Most reports agree on one thing: Philanthropy is changing. “Philanthropy can no longer be about benevolence; it is about having an impact on the complex problems that face the next generation” states the February Beacon Collaborative philanthropy report. Curious about what direction philanthropy in the UK was taking in the midst of Brexit and a global pandemic, we attended the ensuing webinar on “the UK as a centre of excellence for International Philanthropists and social investors”. Here are some of our key take-aways.
1. Matched funding: The future of philanthropy and social investment is impact-oriented, blended, collaborative, and global.
The report opens on the importance of SDG17: “partnerships for the goals”. We need to stop seeing philanthropy as being in conflict with economic interest. In fact, social philanthropy is a type of investment where the return is counted in lives well lived and the betterment of the planet, rather than specific fiduciary return. In order to fully embrace this perspective, it is crucial that we start broadening our perspectives around how we conduct philanthropy and who is involved. We need to nurture conversations between charity and businesses, investors and philanthropists. Dissociating economic investments from social impact has led to siloed systems, where businesses struggle to reallocate funds to CSR and the charity sector is given bad press in the effectiveness of how they conduct their operations. But, if Covid has taught us anything, it is the incredible agility and reflexiveness with which the charity sector is able to adapt, with the help of highly responsive philanthropists. Similarly, during this soul-searching time we have seen growing public pressure to hold businesses responsible for their net impact. Learning how to play the strengths of both sectors together to better society will be key in achieving the SDGs.
As part of this process, the report recommends the increased use of Match funding. This practice consists in using government capital to encourage the development of social investment programmes geographically or thematically, where private capital would come to complement the projects through various incentives. This follows the success of Aid Match where the UK government enlisted the help of the British public to implement international development targets, aligned with the UN and specific Sustainable Development Goals. Should this be implemented at a wider scale, it would help catalyse and focus resources through the power of collective giving.
2. Stable rule of law: The UK’s strong regulatory framework provides a significant attraction for international philanthropists and social investors.
Although some argue that Brexit is a brilliant opportunity for the UK to redefine itself, the UK leaving the EU has certainly disrupted the status quo and shaken many institutional foundations. However, the report finds that regardless of ongoing political debates the UK remains well regarded by international audiences, who applaud its comparatively stable regulatory environment, dedication to democracy and ecosystem enabling philanthropy.
The UK is already a leader in wealth management (close second behind Switzerland). The question is now centred around how to keep doing what we do in the most effective way. The report uses Joe Nye’s language of “soft power”, the concept that power also lies in the ability to influence the behaviour of others to get the outcomes you want. It outlines the role the UK can play moving forward. By tweaking its legislation and keeping an international perspective, it can harness an already well-established giving structure by embedding the culture of giving and attracting worldwide philanthropists who might not have similar opportunities in their home countries.
3. Technological innovation: the increasing need for practical tech solutions behind greater giving.
The report highlights the growing need for specialist technology that can support philanthropists and social investors through their giving and investment choices. At Maanch, we could not agree more. We believe that the solutions to many problems can be found in democratisation of impact and additional visibility in why, how and where you give. The way we’ve set up M GIVE aligns almost exactly with the report’s pointed recommendations to foster technology platforms that:
- “Provide research and information that supports giving and investment choices
- Help identify opportunities whereby donors can create the most impact (locally, nationally and internationally and by cause area)
- Ensures thorough and compliant due diligence on charities and social investments
- Enables frictionless transactions (domestically and cross-border)
- Supports administration, and financial and tax reporting
- Measures impact”
Beyond traditional philanthropy, technology makes effective giving accessible to a large audience and can be the vector for change in society. Which leads us to our final point:
4. A common language: philanthropy is for everyone who has compassion, not just the wealthy.
At Maanch, one of the great myths that we want to see debunked is who can conduct philanthropy. With a disciplined approach to giving, passion and conviction around where you want to make a difference, and a little bit of time or money to spare; everyone can be a philanthropist. Gone are the days where only the ultra-rich can be held accountable for their philanthropic giving. In fact, some would argue that no matter the amount of money you give away if it is not strategically allocated even large amounts can result in very little overall impact. On the contrary, if we nurture a culture of engaged and transparent giving, we are more likely to reallocate resources where it is most effective and needed. Regardless of wealth, a philanthropist is defined by an attitude: a mindset of compassionate giving and a strategic drive to create impact.
If you are a registered charity in the UK, you can sign up here to fundraise on the Maanch platform.
To donate, visit our 700+ registered charities here.