Carnegie Reporter, Vol. 4, No. 3 | International Philanthropy: Strategies for Change, page 5

Arango worries that Mexico’s younger generation isn’t thinking about philanthropy either, unlike their colleagues in other countries. “Right now, the young here are busy trying to make money,” he says. “We have to change that culture and say that this is part of your life at any age. A street kid can be a philanthropist if he shares the corner of his street. Philanthropy is money and talent and time.”

Yet Arango is convinced “it will happen eventually.” Perhaps that’s why he and others threw down the gauntlet recently, when more than 600 participants from Latin America, plus Spain and Portugal, met in Mexico City—under the auspices of CEMEFI—to discuss civil society and philanthropy. Noting that the big international foundations had turned their attention to Africa and Asia, they challenged their wealthy individuals and corporations to pick up the slack. “Clearly, it is up to the inhabitants of the region to take on an equal share of responsibility,” their statement said.

South African Hylton Appelbaum might have said the same thing. There is a lot of talk about philanthropy in his country, he says. And there is serious spending on development. But much of it is really social spending of corporations made in response to “policy imperatives.”

As the son-in-law of Donald Gordon, who founded what is today South Africa’s largest private foundation in 1971, Appelbaum oversees the David Gordon Foundation as well as The Liberty Foundation and The Liberty Educational Foundation, which are arms of Gordon’s financial empire, Liberty International. (They are pass-through foundations, lacking endowments, and generally donate about 1 percent of after-tax profits; Appelbaum says most South African companies allot 0.5 percent to 1.5 percent of their profits to social spending.)

“The fall of the Berlin Wall is seen as a defining moment in the development of civil society, which is largely dependent on philanthropy. Civil society has since moved from buzzword to broad acceptance.”
— Rob Buchanan, Council on Foundations.

With its legacy of apartheid, exchange controls, embargoes, and ethnic enclaves, South Africa is a very complicated place. Its Jews, Afrikaners, Chinese, Greeks, and other groups have all traditionally supported schools and socials service organizations within their own communities, but not beyond. Some 15 years after reformers began to dismantle apartheid, social stratification remains rigid. As for competitive philanthropy, it doesn’t exist. “More likely here,” Appelbaum says, “if we have given X million rand, other people here would say ‘good, we don’t have to give now.’” The government allows tax deductions for contributions, but only up to a small portion of personal income— in part so that it can control spending on social goals.

Appelbaum won’t disclose the Gordon Foundation’s assets, but says it has given away about $14 million a year for the last six years. Its most far-reaching initiatives are both attempts to stem the country’s brain drain and improve the training of its professional class. With $15 million in funding, it founded the Gordon Medical Centre, in partnership with the University of the Witwatersrand. And with a gift of about $8 million, it opened the Gordon Institute of Business Science in Johannesburg, part of the University of Pretoria, in 2000.

Appelbaum says that a few other white South African families—the Ackermans, the Oppenheimers, the Ruperts—have traditionally been philanthropic, though much of their giving has been private. He cites Allan Gray, who also founded a financial empire, as a more recent addition to the list.

But as elsewhere when a lid has suddenly been lifted on a country, some efforts to finance scholarships, businesses, and community-based organizations were beset with accountability problems. As a result, some givers pulled back from cash gifts, switched to giving goods or services, and stepped up auditing. Others probably retrenched, though it’s hard to tell since giving is so private.

Now, there’s a new generation of rich, and they are different. Thanks to Black Economic Empowerment (BEE) policies, which involve the transfer of assets from whites to blacks, and privatization of government-controlled businesses, there’s a growing cadre of rich blacks. The money may be too new for them to be comfortable giving it away already. But at least two rand billionaires, Tokyo Sexwale and Patrice Motsepe, have joined Peggy Dulany’s Global Philanthropists Circle, starting down the road.

Shelagh Gastrow, chief executive of the South African Institute for Advancement (SAIA), is far more positive about prospects than Appelbaum. “We want to actually create a movement of philanthropy in the country and make people aware of the necessity to invest in our own society,” she said in a recent television interview. She plans to help show the way. Steeped in the history of philanthropy abroad, the annual report of SAIA (also known as Inyathelo) not only cites Carnegie, Ford, and Rockefeller as inspiration for strategic philanthropy, but also the Leverhulme, Nuffield, Van Leer, and Robert Bosch foundations in Europe. Gastrow, not satisfied with simply developing the culture in South Africa, has taken her gospel and shared her expertise in raising money with non-profits with institutions in Nigeria and Mozambique.

“It is having an impact,” Appelbaum says. “I haven’t seen any new foundations, but it is helping to create an environment conducive to giving.”

That is the key everywhere. As various reports from around the world demonstrate, philanthropy is growing, but only a small fraction of available wealth is being given away—and by only a fraction of the wealthy. Much more could develop—and it’s likely to. “The big thing that will change as wealth grows is that philanthropy will become more prevalent,” Tom Hunter says, “You get fulfilled, and when they realize that, more people will try it.” He’s in a great position to know.

Judith H. Dobrzynski, a former a senior editor at The New York Times, Business Week, and CNBC, is a writer based in New York.