Chapter 2. Foundations as funders

According to the results of the OECD survey (data questionnaire) foundations gave USD 23.9 billion for development in 2013-15.

While these contributions remain relatively modest compared to ODA (5% of the three-year total) and financing for development more broadly, foundations were major partners in some specific areas such as the health and reproductive health sectors (foundations’ support was the third-largest source of financing for developing countries). In general, over the period surveyed, health was the main sector targeted by philanthropic giving – far ahead of the other sectors – with 53% of the total in 2013-15 (or USD 12.6 billion).

This chapter examines the data collected through the survey questionnaire and provides an in-depth analysis of private philanthropy distribution by recipient, income group and sector. It also describes the main modalities of giving used by the philanthropic foundations, in particular the institutions through which they channel most of their funding.

2.1. Analysis of philanthropic flows

2.1.1. Philanthropy for development amounted to USD 23.9 billion over 2013-15

According to the OECD survey on private philanthropy for development, foundations provided USD 23.9 billion for development over 2013-15, i.e. USD 7.96 billion per year on average (Figure 2.1). Philanthropic giving remains relatively small compared to official development assistance (ODA) and financing for development more broadly. However, these foundations have already become major partners in some specific key areas. In the health sector, for example, total philanthropic giving came third, just after contributions from the United States and the Global Fund to Fight AIDS, Tuberculosis and Malaria (Box 2.5).

2.1.2. The source of giving is concentrated in the United States, largely due to the Bill & Melinda Gates Foundation

As shown in Figure 2.2, philanthropic giving to developing countries1 followed an upward trend over time with an annual increase of 19% on average, mainly driven by European foundations and the Bill & Melinda Gates Foundation (BMGF). Indeed, European foundations’ giving in 2015 was 53% higher than in 2013. 2

The survey results also show that almost three-quarters of giving originated from foundations based in United States (Figure 2.2). However, this is largely explained by the sizeable share of the BMGF’s giving in the total. Indeed, of the 143 foundations included in the survey sample, the BMGF was by far the most significant philanthropic donor, providing almost half of total giving (49%). Other top originating countries were the United Kingdom (7%), Netherlands (5%), Switzerland (2%), Canada (2%) and United Arab Emirates (2%).

Figure 2.4 also indicates that 20 foundations provided 81% of the total philanthropic giving during 2013-15, of which a significant share came from foundations located in Europe (17% of total). Four of the top ten foundations working for development were European.

2.1.3. Foundations based in emerging countries mainly operate domestically

The survey sample also included a few philanthropic foundations based in emerging countries (Figure 2.5). The largest of these foundations are the Mexican Carlos Slim Foundation, the Indian Tata Trusts, the Turkish Vehbi Koç Foundation and the Hong Kong, China-based Li Ka Shing Foundation. The OECD survey results indicate that these foundations operate to a large extent domestically, mainly through grantmaking to institutional intermediaries (71% of all domestic giving). The remaining 29% was directly executed by the foundations themselves, either as specific projects or as scholarships/fellowships to individuals.

Cross-border giving from foundations based in emerging countries to developing countries was mainly provided by foundations in the United Arab Emirates (e.g. Emirates Red Crescent and Dubai Cares). Only USD 62 million was identified as flowing between developing countries (from the Panama-based Avina Foundation, the Nigerian Tony Elumelu Foundation and the Li Ka Shing Foundation in Hong Kong, China).

Box 2.1. Perspectives on philanthropy from around the world

Philanthropy in the United States

Based on access to decades of public tax records, the Foundation Center provides a striking picture of giving for development in the United States over time. It shows that amounts of United States’ giving to international causes have risen more than threefold over 2002-14 from USD 2 billion (or 14% of the total) to USD 15 billion (over 25% of total United States giving). The scale of giving to development by US philanthropists is confirmed by additional analyses of giving on issues related to the SDGs (rather than on international giving as a whole). Over 2010-15, US-based foundations (along with another 2 000 organisations based in other countries that report data to the Foundation Center) made grants worth more than USD 112 billion.

Yet access to consistent data on philanthropy for development worldwide is not yet available, which is why surveys by the OECD and others are so important. The influence of the SDGs means that foundations are applying the language of development more systematically. Efforts such as SDGfunders.org and the work of netFWD are hastening this process.

Contributed by Larry McGill, Foundation Center

Philanthropy in Europe

Agenda 2030 on sustainable development and the Sustainable Development Goals (SDGs) have created momentum and led European philanthropists to step up their engagement in relation to the development agenda.

Today, 7% of newly created foundations in Germany have included development work in their objectives compared to only 5% over 1990-99. Members of Donors and Foundations Networks in Europe report that, in their respective countries, foundations follow a similar trend: more of them provide grants that directly support projects in developing countries.

Foundations work in all areas addressed by the SDGs. However, certain dimensions resonate particularly well with philanthropy, such as “leave no one behind” and the fight against inequality. The SDGs represent a framework for foundations to position and measure their impact, provide opportunities on how to tackle complex and interconnected challenges, and help ensure – through support for civil society – that governments are held accountable.

However, foundations need a conducive enabling environment to work in ways that are effective, efficient, accountable and sustainable. Even within Europe, this enabling environment is not seen as favourable to philanthropy that supports development. For donors and foundations willing to give across borders, taxation barriers and uncertainty about charitable status in the recipient country are two of many limitations. Regulators at national and European levels can do much more to shape the enabling environment for foundations so they can better leverage their potential to support development.

Contributed by Max von Abendroth, Donors and Foundations Networks in Europe (DAFNE)

Philanthropy in Asia

Philanthropic practices vary across Asia based on history, culture, religion and laws. Much philanthropy by high-net-worth individuals and family foundations is confined to traditional giving. However, the next generation is driving a movement towards strategic philanthropy and social investing, as evident in Thailand and the People’s Republic of China (hereafter “China”). For their part, Malaysia and Indonesia see substantial contributions through religious funding.

In economies with a legacy of wealth such as Singapore and Hong Kong, China family foundations play a prominent role. Family foundations innovate across the region: RS Group in Hong Kong, China is vocal about its “Total Portfolio Approach” to asset allocation, while the Putera Sampoerna Foundation in Indonesia invests in nurturing local communities. Zuellig and Ayala Foundation in the Philippines are pioneering the venture philanthropy model in their own unique ways. In India, Tata Trusts and a host of philanthropists and family offices are significantly broadening the horizons of giving by supporting under-funded causes through both venture philanthropy and impact investing.

Corporate philanthropic contributions in the form of corporate social responsibility (CSR) vary in Asia. India’s 2013 CSR law compelled all large companies to give 2% of their profits to social and environmental initiatives; this law is beginning to bear fruit as companies create vehicles for structured giving. Japan and Korea have examples of corporates using venture philanthropy and setting up equity funds for impact investing. Manufacturing companies in India tend to have strategic and sustainable CSR that bring equitable value to all stakeholders. CSR in Cambodia, Viet Nam and Singapore are largely driven by international trade imperatives, while multinational corporations are driving international CSR best practices in countries such as Myanmar and China.

Contributed by Martina Mettgenberg-Lemière, Asian Venture Philanthropy Network (AVPN)

Philanthropy in the Arab region

Since the protests in the Middle East and North Africa in 2010, Arab youth have seen their circumstances and quality of life largely diminish, with restrictions on freedoms of speech and expression in some cases, as well as a burgeoning unemployment rate. Some Arab governments have struggled to address the pressing needs of the region’s youth, with more progress in some countries more than others. The region’s philanthropic sector has begun to change its stance towards addressing issues affecting Arab youth. The under-30 cohort, which makes up 60% of the region’s population, is increasingly recognised as a priority target group with the potential and promise of being change makers.

These demographic realities, along with the rallying cry for a better quality of life, were the catalysts for the Arab Foundations Forum to launch a coalition aimed at creating better opportunities for jobs for Arab youth. Similarly, in another paradigm shift, funders are beginning to recognise and acknowledge the need to move beyond mechanisms like foundations and traditional grant-making in addressing those needs. Arab philanthropists, donors, and foundations are increasingly interested in the potential of social enterprises to help youth consolidate or acquire entrepreneurial skills. Such an approach can empower youth to build financially viable businesses that can resolve social challenges at scale, which is particularly necessary for a region with the highest youth population, and one of the highest populations of unemployment, in the world.

Contributed by Naila Farouky, Arab Foundations Forum (AFF)

Philanthropy in Latin America: the Mexican case

Following the colonial period in Latin America, where individuals helped others out of a sense of personal responsibility, governments developed social programmes, as well as regulations to frame the activities of civil society organisations (CSOs). In turn, CSOs filled gaps in areas considered beyond the reach of government, such as projects and policies aiding minorities. The first wave of democratisation in the 1980s helped spur a more vibrant and active civil society, with a focus on advocacy.

In recent years, the line between CSOs and foundations in the region has become blurred. Foundations across the region are often both grant-makers and grant-seekers. In other words, they implement activities both through their core budgets and fundraising. However, this practice emerged in an environment in which foundations do not have a separate legal status from CSOs. Currently, foundations lack a supply of reliable grantees to implement projects.

Over the last 20 years in Mexico, rising awareness of corporate social responsibility (CSR) and a law supportive of civil society led to the creation of many foundations. However, civil society has been hampered by broad societal concerns about corruption, illegal trading, money laundering and drug dealing. A 2012 law, for example, identified CSOs as vulnerable to exploitation by criminals seeking to launder money. Though this may only concern a minority in practice, it may hamper overall giving. In addition, philanthropy may not be entirely immune to funders pursuing commercial or personal interests.

Contributed by Lourdes Sanz Moguel and Romina Farías Pelayo, Centro Mexicano para la Filantropía (Cemefi)

2.2. Geographical allocation of philanthropic giving

2.2.1. Africa received the largest share of philanthropic giving

According to the OECD survey, over 2013-15, Africa received the largest share of philanthropic giving (USD 6.6 billion, 28%), followed by Asia (USD 4.1 billion, 17%), Latin America (8%), Europe (2%) and Oceania (0.12%). Over 45% of total philanthropic giving was not allocable by country or region (i.e. extended for multiple regions).

As shown in Figure 2.6 the BMGF’s giving constituted a significant share of giving for Africa (49% of the Africa total), Asia (37% of Asia total) and to global/unallocated issues (62% of unallocated total). At the same time, giving from other foundations accounted for most receipts in all regions, particularly in Latin America, Europe and Oceania. Domestic giving was significant in Asia (USD 527.1 million; 13% of Asia total), Latin America (USD 444.3 million; 24% of Latin America total) and Europe, including Turkey (USD 261.4 million; 59% of the Europe total).

2.2.2. India was the main beneficiary country

As shown in Figure 2.7, India was by far the largest beneficiary of philanthropic funds (USD 1.6 billion, i.e. 7% of the total, mainly from the BMGF, Tata Trusts, IKEA Foundation, Children’s Investment Fund Foundation [CIFF] and Dell Foundation), followed by Nigeria, Mexico and the People’s Republic of China (“China”). For India, Mexico and China, domestic giving represented a significant share of the country totals, i.e. 22%, 60% and 35% respectively. Among the top 20 beneficiary countries, 11 were from sub-Saharan Africa.

In relative terms, Palau, Belize and Federated States of Micronesia (“Micronesia”) were the largest recipients of philanthropic giving per capita3 over the period, with total giving amounting respectively to USD 57.6, 23.9 and 21.8 per capita received (Figure 2.8). However, the high amounts are mainly explained by a relatively small population. Considering territories with more than 1 million inhabitants, sub-Saharan African countries and the West Bank and Gaza Strip were the main beneficiaries per capita.

2.2.3. Philanthropic flows targeted mainly middle-income countries

Figure 2.9 shows that 67% of country-allocable giving was directed to middle income countries, of which 37% went to lower middle-income countries (LMICs) and 30% to upper middle-income countries (UMICs). Only a third of country allocable funding targeted the least developed countries (28%) and other low-income countries (LICs) (5%).

More generally, states in situation of fragility benefited from a relatively small share of philanthropic giving (USD 3.8 billion, 38% for the country-allocable total), a half of which was provided to address specific needs in Nigeria, Ethiopia, Kenya and Pakistan. (OECD, 2015_[18]) Similarly, small island developing states (SIDS) received only 1.6% of the country-allocable total, a half of which was to Haiti (OECD/World Bank, 2016_[19]).

Box 2.2. Comparison between the geographical distribution of philanthropic giving and ODA flows in 2013-15

Most private philanthropic foundations working for development and ODA providers have the primary objective to fight and reduce poverty, and foster economic development and welfare of developing countries. However, some differences exist in the way these funds are allocated by country and region.

Similarities

Africa was the main beneficiary region of ODA flows and philanthropic giving alike (42% of region-allocable total ODA flows and 51% of region-allocable philanthropic giving), followed by Asia.
India was the main beneficiary country of both ODA and philanthropic giving. Turkey, Ethiopia and Kenya also belong to the ten countries targeted by both ODA providers and private foundations.
Both ODA and philanthropic giving were rather concentrated, as more than a third of country-allocable ODA and philanthropic giving targeted top ten beneficiary countries (35% and 58% respectively).

Differences

In relative terms, Europe and Oceania were more of a focus for ODA than for foundations. The share of foundations’ giving to Latin America was significantly higher than in the case of ODA.

Table 2.1. ODA and philanthropic giving by region, 2013-15, percentage of respective region-allocable total
	Private philanthropy	ODA
Africa	51%	42%
Asia	31%	41%
Latin America	14%	8%
Europe	3%	7%
Oceania	0%	2%
Source: OECD (n.d.), OECD DAC statistics (database) www.oecd.org/dac/stats/idsonline.html and (OECD, 2018_[11]) Survey on Private Philanthropy for Development 2013-15: Data questionnaire www.oecd.org/dac/financing-sustainable-development/development-finance-standards/beyond-oda-foundations.htm

Except for India – the first recipient of both ODA and philanthropic giving – the two funder categories appeared to have different priorities in terms of recipient countries. While Afghanistan, Egypt and Myanmar were among the main recipients of both ODA and philanthropic giving, the survey showed that other countries such Mexico and Brazil were also among the top beneficiaries of philanthropic giving (Figure 2.10).
41% of country-allocable ODA was directed to least developed countries; only 28% of country-allocable foundations’ giving went to this group of countries. Furthermore, 52% of country-allocable ODA (2013-15) was allocated to states in situations of fragility4 . For foundations’ giving, the share was 38%. Similarly, a higher share of country-allocable ODA (3.7%) was provided to SIDS, as opposed to only 1.6% for foundations’ giving.

2.3. Sectoral allocation of philanthropic giving

Almost three-quarters (74%) of foundations’ giving in 2013-15 supported activities in social infrastructure and services, such as health, education, human rights and social protection. The remaining 26% was distributed among production sectors, such as agriculture (9%).5

Figure 2.11 shows that BMGF commitments were highly concentrated in the health and reproductive health and agriculture sectors. Giving from the other foundations was more evenly distributed among a broader range of sectors, including education, government and civil society, and environmental protection.

Box 2.3. Comparative analysis between the sectoral distribution of philanthropic giving and ODA flows in 2013-15

A comparative analysis of the sectoral allocation of ODA and philanthropic giving (2013-15) revealed some differences in the way private foundations and official development agencies generally operate.

Similarities

Both ODA and philanthropic giving primarily targeted social infrastructure and services.
Production sectors attracted a similar share of both ODA and foundations’ giving.

Differences

Foundations allocated 73% of giving to social infrastructure and services, a share twice as high as that contributed by ODA (37%). While philanthropic foundations clearly focused on health and reproductive health, ODA also focused significantly on government and civil society issues (27% of ODA through social infrastructure and services).
ODA (22%) was much more directed towards economic infrastructure and services than philanthropic giving (6%).
Even though many philanthropic foundations provided funds for humanitarian aid and disaster relief (3% of philanthropy total), ODA’s share was three times higher (9%).
Unlike ODA, foundations did not provide general budget support and debt relief.

2.3.1. Health and reproductive health were by far the main sectors targeted, 72% of which came from the BMGF

Overall, health was the main sector targeted by philanthropic giving – far ahead of the other sectors – with 53% of the total in 2013-15 (or USD 12.6 billion), 13% of which supported population policies and programmes and reproductive health and reproductive health. The BMGF was the major player in this area, accounting for 72% of total giving to health. Even though the donations of other foundations accounted only for 28% of the sector total, the survey showed that health and reproductive health was also their main funding priority.

Indeed, as indicated by Figure 2.13, seven foundations provided more than USD 100 million each for health over the period (i.e. the BMGF, Susan Thompson Buffett Foundation [STBF], CIFF, Wellcome Trust and Bloomberg Philanthropies, Carlos Slim Foundation and Hewlett Foundation). In general, health-related activities represented a significant share of many foundations’ giving. Fifty foundations dedicated more than 20% of their giving to the health sector. Further, 27 foundations provided more than 50% of their giving to the sector, and for 10 foundations the share was even higher than 80%.

Approximately 60% of health-related giving had a global or unallocated scope (Figure 2.14), mainly reflecting the global or multi-regional character of many of these activities. Africa (24%) and Asia (13%) were the most targeted regions for country/region-specific activities.

India, Nigeria, Ethiopia and Pakistan were the main beneficiary countries of health-related giving, mainly due to the high concentration of donations from the BMGF in these four countries (Figure 2.15). In the case of the remaining top 15 beneficiary countries in the health and reproductive health sectors, the other foundations played a more important role, in particular for Mexico. The local Carlos Slim Foundation, for example, donated 67% of the sector total in Mexico.

2.3.2. Main health-related causes targeted

USD 7.9 billion (62% of total giving for health and reproductive health sectors) was dedicated to infectious diseases control6 (Figure 2.16). This was followed by reproductive health and family planning (18%), basic nutrition (5%), provision of basic health care (3%), medical research (3%), and health education (2%, including tobacco control).

Figure 2.17 shows that the main infectious diseases addressed were poliomyelitis, malaria, sexually transmitted diseases (e.g. HIV/AIDS, cervical cancer and human papillomavirus infection), tuberculosis, diarrhoeal diseases (e.g. cholera, dysentery and rotavirus infection), respiratory diseases (e.g. respiratory syncytial virus infection, influenza and pneumonia) and worm infestation (e.g. helminthiases and lymphatic filariasis). Although more than 50 foundations supported such activities, 92% of the funding still originated from the BMGF, including a core contribution to Gavi, the Vaccine Alliance. Other significant funders of infectious diseases control were the Wellcome Trust (2%), CIFF, Bloomberg Philanthropies and Dalio Foundation (1% each).

With USD 2.2 billion (18% of total health-related giving), reproductive health and family planning was the second most funded health-related cause. Over 50 foundations funded activities dealing with safe pregnancy and delivery, postnatal care, reproductive rights, consequences of abortion and other related issues.7 Even though the BMGF remained the most generous foundation in this area also (42% of the subsector group total), funding from other foundations played an important role too, particularly STBF (30%), CIFF (5%), Hewlett Foundation (4%) and Packard Foundation (3%).

Box 2.4. Foundations’ support to non-communicable diseases and partnerships: Novartis Foundation and World Diabetes Foundation

Before 2015, the Millennium Development Goal on infectious diseases galvanised the global community. However, non-communicable diseases – including cardiovascular disease, diabetes and cancer – continued to take a heavy toll on health and healthcare systems. Today diabetes affects 400 million people worldwide, a number expected to grow by at least another 100 million in the next 10-15 years without appropriate action. Such action is likely to be hampered by the multiple constraints facing low- and middle-income countries: health systems are typically geared towards acute care, ageing populations are growing; health systems are underfunded; and growing urbanisation is setting into motion lifestyle changes such as unhealthy food, less physical activity and too much alcohol and tobacco consumption.

The adoption of the SDGs has widened the focus of efforts to improve global health. Goal 3.4 stipulates a one-third reduction in premature deaths from non-communicable diseases. In support of this objective, several foundations have come together to pilot solutions that can achieve widescale buy-in and participation.

The Novartis Foundation is part of a broad-based public-private partnership called Better Hearts Better Cities. Active in Ulaanbaatar, Dakar and São Paulo, the initiative is building a network of partners that goes beyond healthcare providers. For example, it also includes digital and telecommunication organisations, food suppliers, schools and employers, insurance funds, social enterprises and CSOs. Together, they are developing new solutions and ways of working to tackle non-communicable diseases at scale in low-income communities. For example, in Ghana, ComHIP provides community-based services to monitor hypertension, making previously hospital-based monitoring more accessible. Local businesses, community health officers and nurses are trained to conduct screening and provide care. Digital healthcare tools provide a seamless connection between screening stations, community healthcare workers and physicians – and also empower patients to manage their health. Local ownership is key to success; the Better Hearts Better Cities alliances are not a one-off network of partners, but instead an effort to ensure sustainability and impact by working with local governments to strengthen health systems.

Contributed by Geoffrey So, Novartis Foundation

The World Diabetes Foundation (WDF) was established in 2002 – when diabetes and other non-communicable diseases were almost absent from the international development agenda.

During its early years, the WDF awarded small-size grants to implement pilot projects, some of which gradually gained attention from health authorities. In the United Republic of Tanzania (“Tanzania”), for example, lessons from the pilots nurtured a national diabetes strategy within the Ministry of Health. A USD 2.5 million WDF grant launched a first phase of larger-scale capacity building and health promotion programmes (2013-17), implemented in collaboration between the Ministry of Health, Ministry of Education, local civil society and the private sector.

Outcomes from the first phase of the Tanzanian experience have been showcased and recognised at the international level (WHO conferences and elsewhere). WDF is now supporting similar programmes in several other sub-Saharan countries (e.g. Kenya, Rwanda, Malawi, Mozambique, Mali) and globally (e.g. Sri Lanka, Fiji, Philippines, Peru, Brazil). In each case, strategies are developed and owned at the country level. Some countries have additional resources of both domestic and international origin to advance the programmes further, although not enough to meet demand.

Contributed by Bent Lautrup-Nielsen, World Diabetes Foundation

2.3.3. Delivery of giving in health

The survey highlighted that most private philanthropic foundations used intermediaries to channel their funds for health-related activities (Figure 2.18). These intermediaries mainly comprised non-governmental organisations (NGOs) and civil society (35%); the multilateral system (29%); and universities, research institutes and think tanks (24%). The main delivery channels of health-related philanthropic giving were Gavi, the Vaccine Alliance, followed by the World Health Organization (WHO), PATH International, UNICEF, Rotary International, Population Services International (PSI) and the University of Oxford.

Most health-related giving channelled through intermediaries was earmarked for specific projects and/or countries or regions. The exception was the donation of USD 1.55 billion from the BMGF to Gavi, the Vaccine Alliance for its 2016-20 operations. This was the largest core contribution from a private foundation ever recorded.

Box 2.5. Comparison of ODA flows and philanthropic giving for health and reproductive health

The OECD survey revealed that foundations’ support was the third-largest source of financing for developing countries in the health and reproductive health sectors in 2013-15. It followed the United States and the Global Fund to Fight AIDS, Tuberculosis and Malaria. Focusing on the health sector alone, private philanthropic foundations were the most significant source of finance.

2.3.4. Education remains a popular cause among foundations

Education was the second largest sector supported by philanthropic foundations during 2013-15, with 2.1 billion (9% of the total) provided by more than 100 foundations. The main philanthropic funders in this sector were the MasterCard Foundation (15% of the sector total), Vehbi Koç Foundations (8%), IKEA Foundation (7%), Telefónica Foundation (7%) and Li Ka Shing Foundation (6%). Education accounted for more than half of overall giving from four of the five top foundations, IKEA being the exception. Only 26% of education funding originated from US-based foundations, essentially from the Dell Foundation, Ford Foundation, Open Society Foundations and the Carnegie Corporation of New York (Figure 2.20).

Education was a prominent sector for the philanthropic foundations based in emerging countries and operating domestically (one quarter of total education giving). Major contributors included the Koç Foundation and Turkish Educational Foundation in Turkey, Li Ka Shing Foundation in Hong Kong, China, Tata Trusts in India, Carlos Slim Foundation in Mexico and Itaú Social Foundation in Brazil. Focusing on the top ten beneficiary countries in the education sector, the share of domestic philanthropy was even more significant: 54% of total education (Figure 2.21).

Figure 2.22 shows that Asia received the largest regional share of philanthropic giving for education (29%), closely followed by Africa (28%). The share of Latin America and Europe in the sector total was also quite significant (19% and 11%, respectively), while global or unallocated activities accounted only for 12% of the sector total.

As Table 2.2 shows, giving in the education sector mainly targeted the post-secondary level (higher education and advanced technical and managerial training) and vocational training (together 37%). Early childhood, basic life skills, primary and secondary education level represented 20% of total giving to education. Around 18% was provided for capacity building in education (e.g. teacher training, education facilities, and training and education research).

Table 2.2. Philanthropic giving to education, 2013-15
Purpose code	Purpose description	Amount (USD thousand)	Share of sector total
11110	Education policy and administrative management, unspecified education activities	534 561.8	25.7%
11120	Education facilities and training	216 615.2	10.4%
11130	Teacher training	94 658.2	4.6%
11182	Educational research	53 385.7	2.6%
11220	Primary education	134 344.6	6.5%
11230	Basic life skills for youth and adults	87 628.1	4.2%
11240	Early childhood education	103 698.0	5.0%
11320	Secondary education	82 536.8	4.0%
11330	Vocational training	139 619.2	6.7%
11420	Higher education	549 458.4	26.5%
11430	Advanced technical and managerial training	80 742.2	3.9%
Source: (OECD, 2018_[11]) Survey on Private Philanthropy for Development 2013-15: Data questionnaire www.oecd.org/dac/financing-sustainable-development/development-finance-standards/beyond-oda-foundations.htm.

More than two thirds of total giving to education was channelled as earmarked contributions to specific projects or countries through intermediaries. These included NGOs (37%), universities and research institutes (30%), and multilateral organisations (10%). Direct funding from foundations to the education sector was mainly allocated to support the construction and maintenance of schools administered by foundations (15%) or was extended as direct scholarships to individuals (9%). Foundations providing such direct funding included the Koç Foundation, Telefónica Foundation, Bharti Foundation, Ayrton Senna Institute, and the Dell Foundation.

2.3.5. Agriculture

Agriculture was the third largest sector in total philanthropic giving with USD 1.9 billion over the period (8% of total giving).

In general, agriculture funding aimed to improve the food and income security of farmers through activities related to farm development. Indeed, 49% of funding focused on agricultural development, agricultural land resources, agricultural water resources, agricultural inputs, food crop production, industrial crops/export crops and livestock. The next largest category (19%) was dedicated to research (particularly on increase of nutritional and yield quality of staple and export crops). Further, 11% went to various agriculture services, such as plant and post-harvest protection and pest control, agricultural financial (and other) services, agricultural co-operatives and livestock/veterinary services. The remaining 21% was provided for other or unspecified activities in the agriculture sector.

As in the health and reproductive health sectors, the BMGF was the main provider in the agriculture sector (68% of the sector total). Apart from the BMGF, agriculture was mainly targeted by US-based foundations. Non-US-based foundations represented only 18% of the sector total, mainly driven by Tata Trusts and the IKEA Foundation.

India was also the main beneficiary country in this sector (10% of the sector total). Over two- thirds of agriculture giving (69%) was allocated to African countries, predominantly to Ethiopia (8%), Tanzania (8%), Nigeria (6%), Uganda (5%) and Rwanda (5%).

2.3.6. Government and civil society

According to the OECD-DAC sectoral classification, the government and civil society sector refers to activities aimed at strengthening the administrative apparatus and government. This includes, for example, human rights, democratic participation and civil society development, media and free flow of information, legal and judicial development, support to women’s equality organisations, ending violence against women and girls, and conflict prevention and resolution.

Over 2013-15, foundations’ giving in these areas amounted to USD 1.7 billion (i.e. 7% of total giving). This made government and civil society the fourth-largest sector of destination of philanthropic giving. Excluding the BMGF, government and civil society was the third most important sector.

Philanthropic giving for government and civil society originated predominantly from the United States (70%) and Europe (28%, mainly the Netherlands, Switzerland and United Kingdom). The main US-based foundations supporting this sector were the Ford Foundation (20% of the sector total), followed by the Open Society Foundations (11%) and Hewlett Foundation (10%). The most significant European private funders of these activities were the Oak Foundation (6%), Dutch Postcode Lottery (6%) and Sigrid Rausing Trust (5%).

Philanthropic funding in this sector was evenly distributed worldwide. With a share of 26% of the sector total, Africa was the main beneficiary region, followed by Asia (19%) and Latin America (15%) and Europe (4%). Around 35% had a global or multi-regional scope (e.g. global human rights, global human trafficking, etc.).

The geographical distribution by main recipient country (Figure 2.25) shows that most of the top 10 recipients were middle-income countries, notably South Africa, India, Mexico, Brazil and China.

As shown in Figure 2.26 support to human rights accounted for the largest share (36%) of government and civil society activities, followed by democratic participation, civil society development and free flow of information (18%). Support to women’s quality organisations and institutions, together with support to ending violence again women and girls, accounted for 15% of total giving in this sector. Most funding for human rights, democratic participation, civil society development and media was evenly distributed among regions. However, giving for conflict-related activities, support to women’s equality organisations and institutions as well as to ending violence against women and girls mainly targeted Africa and Asia (particularly Uganda, India and South Africa).

2.3.7. General environmental protection

Environmental protection attracted USD 1.1 billion (i.e. 5% of total foundations’ giving during 2013-2015). It supported mainly biodiversity conservation, environmental research, biosphere and site preservation (e.g. maintenance of historical manuscripts and sites).

As indicated in Figure 2.27, the main foundations in this sector were the Packard Foundation, Oak Foundation, Moore Foundation, Dutch Postcode Lottery and MAVA Foundation. Foundations that allocated over 90% of their three-year funding for this sector included the MAVA Foundation, Marisla Foundation and Moore Foundation.

The main beneficiary region of foundations’ giving in the environment sector was Latin America (28% of the sector total) – e.g. the Amazon region, Mesoamerican rainforests, and the Gulf of California. It was followed by sub-Saharan Africa (15%) and Asia (11%). Most activities related to conservation of unique and vulnerable biotopes, protection of apes, anti-poaching activities and restoration of national parks.

2.3.8. Philanthropic giving for cross-cutting issues

The survey also looked at the extent to which philanthropic giving aimed to support some cross-cutting issues that usually straddle multiple sectors. This subsection analyses foundations’ support for:

Research – all activities allocated under research purpose codes and all other activities explicitly aiming at research
Climate change – all activities allocated in renewable energy and/or efficiency and all activities explicitly targeting climate change mitigation and/or adaptation, renewable energy, climate resilience, etc.

Research

Philanthropic giving in support of research amounted to USD 3.5 billion over 2013-15 (15% of the total). Most research activities funded by the philanthropic foundations were related to health and reproductive health (48%), followed by agriculture (22%), environment (7%), education (7%), and government and civil society (5%).

The BMGF was by far the main philanthropic provider in this area (54%), mostly for research in the health and reproductive health, and agriculture sectors (Figure 2.28). The second most significant funder in this category was the Wellcome Trust (10%), also in the health and reproductive health sectors. The third-largest provider was the Packard Foundation (5%), mainly for environmental research (Figure 2.28).

Foundations with the highest share of giving dedicated to research (over 75%) were the Bertelsmann Foundation, Carasso Foundation, Lloyd Register Foundation, Mellon Foundation and Wellcome Trust.

Combating climate change

Only USD 1.5 billion (6.5% of total philanthropic giving) aimed at combating climate change, mainly through activities targeting general environmental protection (44%), agriculture (16%) and energy (11%). The main players in this area were the Packard Foundation, followed by the Rockefeller Foundation, Dutch Postcode Lottery, CIFF and Oak Foundation (Figure 2.29). Foundations with the highest share of climate expenditure in their total outflows were the Moore Foundation, McKnight Foundation, Shell Foundation and EDF Foundation.

Box 2.6. Foundations’ support to mitigating climate change: Climate Works Foundation

Less than 1% of total foundation giving in the European Union and the United States is devoted to mitigating climate change worldwide. However, these investments are still saving and improving lives, catalysing economic and human development, and protecting natural resources.

Through its collaborations with NGOs, foundations, and other climate leaders, the ClimateWorks Foundation tracks philanthropy-supported strategies, investments, and results, and strives to understand how charitable giving can best leverage the forces that are driving climate action around the world.

ClimateWorks estimates that climate-related giving has increased by more than 30% from 2015 to 2017. Collectively, leading climate change mitigation funders invested approximately USD 700 million to accelerate climate action in 2017. This funding, disbursed to over 1 500 grantees worldwide, supports causes and sectors critical to reducing climate pollution and promoting prosperity. Key sectors supported include electricity, transportation, forests and land use, energy efficiency, and communications and public engagement.

Individual philanthropists and foundations are also increasingly collaborative. For example, through the Kigali Cooling Efficiency Program, 18 foundations and individuals pledged USD 52 million in 2016 to promote energy efficient cooling in developing countries, in tandem with efforts to phase down the production and use of hydrofluorocarbons. These efforts could avoid up to a degree Celsius of warming by 2100. Improving the efficiency of cooling systems can also reinforce progress towards the achievement of multiple SDGs.

There are more opportunities than ever – in food and agriculture, energy, buildings and urban planning, transportation, among others – for foundations and donors to accelerate innovation and build a broader, more connected climate movement.

Contributed by Ann Cleaveland, ClimateWorks Foundation

2.3.9. Selected population groups targeted by philanthropy

Information in the descriptive fields of the survey enabled an examination of some population groups targeted by foundations’ giving. This analysis particularly focused on:

Children and youth – all activities in the education sector and activities explicitly targeting children, youth, boys, girls, orphans, adolescents, etc.
Women and girls – all activities allocated in the population policies/programmes and reproductive health except STD control, including HIV/AIDS; support to women’s equality organisations and institutions; ending violence against women and girls and all other activities, explicitly targeting women, girls, brides etc.
Refugees, internally displaced and stateless persons – all contributions to UN High Commissioner for Refugees (UNHCR), UN Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) and all activities explicitly targeting refugees, internally displaced and stateless persons.

Support to children and youth

USD 7.5 billion (31%) of the total foundations’ giving over 2013-15 was intended to address children and youth empowerment. More than half (57%) took the form of health and reproductive health activities – such as infectious diseases control, family planning and basic nutrition – and 27% as education projects. The BMGF was the main actor in this field (45% of total), followed by CIFF (8%), IKEA Foundation (5%) and MasterCard Foundation (5%). While the BMGF and CIFF supported children and youth mainly through health activities, education was the main entry point in this area for several other foundations such as IKEA Foundation, Koç Foundation, Telefónica Foundation and the Dutch Postcode Lottery.

For 16 foundations, children and youth constituted the core of their support (more than 90% of their portfolio), e.g. IKEA Foundation, Mellon Foundation, Jacobs Foundation, Oprah Winfrey Leadership Academy Foundation, UBS Optimus Foundation, Stars Foundation and Dubai Cares.

Support to women and girls

Around USD 3.7 billion (16% of the three-year total) was provided for women and girls, mainly through health and reproductive health activities (74% of related funds), government and civil society (10%) and education (4%). Thus, reproductive health and family planning was the main vector for supporting women and girls (59%). This was followed by infectious diseases control (7%); basic nutrition (4%); support to women’s equality organisations (3%); ending violence against women and girls, including FGM/C (3%); and activities in the agriculture sector (3%).

The BMGF (43%) and STBF (19%) provided the largest share of funds in support of women and girls (Figure 2.31). Other foundations supporting women and girls with significant funding were the CIFF, Ford Foundation, Dutch Postcode Lottery and Hewlett Foundation (3% each). Specialised foundations in this field (more than 90% of their portfolio) were STBF, NoVo Foundation, Walmart Foundation, Goldman Sachs Foundation, Oprah Winfrey Leadership Academy Foundation, Sabancı Foundation and Foundation CHANEL.

Refugees, internally displaced and stateless persons

Foundations’ contributions to issues related to refugees, internally displaced and stateless persons (RIDSP) amounted to USD 361 million (2%) over the three years, following a clearly growing trend (Figure 2.32).

Two thirds of these funds were provided by the IKEA Foundation (28%), Dutch Postcode Lottery (20%) and the Emirates Red Crescent (18%). With a share of 32% of these funds, the Middle East was the main beneficiary sub-region, followed by sub-Saharan Africa (22%). Of these contributions, 39% were unallocated, reflecting foundations’ contributions to organisations dealing with international migration at a global or multi-regional scale. The main channelling organisations were UNHCR (36%), VluchtelingenWerk Nederland (11%) and the UNRWA (3%). These were followed by a plethora of local and international humanitarian organisations.

2.4. Implementation of philanthropic giving

2.4.1. Almost all philanthropic giving was channelled through intermediaries

According to the survey data, almost all philanthropic giving (97%) was implemented through intermediary institutions, also referred to as “channels of delivery”. As shown in Figure 2.33, the main categories of channels of delivery8 used by philanthropic foundations to implement their funding in 2013-15 were the following:

NGOs, civil society, PPPs, networks and for-profit private sector (50% of total giving)9
public or private universities, teaching institutions, research institutes and think tanks (22%)10
multilateral organisations (19%)
aid agencies and national governments (2%) and
other/unspecified channels (5%).

As noted in Figure 2.33, only a very small share of total giving was implemented and executed by the foundations themselves (3%). The main foundations directly implementing their funding were the Koç Foundation, the Turkish Educational Foundation, Tata Trusts, Telefónica Foundation, McKnight Foundation, La Caixa Banking Foundation and the Ford Foundation.

Most philanthropic funds channelled through intermediary institutions took the form of earmarked funding for specific purposes (81%). Unearmarked or core contributions to implementing institutions represented only 14% of total philanthropic giving (Figure 2.34). These were provided mainly to multilateral organisations and NGOs such as Gavi, the Vaccine Alliance; ClimateWorks Foundation; Stichting DOEN; UNICEF; Médecins sans Frontières, World Wildlife Fund (WWF); and Oxfam.

Giving to/through NGOs, civil society, PPPs, networks and for-profit private sector

In 2013-15, half of philanthropic giving was channelled through NGOs, civil society, PPPs, networks and the for-profit private sector. As Figure 2.35 indicates, the main beneficiary institutions of these funds were organisations based in OECD countries, including PATH International, Rotary International, ClimateWorks Foundation, Population Services International, Clinton Foundation and WWF (each of which received more than USD 150 million). Most of these funds were earmarked for specific purposes (89%).

Giving to/through universities, teaching institutions, research institutes and think tanks

Overall, philanthropic giving channelled through universities, teaching institutions, research institutes and think tanks targeted activities in research and education. The main receiving institution was the University of Oxford, followed by US-based universities or research institutes (Figure 2.36). Over 90% of the funds came from the following foundations: the BMGF (63%), Wellcome Trust (11%), Ford Foundation (6%), Li Ka Shing Foundation (6%) and Hewlett Foundation (4%).

Giving to/through the multilateral system

Multilateral organisations were the third channel of delivery category used by philanthropic foundations, with USD 4.4 billion transferred over 2013-15 (19% of total giving). Five foundations alone provided 94% of these funds: the BMGF (82%), IKEA Foundation (6%), CIFF (3%), Dutch Postcode Lottery (2%) and the MasterCard Foundation (1%).

The United Nations system was the main beneficiary of philanthropic support to multilateral organisations (47% of the multilateral total), in particular through WHO, UNICEF and UNHCR. However, USD 1.8 billion (40% of total giving to multilaterals) was provided solely to Gavi, the Vaccine Alliance; this included a core contribution of USD 1.55 billion from the BMGF. The World Bank Group was also an important channel of delivery used by the foundations (8% of total giving to multilaterals), mainly through the International Development Association (IDA) and the International Finance Corporation (IFC).

With respect to funds channelled through the multilateral system, 37% took the form of unrestricted/core contributions. However, excluding the unprecedented BMGF contribution to Gavi, the Vaccine Alliance, core support to multilateral institutions only represented 3% of the remaining giving to multilateral organisations (mainly from the Dutch Postcode Lottery and the Ford Foundation).

A tiny share was channelled to/through government agencies

Only 2% of philanthropic giving was channelled through government institutions. These included aid agencies and other government institutions in high-income countries (e.g. the French Development Agency [AFD], German Corporation for International Cooperation [GIZ], American US Agency for International Development [USAID] and United Kingdom Department for International Development [DFID]) and government agencies in developing countries (e.g. ministries of health). The BMGF and the CIFF were the main foundations channelling their funds through government institutions.

References

[80] OECD (n.d.), OECD DAC statistics (database), http://www.oecd.org/dac/stats/idsonline.htm.

[19] OECD/World Bank (2016), Climate and Disaster Resilience Financing in Small Island Developing States, OECD Publishing, Paris, https://doi.org/10.1787/9789264266919-en.

[18] OECD (2015), States of Fragility 2015: Meeting Post-2015 Ambitions, OECD Publishing, Paris, https://doi.org/10.1787/9789264227699-en.

[11] OECD (2018), Survey on Private Philanthropy for Development 2013-2015: Data questionnaire (internal database), OECD, Paris, http://www.oecd.org/dac/financing-sustainable-development/development-finance-standards/beyond-oda-foundations.htm.

[17] World Bank (n.d.), World Bank Data Portal (database), World Bank, Washington D.C., https://data.worldbank.org/indicator/SP.POP.TOTL.

Notes

← 1. The terms “developing countries” and “developing economies” refer to all countries and territories on the DAC List of Official Development Assistance (ODA) Recipients and consists of all low and middle income countries based on gross national income per capita as published by the World Bank, with the exception of G8 members, European Union members, and countries with a firm date for entry into the EU. The list also includes all of the least developed countries as defined by the United Nations (UN).

← 2. For the purpose of this publication, North America includes United States and Canada.

← 3. https://data.worldbank.org/indicator/SP.POP.TOTL.

← 4. http://www.oecd.org/dac/states-of-fragility-2015-9789264227699-en.htm.

← 5. In the DAC sector classification, social infrastructure and services refer to sectors such as education, health, population policies/programmes and reproductive health (further health and reproductive health), water supply and sanitation, government and civil society, and other social infrastructure and services. Production sectors include agriculture, forestry, fishing, industry/manufacturing, mineral resources and mining, construction, tourism, and trade policy, regulations and trade-related adjustments. Economic infrastructure and services include transport and storage, communications, energy generation, distribution and efficiency, banking and financial services, and business and other services.

← 6. For this publication, infectious diseases control refers to activities under the health sector (targeting malaria, tuberculosis, polio eradication, de-worming and other infectious diseases) and population policies/programmes and reproductive health (sexually transmitted diseases, including HIV/AIDS).

← 7. Activities related to female genital mutilation/cutting (FGM/C) are included under the sector “government and civil society”, purpose “ending violence against women and girls”.

← 8. Channels of delivery refer to the first institutional recipients/implementing partner of foundations’ giving, i.e. the entity that has implementing responsibility over the funds and is, in principle, linked to the extending agency by a contract or other binding agreement, and is directly accountable to it. See also para 64 of www.oecd.org/dac/financing-sustainable-development/development-finance-standards/DCDDAC(2016)3FINAL.pdf.

← 9. NGOs, civil society, PPPs, networks and for-profit private sector are presented together since, in the context of the high number of reported channels, it was not feasible to distinguish which channelling organisations had a not-for-profit or for-profit business model or, for example, to what extent they could qualify as PPPs or networks.

← 10. Organisations called “institute”, “centre”, or including “analysis” “analytical” or “research” in their title are considered to belong to this category.