What is needed are more professional advisers who specialise in charity management, on the one hand, and more information about them in the public domain, on the other.
A few weeks ago, a friend from America rang up to seek my advice on how to go about giving away approximately ₹100 crore to create a Booker-type of prize for a literary book in Hindi. Being 90 years old, he wanted someone who can take the entire responsibility for setting up and administering the endowment.
If our philanthropy is to grow and play an effective role in bringing about the needed social change, we need more infrastructure for philanthropy. (Shutterstock)
I have been working in the field of research and promotion of philanthropy for the last 30 years or so, and yet, I was stumped about where to point him. Unfortunately, in the field of philanthropy in India, there are hardly any intermediary organisations that keep such information or can offer such advice. There are some wealth managers, lawyers, and chartered accountants who specialise in managing charitable donations and endowments, but there is no directory or listing of such professionals, a gap that perhaps some philanthropy intermediary organisations can fill.
The need for such professionals will undoubtedly go up in the near future. In spite of the pandemic, the number of high net-worth individuals (HNWI) has gone up and philanthropy in India continues to grow.
According to Bain and Co’s Annual Philanthropy Report, about 20% of private sector philanthropic funding totalling about ₹64,000 crore (about 23% more than in the fiscal year 2019 — ₹52,000 crore) comes from family philanthropy. Edelweiss’ The Family Wealth Report 2018 shows a similar picture. India has nearly 150,000 ultra high-net-worth families holding a cumulative net worth of about ₹140 lakh crore. This cohort is expected to grow to 400,000 families with a net worth of almost ₹360 lakh crore by 2025.
Not all of them know what they want to do with that money philanthropically, or how to go about it. Nor do all have legal advisers for this purpose, who are knowledgeable about the social sector and where the gaps are where their money would make the maximum impact.
The problem is even more acute when it comes to the Indian diaspora, for there is the added complication of the Foreign Contributions Act, if they are foreign citizens.
On the other side, there are thousands of non-governmental organisations (NGOs) and socially-minded individuals who desperately need money to actualise their visions for social change.
Therefore, what is needed are more professional advisers such as lawyers, wealth managers, and chartered accountants who specialise in charity management, on the one hand, and more information about them in the public domain, on the other. This is where intermediary organisations in the philanthropy field can play a valuable role. They could be the first port of call when one wants information of the sort mentioned above.
At the moment, there are very few such organisations in India, largely because there is very little funding available for such organisations. Donors don’t seem to understand the need for organisations of this type.
They would much rather give their money for schools, public health projects or something where they can have their name attached to the donation. It needs some farsighted donors who understand the role that philanthropy plays in a society, in partnership with the government, and as a counterweight to the government.
If our philanthropy is to grow and play an effective role in bringing about the needed social change, we need more infrastructure for philanthropy such as professional advisers specialising in philanthropy, intermediary organisations and more research and advocacy centres. Is this too much to wish for?
Pushpa Sundar is a scholar of Indian philanthropy, civil society, and development, and has several books to her credit
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