BEYOND COCA COLA: PHILANTHROPY LEADERSHIP MOVING EAST

1
BEYOND COCA COLA PHILANTHROPY LEADERSHIP MOVING
EAST

• Olga Alexeeva
• Charities Aid Foundation

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WORLD AS WE KNEW IT

• Global markets dominated by US and Western
  European companies
• Eastern and Southern business is just a part of a
  supply chain
• Economic growth associated with the USA
• Domination of US and European brands, trust in
  those brands as symbols of quality of life and
  values
• East and South are seen as recipient countries
  associated with poverty and authoritarian rule

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WORLD THAT WE ARE GETTING TO KNOW

• Emerging of new global players from East and
  South Indians, Chinese, Russians, Brazilians
• 17 economic growth in China, India, 10 in
  Russia economic growth associated with BRIC
  countries
• Third wealthiest man in the world Indian, forth
  Mexican, eighth Russian
• Values and symbols of quality of life revisited,
  national and traditional values, brands, symbols,
  customs are valued and promoted, raise of faith
• East and South are still seen as recipient
  countries, new wealth creation is under valued
  and seen with suspicion rather than with hope

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PHILANTHROPY AS WE KNEW IT

• West to East and South from wealthy individuals
  and Western born multi nationals to beneficiary
  countries in Asia, Latin America, Africa, Eastern
  Europe
• CSR defined, distilled, segregated from private
  philanthropy of shareholders, driven by UK
  Headquarters and US corporate foundations
• Private philanthropy of the wealthy
  predominantly WASP, institutionalized, driven by
  founders values and perspectives of independent
  trustees.
• Independent of opinions and pressure of any
  governments, non-partisan
• USA and the UK mostly grant-making to
  independent NGOs
• Philanthropy that benefits from generous tax
  regime and favourable legal and political
  framework

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PHILANTHROPY THAT WE ARE GETTING TO KNOW

• Eastern and Southern wealthy that give to their
  home countries and, still rarely, beyond
• CSR popular concept but not yet ingrained in
  practice of locally owned companies, seen as
  useful fashion without deep understanding and
  commitment, rarely goes beyond charity
• Borders between corporate giving and private
  philanthropy of owners are blurred, significant
  portion of private giving of the wealthy (up to
  80) is channeled through their mostly privately
  or family owned companies
• Private philanthropy driven by responsibilities,
  emotions, faith, guilt
• Private philanthropy in most of cases
  non-strategic and not institutionalized BUT!
  Pro-active, creative and innovative, as well as
  generous
• Both private and corporate giving easily succinct
  to the state pressure or falls a victim of
  political games
• Clear tendency towards operating programmes vs
  grant-making a wish to leave a legacy in the
  form of established institutions, not foundation
  endowments
• Philanthropy that is booming without or with very
  limited tax benefits in volatile or even hostile
  legal and political environment

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FACTS AND FIGURES

• China 50 Chinese philanthropists donated over
  160 million in 2004. Education and healthcare
  are prime priorities. One 54 year old businessman
  donated 350 million in course of 2003-4
• Russia 20 Russian private and family foundations
  donated over 50 million in 2004. Overall private
  giving by ultra wealthy Russians is over 100
  million/year. Priorities education and culture.
  The largest philanthropic endowment to date is
  450 million
• India 96 of upper and middle classes in India
  give annually for philanthropic purposes. The
  third wealthiest man in the world is now Indian
  Lakshmi Mittal with over 20 billion personal
  wealth, active in philanthropy We are talking
  about billions of dollars in the next 3-5 years.
• Mexico third wealthiest man in the world Carlos
  Slim recently pledged to give one third of his
  33 billion wealth to support charities in Mexico

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DONOR SUPPORT ORGANISATIONS CHALLENGES

• Focus corporate or private?
• Best practice only Western or Western and local?
  Or only local? What to do with philanthro-patriot
  ism?
• Transparency how to be transparent and realistic
  at the same time in given circumstances
• Donor education can we do it, should we do it,
  how to do it? How to educate very wealthy and
  very busy youngsters?
• Donor dialog walls of stereotypes on both sides
  Western Eastern/Southern
• Due diligence should we even talk with new
  wealth?
• Institutionalized philanthropy foundations are
  foundations a universal solution?
• Faith based philanthropy an opportunity or a
  terrorist threat?
• Finally they arent cover our administrative
  costs in the short term.

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DONOR SUPPORT ORGANISATIONS OPPORTUNITIES

• Believe in new wealth
• Build a bridge between new wealth and independent
  non-profit sector in their countries
• Promote separation between private and corporate
  giving
• Donor education learn, learn and learn as
  Lenin requested! Learn together with new donors
• Donor dialog overcome prejudices and stereotypes
• Set a realistic acceptance barrier let them
  desperately want to become our clients and
  members and thus aspire to be transparent
• Help new donors to move from emotion, tradition
  and guilt based philanthropy towards philanthropy
  that is based on values.
• And finally again Believe in new wealth!

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• QUESTIONS?