How does anyone contribute to the society’s betterment? First, there should be the intent or drive, then the resources. But that’s only the starting point. Having a conducive environment is a prerequisite. Philanthropist Ruth Shapiro and her Hong Kong-based organization, the Center for Asian Philanthropy and Society (CAPS), travel to Asian countries to find out how easy is it to carry out philanthropic works. Her focus is on finding out if business organizations feel at ease carrying out philanthropic works in a particular country. But the work goes beyond business organizations and covers non-profit and non-government sectors as well.
Philanthropy is a trendy topic for the modern corporate world. Business leaders often talk about giving back to the society. In the US, philanthropy accounts for 2 percent of the GDP. For corporates, it is legally mandatory to spend at least 2 percent of their annual revenue in philanthropic works. There are two benefits to it: first, such spending is tax-free, and second, it helps build public trust, which ultimately helps the business.
We may recall the recent announcement by Chinese billionaire Jack Ma to give US $14 million to fight coronavirus, which won his company big public acclaim. However, the philanthropic spending in Asia is far lower than 2 percent, even though it is slowly picking up.
The CAPS compiles the Doing Good Index (DGI) from 17 countries and economies in Asia to gauge the ease of philanthropic giving. The index gives a sense of whether a country’s regulatory and institutional frameworks are helpful for that by building on both government and non-government data.
“If we could reach the 2 percent figure here, that would be equivalent to US $504 billion a year, to be generated from the countries in Asia where we are working,” says Shapiro. This figure—US $504 billion—is approximately 11 times the money that comes as foreign aid into this region, according to Shapiro.
“It’s one third of the cost of achieving the Sustainable Development Goals on an annual basis. I think the 2 percent philanthropic spending is very possible,” she says. “What would happen if we got there? Wouldn’t that be incredible?”
The CAPS data include China, Hong Kong, India, Japan, Pakistan, Singapore, and Sri Lanka, among others. From 2019, it has started studying the philanthropic environment in Nepal as well. The final report, to be compiled as Doing Good Index 2020, will be released soon. It essentially looks at four sets of indicators, three of which have to do with the government—regulations, tax and fiscal policy, and procurement policy—and one with the people and the private sector. The organization has partnered with Chaudhary Foundation in Nepal for field research.
A matter of trust
Philanthropic giving hinges on an environment of trust. “There is a lack of trust among the private sector, the non-profit sector, and the government. In many cases these groups don’t trust each other when it comes to giving,” Shapiro says. “How do you build trust? One way is to be more accountable and transparent with what you are trying to do.”
“By compiling the DGI, we want to understand what enables the giving and receiving of money and other resources, and what holds it back,” Shapiro adds. She and members of her organization tour the region meeting government officials, policymakers, members of the public, and the business community to encourage philanthropic giving.
More than charity
The popular misconception about charity and philanthropy bothers Shapiro. While the former can be a one-time random act, philanthropy is much deeper and long-term.
“Charity generally refers to a kind of spontaneous act, out of compassion for a person—like there’s been an earthquake, and you give money. Everybody steps in. Or you give to a beggar. It’s generally on a one-off basis,” she says. “Philanthropy is more systematic. We are trying to bring about system change instead of a one-off reaction. So philanthropy is a more strategic way to help others.”
The CAPS has an impressive governing body headed by Ronnie C. Chan, a noted business leader of Hong Kong. Chairman of Tata Trusts India Ratan Tata sits on the advisory board along with Nirvana Chaudhary, Nepal’s youth business icon. Shapiro, a Stanford PhD and Harvard postgraduate, left her promising professional career to help businesses engage in philanthropic work in Asia.
“It’s in nobody’s interest to live in a community where there’s hunger, sickness, and illiteracy. You are in a win-win if you help the society,” says Shapiro. “To the extent that you’re helping people by providing better healthcare, better water, and education system, it helps you back on the fronts of your customers, employees and so on.”