non-government organizations
(NGOs) as “fluffy, unfocused, inefficient.” In his view, NGOs like HHI, which
aspire to be the best business not the best NGO, are what make the most
difference. “When I hear about a new plan, it is like starting to watch an old film,"
he is reported to have said, “You know from the start there is no happy ending.
The best plan is no plan.” Interestingly, this is not unlike the assertions of
economist and academician William Easterly. He argues that grand, ambitious aid
and development schemes are doomed to failure and inefficiency; that the right
plan lies in not having a plan, but finding out what works, doing it and checking
the outcome against the experience of beneficiaries (Easterly, 2006).
However, some critics have begun to question the nature and shape of the
‘partnerships’ envisioned by the state. Many are increasingly uncomfortable with
what they perceive as a co-option of the Third Sector through punitive policies.
Carmel and Harlock (2008) for example are critical of what they perceive as the
UK government’s attempts to rationalize voluntary community organizations
(VCOs) into a governable Third Sector through procurement practices. By doing
so, they argue that VCOs are represented as a homogenous group of generic
33
service providers. This strips them of their unique identities and “renders their
specific social origins, ethos and goals absent, as if these are politically and
socially irrelevant to their activities and role in relation to the state” (ibid., p. 156).
Staples’ (2007) study of Australian government practices in relation to
local NGOs arrives at similar conclusions. She argues that Australian government
practices follow from a commitment to public choice theory set within a neo-
liberal paradigm. Public choice theory she suggests “claims that interest groups
are predatory and will try to obtain benefit for their members that stifle economic
growth” (p. 5). In doing so, “the theory denies the existence of altruism in the
behaviour of NGOs” and removes consideration for unique NGO values and their
place in contributing to public policy debate. Within this paradigm, NGOs are
ineffective for they do not subscribe their operations to market rationalization. To
curtail these NGOs, Staples (2007) suggests that methods of coercion have been
employed; these include reductions in public funding, forced amalgamations
resulting in subsumed specific interests and the widespread use of purchaser-
provider contracts.
In the UK, similar conditions have emerged. For example, there has been a
drive to encourage TSOs to align themselves into consortiums as a means of
obtaining public contracts because these are often “too large for small community-
based organizations” (Hope, 2008). It has been reported that 69 percent of larger
TSOs receive public contracts compared to 30 percent of smaller ones (Gould,
2008). The emergence of such practices has not been lost on activists of smaller,
grassroots-level community and voluntary organizations. Andy Benson, founder
34
of the National Coalition for Independent Action (NCIA), for example,
established NCIA for the express purpose of fighting “the complicity of big
national charities and infrastructure organisations in the government's co-opting of
the voluntary sector” (Kelly, 2008). In his view, not only is there a threat of co-
option by the state, smaller TSOs are also at the mercy of the larger TSOs, which
Benson describes as businesses which have “appropriated the term charity for
their own ends” (ibid.).
In light of these circumstances, what is the link between state endeavors to
promote the growth of the Third Sector and encouraging active participation by
wealthy philanthropists? I will suggest that doing so fits neatly with state
objectives. By promoting private giving, the state transfers part of its obligation to
fund the provision of certain social services to the Third Sector. By enlisting the
skills of leading business individuals to the cause, it protects its fundamentally
neoliberal practices. Arguably, who better to provide capital investment than
individuals with billions or millions to do so? And who better to introduce market-
based innovation than those who have made their wealth honing their skills
through such activity? And how better to ensure competition according to market
principles is instilled within the Third Sector, traditionally seen as a non-
economically competitive sector, if not through private individuals who ascribe to
and have benefited from the same economic paradigm? In short, while these
governments may not have abdicated total responsibility for the welfare of its
citizens, they have retreated. Hence, it is not surprising that “in general, there has
been a switch from core public bureaucracy institutions to an increase in the use of
35
private or independent enterprises for the provision of public services” (O'Leary
and Takashi, 1995, p. 320).
36
3.0 The Influence of Soft Factors on Private Giving
In the previous chapter, I began by suggesting that a confluence of hard and soft
factors have fuelled the rise in private giving and gave some specific examples of
hard factors. However, just because the rich have become richer does not
automatically presage nor explain the outpouring of benevolence towards the less
fortunate. It is for this reason that I suggest that there are soft factors or socio-
cultural elements which influence such motivations. Recognizing that socio-
cultural elements influence assistance is to acknowledge that development
thinking is fluid and organic; a product of the prevalent dominant forces of
thoughts at any given time. By ‘development thinking’ I refer to Potter’s use of
the term to encompass what Hettne (1995) describes as the three constituents of
development as a concept: development theories, strategies and ideologies. To
elaborate, development theories relate to the study of development, how it has
been implemented, the lessons learnt and implications for future direction.
Development strategies refer to the practices, tools and techniques used for
development intervention purposes, while development ideologies reflect “social,
economic, political, cultural, ethical, moral and even religious influences” which
inform all three (Potter, 2002, p. 62). To clarify, development thinking, within the
context of this chapter, refers to the socio-cultural dimensions which situate
assistance within the broader conceptions of humanitarianism and all that the term
presupposes, including questions relating to morality, equity and justice. This is
because development assistance is derived through a “trinity of mixed motives:
37
humanitarian, political and commercial considerations” (Macdonald, R., and
Hoddinott, J., 2004, p. 294). How ‘distant others’ are perceived and represented,
how aid responses are shaped to meet the needs of those in distress and what
forms the basis of responsibility to meeting those needs are informed by the socio-
cultural (Boltanski, 1999). These elements undergird and mold the prevailing
development thinking of their time and are reflected in the complex and nuanced
intricacies which inform assistance flows. It is also my contention that these
sentiments are more palpable and prevalent in countries of Western origin due to
an established historical legacy of organized and institutionalized philanthropy8.
While there is evidence of philanthropy in non-Western countries, these usually
lack the scale and scope of Western philanthropies9.
In this chapter, I will explore the threads of thinking which make up the
complex tapestry of Western attitudinal responses towards philanthropy. I
acknowledge however that this discussion is necessarily one that is subjective.
This is because concepts of culture, humanitarianism and globalization are
intangible, “ideational elements,” which carry multiple connotations for different
people and are neither verifiable nor measurable (Midgley, 2003, p. 840).
However, common logic suggests that the imprints of dominant socio-cultural
patterns can be alluded to through multiple sources, including representations by
the media, the writings of prominent thinkers on the subject and observed
behavioral trends. I begin by exploring the link between the concepts of
8 See Muensterberg, 1897a; 1897b; Bell, 2000, 2002; Braithwaite, 1938, and Burton, 1997, for examples of historical accounts in philanthropic activities and organizations in Germany, UK, and the US. 9 See Haynes, 1987, and White, 1991, for discussions on philanthropic activities and motivations in 17th to 19th century India, and Lin, 2004 on the same in early 20th century China.
38
philanthropy and humanitarianism. This is useful to provide a basis for
understanding the “growing public culture and personal spirituality of care” which
exists in contemporary (largely Western) societies (Havens et. al., 1999, p. 14).
3.1 Philanthropy and humanitarianism
Philanthropy has evolved to embrace the universalistic concept of humanity. At
the core of philanthropy, as it is commonly understood, lies its etymological
meaning: “love of mankind;” but beyond this fundamental creed, it is also “a basic
human and social impulse that shapes the way individuals and groups relate to
each other and offers possibilities for change. It is more than the giving of money;
it is voluntary action for the public good” (Gibboney, 1997, p. 193). Translated
into action, it is often perceived as unselfish service rendered to others without
benefit and without expectation of reward (Bogardus, 1923; Piliavin and Charng,
1990). It is also predicated upon the assumption of directing “resources and good
intentions to the needy” to alleviate society’s problems (Fisher, Nadler and
DePaulo, 1983). As such, as Bogardus (1923) suggests, it is perceived to be
“synonymous with socialized behaviour, that is, with activity that harmonizes with
social welfare” (p. 102). Raymond (2008a) clarifies philanthropy as the result of
the urge or human instinct to respond to suffering, where “the institutionalization
of that urge, the emergence of leaders (individuals and groups) who develop
organizational forms that will take that urge to scale in terms of resource
commitments and public recognition” (Raymond, 2008a). Hence, it is clear that
the term has multiple meanings, evolving from beyond that of a love of mankind
to “the love of man, charity, benevolence, humanitarianism, social reform” and in
39
more recent times, to encompass “large-scale giving by... men of great wealth”
(Curti, 1958, p. 420- 421). Wrapped up within normative interpretations of
philanthropy is the notion that it involves help rendered without self-interest on
the part of the giver, it imparts benefits which add to the totality of welfare in
society and that it comprises both good intentions and tangible forms of aid.
To discuss philanthropy is to tread into the nebulous realm of ethics and
morality, for as Chambers (2004) reminds us, what we perceive as good is value-
laden and constantly changes. It is subject to personal definition and redefinition
and often “the realities of the powerful tend to dominate” (ibid, iii). This
recognizes that philanthropy is imbibed with power relations discourse. For the act
of philanthropy necessitates what Boltanski (1999) refers to as the “politics of
pity.” The politics of pity involves the “ranking of priorities towards which a
spectator, when compelled to action, must choose to invest his or her energy or
aid” (p. 13). This ranking of priorities necessitates the casting of one party as
benefactor, the other as recipient; one superior and the other inferior in some way.
Hence, the politics of pity invokes a “division and separation of the fortunate and
the unfortunate.” This division of gives rise to moral obligation and causal
responsibility; “for without morality, there is no pity” (ibid.)
This leads us on to a discussion of the contours of morality, for
philanthropy (and morality from which it derives its power) is culturally specific
and draws its influences in terms of definition, understanding and practice from
traditions (Lin, 2004, p. 151). Western philanthropy, in particular, draws its early
historically developed meanings from the moral fundamentals of Christian
40
civility. In medieval times, the act of philanthropy was “a mode of penance” and
exercised in return for salvation (Muensterberg, 1897a, p. 560; Gronemeyer,
1992). Thus, to engage in philanthropic acts was a Christian duty and to extend
that help to the unfortunate was to carry out the “Divine injunction” (Owen, 1965,
p. 39). Gronemeyer (1992) explains how missionary expeditions of the 16th
century were conducted with the express view of extending ‘help’ in the form of
salvation to regions beyond Christiandom. In this fashion, she suggests, the
principles of early Christianity also imparted to philanthropy a “repertoire of
meanings surrounding the idea of help” (p. 57). This repertoire, she asserts,
consists of notions surrounding “global dimensions of the right to receive,” an
abstract utopia (of a singular collective humanity), and “the idea of improvement”
(ibid, p. 57).
These ideals were transformed somewhat from the 17th century onwards
under the influence of Enlightenment thinking, when “the decentering of the
authority of God and monarch placed human individuals at the center of the social
world, and thus provided the possibility for an ethics that would be based upon
human reason and agency” (Popke, 2003, p. 301). The Kantian injunction to
viewing the human individual not as a means but as an end in him or herself, and
to value human life as more noble than all other forms of life, are exemplary of
these changing perceptions (Kanz, 1993). So while early Christian principles
perceived the utopia of humanity as a family of disciples of Christ, Enlightenment
ideals widened the remit by reframing this utopia as a family of human individuals
subject to the universal principles of autonomy, rationality and free will.
41
These ideals manifested themselves in the colonial philanthropy of the 18th
and 19th centuries. In referring to Haskell (1985a; 1985b), Lambert et. al. (2004)
propose that Western colonialism created “new habits of causal attribution that set
the stage for humanitarianism.” This “global and interconnected vision” gave rise
to a sense of responsibility towards distant colonial subjects, wherein “colonial
philanthropy created new metropolitan imaginations of certain colonial spaces,
constructing them as appropriate sites for public concern and imperial
intervention.” British colonialism, in particular, deliberately extended this moral
obligation to the British public. Colonial philanthropists, Lambert et. al. propose,
“maintained consistently that Britons could, and should, do something about these
sufferings.... What such practices did was to bridge the imaginative distance
between ‘here and ‘there;’ transforming the economic and political networks of
empire into webs of moral responsibility” (ibid, p. 320-332).
Despite the passage of time, such conceptualizations of philanthropy and
humanity have retained their potency. The only differences lie in perceptions of
what is ‘here’ and ‘there’ and what forms of help or improvement should be
rendered. When President Truman presented his inaugural address in 1949,
pledging the United States to a global program of deliberate intervention whereby
“the benefits of our scientific advances and industrial progress” was to be made
“available for the improvement and growth of underdeveloped areas,” he was
charging the West with the moral obligation to discharge wholesale development
to the rest of the world (Truman, 1949). However, arguably, he was not only
propagating the notion of economic progress and technological advancement, he
42
was offering the utopia of an American universalism. This brand of universalism,
Higham (1993) explains, is an extension of an egalitarian ideology based upon the
right to equality in public life and common citizenship. By promoting this
celebration of human rights to the world, it also “gave an impetus to wider
humane concerns” and “sympathy for the suffering of humanity everywhere was
readily experienced as a natural extension of patriotic feelings” (p. 197).
This universalism is evident in the UN’s promulgation of humanity as that
of a “common denominator uniting all peoples” where the interconnectivity of a
global economic order ensures that interdependence and mutual interest reign
(Sachs, 1992, p. 103). Popke (2003) concurs and suggests that this
interconnectedness has given rise to a ‘new universalism’ or a ‘certain kind of
universalism’ which provides “the grounding for an ethical responsibility that
holds for those who are spatially distant” (ibid., p. 300-301). Against this moral
milieu, humanitarianism is justified by “legaliz(ing) a limit on national
sovereignty” (Boltanski, 1999, p. 178). Such refrains of commonality and
mutuality continue to hold sway in the 21st century. In his book The End of
Poverty, economist Sachs (2005) exhorts that we take up the challenge to
“improve human well-being on a global scale” (p. 347-348). Within this
paradigm, humanity is subjugated to the convergence of one mission; that of
progress and development, and is location bound: “We share in ‘humanity,’ we
are connected by the ‘world market,’ but we are condemned to one destiny
because we are inhabitants of one planet” (Sachs, 1992, p. 107).
43
Thus, we have explored how the concept of humanitarianism has evolved
hand in hand with our understanding of philanthropy. It has supplanted general
notions of good will by extending help beyond ‘others’ to ‘distant others’ within
the rubric of humanity. The ties that bind have shrunk; forged through the
interconnectedness of globalization. However, the notion of humanity has become
more complex, for it also supposes a moral community. But a moral community is
one in which there is no “full agreement on fixed beliefs” (Galston, 1989, p. 120).
Interpretations are manifold, made complex by the freedom and autonomy of
individuals. Such freedom and autonomy suggests a sharing of space with others;
for through the recognition of the ‘we’ in ‘us’ we are inserted into a shared space,
where “to live ethically is to acknowledge this shared Being, and to participate in
a collective spatial politics in which a commitment to the other is our abiding
concern” (Popke, 2003, p. 311-312). But shared meanings cannot be inhabited at
the same time by those who are dominant and those who are the dominated
(Galston, 1989). Thus, while humanity may be a universal concept, relativity is
introduced for “morality is always potentially subversive of class and power”
(ibid., p. 20-21). The political philosopher Michael Walzer suggests that human
society comprises a dualistic morality; one that is ‘thin,’ universal and abstract
and another which is ‘thick,’ particular and centered on experience:: “..it is
universal because it is human, particular because it is society.” (Orlie, 1999, p.
142) That is, the universalism experienced enables us to empathize and understand
thin moralities like truth and justice in a generalized though abstract manner,
while our individual experiences within particular societies render our
44
understanding of what these mean in a thick manner; this is where relativism and
differences emerge. Hence, while philanthropy is of universalistic concern, for all
human beings are capable of being afflicted by poverty, individuals negotiate their
choices in responding to humanitarian concerns in unique ways. How they do so is
influenced by the public culture in which they are submerged.
3.2 Public culture and personal spirituality of care
Schervish (2006b) suggests that affluence has expanded financial security and
comfort to “whole cultures.” He adds: “For the first time in history, the question
of how to align broad material capacity of choice with spiritual capacity of
character has been placed before so many of a nation’s people” (ibid., p. 491).
While this statement reflects his opinion of the state of affairs in the US,
Schervish’s observation can be extended to any nation where its inhabitants have a
healthy measure of affluence. So what does Schervish mean when he suggests that
there is now a question of ‘aligning’ material capacity with that of spiritual
capacity of character?
Schervish (2008) suggests that affluence leads to a phase when acquiring
wealth is no longer an end in itself but an intermediate goal. He suggests that
wealth provides the setting for emotional emancipation and cognitive
empowerment, of the kind that opens up a world of possibilities, to not merely see
the world as it is but to recognise that one can change it. Hence, it promotes
involvement. Owing to this, he argues that there has been a shift in moral purpose
and values whereby the accumulation of wealth has become a means to achieve
other ends; including that of addressing one's duty to others as through an act of
45
philanthropy. I would suggest that this occurs when needs are met, and wants are
satiated. Super philanthropist Arpad Busson terms this prise de conscience, or
loosely translated, the moment of awakening, when the wealthy “realizes that
mansions, yachts, racehorses and football clubs are not enough; that there are
people suffering, kids struggling out there” (Moss, 2008). I would further suggest
that this ‘awakening’ is not limited to the very wealthy but occurs to those who
are reasonably well off with perhaps less excessive taste. In short, due to the
freedom and choice afforded by affluence, those who have more than sufficient
are revisiting their sense of purpose. Schervish postulates that this forms a “moral
biography of wealth.” He defines this as personal capacity directed by a moral
compass. This compass, he proposes, is “the array of purposes or aspirations to
which we devote our capacity” (ibid., p. 165-166). In practicing their moral
biography, the affluent are increasingly engaging with, participating in and
contributing to a public culture according to their individual moral compass. But
what shapes this moral compass? I propose that it is premised upon a number of
factors, including what Chambers (2004) refers to as responsible well-being.
Chambers defines well-being as experience of a good quality of life.
However, he cautions that while its opposite, ill-being, can be alleviated by
wealth, “amassing wealth does not assure well-being and may diminish it.” When
well-being is qualified by equity and sustainability, he suggests, it becomes
responsible well-being. Responsible well-being “recognizes obligations to others,
both those alive and future generations, and to their quality of life” (2004, p. 10-
11). Responsibility therefore, in Chambers’ view, is equated to responsibility for
46
distant others, their well-being and sustainability. He further proposes that
responsibility “has moral force in proportion to wealth and power: the wealthier
and more powerful people are, the greater the actual or potential impact of their
actions or inactions, and so the greater the scope and need for their well-being to
be responsible” (ibid.). But responsibility cannot be enforced from outside, he
cautions, “it points to the personal dimension. …the concept of responsible well-
being puts the personal in the centre” (ibid., p. 12-13). As such, Chambers
encourages that the primacy of the personal should be the focus when
contemplating what good development means and how to promote it. The solution
he believes lies in “find(ing) more ways in which those with more wealth and
power will not just accept having less, but will welcome it as a means to well-
being, to a better quality of life” (p. 15). This is because sustainability and
responsible well-being, he argues, are two sides of the same coin; there cannot be
one without the other – sustainability focuses attention on actions that may
damage livelihoods, while responsible well-being questions omissions which do
the same.
These views expressed by Schervish and Chambers are, I believe, not
unique; I would suggest that they are shared by many of the ‘haves.’ I would
argue that similar convictions are in abundance and that many of the ‘haves’ are
indeed taking on the challenge of responsibility for distant others and applying
their income and skills in accordance with their moral biography. The increase in
private giving is an example. The growing number of TSOs and the number of
professionals and volunteers engaged in the Third Sector is another. Simply put, I
47
would suggest that there are large swathes of the general public in the developed
West who have bought into the idea of a personal sense of responsibility for
distant others. Taking Schervish and Chambers’ ideas one step further, I would
suggest that we are now faced with a new set of questions. Why has moral
biography emerged? And how does acting in a way which promotes responsible
well-being manifest itself? I propose that the answers potentially explain what
shapes current philanthropic and humanitarian sentiments.
Higgott (2001) suggests that globalization has resulted in the making and
remaking of social bonds; that these are no longer stable but subject to
modification and reinvention. Sennett (2006) takes a similar view. He argues that
the “spectre of uselessness” is looming large in a world where globalization has
dismantled the institutions which provided for identity and security (ibid., p. 85).
The geography of globalization, according to Sennett, is distanced; there are no
relations, merely transactions. In the West, the notion of social welfare is under
constant attack from economic cycles which lay waste to social and cultural
havens of the past. In this world, nations have lost their economic value,
supplanted by multinational corporations (MNCs) whose complexity of
ownership, operations and marketplaces transcends the politics of single nation-
states. The widespread reach and speed of technology has dismantled the social
capitalism of the old order. Erosion of social capital necessitates the ability to
reinvent oneself and to depend on self. Uselessness, in this context, is a
“necessary, if tragic, consequence of growth” (ibid., p. 85). Perhaps, as an
unconscious reaction, people are reaching out to mend these social bonds or to
48
reinvent existing ones. Engaging in philanthropic acts and participating in
humanitarian causes are a manifestation of the silent struggle and rebellion against
uselessness, redundancy and the wider ephemeral world. Why? Because “feeling
useful means contributing something which matters to other people. As the scope
of usefulness has expanded in the political economy, it might seem that people
could compensate through the more informal relations of civil society” (ibid., p.
189). I would suggest here that philanthropy is one means of engaging in informal
relations with civil society. Further, if being useful is “more than doing good
privately, it is a way of being publicly recognized” as Sennett claims, it is also an
avenue to rendering the invisible visible. In short, being philanthropic is to
acknowledge and confirm existence by reaffirming purposefulness. And
thankfully, there are many opportunities to do so.
The world abounds in causes, so much so that when you “name any
motivation… it will induce philanthropic giving by someone, somewhere, in some
circumstance” (Schervish, 2008, p. 165). One cannot turn on the television, read a
newspaper, surf the internet or shop on the street without bumping into messages
which promote one cause or the other. We are exhorted to give to feed the hungry
in distant far-off places which we may never visit, to drive cars that go further on
less to reduce our carbon footprint and retard climate change, to recycle our
plastic bags to save the environment, to eat tuna caught with dolphin-friendly nets,
and to be aware that cheap fashion apparel may possibly be made in sweatshops
where underpaid children with nimble fingers have suffered on our behalf. Indeed,
our awareness of the plight of distant others has never been more heightened. We
49
are constantly reminded that we can do our bit with every choice we make. Even
when we are dead. (See visual 6).
6: Remember Charity advertisement - “I will. Will you?”
Source: The Guardian, 13 May 2008
We can buy wisely, we can give more generously; when we do so, we are
not only exercising free will and choice. Instead, as economist Dean Karlan once
50
said, “Giving is not about a calculation of what you are buying. It is about
participating in a fight” (Leonhardt, 2008). If popular culture is a reflection of
civic culture, the public has been overwhelmingly co-opted, indoctrinated, and
implicated in the fight – for freedom from want, for increased well-being, for
survival. We have become aware that globalization has its “victims” and its
“beneficiaries” (Booth, Dunne, and Cox, 2001, p.16). So we shop for coffee
displaying Fair Trade certification to avoid exploiting distant farmers; we sign
petitions and boycott Nike and Gap to review their sweatshop conditions.
These examples, I suggest, are representative of the brave new world of
global ethics as viewed through the majority perspective of the developed West.
We see inequalities lurking behind every corner and in every corner of our
interconnected world; we fear the changes scarcity has imposed on us. Indeed our
sense of unity, of what it means to be of, in and at one with the world is – to
borrow Sachs’ phrase – “unity which is now the result of a threat” and as I have
argued, these threats are everywhere. As Sachs asked once, and I repeat: “Can one
imagine a more powerful motive for forcing the world into line than that of saving
the planet?” (1992, p. 108). A good example of these types of messages is present
in videos produced by the Earth Communications Office (ECO), including “Island
Home.” (See Illustration 7). Patrick Stewart narrates and begins by asking “What
if your family lived in a home on an island you couldn’t leave?” He then suggests
the perils of finite resources against the needs of a growing population. The final
screen is a view of planet earth at a distance, and Stewart cautions ominously “It
51
7: ECO video - "Island Home"
doesn’t matter where your home is because we all live on an island we can’t
leave” (ECO, 2008). Therefore, it is clear that the themes of philanthropy and
humanitarianism are pervasive in contemporary culture. I would suggest that
public culture has been overwhelmed by a confusion of what constitutes the right
amount of spirituality of care. The illustration which follows captures this well.
Philanthropy has been transformed into more than just a display of benevolence; it
has evolved into a business which we can participate in as producers or
consumers, not only as concerned members of humanity.
Source: Eco (2008) OneEarth.org
52
8: Illustration - "Roasted"
Source: The Observer Magazine, 20 July 2008.
53
4.0 Philanthrocapitalism: A New Development Paradigm?
As mentioned earlier, Salamon (2002) suggests that a crisis of development has
occurred, resulting in greater predilection for private initiatives. Sennett (2006)
proposes that the culture of new capitalism, evidenced in the upheavals wreaked
by globalization, raises a spectre of uselessness which necessitates self-help and
independence. Chambers (2004) asks that we focus on the primacy of the personal
to promote good development, while Schervish (2008) postulates that evidence of
a moral biography of wealth explains why those who have are increasingly
participating in philanthropic acts. These perspectives point to one inevitable
conclusion – development as it has been practiced and propounded up to now has
failed; it’s now up to us, as individuals, to make a difference. This coincides with,
as Easterly (2008) suggests, a collapse of the “development expert” paradigm.
Easterly accuses the elite thinkers, leaders and experts of coming up short in
solving the riddle of development. And so, the burden of solving the world’s
problems has now been spread thin and parceled out to those who are willing to
try. And conventional wisdom suggests that the more one has the more
responsibility one should bear. These sentiments are even reflected in the reported
core values of the Bill and Melinda Gates Foundation: “To whom much is given,
much is expected” (BMGF, 2008).
Is it any wonder then, against this backdrop of general helplessness, that
the super-rich are often lionized as potential saviors? In September this year, the
book Philanthrocapitalism: How the Rich Are Trying to Save the World, by
Matthew Bishop and Michael Green, will be released. Bishop is Chief Business
54
Writer at The Economist. He is also credited with coining the term
‘philanthrocapitalism.’ Bishop’s arguments concerning capitalist solutions for
development are pragmatic. He argues that if you can’t fix the poorly governed
politics of “failure governments,” there is no reason to forgo “the opportunity cost
in lost profits” (Bishop, 2008). Rather, he believes that capitalists can affect
change by investing in socially responsible or philanthropic activities by
sacrificing short-term profits for long-term gain. In his view, big business and big
philanthropy can drive social change by ensuring the poor have access to basic
services. In this way, he claims, “self-interest is the best way to put bread on poor
people’s tables, but enlightened self-interest by creative capitalists can potentially
put more bread on more tables faster” (ibid.).
The economist C.K. Prahalad is a proponent of similar market-based social
initiatives. His ideas on solving the problem of the ‘bottom of the pyramid,’ the
poorest of the world’s bottom billion, have been much lauded. He suggests that “if
we stop thinking of the poor as victims or as a burden and start recognizing them
as resilient and creative entrepreneurs and value-conscious consumers, a whole
new world of opportunity will open up” (Economist, 2004). Such views have
gained an audience among the current crop of super philanthropists. Jacqueline
Novogratz, founder of Acumen Fund, believes that best way to tackle poverty is to
apply business-like approaches. If you want to eradicate malaria, she opines, you
don’t ship nets; you build malaria net factories (Novogratz, 2005). In her view,
“We should see every poor person on the planet as a potential customer”
(Novogratz, 2007). Similarly, Bill Gates frames the lack of access by the poor to
55
essential goods and services as a market-based problem. He believes that market
prioritization for research, innovation and delivery are skewed towards those who
can afford to pay, “so the voices of the poor are never heard in this marketplace
system” (Romano and Helm, 2008). This approach, of applying business
principles and practices to philanthropy is known by a multitude of names: social
entrepreneurship, philanthrocapitalism, venture philanthropy and creative
capitalism (Hudson, 2008, p. 6). Its practitioners are “new players (who) hail from
investment banks, hedge funds, and business schools,” and their approach is to
“combin(e) altruism with for-profit business models” (Adelman, 2007, p. 67).
Such efforts have generated praise, admiration and hope. Fulda (1999), for
example, propounds “that society has need—morally and spiritually—of many
things for which there is not a market (or not a strong market) and that
philanthropists provide those things of their own wealth to the betterment of all.
…in a free society, moral and spiritual leadership can be provided by thoughtful
philanthropists, as opposed to bureaucrats and politicians of every stripe.” (Fulda,
1999, p. 8)
However, there are a few detractors. Edwards (2008), for example, is
skeptical of the claims that philanthrocapitalism will revolutionize philanthropy.
He believes that business methods are not the answer to social problems because
they cannot effect the systemic changes necessary for true social transformation
(p.7-14). Starita (2008), on the other hand, is unconvinced about the effectiveness
of such approaches. She questions if applying “some rational return-on-investment
rigor to the business of philanthropy” will yield the necessary efficiency,
56
accountability or transparency its supporters claim. To explore the validity of both
sides of the argument, we will explore the issues and challenges attached to such a
paradigm.
4.1 The double bottom line
So much has been written about philanthrocapitalism and its derivatives that it has
caused a certain amount of confusion. This has prompted Starita (2008) to opine
that “clearly we’re struggling with a new vocabulary for the current era of
philanthropy.” To help clarify, it is useful to distinguish the various strategies
suggested by the term philanthrocapitalism. Schervish (2006b) suggests that there
are three distinctive sets of business-oriented philanthropy strategies:
� Managerial philanthropy where the philanthropist applies his or her
organizational expertise
� Entrepreneurial philanthropy where the philanthropist applies both his
expertise and funds
� Investment or venture philanthropy where the philanthropist provides both
expertise and financial resources but does not engage in operations
Among these strategies, the apparent common denominator here is that the
philanthropist engages in some form of “activist philanthropy” (Nocera, 2008).
This breed of philanthropists “make big bets, demand results, take risks, want
some control over how their money is spent” (ibid.) Findings from the Wealth
with Responsibility Study 2000 indicate that many of these individuals (80
percent) are self-made; 86 percent engage in voluntary work; 71 percent serve on
a board of directors for a charitable or philanthropic organization; and 35 percent
57
feel that inefficiency and mismanagement of charitable organizations was the
main obstacle to their giving (Schervish and Havens, 2001). Clearly, this is a
profile of individuals who will take a hands-on approach to philanthropy.
At the core of philanthrocapitalism is the notion of a ‘double bottom line;’
that of “making money and helping a charitable cause at the same time” (Hudson,
2008, p. 6). In this way, the line between philanthropy and business is blurred. It is
perhaps also helpful to clarify here that taking a business approach to philanthropy
is not an innovation in itself. Howe (1980) credits Rockefeller and Carnegie for
introducing the concept of wholesale, scientific giving. Abel (1995) concurs,
explaining how this form of giving was concerned with “size, efficiency,
economies of scale, and the risk of overcapacity and aimed to develop a corporate
tradition and an esprit de corps among its employees” (p. 342). The
institutionalization of philanthropy is therefore not new. What is new however is
the practice of establishing philanthropies which either engage in or derive their
funding from profitable activities. Consider for example the case where the
BMGF donated $200m in cash plus $200m in Microsoft computers and software
to connect half the public libraries in the US (JBHE, 1997). Should Gates be
chastised for the income Microsoft will make from the software license fees that
will have to be paid in perpetuity? Likewise the example of Google.org, the for-
profit philanthropy arm of Google. Its corporate philosophy is that it is possible to
do good while making money. However, because Google.org is both a
philanthropy and a for-profit organization (FPO), “it lacks such forms of oversight
and regulation to ensure that it adheres to philanthropic purpose” and it also
58
“escapes market-based accountability structures” (Rana, 2008, p. 93-94). It is the
proximity of such business activities and philanthropic endeavors that has critics
up in arms.
Further, philanthrocapitalists subscribe to the principles of market
rationalization. As Starita (2008) explains: “They want, in essence, for
philanthropy to act more like a functioning market, with a market’s transparent
availability of information, inherent incentive structures encouraged by
competition, and accountability for outcomes. The theory, of course, is that by
making philanthropy act more like a business the sector will inherently become
more effective.” Within such a paradigm, philanthropy operates like a for-profit
market with investment options, an infrastructure which acts like a stock market
complete with consultants and research houses, and philanthropists who are intent
on “allocating their money to make the greatest possible difference to society's
problems: in other words, to maximise their “social return”.” (Economist, 2006).
This type of business-speak permeates current philanthropy. Judith Rodin,
president of Rockefeller Foundation, for example, refers to grants as investments,
programs and projects as a portfolio and claims that efficiency is dependent on
managing risks and evaluating returns (Gertner, 2008).
So how does philanthrocapitalism work in practice? We can examine the
work of Acumen Fund, a non-profit organization with ‘investments’ in India,
Pakistan and Africa in the health, water, housing and energy sectors. Their
business model is premised on the belief that “pioneering entrepreneurs will
ultimately find the solutions to poverty” (Acumen Fund, 2007). They provide
59
“patient capital” (that is, capital with a long-term return horizon of five to seven
years) for business models which deliver essential services at affordable prices to
the poor. Like a financial institution, they evaluate applications based on financial
sustainability and the ability to scale up operations. Unlike traditional financial
institutions, social impact is a crucial prerequisite. Social impact is measured
based on how many lives the business can impact and how. To date, they claim to
have “24 thriving enterprises helping over 10 million people” (ibid.). The
positives of such an approach are obvious; there is flexibility in terms of diversity
of potential applicants and businesses, and business models are based on local
identification of needs. However, there are possible downsides, such as how
robust is the measure of social impact when equated to a headcount of lives
impacted, and whether there is room to consider other alternatives apart from for-
profit enterprises.
4.2 The business of giving
The adoption of business principles to philanthropy has created a thriving and
competitive industry, both within and outside the sector. Philanthropy itself has
become a lucrative business. In the private banking sector, “philanthropy is
emerging as a promising product innovation” (Martin, 2004, p. 25). By providing
potential wealthy clients the option of philanthropy management services, banks
are in effect selling legacy and immortality for “transcendence can be bought
through philanthropic giving” (ibid., p. 10). Coutts & Co, voted Best for
Philanthropy Services in the UK by Euromoney Private Banking Survey 2006 and
60
2007, offers an in-house team of philanthropy specialists, investment and charity
specialists to guide clients to “truly creating social impact” (Coutts, 2008).
Similarly, the philanthropy sector has become a competitive marketplace. Schley
(2006) argues that organizations within the philanthropy sector are little different
from those in the for-profit sector: “They struggle for identity and to promote their
brands. They develop and market products and services. They work tirelessly to
differentiate themselves in a crowded marketplace. And they compete for capital.”
In this climate, smaller TSOs are increasingly challenged by “the rapid growth of
commercial donor-advised funds and the powerful appeal of family foundations”
(ibid.). In order to create differentiation, TSOs are applying the business strategies
of marketing and branding to their fund-raising operations (Traub, 2008). For
those with higher profiles and sizeable budgets, enlisting the star power of
celebrities is a way to create awareness and stay current. Oxfam has Colin Firth,
Helen Mirren and Scarlett Johansson; the Office of the U.N. High Commissioner
for Refugees has Angelina Jolie as its good-will ambassador. In this climate,
corporations are jumping on the bandwagon, and often in partnership with NPOs.
As publicist Howard Bragman puts it, ''Celebrities, sponsors and a cause: it's the
golden troika of branding” (ibid.).
Corporate Social Responsibility (CSR) has always had its benefits,
especially for MNCs. Levy (2001) suggests that “(foreign) companies seeking
acceptance as indigenous economic forces… find advantages in being viewed as
citizens in good standing of the countries in which they do business;” as doing so
“offers a competitive edge.” (p. 113). However, companies are also increasingly
61
creative in how they create social impact. For example, companies like Starbucks,
Accenture, Pfizer and Procter & Gamble have engaged in “executive internships;”
where executives are lent to NPOs to impart skills and experience in managing,
fund-raising and marketing (Clark, 2006). This trinity of philanthropist-business-
NPO has revolutionized philanthropy; making a profit has never been such a good
marketing strategy. Take for example the (RED) campaign, which was founded by
Robert Sargent Shriver III and Bono. (RED) channels a percentage of sales from
each product sold to the Global Fund to Fight AIDS, Tuberculosis and Malaria.
(RED)’s sponsors include Motorola, American Express, GAP, Emporio Armani,
Converse, Apple, Hallmark, Dell and Microsoft. If you decide to buy a (RED)
product, the website tells us, “You, the consumer, can take your purchase to the
power of (RED)…. Thus the proposition: (YOU)RED…. What better way to
become a good-looking samaritan?!” In short, the message is: ‘not only will you
do good, it’s cool to do good.’ Further, what is curiously interesting is the
graphical illustration of how customers’ contributions are put to use. (See
illustration 9). It is simplified for mass consumption. As Sennett (2006) explains,
in an economy which prizes mass production and mass consumption, advertising
is deployed to distinguish between competitors and encourage purchase; to do so
“advertising seldom makes things difficult for the consumer” (p. 135). The result,
I propose, ignores the complexity of development issues. As Donald Steinberg,
deputy president of the International Crisis Group, laments, “'There is a tendency
to treat these issues as if it’s all good and evil”(Traub, 2008).
62
Further, the borrowing of business principles to philanthropic activities
does not stop at fund-raising. Advertising and marketing principles have also been
applied to creating more effective campaigns to change the behavior of aid
recipients. Anthropologist Dr Valerie Curtis is founder of the Global Public-
Private Partnership for Handwashing with Soap and Director in Hygiene at the
London School of Hygiene & Tropical Medicine. While working in Burkina
Fasso, she enlisted the aid of Procter & Gamble, Colgate-Palmolive and Unilever
to help raise awareness for the need to handwash with soap to reduce the spread of
infection and diseases (Duhigg, 2008). Despite the best efforts of her team, they
had made little headway. With the advice of the consumer psychologists at these
MNCs, an advertising campaign was devised and implemented in 2003. Rather
than sell soap use, the ads sold disgust. The results from a survey in 2007 showed
that there was a 13 percent increase in soap use after using the toilet and 41
percent before eating.
63
9: How RED Works
9:
Ho
w R
ED
Wo
rks.
Sourc
e: (R
ED
) (2
008).
64
4.3 Issues and challenges
Acs and Desai (2007) acknowledge that the disparity in inequality and wealth
distribution is a result of the global market. However, they suggest that “the
capitalist economy may be the ideal laboratory for solutions to the problems it
generates within itself” (p.2). They argue that social welfare creates dependency,
while a democratic capitalist system encourages entrepreneurship and innovation.
Pointing to the US political economy, they suggest that there is “an implicit social
contract to return wealth to society” (ibid., p. 3). Further, that in such an economy,
a cycle of entrepreneurship, wealth creation and philanthropy can engender a self-
sustaining cycle of growth. Specifically because foundations are not subject to too
many regulations, it promotes social innovation. As such, they argue that
developing countries should promote local philanthropy as a means of solving
country-specific social problems because “foundations come into existence
because of one individual and a large endowment” rather than “large numbers of
people giving modest donations” (ibid., p. 9). They conclude their argument on a
hopeful note: “As the world gets richer, its people become better able to take care
of those that globalization neglects” (ibid., p. 10). I believe that such an argument,
while optimistic, ignores several issues and challenges.
Wealthy associational networks
If, as Wolpert and Rainer (1984) suggest, that philanthropy is a marketplace
consisting of public entities, private organizations and NPOs competing for
resources, the influence and impact of wealthy philanthropists in the marketplace
65
needs to be acknowledged. As Daubón reminds us, “…civil society, even when
implausibly viewed as a whole, is not the people. It is an associative space where
individuals and institutions come to share their civic concerns. It cannot speak in a
single voice, for it represents countless voices, many of them not sufficiently
influential to be heard” (p. 4). For example, not every NPO has the fund-raising
clout to match an Arpad Busson, who managed to raise £26 million at one dinner,
or a Warren Buffet, who auctioned the privilege of lunch for $2.1 million (See
Moose, 2008; Clark, 2008). The wealthy possess power and influence which is
often beyond the capabilities and capacities of smaller TSOs. Consider ex-Ben &
Jerry’s founder Ben Cohen’s ability to amass a coalition of the influential when he
set up the NPO Business Leaders for Sensible Priorities (BLSP). BLSP’s 650
members comprise luminaries like Paul Newman, Max Palevsky (founder of Intel)
and former Assistant Secretary of Defense Lawrence Korb (Palmeri, 2006; BLSP,
2006). Indeed, “when it comes to philanthropy, it is less a matter of financial
capital, or even moral capital... What matters more is one’s abundance of
associational capital in the form of social networks, invitation, and identification”
(Schervish, 1997, p. 101). The wealthy inhabit a different stratum in society,
where “personal request and social pressure are very important reasons for
participation” (Piliavin and Charng, p. 35).
The Global Philanthropists Circle (GPC), founded by Peggy Dulany,
great-grand-daughter to John D. Rockefeller Sr, has been termed “the most elite
club in the world” (McConnon, 2007). Regular group meetings take place on
Rockefeller estates; annual trips abroad have included meetings with heads of
66
states and other wealthy philanthropists. Most of the work that GPC and its
associated NPO, Synergos, do is unpublicized; so little is known of the impact of
their operations. At a GPC gathering, Maria Eugenia Garcés-Campagna, a
philanthropist from a prominent Colombian ceramics family, was introduced to
Mosima Gabriel “Tokyo” Sexwale. She informed him that she was looking into a
model of restorative justice for her foundation, Fundación Alvaralice. He is
reported to have said, “If you bring the president of Colombia, I will bring Nelson
Mandela or Desmond Tutu.” Two years later, the young foundation had eight
centres operating in Colombia, largely as a result of a 2005 symposium in which
Nobel laureate Tutu, Colombian President Alvaro Uribe, business leaders, and
conflict veterans were present; after which, Colombian law was changed to allow
groups like Fundación Alvaralice to mediate conflicts. In the world of mega-
philanthropy, examples abound of collaborations arising from such powerful
associational networks. Bill Gates and Warren Buffett are reportedly close friends
and play bridge together; Gates is also a director on the board of Buffett’s
investment company, Berkshire Hathaway (Dudley, 2004). In 2006, Buffett gifted
$31 billion to the BMGF, “creating a mega-philanthropy the likes of which the
world has never seen” worth $60 billion (Greene, 2006).
Possible pitfalls of a results-oriented culture
Riddell (1991) suggests that “the aid business has been increasingly influenced by
the 'results-oriented' culture.” To show results, aid agencies may eschew hard to
reach recipients, opting instead for those who are able to pay and who are already
more closely linked to markets. As such, he argues that “if official donors miss the
67
poorest 20 percent of the population, NGOs probably miss the poorest 5-10
percent" (p. 321-322). Similarly, Persell (1994) believes that “market rationality
supplants other moralities and changes social practices.” It can result in negative
effects for “market rationality focuses on calculated costs rather than on what is
right; offers only one set of incentives, depressing other motivations;… and
increases rather than decreases economic inequality, leading to lesser commitment
to the social whole.” (p. 648-650). Despite the much-lauded efforts of
philanthropies, Starita (2008) questions the dearth of examples available, arguing
that this is because social impact is difficult to measure. She also cautions that
results-focused business models do not necessarily translate into greater
transparency or accountability; Enron, she suggests, was a model of efficiency
until it was proven otherwise.
Treating the symptoms, not the cause
A healthy civil society is the key to social transformation. For this to occur, civil
society should include the participation of everyone. This, Edwards argues, is the
basis of equality; ““philanthropy as everyone’s business” versus the “business of
philanthropy,” bottom-up versus top-down, meaningful redistribution versus
larger crumbs from the rich man’s table” (2008, p. 59). For aid to act as a catalyst
for real social transformation, issues of power, politics and interest groups need to
be addressed. The marginalized should be invited to participate in both the
development and political process; doing otherwise is to limit their participation to
that of a donor-recipient relationship (Riddell, 1991). Aid alone cannot effect
68
change; it “cannot substitute for leadership and self-reliance in developing
countries. Rather, growth and poverty reduction depend on countries establishing
their own policies that encourage rule of law, job creation, exports, good
governance, and investments in human capital” (Adelman, 2007, p. 64). In light of
the limitations of aid, official and private, will philanthrocapitalists fare better?
The jury is still out but it is worthwhile to consider Chambers (2004) suggestion
of a “pedagogy for the non-oppressed.” He suggests that “for responsible well-
being, it is then especially individuals who are powerful and wealthy who have to
change. This entails confronting and transforming abuses of power and wealth”
(p. 13). It is also worth asking, what is true philanthropy? Huntington (1892)
suggests that philanthropy that does not right a moral wrong but perpetuates it is
‘false’ philanthropy. To do good, we must first do what is right. To do right is to
address underlying wrongs, for philanthropy imposes a moral duty to render
service that has, at its ultimate aim, social progress and betterment of all; it is not
“a war of the classes, but a struggle of the whole people to be free.” In this way,
morality is philanthropy’s “only foundation and its truest guide” (p. 62-63).
69
References
Abel, C. (1995). External Philanthropy and Domestic Change in Colombian
Health Care: The Role of the Rockefeller Foundation, ca. 1920-1950. In
The Hispanic American Historical Review, 75(3): 339-376.
Acs, Z. J., and Desai, S. (2007). Democratic Capitalism and Philanthropy in a
Global Economy. Jena, Germany: Friedrich-Schiller-University and the Max
Planck Institute of Economics, Jena Economic Research Paper No. 2007-
056.
ACF-CAF. (2007). Grant-making by UK Trusts and Foundations. Joint Report
from Association of Charitable Foundations (ACF) and Charities Aid
Foundation (CAF). Available at:
http://www.acf.org.uk/uploadedFiles/Publications_and_resources/Publicati
ons/0416B_TrustAndFoundationBriefingPaper.pdf (Accessed 13 August
2008).
Acumen Fund. (2007). Acumen Fund. Available at: http://www.acumenfund.org
(Accessed 23 March 2008).
Adelman, C. (2007). Foreign Aid: Effectively Advancing Security Interests. In
Harvard International Review, Fall 2007: 62-67.
AFP. (2008). Association of Fundraising Professionals (AFP). Available at:
http://www.afpnet.org (Accessed: 8 August 2008).
Arce, A. (2003) Reapproaching Social Development: A Field of Action Between
Social Life and Policy Processes. . In Journal of International
Development, 15: 845-861.
70
Arnove, R.F. (1980). Introduction. In Arnove, R.F. (ed.) (1980). Philanthropy
and Cultural Imperialism: The Foundations at Home and Abroad. Boston:
G.K. Hall & Co
Baker, D.J. (2008) E-Philanthropy: Charity Begins at Home, Online. In Hudson
Institute. (2008). The Index of Global Philanthropy 2008. Washington,
DC: Center for Global Prosperity, Hudson Institute.
Bell, M. (2000). American Philanthropy, the Carnegie Corporation and Poverty in
South Africa. In Journal of Southern African Studies, 26(3): 481-504.
Bell, M. (2002). Inquiring Minds and Postcolonial Devices: Examining Poverty at
a Distance. In Annals of the Association of American Geographers, 92(3):
507-523.
Berman, E. H. (1977). American Philanthropy and African Education: Toward an
Analysis. In African Studies Review, 20(1): 71-85.
Bishop, M. (2008). Creative Capitalism: Are 'creative' and 'traditional' capitalism
mutually exclusive? Forum Post: 27 June 2008. Available at:
http://creativecapitalism.typepad.com/creative_capitalism/2008/06/are-
creative-an.html. (Accessed 20 July 2008).
Blanchflower, K. (2008). Another Poor Year for Overseas Aid. In The Guardian,
5 April 2008.
BLSP. (2006). Business Leaders for Sensible Priorities (BLSP) Website.
Available at: www.sensiblepriorities.org. (Accessed 12 May 2008).
BMGF. (2008). Bill and Melinda Gates Foundation (BMGF). Available at:
http://www.gatesfoundation.org/ (Accessed 12 June 2008).
71
Bogardus, E. S. (1923). The Concept of Unselfish Service. In Journal of Social
Forces, 1(2): 100-102.
Boltanski, L. (1999). Distant Suffering: Morality, Media and Politics. Cambridge:
Cambridge University Press.
Booth, K., Dunne, T. and Cox, M. (2001). Introduction: How Might We Live?
Global Ethics in a New Century. In Booth, K., Dunne, T., Dunne, T., &
Cox, M. (eds.) (2001). How Might We Live?: Global Ethics in a New
Century. Cambridge: Cambridge University Press.
Boskin, M. J., & Feldstein, M. (1977). Effects of the Charitable Deduction on
Contributions by Low Income and Middle Income Households: Evidence
From the National Survey of Philanthropy. In The Review of Economics
and Statistics, 59(3): 351-354.
Braithwaite, C. (1938) The Voluntary Citizen: An Enquiry Into the Place of
Philanthropy in the Community. London: Methuen & Co.
Brindle, D. (2008a). No Nonsense: Interview with Percy Barnevik. In The
Guardian, 23 January 2008.
Brindle, D. (2008b). Giving A Lead. In The Guardian, 30 April 2008.
Burton, J. D. (1997). Philanthropy and the Origins of Educational Cooperation:
Harvard College, the Hopkins Trust, and the Cambridge Grammar School.
In History of Education Quarterly, 37(2): 141-161.
Campbell, J. L. (1993). The State and Fiscal Sociology. In Annual Review of
Sociology, 19: 163-185.
72
Carmel, E. and Harlock, J. (2008). Instituting the 'third sector' as a governable
terrain: partnership, procurement and performance in the UK. In Policy &
Politics, 36(2): 155-171.
Chambers, R. (2004) Ideas for Development: Reflecting Forwards. Brighton:
Institute of Development Studies, University of Sussex, IDS Working
Paper 238.
Charity Navigator. (2006). From Charity Navigator. Available at:
http://www.charitynavigator.org (Accessed 12 July 2008).
Chaves, M.S. and Stoller, R. (2002) Organizational Empowerment vs.
Clientelism. In Latin American Perspectives, Vol. 29, No. 5: 7-19.
Clark, H. (2006). Beyond Philanthropy. In Forbes, 31 May 2006.
Clark, A. (2008). Fund Manager Pays £1m for Meal with Buffett. In The
Guardian, 30 June 2008.
Cochrane, K. (2008). Anything for An Unquiet Life; Interview: Irene Khan, Head
of Amnesty International. In The Guardian, 12 March 2008.
Conlin, M., Gard, L. and Hempel, J. (2004) The Top Givers. In Business Week, 29
November 2004.
Corbridge, S. (1995) Thinking About Development. In Corbridge, S. (ed.) (1995)
Development Studies: A Reader. London: Edward Arnold.
Coutts. (2008). Coutts & Co. Available at:
http://www.coutts.com/access/philanthropy/guidetogiving.asp (Accessed
30 July 2008).
73
Curti, M. (1958). American Philanthropy and the National Character. In American
Quarterly, 10(4): 420-437.
Daubón, R. (2002) A Grassroots View of Development Assistance. In Grassroots
Development, 23(1): 1-9.
Di Mento, M. and Lewis, N. (2007). Record-Breaking Giving. In The Chronicle of
Philanthropy, 22 February 2007.
Doner, R. F. (1991). Approaches to the Politics of Economic Growth in Southeast
Asia. In The Journal of Asian Studies, 50(4): 818-849.
Dudley, B. (2004). Bill Gates Joins Berkshire Hathaway's Board. In The Seattle
Times, 15 December 2004.
Duhigg, C. (2008). Marketing Tools Foster A Good Habit. In The New York
Times, 20 July 2008.
Dulany, P. and Winder, D. (2001). Status of and Trends in Private Philanthropy in
the Southern Hemisphere. Discussion paper for the Executive Session on
the Future of Philanthropy of the International Network on Strategic
Philanthropy, Harvard University, October 2001. From The Synergos
Institute website. Available at:
http://www.synergos.org/knowledge/01/philanthropyinsouthernhemisphere
.htm. (Accessed 18 July 2008).
Easterly, W (2006) The White Man's Burden: Why the West's Efforts to Aid the
Rest Have Done So Much Ill and So Little Good. London: Penguin Books.
Easterly, W. (2008). Trust the Development Experts – All 7 bn. In Financial
Times, 28 May 2008.
74
Economist. (2004). Face Value: C.K. Prahalad, Profits and Poverty. In The
Economist, 19 August 2004.
Economist. (2006). The Birth of Philanthrocapitalism. In The Economist, 23
February 2006.
Economist. (2008) Who Gives Most in Private Aid to Poor Countries? In The
Economist, 13 May 2008.
Edwards, M. (2008) Just Another Emperor? The Myths and Realities of
Philanthrocapitalism. NY: Demos: A Network for Ideas & Action, The
Young Foundation. Available at: http://www.demos.org/pub1574.cfm
(Accessed 27 June 2008)
Elliot, L. (2008). Eurozone Teeters on Brink of Recession After Output Drops for
the First Time. In The Guardian, 15 August 2008.
Escobar, A. (1995a) Encountering Development: The Making and Unmaking of
the Third World. Princeton, New Jersey: Princeton University Press.
Esteva, G. (1992) Development. In Sachs, W. (ed.) The Development Dictionary:
A Guide to Knowledge as Power. Johannesburg: Witwatersrand University
Press.
Fisher, D. (1986). Rockefeller Philanthropy: And the Rise of Social
Anthropology. In Anthropology Today, 2(1): 5-8.
Fisher, J.D., Nadler, A. and DePaulo, B.M. (eds.) (1983) New Directions in
Helping: Recipient Reactions to Aid. London: Academic Press
Foundation Center. (2008a). Foundation Yearbook: Facts and Figures on Private
and Community Foundations (2008 Edition) – Highlights. Available at:
75
http://foundationcenter.org/gainknowledge/research/pdf/fy2008_highlights
.pdf (Accessed 10 August 2008).
Frank, A.G. (1995) The Development of Underdevelopment. In Corbridge, S.
(ed.) Development Studies: A Reader. London: Edward Arnold.
Fulda, J. S. (1999). In Defense of Charity and Philanthropy. In Business and
Society Review, 104 (Summer 1999): 179-189.
Galeano, E. (1998). The Upside-Down World. In Pilger, J. (ed.) (2005). Tell me
No Lies: Investigative Journalism and Its Triumphs. London: Vintage.
Galston, W. A. (1989). Community, Democracy, Philosophy: The Political
Thought of Michael Walzer. In Political Theory, 17(1): 119-130.
Gardner, J. R. (1992). Oral History and Philanthropy: Private Foundations. In The
Journal of American History, 79(2): 601-605.
Garside, P. L. (2000). The Impact of Philanthropy: Housing Provision and the
Sutton Model Dwellings Trust, 1900-1939. In The Economic History
Review, New Series., 53(4): 742-766.
Gertner, J. (2008). For Good, Measure. In The New York Times, 9 March 2008.
Gibboney, R. K. (1997). Philanthropy in Invisible Man. In MELUS, 22(3): 183-
194.
Gould, M. (2008,). Third Sector Not Yet Trusted to Deliver. In The Guardian, 27
February 2008.
Greene, J. (2006). Buffett's Mega-Gift. In BusinessWeek, 27 June 2006.
Gronemeyer, M. (1992). Helping. In Sachs, W. (Ed) (1992). The Development
Dictionary: A Guide to Knowledge as Power. London: Zed Books.
76
Haskell, T. (1985a). Capitalism and the origins of the humanitarian sensibility,
part 1. In American Historical Review 90, 339-61. (cited in Lambert et. al.,
2004)
Haskell, T. (1985b). Capitalism and the origins of the humanitarian sensibility,
part 2. In American Historical Review 90, 547-66. (cited in Lambert et. al.,
2004)
Havens, J. and Schervish, P. (1999). Millionaires and the Millennium: New
Estimates of the Forthcoming Wealth Transfer and the Prospects for a
Golden Age of Philanthropy. Boston: Boston College, Social Welfare
Research Institute.
Haynes, D. E. (1987). From Tribute to Philanthropy: The Politics of Gift Giving
in a Western Indian City. In The Journal of Asian Studies, 46(2): 339-360.
Hettne, B. (1995) Development Theory and the Three Worlds: Towards an
International Political Economy of Development (2nd edn). Harlow:
Longman (cited in Potter, R.B., 2002).
Higgott, R. (2001) Contested Globalization: The Changing Context and
Normative Challenges. In Booth, K., Dunne, T., Dunne, T., & Cox, M.
(eds.) (2001). How Might We Live?: Global Ethics in a New Century.
Cambridge: Cambridge University Press.
Higham, J. (1993). Multiculturalism and Universalism: A History and Critique. In
American Quarterly, 45(2): 195-219.
Hope, P. (2008). Vital Role for Third Sector in Public Services. In The Guardian,
19 March 2008.
77
Horowitz, I. L. and Horowitz, R. L. (1970). Tax-Exempt Foundations: Their
Effects on National Policy. In Science, New Series, 168(3928): 220-228.
Howe, B. (1980). The Emergence of Scientific Philanthropy, 1900-1920: Origins,
Issues and Outcomes. In Arnove, R.F. (ed.) (1980). Philanthropy and
Cultural Imperialism: The Foundations at Home and Abroad. Boston:
G.K. Hall & Co.
Hudson Institute. (2008). The Index of Global Philanthropy 2008. Washington,
DC: Center for Global Prosperity, Hudson Institute.
Huntington, J. O. S. (1892). Philanthropy and Morality. In International Journal
of Ethics, 3(1): 39-64.
IBRD/World Bank. (2007). The World Bank Annual Report 2007. Washington
DC: The World Bank.
IMF. (2008). International Monetary Fund (IMF) World Economic Outlook 2008,
ESDS International, (MIMAS) University of Manchester.
Inman, P. (2008). Charities Go Online to Stay in the Running and Reach the Next
Generation of Givers. In The Guardian, 25 March 2008.
JBHE Foundation (1994). Do Major Corporations Know that their Philanthropy is
Supporting Efforts to Abolish Affirmative Action and Black Scholarships?
In The Journal of Blacks in Higher Education, 4: 28-29.
JBHE Foundation (1997). Bill Gates and the Black Colleges. In The Journal of
Blacks in Higher Education, 17: 40-41.
Kanz, H. (1993) Immanuel Kant. In Prospects, XXIII(3/4): 789-806
78
Kelly, A. (2008). It’s Nothing Short of Vandalism; Interview: Andy Benson of
National Coalition for Independent Action. In The Guardian, 19 March
2008.
Kiely, R. (2007). The New Political Economy of Development: Globalization,
Imperialism, Hegemony. Hampshire: Palgrave Macmillan.
Klak, T. (2002) World Systems Theory: Centres, Peripheries and Semi-
Peripheries. In Desai, V. and Potter, R.B. The Companion to Development
Studies. London: Arnold.
Lagemann, E. C. (1987). The Politics of Knowledge: The Carnegie Corporation
and the Formulation of Public Policy. In History of Education Quarterly,
27(2): 205-220.
Lambert, D. and Lester, A. (2004). Geographies of Colonial Philanthropy. In
Progress in Human Geography, 28(3): 320-341.
Leonhardt, D. (2008). What Makes People Give? In The New York Times, 9
March 2008.
Levy, R. (2001) Corporate Philanthropy Comes of Age. In Clotfelter, C. T. and
Ehrlich, T. (Eds.) (2001) Philanthropy and the Non-Profit Sector in a
Changing America. Bloomington, IN: Indiana University Press.
Lin, A. H. Y. (2004). Warlord, Social Welfare and Philanthropy: The Case of
Guangzhou under Chen Jitang, 1929-1936. In Modern China, 30(2): 151-
198.
79
Macdonald, R., and Hoddinott, J. (2004). Determinants of Canadian Bilateral Aid
Allocations: Humanitarian, Commercial or Political? In The Canadian
Journal of Economics / Revue canadienne d'Economique, 37(2): 294-312.
Martin, M.D. (2004). Strategic Legacy Creation: Toward a Novel Private Banking
Value Proposition. St. Gallen: Center for Public Leadership, Universitat
St. Gallen.
McCaffrey, L. (2007). Philanthropy leads to policy change in University funding.
In Philanthropy UK Newsletter, Issue 28, March 2007.
McConnon, A. (2007). The Most Elite Club in the World. In BusinessWeek, 26
November 2007.
Midgley, J. (2003) Social Development: The Intellectual Heritage. In Journal of
International Development, 15: 831-844.
Moore, M. J. (1971). Social Service and Social Legislation in Edwardian England:
The Beginning of a New Role for Philanthropy. In Albion: A Quarterly
Journal Concerned with British Studies, 3(1): 33-43.
Moose, G.E. (1995). Assessment of U.S.-Nigeria relations: Assistant Secretary for
African Affairs George E. Moose Speech Transcript, U.S. Department of
State Dispatch, 13 July 1995. Available at:
http://findarticles.com/p/articles/mi_m1584/is_n31_v6/ai_17259739/pg_1?
tag=artBody;col1 (Accessed 10 August 2008).
Moss, S. (2008). Splashing Money Around Is Wrong. Giving It Back Isn’t. In The
Guardian, 1 July 2008.
80
Muensterberg, E. (1897). Principles of Public Charity and of Private Philanthropy
in Germany. In The American Journal of Sociology, 2(4): 589-605.
Muensterberg, E. (1897). Principles of Public Charity and Private Philanthropy in
Germany. II. In The American Journal of Sociology, 2(5): 680-698.
NCCS (2008). Number of Nonprofit Organizations in the United States, 1996 –
2006.
From National Center for Charitable Statistics (NCCS). Available at:
http://nccs.urban.org/ (Accessed 12 July 2008).
NCVO-CAF. (2006). UK Giving 2005/06. Joint-report from National Council for
Voluntary Organisations (NCVO) and Charities Aid Foundation (CAF)..
Available at: http://www.cafonline.org/pdf/UK%20Giving2005-06.pdf
(Accessed 13 August 2008).
NCVO-CAF. (2007). UK Giving 2006/07. Joint-report from National Council for
Voluntary Organisations (NCVO) and Charities Aid Foundation (CAF).
Available at:
http://www.cafonline.org/pdf/2007%20UK%20Giving%20Report.pdf
(Accessed 13 August 2008).
Nocera, J. (2008). Self-Made Philanthropists. In The New York Times, 9 March
2008.
Norris, J. (2008). A New Window Opens Up on Aid Efficiency. In Hudson
Institute. (2008). The Index of Global Philanthropy 2008. Washington,
DC: Center for Global Prosperity, Hudson Institute.
81
Novogratz, J. (2005). Investing in Africa's Own Solutions. Presentation at
TEDGlobal 2005, Oxford, UK, 12-15 July 2005. Available at:
http://www.ted.com/index.php/speakers/view/id/89. (Accessed 23 May
2008)
Novogratz, J. (2007). Meeting Urgent Needs with Patient Capital. In Innovations,
2 (1/2): 19-30.
O'Leary, J., and Takashi, M. (1995). Between State and Capital: Third Sector
Organizational Development in Tokyo. In Comparative Politics, 27(3):
317-337.
Orlie, M. A. (1999). Review: Beyond Identity and Difference. In Political Theory,
27(1): 140-149.
Owen, D. (1965). English Philanthropy, 1660-1960. Cambridge: Harvard
University Press.
Palmeri, C. (2006). From Ice Cream to Nuclear Freeze. In BusinessWeek, 24
August 2006.
Persell, C. H. (1994). Taking Society Seriously. In Sociological Forum, 9(4): 641-
657.
Piliavin, J. A. and Charng, H. (1990). Altruism: A Review of Recent Theory and
Research. In Annual Review of Sociology, 16: 27-65.
Popke, E. (2003). Poststructuralist Ethics: Subjectivity, Responsibility and the
Space of Community. In Progress in Human Geography, 27: 298-316.
82
Potter, R.B. (2002) Theories, Strategies and Ideologies of Development. In Desai,
V. and Potter, R.B. (eds.) The Companion to Development Studies.
London: Arnold.
Power, M. (2002) Enlightenment and the Era of Modernity. In Desai, V. and
Potter, R.B. (eds.) The Companion to Development Studies. London:
Arnold.
Rana, S. (2008). From Making Money Without Doing Evil to Doing Good
Without Handouts: The Google.Org Experiment in Philanthropy. In
Journal of Business & Technology Law, 3(1): 87-96.
Raymond, S. (2008a). Growing Up Global: Philanthropy Matures Around the
World, Part I: Why Going Local Matters. From onPhilanthropy.
Available at:
http://www.onphilanthropy.com/site/News2?page=NewsArticle&id=7395.
(Accessed 12 May 2008).
Raymond, S. (2008b). Growing Up Global: Philanthropy Matures Around the
World, Part II: Philanthropy in Latin America: Past Traditions, Future
Innovations. From onPhilanthropy. Available at:
http://www.onphilanthropy.com/site/News2?page=NewsArticle&id=7423
(Accessed 12 May 2008).
Raymond, S. (2008c). Growing Up Global: Philanthropy Matures Around the
World, Part III: Emerging from the Ashes of Conflict. From
onPhilanthropy. Available at:
83
http://www.onphilanthropy.com/site/News2?page=NewsArticle&id=7447
(Accessed 12 May 2008).
Raymond, S. (2008d). Growing Up Global: Philanthropy Matures Around the
World, Part IV: Corporate Philanthropies Emerge in the East. From
onPhilanthropy Available at:
http://www.onphilanthropy.com/site/News2?page=NewsArticle&id=7471
(Accessed 12 May 2008).
(RED). (2008). (RED) website. Available at: http://www.joinred.com. (Accessed
15 August 2008).
Reid, I. D. A. (1944). Philanthropy and Minorities. In Phylon (1940-1956), 5(3):
266-270.
Riddell, R. C. (1999). The End of Foreign Aid to Africa? Concerns about Donor
Policies. African Affairs, 98(392): 309-335.
Rodgers, B. (1949). Cloak of Charity: Studies in Eighteenth-Century
Philanthropy. London: Methuen & Co.
Romano, B. and Helm, K. (2008). Bill Gates Q&A: The Challenges of Running
the Gates Foundation. The Seattle Times, 1 July 2008.
Ross, A. D. (1968). Philanthropy. In Sills, D. L. (ed.) (1963) International
Encyclopaedia of Social Sciences. New York: Macmillian. [Cited in
Arnove, R.F. (ed) (1980)]
Sachs, J. (2005) The End of Poverty: How We Can Make It Happen In Our
Lifetime. London: Penguin Books.
Sachs, W. (1992). One World. In Sachs, W. (Ed) The Development Dictionary: A
Guide to Knowledge as Power. London: Zed Books.
84
Salamon, L.M. (2002) The Third Sector in Global Perspectives. In Grassroots
Development, 23(1): 10-18.
Schervish, P. (1997). Major Donors, Major Motives: The People and Purposes
Behind Major Gifts. In New Directions for Philanthropic Fundraising:
Developing Major Gifts, 16: 85-112.
Schervish, P. (2004). Wealth and Philanthropy. In D. Burlingame (Ed.),
Philanthropy in America: A Comprehensive Historical Encyclopedia (Vol.
2). Santa Barbara: ABC-CLIO.
Schervish, P. (2006a). The Moral Biography of Wealth: Philosophical Reflections
on the Foundation of Philanthropy. In Nonprofit and Voluntary Sector
Quarterly, 35(3): 477-492.
Schervish, P. (2006b). Philanthropy's Janus-Faced Potential: The Dialectic of Care
and Negligence Donors Face. In W. Damon & S. Verducci (Eds.), Taking
Philanthropy Seriously: Beyond Noble Intentions to Responsible Giving.
Bloomington, IN: Indiana University Press.
Schervish, P. and Havens, J. (2001). The Mind of the Millionaire: Findings from a
National Survey on Wealth with Responsibility. New Directions in
Philanthropic Fundraising, Understanding Donor Dynamics: The
Organizational Side of Charitable Giving. , 32: 75-107.
Schervish, P., Havens, J., and Whitaker, A. (2006). Leaving a Legacy of Care. In
Philanthropy, 20(1): 11-13.
Schley, D. (2006). The Charity Sweepstakes. In BusinessWeek, 28 August 2006.
85
Sennett, R. (2006) The Culture of the New Capitalism. New Haven: Yale
University Press.
Soller, K. (2006). Americans Dig Deeper for Charity. In Business Week, 19 June
2006.
Staples, J. (2007). NGOs Out in the Cold: Howard Government Policy Towards
NGOs. Sydney: University of New South Wales, Law Research Series,
UNSWLRS 8.
Starita, L. (2008). Are they Venture Philanthropists, Philantropreneurs or
Philanthropcapitalists? From Philanthropy Action. Available at:
http://www.philanthropyaction.com/articles/are_they_venture_philanthropi
sts_philantropreneurs_or_philanthropcapitalist. (Accessed: 28 July 2008)
Stewart, H. (2007). Public Backs Rise in Overseas Aid . The Observer, 25
February 2007.
Synergos (2008) Synergos: Global Philanthropists Circle. Available at:
http://www.synergos.org/philanthropistscircle/. (Accessed: . 16 May
2008).
Teather, D. (2008). Dollar Milionaires Top 10m. In The Guardian, 25 June 2008.
Times. (2008). US Recession Will Trigger Global Slump. In The Times, 24
January 2008.
Traub, J. (2008). The Celebrity Solution. In The New York Times, 9 March 2008.
Truman, H.S. (1949) Inaugural address, 20 January, 1949.
Available at: http://www.trumanlibrary.org. (Accessed 1/12/07).
86
United Nations. (2008) United Nations Millenium Development Goals. Available
at: http://www.un.org/millenniumgoals/ (Accessed 10 August 2008).
UNESCAP. (2001). Chapter 7: Official Flows, Part 2. Financing for
Development. In Economic and Social Survey of Asia and the Pacific,
2001. Available at: http://www.unescap.org/drpad/publication/survey2001
(Accessed 5 August 2008).
Wang Ying. (2008). Top Philanthropists Donate $1.8b in 5 Years. In China Daily,
3 April 2008.
White, D. L. (1991). From Crisis to Community Definition: The Dynamics of
Eighteenth-Century Parsi Philanthropy. In Modern Asian Studies, 25(2):
303-320.
Willis, K. (2005) Theories and Practices of Development. Abingdon, Oxon:
Routledge.
Wolpert, J. and Reiner, T. (1984). The Philanthropy Marketplace. In Economic
Geography, 60(3): 197-209.
World Bank. (2007). Aid Architecture: An Overview of the Main Trends in
Official Development Assistance Flows, World Bank/ International
Development Association, Report No. DC2007-0003. Available at:
http://siteresources.worldbank.org/DEVCOMMINT/Documentation/21289
626/DC2007-0003(E)-AidArchitecture.pdf. (Accessed 10 August 2008).
World Bank. (2008). World Development Indicators Database. Available at:
http://devdata.worldbank.org/query/default.htm (Accessed 15 August
2008).