No one ever said,“Give it your 2% and you will do great in life.” Parents, teachers, coaches, and bosses always ask for 110% to be successful. Yet, when it comes to a transformed India where all citizens thrive with dignity and equity, we somehow have limited ourselves to just 2% of funding from a company’s profit to tackle India’s most complex and critical problems.
Let’s keep aside the debate on whether the Corporate Social Responsibility (CSR) mandate is justified, whether it is fair or whether or not a corporate should be responsible for moving people out of poverty beyond providing employment. Instead, let us reflect and realise that as a nation, we must ensure 120 million adolescent girls complete secondary education, secure clean water and sanitation solutions for 78.9 million urban households, and strengthen our systems to enable access to justice, which will not be solved with just 2% of profits, time or energy.
The good news is that in 2017, India’s growth in wealth of $451 billion represented the eighth-largest wealth gain globally by any country, according to the Credit Suisse Global Wealth Report. Between 2017 and 2027, India’s total wealth—the private wealth held by individuals in a country—is slated to grow from $8.23 trillion to $24.7 trillion, rising 200%, according to the 2018 Global Wealth Migration Review by AfrAsia Bank.
India is home to 119 billionaires, second to just China and the U.S. The transfer of wealth from one generation to the next will be Rs 8.6 lakh crore ($128 billion) over the next decade. While the wealthy want to leave behind wealth for their children and grandchildren, it is important to remember what Warren Buffett told Fortune in 1986; that he is leaving his kids “enough money so that they would feel they could do anything, but not so much that they could do nothing”.
The Community, NGOs, philanthropists, and the government are key players in the fight against poverty.
India’s philanthropic landscape is rich with innovation, experience, and accomplishments. Philanthropists Bill and Melinda Gates, Michael and Susan Dell, and Pierre and Pam Omidyar chose India as their first global office outside the U.S. They all realised a significant need and opportunity to support thousands of NGO leaders to impact more lives, forge partnerships with the government, and solve critical issues such as preventing faecal sludge from entering our water supply, ensuring financial inclusion, and improving learning outcomes. While these three foundations have a cumulative Rs 3 lakh crore ($45.2 billion) of assets, early in their philanthropic journey they recognised the need to support and scale existing NGOs, partner with philanthropists, and work closely with the government to create impact at scale. This allowed them to raise their aspirations to eradicate disease, revolutionise education outcomes, and mobilise new sectors such as impact investing.
Domestically, leading foundations such as the Tata Trusts, Azim Premji Philanthropic Initiatives, and Central Square Foundation (started by Ashish Dhawan) follow a similar approach to partnership and collaboration. They work with NGOs, philanthropists, and the government to achieve ambitious and impactful goals. Collaboration is no longer just a buzzword but a necessity, since no single individual or institution can solve these problems alone. It takes multiple stakeholders forging lasting partnerships and bringing various skills, perspectives, and funding to eradicate the components of poverty. The community, NGOs, philanthropists, and the government are key players in this fight.
Development starts in communities. There, India’s true heroes are single-handedly attempting to lift themselves out of poverty. They have immense determination, resilience, and sincerity to move their families and communities to the next economic and social strata. Global studies demonstrate that the poor give a greater percentage of time and money towards serving others. The only thing they ask for is a level playing field.
High-impact NGOs serve as the communities’ voice, understanding their needs, co-creating interventions, and jointly evaluating impact. The community and NGOs work together to introduce innovative pilots, course correct on a real-time basis, and provide proof of concept to funders and the government on what can and should be scaled. Great NGO leaders are committed, solution-oriented, and entrepreneurial, finding opportunity and hope in grave situations, and mobilising talent and funding to work towards a common goal. They are levelling the playing field to allow for upward mobility.
Philanthropists create wealth by building large, successful organisations. The skills of scaling up—assembling a strong management team, instituting robust systems, and implementing long-term plans—are lacking in the NGO sector and can be transferred. Funding for critical institution-building expenditure should be borne by philanthropists since they realise first-hand the link between strong management and delivery of services. That being said, philanthropists lack a deep understanding of the community and its issues; therefore, partnering with NGOs accelerates their ability to solve these issues.
The government is also a crucial and significant player in the development sector. Unfortunately, due to constant election cycles and a slow-moving bureaucracy, their ability to innovate and be agile is limited. But they are becoming more accountable in serving their constituency, and are looking for evidence, private-public partnership models, and experimentation to help India achieve its commitment to the development goals. Programmes that have been scaled with documented evidence play a key role in helping government officials with policy-level decisions and implementation of new programmes.
When these four stakeholders come together, they can move more people out of poverty than ever recorded in history. As Nelson Mandela said, “Like slavery and apartheid, poverty is not natural. It is man-made and it can be overcome and eradicated by actions of human beings.” In the past decade, India’s business families reiterated to the world their ability to compete and succeed on the global stage. Now, it is time to take on a more difficult, complicated but exhilarating challenge of ending poverty in India. This will take much more than just 2% to succeed.
(The article was originally published in the August 2018 issue of the magazine.)