Presentation by Cathy Pharoah at SCF Spring Conference 2012

1. SCF Spring Conference
May 2012
Today s major philanthropy
Cathy Pharoah
Professor of Charity Funding
Co-Director, CGAP
Cass Business School

2. CGAP s research work in philanthropy
The New State of Donation – Trends in household giving 1978-2008
Family Foundation Giving – 5-year series of annual updates
Charity Market Monitor
Briefing Papers – trends in regional giving, generosity
Commentaries on trends in Gift Aid
How do donors choose charities?
Arts and Business Scotland – philanthropy master classes
Entrepreneurial philanthropy
Innovation and the third sector
Philanthropy and building a better society (forthcoming)
Leaders, Intermediaries, Overseers? Exploring the role of community
foundations (forthcoming)
Co-producing research – working together or falling apart? www.shaw-trust.org.uk

3. foundations
Multiple routes for -
flexible
major giving forms
other family community
trusts foundations
channels for
major gifts
Challenges for new social donor-
philanthropy finance advised
management vehicles funds
Challenges for mapping and direct giving
measuring (eg overlapping)
www.shaw-trust.org.uk

4. Ebac Ltd owner John Elliott says new foundation
will oversee company and boost jobs
The multi-millionaire owner of a County Durham company is
toleave the company to benefit the community rather than his
family. Mr Elliot was awarded MBE for Services to
Small Business, and on Channel 4's Secret Millionaire.
Instead of passing the business on to the family, I have decided to create a structure that will
ensure profits are used for long-term manufacturing investment.
[It will] deliver substantial recurring sums for community initiatives and enshrine the business'
community ethos for the benefit of all.
The new foundation will have three trustees to oversee the business at a strategic level, and will
be joined by a community trustee on a rolling three-year basis.
Trustees are charged with using profits to make the business stronger and use surplus to
support local causes.
Mr Elliott said the structure will ensure that the business will not be sold for personal profit, and
keep the business in the North East of England …good for the UK economy and NE England."
www.shaw-trust.org.uk

5. Individual philanthropy today (estimated)
1.7 Very wealthy
1.1 Mass affluent*
2.0 Legacies
+ £1 billion Gift Aid 10.6 General public
££
£16.4 billion (ish)
*Higher-rate tax-payers only
Sources: (McKenzie and Pharoah, www.cgap.org.uk/uploads/TaxAndGiving.pdf www.shaw-trust.org.uk
UK Giving 2009 (CAF/NCVO); HMRC Table 10.2, 2009; Legacy Foresight 2009;
Sunday Times Rich List, 2008 (what happened to 2009?)

6. Real growth in giving 2005/06-2009/10
Individual Family foundation Corporate
-0.4% 27% 7%
www.shaw-trust.org.uk
Pharoah, C with Keidan, C and Gordon, J. Family Foundation Giving 2011.

7. Real growth in giving and assets 06/07- 09/10
%
25 Giving
22
20
17
15
10 Assets
7 8
5
-2
0
2006/07 2007/08 2008/09 2009/10
-5
-6
-8 -9
-10
www.shaw-trust.org.uk
-15

8. Who are today s donors?- trends in % of
income given, by age
%
3.5
3
1978-1982
2.5
2003-2008
2
1.5
1
0.5
0
26-30 41-45 46-50 61-65 66-70 71-75 >75
Age band
www.shaw-trust.org.uk

9. Trends in proportion (%) giving, by age
%
45 1978-1982
40
2003-2008
35
30
25
20
15
10
5
0
26-30 41-45 46-50 61-65 66-70 71-75 >75
Age band
www.shaw-trust.org.uk

10. How to begin? examples of donor points of departure
the consciousness that one should give grew clear in late
teens when sent by mother to live in the Blackfriars Settlement.. my
interest in philanthropy began right there..
the way in which religious values were embedded in, and
transmitted through, family background … Maurice Wohl followed the
example of his father , who was actively involved in charitable giving
the route began with experience of the charitable activities of a US
friend and colleague… his family then joined his friend s family in building a
house for a poor Mexican family – one of the best experiences he had
been able to give his own children
it was experience on a (charity) board which opened the door
www.shaw-trust.org.uk
Pharoah, C with Keidan, C and Gordon, J. Family Foundation Giving 2011.

11. Philanthropy – a challenging donor journey
it was not easy – we were rebels without a cause – everyone
recommended someone else
I felt I could do something, but it was as if I had set sail without a rudder
we wanted the foundation to be a success and honed its vision
carefully…taking time : there are no quick fixes
I had a very large cheque in the bank.. I had to go and educate
myself as the next step….anything I wanted ….. let s go and find out what
the possibilities are …actively started to learn about philanthropy
Pharoah, C with Keidan, C and Gordon, J. Family Foundation Giving 2011
www.shaw-trust.org.uk

12. How to define entrepreneurialism?
Social enterprises
Entrepreneurs
Entrepreneurial approaches and attitudes
Social finance – new products? social and economic returns?
Social investment
Venture philanthropy
 How finance used?
 Innovation?
 Sustainability? – whose?
 Capacity-building?
 Social change?
 Impact www.shaw-trust.org.uk

13. The Social Finance space
 The market-place - £1billion in total? – which space?
 Space still being contested/ configured
 Growing the Social Investment Market: A vision and strategy
 Trust players –Esmee Fairbairn (£20 million)
 Social Impact Bonds (£5 million sold to trusts)
 Pilot bond - prisoner rehabilitation in Peterborough
 Pilot bond development – PEF - NEETs
 Social Bonds – eg Scope (£20 million), Allia (£1.8 million raised through bonds)
 Big Society Capital - £600 million
 Finance-raisers – Social Finance, Zopa, OXFAM (SEIIF)
www.shaw-trust.org.uk

14. Example:The Indigo Trust and information
technology in tackling inequality
With a focus on the power of information technology, the Indigo Trust, one of the eighteen
Sainsbury Family Charitable Trusts (SFCT), has developed a totally new programme around the
use of computer and mobile phone applications at a grassroots level, to address inequality and
development in Africa.
Just 10% of Africa 's population is currently connected to the internet, but this proportion is
rapidly expanding. In urban areas, the internet already has the potential to strengthen
individuals and communities through increasing their access to information, and encouraging
democratic transparency.
The Trust believes that ICT can have a powerful role in stimulating social change and economic
growth. It aims to support the development and use of hand-held information and computer
technology (ICT) which can help improve adult literacy, and increase access to health,
education and welfare services.
Pharoah, C. Global Grant-making. 2011 www.shaw-trust.org.uk

15. New kinds of investment
The Baring Foundation has made a mission-connected investment in Equity for Africa, a fund
which provides transition investing for small and medium-sized micro-entrepreneurs in Sub-
Saharan Africa aiming to build their business to the next level.
The Ashmore Foundation – building primary health care enterprise in Ghana
The Foundation has a strong interest in supporting social enterprise as a sustainable approach to
building skills and income in marginalised communities. The AfriKids Medical Centre is one of
several of the Foundation s sustainability initiatives that improves services for the local community
while also building an independent revenue stream to reduce reliance on donations.
The Medical Centre provides basic health services to the community of Bolgatanga, with an
inpatient capacity of 60 beds and a new maternal health unit. It is planned that by 2015, the Centre
will have 80 beds, 8,000 inpatients and 100,000 outpatients each year. The Ashmore Foundation
has supported Afrikids with a grant of £70,000 to develop a permanent x-ray suite which will both
improve local access to healthcare and provide a sustainable source of revenue.
Pharoah, C. Global Grant-making. 2011 www.shaw-trust.org.uk

16. Case-study: Brian Kennedy Charitable Settlement
Successful businessman: wanted to develop his philanthropy on a local basis
He began to see social problems as interlinked, needing holistic mainstream approaches
Joint venture with local constabulary to introduce SHARP system to local schools (School Help Advice
Reporting Page) - an internet system providing additional links between schools, the community and the
police. www.thesharpsystem.com)
The Foundation did not begin with a big vision ; finding its purpose has been developmental
SHARP now being piloted in 6 schools and aiming at 60; negotiating access can be a lengthy process
As a self-made businessman without a privileged background, Brian Kennedy s vision for the future
involves bringing his own entrepreneurial skills and experience to develop sustainable social enterprise
BKCS believes many young people are at risk because of their environment, and are not beyond reach
Wants to offer young people with problems the opportunity to earn an income, and come off benefits
The Foundation does not believe in being a sole funder, but in acting as catalyst bringing other agencies
and funders together: currently working with a local consortium to look at social enterprise options
A contributing factor to local partnership success - Brian Kennedy is well-known figure in local community.
Pharoah, C with Keidan, C and Gordon, J. Family Foundation Giving 2011
www.shaw-trust.org.uk

17. Case-study: self-confessed entrepreneur Tom Hunter
A successful entrepreneur and philanthropist whose personal wealth derives from creating, growing and
selling his sports retail business Sports Division in 1998.
After selling business Sir Tom established the Hunter Foundation as a formal vehicle through which to
manage his philanthropy.
Passionate about creating a more entrepreneurial Scotland, supporting the development of young people
through education and leadership.
Examples of current partnerships in the UK include Children in Need and Cash for Kids in the West of
Scotland that aim to target the NEET agenda (young people not in education, employment or training).
The positive destination programme undertaken in partnership with Children in Need comprises of £1.7
million grant that funds five projects across the UK.
The projects are focused on improving outcomes for children and young people in the NEET category.
Each project focuses on a different aspect of the NEET agenda, and takes a unique and innovative
approach to tackling it.
Pharoah, C with Keidan, C and Gordon, J. Family Foundation Giving 2011
www.shaw-trust.org.uk

18. Major preventive programmes
Children s Investment Fund Foundation
Few independent funders, apart from the giant US Bill and Melinda Gates Foundation, have
the resources to undertake large-scale public health and education programmes, working in
partnership with governments and international agencies. In the UK CIFF has placed a strong
emphasis on taking this route, investing more than £18 million in child survival in 2009/2010,
with a particular focus on risks due to malaria and AIDS, and £3 million on educational
development.
It has set itself ambitious targets, based on an analytical approach to assessing need and the
potential for impact. It aims to help eliminate paediatric HIV/AIDS in Zimbabwe, supporting the
government s work through a major grant to the Elizabeth Glaser Paediatric Aids Foundation.
Through a Teacher-Community Assistant Initiative (TCAI) in Ghana, the Foundation is
working with the government to improve education outcomes for primary school children,
aiming to rollout TCAI across 13,000 schools.
Pharoah, C. Global Grant-making. 2011 www.shaw-trust.org.uk

19. Partnership example – sustainable economic
and agricultural development
Gatsby Charitable Foundation and Wood Family Trust
Two foundations with a similar interest in improving the incomes of the poor through promoting
sustainable enterprise in Sub-Saharan Africa, the Gatsby Charitable Foundation and the Wood Family
Trust Africa, have partnered with tea industry stakeholders in Tanzania to launch the Chai Project.
Its aims are to double smallholder production, increase productivity and incomes, and enhance the
overall competitiveness of the sector. While the target beneficiary is the smallholder tea farmer, the Chai
Project is also comprehensively reviewing the whole process from input supply to end market.
Key research activities have been carried out, including a comprehensive and detailed audit of all
existing and potential tea growing areas, clarifying exactly what opportunities exist for expanding
production and increasing productivity, plus an industry benchmarking of costs, comparing the
competitiveness and cost structure of Tanzania s tea sector with other major producers in East Africa.
Support will be provided through a variety of mechanisms including technical assistance, matching
grants, loans, equity and any other commercially viable intervention.
Pharoah, C. Global Grant-making. 2011
www.shaw-trust.org.uk

20. Cathy Pharoah: Heed the case of Linda Kirk
who tried and failed to get local social
investment
Third Sector, 1 May 2012
Cathy Pharoah
Set aside the romance and grasp the harsh realities of social
enterprise, says our columnist
The demystification of the idea of social enterprise is long overdue. The cult of enterprise has held
iconic status in the sector over the past decade or so. But the fact is that in a sector where income is
under pressure on all fronts, entrepreneurialism is no longer just an aspiration; it's a necessary
www.shaw-trust.org.uk
condition of survival. So it is time to get real about it.

21. Today s major donors?
 investors - in futures (not necessarily financial products!)
 education, international development, culture
 big money – use for big projects
 capital investments as much as social investments
 partnerships – many reasons
 networkers
 sometimes beginners – learning curve
 often more specific, operational, engaged
 business- like / used to success/ want to be good at whatever they do
 many different routes to entrepreneurial philanthropy
www.shaw-trust.org.uk