What is the Ice Bucket Challenge? And is it a good thing? A quick guide

Alliance magazine

Alliance magazine

According to Wikipedia – yes, it’s already in there! – ‘the Ice Bucket Challenge, sometimes called the ALS Ice Bucket Challenge, is an activity involving dumping a bucket of ice water on one’s head or donating to the ALS Association in the United States. It went viral throughout social media during the Northern Hemisphere summer of 2014.’

The challenge has been highly successful in fundraising terms. As of 18 September, the ALS Association had raised $15.6 million since 29 July – compared to $1.8 million in the same period last year.

There have already been many articles written weighing up whether it’s a good or a bad thing. Both the Nonprofit Quarterly and the Chronicle of Philanthropy provide summaries of some of these. One obvious criticism is that the whole thing trivializes charitable giving – and of course ALS, which stands for amyotrophic lateral sclerosis, a form of motor neurone disease. Another is that it seems to suggest that donating to pouring a bucket of ice-cold water might be better than donating to charity.

British charity Macmillan Cancer Support already has different rules, which get round this particular difficulty by asking people to pour ice-cold water on their heads and donate to charity (which it is of course hoped that people will do anyway). ‘Just challenge someone via Facebook or Twitter to have a bucket of ice-cold water poured over their head in exchange for a text donation to Macmillan.’

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Who’s missing from the Aspen Philanthropy Group 2014 roster?

Alliance magazine

Alliance magazine

Can This Crew of Aspen Institute Big Shots Show the Way on Philanthropy?’ This is the question posed by David Callahan, writing on the Inside Philanthropy blog.

‘Aspen has never had much difficulty rounding up high-level folks for its working groups,’ he reports, ‘and the 2014 roster of the Aspen Philanthropy Group, which just met last week, is a case in point. It includes the chiefs of the following foundations: Carnegie, Gates, Goldman Sachs, Heron, Hewlett, Intel, Irvine, Kaufmann, MacArthur, MasterCard, Margaret Cargill Philanthropies, New Orleans Foundation, Packard,  OSF, Rockefeller, and the Rockefeller Brothers Fund.

‘A few non-foundation folks are also in the mix, representing Bridgespan, the Foundation Center, FSG, and the Philanthropy Roundtable.

‘So: Who’s missing from this group which bills itself as “a small gathering of leaders in philanthropy and civil society who are at the cutting edge of social change?”

‘I guess the answer depends on how you define “cutting edge.” But it seems that nearly any definition would encompass a range of players in philanthropy who aren’t part of the Aspen group.’

Click here to read more and find out who’s missing>

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Now free to read – Interview with Robert Rubinstein

Robert Rubinstein

First published 01 April  2014, by Alliance magazine.

In trying to get the business community to participate in an economy which takes into account people and the environment, not just profit, Robert Rubinstein, founder of  TBLI (Triple Bottom Line Investing), doesn’t put his faith in the sector’s idealism but in investors’ greed and the ability to inflict ‘excruciating pain’ on business. He explains to Caroline Hartnell how and why this works. He is optimistic about more money flowing into impact investing, as defined by TBLI, but not that hopeful that it will be in time for climate change mitigation. ‘Get your wellies out,’ he advises.

You founded TBLI in 1998. What did you hope to achieve?
I wanted to create an economy based on well-being by engaging with the business sector. I realized that to do that, the business sector has to buy into it, and they will only buy into it if they feel excruciating pain. I concluded they had three pain buttons: finance, personnel and reputation.

First, I looked at personnel. I tried teaching MBA students about sustainable finance, but most of the students were only worried about defaulting on their student loans. They didn’t follow their hearts and went to work for companies that didn’t share their values.

So then I looked at finance. I decided to focus on the financial sector. I worked out that the top hundred or so owners or managers in 1998 had direct or indirect control of 30-40 per cent of the money. So I hit on the idea of trying to convince those hundred CIOs [chief investment officers] through a conference. It sounds rather naive but it does work: if you show the financial sector over and over again the self-interest, opportunity and money flows in sustainable business, it’s not hard to change behaviour.

The hard part is access. I call it the Shawshank Redemption approach – that’s the prison movie where, after 15 years of chipping away at a wall, the guy broke through but no one knew about it. That’s what this work is, it’s chipping away over and over again, there’s no big ribbon-cutting ceremony. We’ve seen massive money flows and very large deals done at the TBLI Conference, so I know we’ve had an influence on the behaviour of the financial sector, and now I would like to scale up dramatically.

So what is the pain that you’re making them feel?
If people don’t want to invest in you or work for you because of your lack of interest in sustainability, which is what happened to Shell in Nigeria and over Brent Spar, it’s a very painful thing. Look at Dow Chemical, which is now seen as the superstar sustainable chemical company. What were its best-known products in the sixties? Napalm, Agent Orange, defoliants. How did they get from there to here – because during the Vietnam War many students didn’t want to work for them, and if you’re a big company and the best and the brightest don’t want to work for you, you have a problem. We’re focusing on the financial sector, showing them that it’s in their interest to look at what they call extra-financial issues: climate change, waste, energy, resource use, human resources management. All of these things ultimately produce better returns with a reduced risk, and if you ask anybody – even cocaine traffickers, criminals – do you want a financial return with a social and environmental added value, it’s pretty hard to find somebody who says no.

But you cannot push the moral imperative to someone who has a target if the two things are in conflict. You have to show that their self-interest aligns with the social and environmental added value. If the financial sector sees money flows going in a certain direction, they’re likely to follow.

I remember when I started, people would ask for research to show that ESG [environmental, social, governance] investing doesn’t underperform and that, at its best, it can outperform. So I stupidly sent out hundreds and hundreds of research papers before I had my ‘aha’ moment: I realized that it wasn’t about proof, it was about belief. How many investors read the research on the risk associated with sub-prime collateralized debt obligations that created the financial meltdowns? Almost nobody. How much money went into it? Everything, because people believed that this was the new way of endlessly making money.

Since the financial meltdown, are you finding finance companies more willing to listen?
Yes, but not as much as I’d like them to.

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My takeaways from the China Charity Forum

Bin Pei

Bin Pei

The China Charity Forum, entitled Open a Philanthropy Era’, was convened in Beijing from 16 to 17 August with participants from across China and from other countries. The two-day forum consists of discussions and a field visit to Lao Niu Foundation. This is the first international forum organized by the China Charity Alliance since its formation a year ago. Below are my main takeaways from the forum.

The potential of philanthropy high in China

Private foundations have increased by more than 50 per cent from five years ago. China ranks as the second largest economy in the world, with over 200 billionaires, and with more than 67,000 people with assets of over RMB 100 million Yuan (over US$16 million). Everyone believes philanthropy in China will show a boost.

Legislation yet to be prioritized

From high-ranking officials such as the Minister of Civil Affairs and the legislator from National People’s Congress, Dr Zheng Gongcheng, to philanthropists such as Wang Jianlin and Lu Dezhi, there is consistent advocacy for prioritization of legislation to protect the legal status of philanthropy and to incentivize philanthropic activities in order to unleash the potential of philanthropy in China. According to an insider from the government, there is a wide disparity of perspectives around charity law legislation, and a consensus has yet to be formed.

Challenges of doing philanthropy highlighted

Mr Ma Weihua (former governor of China Merchants Bank and now chairman of the board of One Foundation) shared as one of the plenary speakers: ‘It is more difficult to do philanthropy than to do business in China, with little social recognition.’ This was his experience as he made the transition from a banker to a philanthropist. Although Mr Ma talked a lot about philanthropy during the National People’s Congress in March 2014, media reporters seemed more interested in banking and finance than in philanthropy. Philanthropy in China is still in an early stage of development, though the potential is great.

Private sector contribution to global development emphasized

The original aim of the forum was to discuss trends in global philanthropy. As a result, most of the discussion was focused on how Chinese philanthropists and foundations can learn from international best practices as they go global. According to Christophe Buhuet, China Country Director of UNDP China Representative Office, the private sector contribution globally is over five times larger than that of the public sector (with the OECD total contribution to global development in 2013 at US$135 billion from the public sector vs US$577 billion from the private sector, including US$59 billion from private philanthropy). Private philanthropy doesn’t just fill gaps in funding; it also contributes insights and innovations. It has yet to explore, however, how to leverage social and technology innovations and private-public partnerships to promote human development globally and locally.

Sharing of best practices on how to internationalize philanthropy in China

A dedicated breakout session focused on global collaboration in philanthropy. Despite a large economy, China is an emerging country at a learning stage in philanthropy development. Experts from the US, UK, Taiwan and Hong Kong, among others, shared best practices and innovations as Chinese philanthropy learns to go global. Currently the ecosystem of philanthropy tends to be government-driven, with much room to improve in the national strategic plan and legal framework governing philanthropy and charities, as well as in increasing self-governance, transparency and capacity of charities.

Bin Pei is a senior program officer, Bill and Melinda Gates Foundation.

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Realistic strategies for complex circumstances: a response to ‘Strategic Philanthropy for a Complex World’

Jasna slika

Jasna slika

This is the last in our series of responses by contributors to the March issue of Alliance to John Kania, Mark Kramer and Patty Russell’s ‘Strategic Philanthropy for a Complex World’. We published these articles throughout last week – starting with Kathleen Cravero’s on Tuesday, Avila Kilmurray’s on Wednesday, Ambika Satkunanathan’s on Thursday and Rana Kotan’s on Friday. Tomorrow we will publish an article drawing all the threads together.

I was not aware of these debates, but the issue very much resonates with the work of the community foundation in Bosnia and Herzegovina because of the complexity of the problems we face every day in our transitional, post-war, politically and economically torn society.

As Kania, Kramer and Russell say, foundations (and I add especially community foundations) are better suited than other NGOs to make progress against complex social problems, because they work on a long-term basis, isolated from political and other pressures.

We have invested a lot of efforts to become strategic in our activities and grantmaking but it seems that our strategies were always realistic about complex circumstances, insecure living conditions, multiple problems within the legal system, post-war damages, the social problems of economic development, closed factories and private businesses, etc.

In such environments, it is hard to measure outcomes if the strategies are too rigid and focus on one or two problems and agendas. I very much like Henry Mintzberg’s scheme of emergent strategy into which we fit completely, as a community foundation that is deeply rooted into local circumstances. Having in mind all the complex problems within Bosnia and Herzegovina society, we were aware from the beginning that we cannot make accurate predictions about the expected results of our interventions in the community.

We have always worked strategically – but as in Mintzerg’s scheme we had an ‘intendant’strategy that had to emerge over time and be shaped up to the changing reality (for instance, improving the quality of life in the Tuzla region by encouraging vulnerable groups such as youth and women and the unemployed in rural areas to participate in community life, convene people to press for better policies and public services, and encouraging local people to invest in their community and civil society).

There have been so many events and changes in Bosnia and Herzegovina in the last 10 years (like electoral changes, demonstrations against government at all levels, horrible floods, changes in the law unfavourable to non-profits and philanthropy development, etc) that have made us abandon or adapt parts of our strategy. This might be because of actions taken by government or other organizations or because our aims could not be realized because of political circumstances. In these circumstances we had to adapt the time-frame or completely abandon certain strategies or evolve them to meet the changed circumstances.

The debates will not change our approach because I think that we have

all elements that are needed for measuring the impact of our work (which perfectly fits with both strategic and emergent philanthropy theories): we have clear goals; we do research; we approach problems in a strategic way, involving many stakeholders in problem-solving activities; we do evaluations and learn from the results. We expect our grantees to work in the same way.

Jasna Jašarević is executive director of Tuzla Community Foundation, Bosnia and Herzegovina.

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