Promoting local philanthropy
Philanthropy is not only a source of funding for advocacy in that donors themselves have an advocacy role to play. This role includes building the profile of philanthropy within the social economy, taking public positions on the initiatives and issues in which investments are made, and promoting effective funding practices.
We need people to invest in civil society movements, regardless of their shape or size. We need philanthropists, particularly local philanthropists, to come on board and play their part in building such movements and a vibrant citizenry. *
There is a continuing need for funding to come into the country, but there is a greater need to build our own local philanthropy. Those people that have generated a lot of wealth … we need to encourage them to think about supporting others.*
Growing philanthropy in South Africa requires more than straightforward promotion of giving. It necessitates the development of an appetite amongst donors to advocate for an environment that enables giving. A number of reports16 indicate the positive impact of a philanthropy infrastructure on levels of philanthropic giving. Deemed essential to a sustained growth in giving, the development of support structures for giving has been shown to aid the promotion of effective philanthropy.
If you want your society to be stable and fair and your economy to thrive, then it’s very important that people are able to participate and that you’re open to the contribution of civil society. More and more people are realising that this is an important time to invest in making this place work.*
A philanthropy infrastructure includes:
- Industry-specific professional development
- Organised networks in the field including affinity- or issue-based funder groups
- Context-specific standards and best practice
- Research on the scale and scope of giving practices
- Engagement with government towards an conducive legislative and policy environment for giving
- Media profiling and awareness-building
- Online platforms for sector engagement and knowledge sharing17
This infrastructure supports funders to use their leverage to grow the donor pool more generally, and to encourage giving. A comprehensive report by Worldwide Initiatives for Grantmaker Support (WINGS) on the development of philanthropy infrastructure, globally, highlights key environmental features deemed conducive to such an infrastructure. These are:
- “A legal framework that empowers rather than shackles”
- “A tax structure that provides incentives, not penalties”
- “An accountability system that builds confidence in philanthropy and civil society”
- “Sufficient institutional capacity to implement effective activities”
- “Enough resources to undertake these activities”18
Advocating for the growth of local philanthropy, and the infrastructure that supports it, includes
- Supporting programmes and organisations that:
- Advocate for individual giving, for institutionalised giving, and for strategic giving for longer-term impacts
- Provide networks, forums, and affinity groups for peer-learning, potential collaborations, and professional skills development amongst grantmakers and donors
- Work toward establishing codes of conduct and professional standards in grantmaking and in the provision of philanthropy advisory services
- Engage with government on policy related to the legislative framework governing philanthropy towards the creation of an enabling philanthropic environment
- Build a media profile for philanthropists, and for philanthropy and its potential for positive development impact
- The use of challenge grants to encourage giving
- The development of a body of knowledge about philanthropy
- Skills development amongst grantees to improve their capacity to seek funding, in a professional and strategic way, towards enhancing the sustainability of their organisations and their ability to achieve their missions
- Showcasing projects and their impact on particular social challenges, and drawing the links between the cause, the organisation, the project, and the funding support as interdependent links in the social change chain.
The drawing to a close of The Atlantic Philanthropies grantmaking in South Africa took place in a context where insufficient local funding sources had been identified, nurtured and developed to replace what would be a large gap left by Atlantic’s departure. This was also a time of recognition by local donors and NGOs of the need for shifts in the local funding terrain.
With high levels of wealth, and large disparities between rich and poor, it was felt that South Africans, particularly those with surplus income, could be more directly encouraged to invest in strengthening civil society and democracy-building.
Some strategies through which Atlantic has supported the growth of local philanthropy include:
- Supporting philanthropy promotion
- Making the case for social justice
- Challenge grants to encourage giving
- Knowledge and resources about giving
A 2004 report19 by the Bertelsmann Foundation outlines a number of strategies used in various contexts across the globe to promote philanthropy. These include:
- Legal reform to create an enabling environment for philanthropy
- Public awareness campaigns to build a profile for philanthropy, philanthropists and the potential for impact through strategic and effective funding
- Donor leadership to develop a higher, more engaged profile for the donor community
- Donor education to address issues of grantmaking practice and donor-grantee relationships, amongst others
- Professional advisors to generate energy around and recognition of the professional skills required for effective philanthropic advising in wealth management, tax issues, the legislative framework, and grantmaking strategy amongst others
- Place-based philanthropy: To energise community-level potential for supporting particular geographic or cause-focused communities. For information on community Foundations elsewhere, go to the Charles Stewart Mott Foundation website
- Peer-based philanthropy: Peers leveraging their lower level giving capacities through combined giving by means of, for example, giving circles
- Issue-based philanthropy: The power of a cause to build interest in supporting particular issues, such as LGBT philanthropy
Supporting philanthropy promotion
There are a many ways in which The Atlantic Philanthropies has explicitly supported the growth of philanthropy in South Africa and local efforts to promote, profile, energise and increase giving amongst individuals and the donor community at large. In the main, this has been directed at encouraging high net worth individuals (HNWI) and ultra-high net worth individuals (UHNWI) to formalise their philanthropy into more streamlined, strategic and institutionalised practices. Atlantic has also invested in wider efforts to encourage individual giving across the board and, more recently, on increasing funding for human rights and social justice causes.
Building philanthropy can be aided by:
- The production and increased accessibility of knowledge about the philanthropic landscape (including forms and critiques of, and motivations for, giving and funding practice), and making this accessible
- The profiling of the vast and diverse kinds of activities included in the broad notion of philanthropy
- The creation of opportunities for engagement amongst and between grantmakers, grantseekers and funding advisors to local philanthropists
Philanthropic giving is one small component of what is required to build a democracy in this society. *
If it were up to me, South Africa would be fully self-funding in 20 years time, so that civil society wouldn’t have to depend on external funders. It is possible. *
Atlantic partnered in the above through supporting a number of organisations including Inyathelo: The South African Institute for Advancement (Inyathelo), and the Charities Aid Foundation Southern Africa (CAF Southern Africa).20 For example, Atlantic supported both Inyathelo and CAF Southern Africa in research initiatives into government funding for NPOs and whether particular agencies meet their mandates in support of civil society organisations.
In giving effect to one of its key strategies, namely to fund anchor organisations, Atlantic supported Inyathelo in its endeavour to develop and promote local philanthropy. Through Inyathelo’s annual awards programme, individuals are identified as role-model philanthropists and formally recognised for their philanthropic contributions and their impacts.
In addition to this, the organisation hosts funder forums for peer-learning, runs a dedicated philanthropy web platform with a regular newsletter to generate accessible information about local giving, and served as secretariat to the Private Philanthropy Circle (now the Independent Philanthropy Association of South Africa) during its first four formative years.
Such efforts to spur local giving also attract media interest in the causes supported by philanthropists, increase public awareness of philanthropy and its social role, and make accessible wide ranging information about the value, practices and impacts of philanthropy.
Alongside the promotion of local giving, Atlantic and its partners also recognised the need to strengthen the sustainability of non-profit organisations by up-skilling their fundraising efforts. To this end, Atlantic invested in Advancement capacity development projects with its grantee clusters. These initiatives, designed and implemented by Inyathelo, sought to improve grantee capacity to ‘ask’, the flipside of improving South African philanthropy’s capacity to give.
Making the case for giving to social justice
The nature of giving is quite conservative here [in South Africa], but we’re beginning to see a number of individuals coming forward and publicly saying they’re going to put their money into social justice issues…So the work has really been about trying to change mindsets.*
Philanthropy should not be about asking ‘What can I get out of this?’. It should be about asking ‘What contribution can I make to society? *
During the struggle against apartheid, South African civil society was the recipient of much international funding directed toward the realisation of a democratic and equal society. In the early years of democracy, international funding remained significant, however this has diminished significantly over the past decade. As a middle-income country, South Africa is perceived to be capable of supporting its own civil society sector.
South African philanthropy boasts a rich history, however, there has been reluctance by wealthy individuals to see the social justice arena as a funding priority. Local philanthropy tends to focus on education and health and does so in ways that alleviate immediate or short-term distress, such as for example, bursaries or medical programmes, rather than systemic issues that address the root of social inequity.
While there has been a perceptible shift from charity-style philanthropy to one that is more development focused, the field of social justice remains severely underfunded by local donors.
Atlantic had for some years sought ways to address the issue of limited local funding for social justice work in light of its planned exit from South Africa.
Atlantic partnered with The Raith Foundation to establish a fund to promote social justice activism. The result was The Social Justice Initiative (SJI), established in 2013 to promote giving to social justice causes and to build the case for such investments.
Alongside the support of other donor partners, the SJI is supported by an Atlantic grant aimed at strengthening the capacity of civil society to engage in building democracy and constitutionalism by promoting giving by high-net worth individuals and middle-income earners to social justice organisations21.
There are many challenges in funding social justice. The big one is that it is perceived as political. And it is political. Most things are, but not so obviously. *
The willingness to give is something that’s there. The question is how to unlock that willingness to give. Where do we go to find people in their comfortable spaces, where they feel able to give?*
Under the slogan Make it Real. Make it Last, the SJI promotes awareness and funding for a range of social justice organisations committed to poverty eradication, to ensuring the active engagement of government and business in the development of a more just society, and to energising public participation in matters that impact lives and livelihoods. In particular, it builds donor awareness of social justice endeavours, which, as defined by the SJI, include activities and organisations that:
- Enable access to justice
- Ensure good governance and an active citizenry
- Maintain accountability and transparency
- Promote socio-economic rights
- Build civil society
SJI is geared toward the mobilisation and disbursement of funds to civil society organisations that enhance democracy and promote justice. The initiative specifically targets high net worth individuals (HNWIs) so as to draw them into a circle of information and discussion about the value of social justice work and the crucial need for its support. The SJI works to change the perception of social justice work as marginalised and necessarily internationally funded.
Philanthropy in support of social justice should be
- Convinced of the critical need for the social justice sector to be active, funded and valued, in defending and advancing democracy and constitutionalism
- Capable of taking leaps of faith in pursuit of advancing social change
- Willing to collaborate and engage with the people and communities who are affected by and actively working in the sector
- Able to weather mistakes and use them as models for learning and development
Challenge grants to encourage giving
Donors can talk to other potential donors more easily than we can because we [NPOs] are asking for money.*
I hope that philanthropic giving can be rooted in a desire to have a democracy that actually works for everybody, not just for an elite, or not just for people who have political business connections.*
Multiple resources, reports and guides have been developed on the role of challenge grants in encouraging giving, whether campaign-specific or for longer term objectives. Based on a matching mechanism, challenge grant leverage has been used by funders across the spectrum, particularly in the USA, including by The Kresge Foundation.
Challenge grants encourage giving by:
- Boosting an organisation’s credibility through a grant-based endorsement from a well-known funder thus attracting the interest of other grant makers (“if that funder supports this cause, perhaps we should too”)
- Making less sizeable grants more significant in that the challenge grant encourages smaller donors, who might feel that they are not in the “ball park”, to contribute to a big-budget project. Donors who make smaller grants can increase their grantmaking leverage when applying, for example, a 2:1 grant match whereby a R100,000 grant is increased to R200,000 when other donors meet the matching challenge. In this way challenge grants improve the profile of smaller grantmakers
- Encouraging donations of all sizes and means, through the pooling of grants
- Growing an organisation’s donor pool by actively seeking new donors to enlist their support for an organisation or programme
Atlantic used challenge grants in its South African programme to catalyse growth in local philanthropy for particular causes. One such grant was made to The Other Foundation.
Historically, Atlantic has been the single biggest supporter of organisations that advance and defend the rights and well-being of LGBTI people in South Africa.
In the lead up to Atlantic’s spend-down, as a limited life Foundation, there were concerns about the sustainability of its numerous grantee organisations in the LGBTI sector, many of which had existed almost exclusively on Atlantic funding. Consequently, amongst other strategies, Atlantic investigated the feasibility of supporting the establishment of a community Foundation that could support LGBTI causes into the future.
Following extensive research and stakeholder engagement, a challenge grant and dedicated operational funding was given to The Other Foundation, established in 2012 to be both a grantmaking and fundraising organisation working to expand resources to support the realisations of rights for LGBTI people in South Africa and the Southern African region.
It is part of The Other Foundation’s mission to mobilise LGBTI givers to support LGBTI social justice causes, to bring LGBTI people into closer relationship with advocacy for LGBTI rights, and to promote giving more broadly in South and Southern Africa.
Knowledge resources about giving
Growing philanthropy is strengthened by an understanding of the local terrain, including the size and scope of the sector, the funding practices of various donor groups, the challenges philanthropists face, and so on. Atlantic contributed to the development of knowledge resources in this sphere through, for example:
- Initiating and supporting a conference of local and international funders in South Africa, the first of its kind, in order to discuss and develop strategies for giving, and to identify and respond to the challenges for, and obstacles to, growth in the local philanthropy sector
- Investing in research on the forms and practices, both effective and ineffective, of funding for civil society organisations in South Africa: this included two projects which investigated the funding practices of the National Lotteries Board22 (now the National Lottery Commission) and the National Development Agency23, to establish whether these institutions are meeting their mandate in relation to the management and disbursement of funds
- Providing core support to organisations and initiatives that generate and disseminate information about local giving
In South Africa, giving attitudes and practices remain largely under-researched in a range of giving markets (from ultra-high net worth individuals to community-based giving structures). Developing such a knowledge base is essential – particularly to inform grantseekers’ strategies for resource mobilisation, as well as to understand the opportunities and constraints within the giving landscape. For more on the research available, see the snapshot of South African philanthropy.
In addition to the published studies in the field, Atlantic commissioned research that investigated, amongst others, the feasibility of establishing a community Foundation for LGBTI causes, and examined the proclivity of high net worth individuals to give to social justice initiatives.
These unpublished reports have informed funding decisions and point to the ever-expanding pool of contextualised knowledge resources that inform donor strategy and practice and the establishment of new philanthropic initiatives.