• Sunday, February 25, 2024
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BusinessDay

Bringing global philanthropy closer to home

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Speaking at the recent Global Philanthropy Forum, Toyin Saraki – founder and president of WellBeing Foundation Africa – articulated her evolving approach to giving.

Whereas her Nigerian parents tended to give indiscriminately to poor people, with religion as the driving motivation, Saraki has embraced a more structured, purpose-driven approach to giving. ‘’I didn’t take it up from the point of giving money,’’ Saraki explained. ‘’I took it up from data. Facts.’’

Saraki’s approach is emblematic of a growing trend of impact-focused investors that are emerging from developing countries, where economic growth is on the rise.

Between 2003 and 2013, developing economies averaged a gross domestic product growth rate of 6.5 percent. This has created a burgeoning middle class, and fueled an interest in philanthropy.

But such growth – while rapid – has not been broad-based. Emerging philanthropists in developing countries are eager to address the unmet needs in their regions. And they are not afraid to speak out.

In a recent interview Jane Wales, president and CEO of the Global Philanthropy Forum, argued that emerging philanthropists are acting more like investors than traditional philanthropists. As a younger, more tech-savvy group closely connected to their communities’ problems, emerging philanthropists are making data-driven investments in both nonprofits and socially-driven small and medium enterprises.

Vox Capital – founded in Brazil in 2008 by three young social entrepreneurs – invests in innovative businesses serving low-income populations.

Vox uses Impact Reporting and Investment Standards and the Global Impact Investment Rating System to measure the impact of its portfolio companies, signaling the organization’s focus on data and metrics.

Many of these emerging philanthropists emphasize the value of sharing the benefits of economic growth more widely. James Mwangi, CEO and managing director of Kenya’s Equity Bank and chairman of the Equity Group Foundation, is focused on driving African development and creating opportunities for prosperity.

For example, the foundation’s financial literacy program, known as Financial Knowledge for Africa, equips women and youth with financial management skills and knowledge. At the end of 2011, over 240,000 trainees had graduated from FiKA.

Emerging philanthropists in the developing world are embracing effective, impact-driven strategies to help their communities address social problems and grow the middle class. The budding philanthropic communities in Africa and Latin America are growing in strength and influence – and they are poised to develop further in the coming years.

(Susan McPherson is a senior vice president at Fenton and regularly speaks and writes on corporate responsibility, social entrepreneurship, international development and social change.)