As part of our series on Philanthropy in Asia, we sat down with Jenny Santi, a philanthropy advisor to ultra high net worth philanthropists, including an Oscar-winning actress and signatories of the Buffet-Gates Giving Pledge. At 28, she became the head of UBS’s award-winning Philanthropy Services department in Southeast Asia. In 2011, she conceptualized and led UBS-INSEAD’s study on Asian family philanthropy, the most comprehensive report of its time. She is also the author of “The Giving Way to Happiness: True Stories and Science Behind the Transformative Power of Giving” coming soon from Penguin Random House. In our Q&A, she discusses broad trends she is seeing in Asia philanthropy, especially in family giving.
What are some of the interesting trends you’ve seen in family philanthropy in Asia?
- Greater exchange of ideas among philanthropists. Collaboration among philanthropists is taking place – not quite yet on the ground– but at least in the ideological sense. Over the last few years there have been a great number of conferences, meetings, and networking events convening philanthropists in Asia. There is a greater willingness among them to meet with other families and individuals in the social sector, such as academics, nonprofit leaders, social entrepreneurs, and other wealthy families and individuals. Most of these gatherings are organized by private banks, academic institutions, and non-governmental organizations, but there is evidence of philanthropists self-organizing as well, particularly among the younger generation. This month in Singapore we just held the Philanthropy in Asia Summit 2014, an event that aims to form a vibrant, well-connected, and collaborative community of philanthropic leaders in the region.
- Philanthropy becoming more public. Accompanying the greater exchange of ideas is the trend towards more public giving. Many major philanthropists in Asia still prefer to maintain the confidentiality of their activities, mainly due to strong cultural and religious dispositions, as well as their concerns regarding unwarranted governmental or media scrutiny. However, a number of philanthropists realized that they themselves got started on their giving journey after having heard or read about another individual’s or family’s philanthropic acts. They then realized that being more public about their giving increases the chances that other people will be compelled to do the same. For instance, a Singaporean real estate tycoon with whom I have worked once told me that the reason he decided to formalize and be public about his giving was because he was inspired by Bill Gates – and that had Gates been private about his giving, wealthy Singaporeans would not have learned from his example.
- Combining business approaches with traditional philanthropy. A number of Asian families are combining traditional philanthropy with investments in for-profit businesses that can directly benefit the lower income segments in Asia. These include investments in basic services and infrastructure that governments have not been able to provide, such as socialized housing, the water sector, education, health care and microfinance.For example, the Ayala Corporation, one of the oldest and largest conglomerates in the Philippines, combines philanthropy and business to address bottom of the pyramid problems by investing in microfinance, healthcare and education. These have been game changers for people with little or no access to services. Another example is Cipla, a socially conscious, multi-billion dollar generic pharmaceuticals company led by Yusuf Hamied. He and his company made high-quality HIV-AIDS antiretroviral medicines cheap enough so that poor people in developing countries, especially in Africa, can access them. Treatment used to cost US US$12,000-US$15,000 per patient per year. Cipla brought it down to about US$350 a patient a year. Hamied saved millions of people by providing affordable – not free – medicines.
- The next generation becoming a catalyst for change. Asia 30 years ago is vastly different from what it is now. The economic transformation of the region, particularly in countries such as Singapore and China, has been exceptionally rapid. Within Asian families, successive generations have vastly differing experiences in terms of their exposure to war and political upheaval, economic deprivation, the impact of the West, the globalization of business, and the shifting balance of tradition and modernity. The younger generations are more influenced by Western trends and practices, and are leading the ideological shifts within their rather traditional family philanthropies.
How do you think it differs from family giving in the U.S.?
Family philanthropy is just as much an Eastern practice as it is Western. The philanthropic impulse is a universal human trait and families in Asia, just like their peers across the globe, have similar motivations to give.
One major difference is that family philanthropy in Asia is far less professionalized than it is in the USA. Take for example the matter of administrative costs among Asian family philanthropies. These costs generally appear to be under control, and statistics indicating low admin costs in family foundations in Asia seem, on the surface, quite impressive. However, the relatively low admin costs of Asian family philanthropies do not necessarily indicate that they are operationally effective and efficient; instead they have under-invested in professionalization. Many Asian family foundations are run by company employees who have other full-time jobs; and many more Asian philanthropists expect their foundations to be purely volunteer-run. A view that funds should not be spent on admin is understandable and positive in many ways; however the failure to invest adequate funds in these areas is a risk factor that may lead to suboptimal grant allocations, uneducated and informal rather than systematic decision making processes, and disruptions when leaders leave, retire or pass away.
What challenges do families that seek to have social impact face?
The size of the problems in Asia is enormous. Despite the so-called “Asian miracle’ that has become the predominant narrative in socioeconomic and political analyses of the continent in recent years, practically all Asian countries today still face vast income disparities, persistent poverty, corruption, religious conflict, and environmental degradation.
Amidst these challenges, families want to see scale and impact. The main challenge for many individuals and families is how to give in a more focused and strategic way so that the donations can have a more meaningful impact. But there are limits to this. So some families see the ‘for profit model’ with services catering to the poor as more sustainable.
With regards to the landscape of structured family philanthropy, the need for greater professionalization of the sector is the most commonly voiced refrain among philanthropists in Asia. The passion to make a difference is there, but the know-how and the training isn’t always. The professionalization of the sector is still largely ahead of us. The good thing is that families are becoming more open-minded, willing to learn, and collaborative in their approach.
What does the future look like for family philanthropy in the region? What’s next for the sector?
- Family foundations will become more and more of a status symbol. The enormous increase in affluence in Asia is providing far greater opportunities for giving. There will be greater pressure on, as well as greater desire within, wealthy families to give as much money away as they spend. Philanthropy will be more and more important to the wealthy, and will even be a status symbol. There are signs that it already is.
- Celebrity philanthropy will emerge. As wealthy families become more and more public about their philanthropy, they themselves will become “celebrities” by virtue of their big-ticket giving. At the same time, they will enlist notable personalities from the world of entertainment, politics and sports to draw greater attention to their cause. In India, for example, celebrities such as Amitabh Bachchan have played a crucial role in eradicating polio through public service campaigns. Ultra high net worth families and individuals will realize that partnering with well-loved celebrities multiplies social innovation and impact.
- Philanthropists will take on more controversial issues.Right now most philanthropy in Asia is directed toward the improvement of education and healthcare, and the broad goal of poverty alleviation. These issues are hardly controversial; everyone is in agreement that these are important matters to address. In the near future, I can see that Asian philanthropists will be bolder and riskier. Some of the causes they back may be contentious and polarizing, but they will back them anyway. It is already happening in the USA. For example, Giving Pledge signatory Peter B Lewis funds much of the movement to enact laws that give patients access to marijuana as relief for pain and nausea, and he has made no secret of being one of those patients himself, using marijuana to help with pain following the amputation of his leg. The Lien Foundation, one of the leading foundations in Singapore, prides itself in its radical approach. Its “Happy Coffins” initiative overturns the stigma of death and turns the coffin from a symbol of fear, dread and grief into a positive and life-affirming expression of art.I would like to see Asian philanthropists embrace more provocative causes just as the Lien Foundation does. My dream is to work with a philanthropist with the commitment and audacity to back controversial, underfunded causes such as mental illness, gay rights, or sex education.