Philanthropists expect too much too quickly, report says

This is a problem.

Wealthy philanthropists are ambitious and want to see changes in government policies soon after they have made a donation, but their efforts are still too fragmented and often fail to have a great impact, a new study has found.

Entitled Alleviating Global Poverty: Catalysts of Change, the research by Forbes Insights was based on a survey of more than 300 wealthy individuals, with investible assets of at least $1 million.

It found that 73 per cent of respondents said they want to affect international and national government policies in a short time.

Interestingly, while 48 per cent admitted there were too many overlapping charities working in the same sector, only 20 per cent said they partner with experts in the field to realise their philanthropic goals.

‘There are two crushing weaknesses with the philanthropic model today,’ said Harvard Business School professor Michael Porter in the report. ‘There is not enough money to give away. And there is too much fragmentation and not enough large-scale impact. That is why we haven’t gotten a lot of great results yet.’

The study also found that philanthropists from different regions of the world disagreed on the main causes of poverty. North and South Americans, in fact, pointed to the lack of access to education, while Europeans focused on the lack of access to healthcare and respondents from Asia-Pacific emphasised on the scarcity of food and shelter.

According to the report, local causes were a priority among philanthropists, with a third of respondents saying only 10 per cent of their donations go on global causes. This was because they felt a need to give back to their own community and because they understood the local context better, but also because they thought local giving often makes an immediate difference.

This is similar to what Simon Thurley, the CEO of English Heritage, has been recently campaigning for in the UK, as he told Spear's. He called for the country’s wealthy to financially support many of the national historic buildings that will not receive any government funding for repairs and enhancement works, as part of the austerity measures.

However, the wealthiest respondents had a strong focus on global giving, which normally requires more resources. Forty per cent of those with a net worth of at least $50 million said they focused on such issues. Think of Bill Gates, who set up the Bill and Melinda Gates Foundation to eradicate malaria and polio worldwide.

Children’s education was the respondents’ preferred cause, chosen by 38 per cent, followed by children’s health (37 per cent), nutrition and food supply (33 per cent) and pre-school education (31 per cent). However, a third of philanthropists said family planning and contraception should be the top priority in the next five years, while 31 per cent chose the sustainable management of resources such as water and land.

When they have to choose what programmes to fund on, 45 per cent said they looked at the idea or at the premise of the initiative, while 23 per cent said they paid particular attention to the organisation behind the project. Interestingly, only 32 per cent cited the leader in charge of the programme as the most important factor – the report suggested that this was because wealthy individuals often have the ability to influence the choice of leader.

As for the future, nearly one in five philanthropists plans to give away more than half of their wealth. Thirty-one per cent of those with more than $10m in assets and 46 per cent of those with more than $50m plan to do so. They will join the likes of billionaires such as Gates, Warren Buffett, Richard Branson, Michael Bloomberg and Azim Premji, who signed up for the Giving Pledge initiative, committing at least half of their wealth to charity organisation after their death.

Read more from Giulia Cambieri

This piece first appeared on Spear's Magazine

Bono. Photograph: Getty Images

This is a story from the team at Spears magazine.

Getty
Show Hide image

Leader: The divisions within Labour

Labour’s divisions have rendered it unfit for government at a moment of profound political change.

Labour is a party torn between its parliamentary and activist wings. Since Jeremy Corbyn, who this week appealed desperately for unity, was re-elected by a landslide last September, Labour has become the first opposition in 35 years to lose a ­by-election to the governing party and has continually trailed the Conservatives by a double-digit margin. Yet polling suggests that, were Mr Corbyn’s leadership challenged again, he would win by a comfortable margin. Meanwhile, many of the party’s most gifted and experienced MPs refuse to serve on the front bench. In 2015 Mr Corbyn made the leadership ballot only with the aid of political opponents such as Margaret Beckett and Frank Field. Of the 36 MPs who nominated him, just 15 went on to vote for him.

Having hugely underestimated the strength of the Labour left once, the Parliamentary Labour Party (PLP) will not do so again. In the contest that will follow Mr Corbyn’s eventual departure, the centrists could lock out potential successors such as the shadow business secretary, Rebecca Long-Bailey. Under Labour’s current rules, candidates require support from at least 15 per cent of the party’s MPs and MEPs.

This conundrum explains the attempt by Mr Corbyn’s supporters to reduce the threshold to 5 per cent. The “McDonnell amendment” (named after the shadow chancellor, who failed to make the ballot in 2007 and 2010) is being championed by the Bennite Campaign for Labour Party Democracy and Jon Lansman of Momentum, who is interviewed by Tanya Gold on page 34. “For 20 years the left was denied a voice,” he tweeted to the party’s deputy leader, Tom Watson, on 19 March. “We will deny a voice to no one. We face big challenges, and we need our mass membership to win again.”

The passage of the amendment at this year’s Labour conference would aid Mr Lansman’s decades-long quest to bring the party under the full control of activists. MPs have already lost the third of the vote they held under the electoral college system. They face losing what little influence they retain.

No Labour leader has received less support from his MPs than Mr Corbyn. However, the amendment would enable the election of an even more unpopular figure. For this reason, it should be resolutely opposed. One should respect the motivation of the members and activists, yet Labour must remain a party capable of appealing to a majority of people, a party that is capable of winning elections.

Since it was founded, Labour has been an explicitly parliamentary party. As Clause One of its constitution states: “[The party’s] purpose is to organise and maintain in Parliament and in the country a political Labour Party.” The absurdity of a leader opposed by as much as 95 per cent of his own MPs is incompatible with this mission. Those who do not enjoy the backing of their parliamentary colleagues will struggle to persuade the voters that they deserve their support.

Labour’s divisions have rendered it unfit for government at a moment of profound political change. Rather than formalising this split, the party needs to overcome it – or prepare for one of the greatest defeats in its history.

This article first appeared in the 23 March 2017 issue of the New Statesman, Trump's permanent revolution