WINGSForum 2006: Inaugural Barry Gaberman Lecture on Global Philanthropy - The Status of Global Philanthropy

Barry Gaberman, Chair Emeritus, WINGS

What a pleasure it is to be here with all of you - old friends and new friends. This forum has had the good fortune of starting in a magical city, Oaxaca in 1998, moving to another magical city, Sydney in 2002, and now coming to a third magical city - Bangkok. As it moved, it grew, as you heard from Monica Patten on Thursday, and I can't wait to hear where it will go next.

Before starting my remarks today I want to be sure to tell you how honored I am that WINGS decided to name a lecture after me. I started out in life to be a professor, but a funny thing happened on the way to the classroom, the Ford Foundation called and offered me a job in its Jakarta Field Office. That was 35 years ago and having a lecture named after me seems almost poetic as I finally try to get back into the classroom. But there is no such thing as a free lunch and going along with having a lecture named after you means you actually have to deliver a lecture.

Since this is a lecture about global philanthropy, I propose to stay within that broad theme and talk about the rapidly emerging global infrastructure of philanthropy. But before we plunge into that topic it is important to step back and remind ourselves that the building of the global infrastructure for philanthropy is not the end in itself. Rather, the end is captured by mission statements that have to do with enhancing the livelihoods of the poor, eradicating poverty, promoting economic development, advocating for human rights, supporting the arts, and any number of other worthy activities. And if these activities are the goals, we need to recognize that for the most part, the chosen instrument of philanthropy it to work through the institutions of civil society to accomplish those ends.

I use the term civil society, not because it is perfect, but rather, it seems to be the phrase that more and more people across all the regions of the word are using. Civil society is not a new term, and writers from Plato to Putnam have used it. The problem is that the term tends to be used quite differently by different people. So while we may not have reached a consensus on a definition of civil society, I would suggest that we know what civil society organizations are when we see them.

Basically, these are organizations that:

• Provide services often to the most disadvantaged, isolated and marginalized segments of our populations;
• Educate and train us throughout our lives;
• Do independent policy analysis and assessment;
• Engage in advocacy to make sure that people’s dreams and demands are heard; and
• Strengthen our awareness, identity and enjoyment through artistic expression and cultural understanding.

For many, this instrumental and descriptive definition of the functions of these institutions would be incomplete for a number of reasons. Let me mention just three.

The first is that the picture is incomplete because it does not touch on the normative dimension of the institutions of civil society. For many people, the important point is that these organizations welcome participation, sharpen an individual's organizational skills, promote tolerance, and enhance inclusion - to mention a few of the elements that go into building social capital.

The conundrum is that we all know that there are many institutions that have none of these attributes that build social capital. In a sense we might be able to say that while all the institutions of civil society are part of the nonprofit sector, not all nonprofit institutions are part of civil society - only those that build social capital.

A second reason the picture is incomplete is that there are lots of institutions and events that tend to be left out of the definition of civil society. Labor unions and political parties are two examples. Our description also seems to apply primarily to formal organizations, but these may be only the tip of the organizational iceberg. What about the many more informal associations and voluntary groups. Surely, our intention is not to exclude them. Finally, there is the complexity of dealing with social movements themselves, one of the important incubators of civil society organizations.

A third, and perhaps the most important reason, is the generic role the institutions of civil society play as a safeguard against the abuse of power.

If we think about the transition to more open and participatory systems that took place in Latin America in the 1970s, Eastern Europe in the late 1980s, and Africa and Asia in the 1990s and the new millennium, we can reasonably ask what is to prevent a regression to authoritarian regimes, as has been the pattern in the past? The answer for an increasing number of people is that in large measure it is a vibrant civil society and the social capital it builds that offer the best protection against regression.

To be sure, the institutions of civil society have always been there. What is different about them in this period of history is that they have a conscious sense of being a part of a sector and these linkages reinforce and strengthen the soft power of their influence.

We live in a time when societies and the issues they face are very complex. The traditional safeguards against the abuse of power, such as the separation of power to achieve checks and balances into legislative, executive, and judicial functions and the addition of an independent press may not be enough. In this context, the institutions of civil society add another layer of safeguards against the abuse of power.

But, to be most effective these institutions of civil society need an enabling environment comprising of:

• A legal framework that empowers rather than shackling them;
• A tax structure that provides incentives, not penalties;
• An accountability system that builds confidence in civil society organizations;
• The institutional capacity to implement effective activities; and
• The availability of resources to undertake these activities.

If we move beyond the important role played by the institutions of civil society to look at the components that make up the global infrastructure for philanthropy, we can see that the components consist of the institutions that resource civil society, the institutions that hold these resource providers accountable, the institutions that capture and disseminate the learning gleaned from the activities supported, and finally, the institutions that nurture and support the resource providers.

Let us take each of these four components up in turn and build a snapshot of the global infrastructure of philanthropy.

Both individual giving and organized grantmaking institutions are the building blocks of the global infrastructure of philanthropy. They provide the funds that resource the organizations of civil society. While there are multiple definitions of philanthropy - often tracing back to the classics and religion, I prefer a simple and practical definition - "Philanthropy is the capture of private wealth for public purposes."

As such, it has existed long before there was a United States and long before Europe was organized into a cluster of nation-states. Philanthropy is not today, nor was it ever, solely a Western concept, although it is true that each society puts its unique stamp on this work in progress.

Organized philanthropy in the form of foundations and other grantmaking institutions have always existed, but under many different names and they have historically tended to be somewhat parochial and charitable rather than strategic and developmental. What we are seeing today is an increasing number of grantmaking institutions throughout the world that aspire to be strategic and developmental.This trend is complemented by a veritable explosion in the models available under which to conduct philanthropic activities. The standard categories of corporate, independent, family, and community philanthropies themselves are undergoing changes and to them we have new social investment models as well as traditional models such as giving circles whose power has been dramatically enhanced by technology.

If philanthropy is the capture of private wealth for public purposes then the good news is that the larger the menu of models available to choose from, the greater the chance that people of wealth will find a philanthropic vehicle that they are comfortable with. The bad news is that we must stop the constant bickering among ourselves about which model must be followed. The old models are not all entirely inept as some proponents of the new would have you believe, nor are the new models just old wine in new bottles as some of the traditional philanthropies claim.

We need to pause here to acknowledge an important issue. Many civil society institutions in Eastern Europe and in the South are funded by foreign sources -- largely from the United States and from Western Europe. This makes them vulnerable to the fickleness of foreign funding on the one hand, and to the charge that they speak not for the interests of their countries, but rather for the interests of their foreign funders. An increasing number of well-resourced, indigenous philanthropic institutions that are strategic and developmental increases the chances that the institutions of civil society can be sustained with internal resources.

The second component of the global infrastructure of philanthropy is responsible for the accountability structure under which the grantmaking institutions operate. This accountability structure operates at three levels. One level is that of the state in terms of the regulations grantmaking institutions must comply with. What is different about this level than the other two is that the state has the power to enforce compliance. The second level is the sector level where there is a cluster of mechanisms such as "codes of practice", watchdog organizations, and specialized publications. The Chronicle of Philanthropy is one example of the latter. Finally, at the level of the individual institutions, there is the transparency that comes from informative reporting and the effective governance that comes from boards of directors that know their responsibilities.

When the three-tiered system of accountability is used as a guideline we find important gaps. At the level of the state, in most places civil society organizations are still viewed with suspicion and the regulatory environment reflects this. The regulations emphasize control and often are bureaucratically cumbersome and onerous. At best, this is a grudgingly obtained form of accountability at the expense of operational effectiveness and innovation.

At the sectoral level, the picture is a bit brighter. Increasingly there are associations, support organizations and centers that have developed "codes of practice" for grantmaking institutions, but watchdog organizations and specialized publications are few.

At the level of the grantmaking institutions, the reporting has increased dramatically in the past 20 years, although the financial side of that reporting can be quite thin. Let's remember, however, that in hostile environments, fulsome reporting can make your organization quite vulnerable. As far as boards go, there is a shift taking place from boards that are largely honorific to boards that exercise appropriate oversight, but the shift is not taking place at breathtaking speed.

The third component of the global infrastructure for philanthropy is the institutions that study the grantmakers and assess the activities funded. One might argue that in the United States this cluster of academic and free-standing institutions has gone beyond the saturation point and is no longer sustainable. Outside the United States, the density of such institutions is sparse but growing. And importantly, the journals in the field have worked hard to incorporate international perspectives. One that has particular resonance for practitioners around the world is the quarterly magazine Alliance.

Let me turn now to the final component of the global infrastructure for philanthropy, the institutions that support and nurture the grantmaking institutions. These organizations come in the form of membership associations and other types of support organizations. I would like to spend a little more time on this component and particularly on these membership associations of grantmakers because they play such an important, but often lonely role in their societies and they are seldom allowed to bask in the light we turn on foundations and operating organizations.

While the Council on Foundations in the United States is still the grandparent of these associations in scale and in history, as you have heard there are now 135 membership-based and other philanthropic support organizations in WINGS. They are operating at the regional, the national, and the sub-national level. Some of these associations serve both the grantmakers and grant seekers. Some serve only grantmakers, but serve all the different types of grantmaking organizations. And some target their support to a particular type of grantmaker - such as corporate giving programs or community foundations.

A few years ago, in an introductory essay to a two-volume publication on associations and other philanthropic support organizations, I tried to present the core activities of these organizations. In looking over that essay as preparation for these remarks, it seemed to me that they could be freshened up a bit and expanded. Essentially, membership associations and in some cases other philanthropic support organizations have the following core activities:

First, and at the heart of any association, is the services it provides its members. Services that run the gamut from essential information to using the new technology, to fundraising and investment practices to governance. No association can provide all these services directly and hence the practice of outsourcing some of these services to specialized non-membership-based support organizations.

Second, is the convening function these associations perform. It allows members to renew relationships, share experiences, and rekindle the spirit of being involved in a common purpose.

Third, these convenings often provide the first contact in what can develop into powerful collaborations among grantmaking institutions.

Fourth, it is at the level of the association that we often see the most effective development and use of "codes of practice".

Fifth, these associations often take the lead role in promoting an enabling environment for civil society and grantmaking institutions.

Sixth, associations provide representation and protection to grantmaking organizations and their interests in the public policy arena.

Seventh, these associations are often the vanguard promoting philanthropy and a culture of giving in their societies.

Eighth, it often falls to the associations to communicate the value of institutional philanthropy to the general public and its policy makers.

Ninth, and particularly in lower-income countries, associations can provide a gateway through which foreign funders can establish and support productive working relationships.

Tenth, an association can take the lead in encouraging work with the other sectors of society. Let’s face it, if you want to effect change on a large scale and sustain it over time, there is no alternative to the public sector and its ability to extract resources through the power of taxation.

And finally, an association can consciously go out to strengthen the current leadership of the philanthropic field and more importantly, build the next generation of leaders.

Now I couldn't possibly end a set of remarks like these without saying a few words about WINGS as well as a few words about a critical challenge before us. Just as grantmaking institutions need an organization to nurture them, that is equally true of the association and support organizations of philanthropy. If you just listen to the buzz in the hallways here, you have convincing proof that WINGS fulfills that role. But, the WINGSForum only takes place about every four years - and in the intervals between these conferences, a set of peer learning activities and an increasingly robust website keeps the momentum going.

This is important because we face a powerful challenge in the years ahead. In the early 1990s, Lester Salamon wrote an article titled the "Associational Revolution". He was reflecting on the rise of civil society organizations in Central and Eastern Europe. He could just as easily been talking about the dramatic growth of civil society across the globe over a 50-year period beginning in the 1950s. Writing today, Douglas Rutzen and Catherine Shea titled their article in Alliance, the "Associational Counter-Revolution" because a marker for this new millennium is the increasing scrutiny of and pressure being placed on civil society across the globe from China, to Egypt, to Zimbabwe, to Venezuela, to the United States, to Russia - just to name a few places.

It is the convincing manner in which associations and their members demonstrate their accountability and their effectiveness that is the best defense we have against a spate of increasing onerous regulations.

Let me close now with a personal hope, if not during my lifetime, than the lifetime of my children. I hope for a day when:

• The regulatory framework around the world will increasingly empower rather than shackle the institutions of civil society;
• When the tax structure will increasingly provide incentives, not penalties to the institution of civil society;
• When private wealth will increasingly be used for public benefit through a plethora of philanthropic mechanisms that people find attractive;
• When corporations will move beyond the narrow interests of their stockholders to the broader interests of their stakeholders;
• When every square foot of the planet will be covered by a community foundation; and
• When all philanthropic models will have an association they can call home.

Background information on the Barry Gaberman Lecture on Global Philanthropy and the Fund created to support future lectures can be found here.