GIFT at Work, performance philanthropy
Geneva Global aims to ensure the investors' money is being used effectively and to everyone's benefit.

Chandran Nair

A Philadelphia-based company is pioneering a new form of philanthropy, based on the belief that for-profit companies can do a better job of getting the most bang out of a charitable buck.

Geneva Global, founded in 1999 by a group of emerging-market investors, differs from traditional chequebook charities in its focus on results and the need to bring together all investors for the maximum benefit of everyone involved.

Serving as clearing houses that match donor and non-governmental organisation requirements, performance philanthropy’s success lies in its ability to assure donors that their investments are being used efficiently.

Timothy Ogden, the organisation’s chief knowledge officer, said its founders were excited by the need to give something back to places where they had made a great deal of money.

They expected to donate in the same way they had made money – by looking for opportunities, giving feedback and adjusting their approach to create the maximum benefit.

“We are not yet profitable but will be by the end of 2009. Our fees vary based on the services required by the client but average about 15 per cent of the grant amount” he said.

Other key players include what Mr. Ogden termed life capital, people who contributed to these projects and invested their lives to a greater extent than their contributors.

“Bringing these three groups together means that everybody benefits…and the givers understand a lot more about what’s needed and what happens to [their] money and experience the full joy of giving,” he added.

Geneva Global has generated about US$55 million in grants and made a dramatic impact on an estimated 50 million lives.

Projects range from providing good access to clean water to freeing people from slavery or caring for Aids sufferers.

Mr. Ogden said where performance philanthropy organisations differed from big foundations was that they acted as independent advisers.

Geneva Global serves international clients on projects worldwide, including some in South Asia and on the mainland.

Catherine Liu Wan-mun, the organisation’s regional manager for China, said: “We’ve been in China for about three…[and have] done health, Aids and basic community health projects, particularly in the rural areas.”

In China, it has brokered about US$3.5 million in grants. This year it has done around US$1 million on the mainland although, Mr. Ogden added, this could grow.

He said: “We haven’t seen a lot of demand from donors in the mainland so far, but it has not been a specific target for us at this early stage of our development.

“We have had plenty of clients from elsewhere interested in giving in China, though obviously Sub-Saharan Africa is the area that is of most interest to clients these days.

“In terms of supply, there are many exceptional Chinese organisations addressing the needs of the poorest.

“To date we have not had any problem finding quality organisations to work with and to implement programmes on the ground,” he said.

According to John Peralta, the managing director and chief adviser of Hong Kong-based philanthropy consultant Global Philanthropic performance philanthropy developed from venture philanthropy of the 1990s, which was a concept that emerged from the technology boom of the times. Venture philanthropist armed with newly earned riches were entrepreneurs who felt the need to contribute back to society by being active in charitable causes to a degree that was previously unusual.

Mr. Peralta said that as these venture philanthropists discoveres the difficulty of conducting reliable due diligence on small NGO’s in locations such as Bangladesh or Laos, they began setting up back-office operations to locate reputable charities in far-flung regions.

One of these back-office operations probably evolved into Geneva Global as it is today.

He added that, in principle, performance philanthropists provided a similar service to private banks who also matched donors with a suitable NGO.

But even though performance philanthropy applied the vigorous investment banking approach to traditional chequebook charities, Mr. Peralta warned it was not for everybody.

“It’s a good model only in the case where a donor wants to give to a cause that is in a developing world where organisations do not exist that are capable of providing the donor with adequate reports and being responsible, and the donor doesn’t have the time or the capacity to get hands on involvement. It’s a very niche model,” he said.

While performance philanthropy is still rare in Asia where most economies are still developing, one company in Hong Kong that operates a similar business model is Global Institute for Tomorrow (GIFT), a non-profit, Asian-based think-tank.

GIFT works with business leaders and government policymakers on the challenges of globalisation and Asia’s development needs. While the non-profit firm serves to connect big corporations to charitable causes in the field, and trains executives in philanthropy best practices, it charges a consulting fee to the corporation for the executive training rather then a percentage of money donated.

In addition, it provides insights about Asia to the international community, fosters partnerships between civil society, corporations and government and addresses critical leadership needs.

Chandran Nair, GIFT’s founder and chief executive, said: “Money, corporate efficiency [and] good intentions are too often in different orbits.”

He said in line with the thinking of other performance philanthropists, connectivity, rather than money, was often the biggest block to effecting positive change.

www.globalinstitutefortomorrow.org/

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