The Charities Aid Foundation’s (CAF) Future World Giving project has revealed the staggering potential for ordinary people in emerging economies to power a global upsurge in civil society and provide the funds to tackle some of the worlds most pressing problems. However, it has also uncovered global trends which threaten to undermine the capacity of NGOs to speak out on important issues and receive funds from foreign donors.
By raising the profile of this issue through press coverage, op-ed pieces and blogs, and by speaking around the world at prestigious events such as at the United Nations at the Nexus Global Youth Summit and the 2nd Seminar of the Legal Framework for Civil Society Organisations at the invitation of the Presidents office in Brazil, we have helped to ensure that this important topic is being discussed at the highest of levels.
Background to Future World Giving
In December 2012, I sat down with colleagues to discuss how we should take our global policy work forward. With ten offices across six continents that provide a range of financial and advisory services for NGOs and companies, large or small and donors, from the very wealthy to ordinary generous people, we recognised that we occupy a unique position to talk about the global environment for charitable giving.
We agreed that whilst the World Giving Index -an annual study of the proportion of people in each country who give money to charitable causes, volunteer time or help a stranger – has helped to start a global conversation about giving. By allowing a comparison of how often we are generous with our time and money, it has initiated debate online, in the chambers of government and over coffee tables the world over. However, the WGI leaves many people with more questions than it answers. The principle questions that we agreed we would like to tackle going forward were;
- What would the world be like if we could bring engagement in giving up to the levels of more generous nations in emerging economies?
- Why is it that even accounting for economic differences, some countries score higher in the WGI?
- What policies could to create an enabling environment for mass engagement in giving?
- What are the barriers to the future growth of middle class giving?
Unlocking the Potential of Global Philanthropy
In attempting to answer some of these questions we developed the Future World Giving project. In February 2013 we published a concept for paper for the project, “Unlocking the Potential of Global Philanthropy” which detailed the context for our studies and the enormous stakes for the world in addressing the need to create an enabling environment for mass charitable giving. It asserted that although philanthropists and NGOs have rightly been quick to see the immediate potential encouraging the emerging super-rich in fast growing economies in the global South to give – think of the Giving Pledge – we have been slower to see the potential for mass giving in these future economic centres.
OECD projections estimate that the number of middle class people will grow by 161% by 2030 with their spending power increasing by 161% over the same period. If this new aspirant middle class were to give in line with the average UK household – about 0.4% of their income – this could generate an astonishing US$224 billion a year in charitable funds. To put that figure in perspective, it is more than the GDP of the Republic of Ireland and significantly more than the $135 and $195 billion a year that Geoffrey Sachs once estimated would be needed to eradicate extreme poverty.
Building Trust in Charitable Giving
In January of 2014 we published a report called “Building Trust in Charitable Giving” which looked at what governments can do to ensure that NGOs are well regulated, afforded status but are not over burdened by legal requirements. We found that regressive policy towards NGOs and an atmosphere of suspicion among governments across the world risks undermining public trust and threaten to stifle the growth of charitable giving. We made a number of recommendations including that governments should;
- Ensure that everyone is legally entitled to register a charity without discrimination.
- Reduce red tape for smaller not-for-profits whilst maintaining regulatory focus on larger organisations
- Allow not-for-profits to access foreign funds and engage in international association without discrimination
Enabling an Independent Not-for-profit Sector
In May of 2014 we published our third Future World Giving report entitled “Enabling an Independent Not-for-profit Sector” which attempted to assess to what extent NGOs (and donors) need to be free to speak out on issues and manage their resources as they see fit in order for a vibrant civil society and a culture of generosity to thrive. We found that the independence of NGOs was at risk due to the hostile rhetoric and regressive policies of governments around the world and highlighted some extremely concerning trends for governments limit access to foreign funding and more generally for new laws which undermine the voice of NGOs. As well as issuing a number of recommendations the report introduced some basic principles including;
- Governments should allow not-for-profits to criticise and influence policy in order to improve standards and promote public debate.
- Not for profit organisations need freedom to manage their resources in the way which best achieves their stated mission.
- Governments should foster a strong and independent civil society to benefit both the state and society as a whole.
The Future World Giving project has had extensive media coverage with articles in the New Statesman, The Guardian and the Stanford Social Innovation Review to name but a few. Our reports have been referenced widely including in a UNDP report on “Philanthropy as an Emerging Contributor to Development Cooperation” The Future World Giving blogsite has been viewed in 129 countries since its launch in August 2013 and enables us to tackle in depth some of the issues that we were unable to include in our reports.
In addition, the Future World Giving project has taken CAF to new and exciting audiences. I have spoken at the Nexus Global Youth Summit in New York, at the United Nations at the Nexus Global Youth Summit and the 2nd Seminar of the Legal Framework for Civil Society Organisations at the invitation of the Presidents office in Brazil, at international academic events such as Charity, Philanthropy and Development, organised by the University of Sussex and other events across Europe. Next month I will be speaking at the Global Citizen Forum in Toronto, Canada.
NEXT: exploring the effectiveness of tax incentives and exemptions
The next phase of the project promises to be the most exciting and high profile yet. In October 2014 we will be publishing a report with Nexus Global Youth Summit and McDermott Will & Emery that puts the findings of research into the basic legal and tax infrastructure for NGOs and giving 193 nations into a scored index. In addition, we are working with pro-bono legal experts through the Thomson Reuter TrusLaw Connect programme to produce a detailed Future World Giving report into tax incentives in which we will look at 30 large economies and assess the efficacy of different policies on incentives for giving.
Thank you for all of your kind words of encouragement and the help that you have given me in getting this project off the ground and stay tuned for our next reports on tax incentives in the coming months.