Ethics of Philanthropy

Source: Indian Express

Context: The article highlights the growth and potential of Indian philanthropy

*“We must consider the time and the place, and the character of the receiver, which is the weights in the scale, which cause our gifts to be well or ill received.” – Seneca*

Definition: Philanthropy can be defined as an act or gift done or made for humanitarian purposes.

Philanthropy in India:

In pre-independent India, Mahatma Gandhi encouraged businessmen to contribute their wealth for the betterment of society. Industrialists like Jamnalal Bajaj and G.D. Birla supported Mahatma Gandhi’s initiatives during the freedom movement while pursuing their own philanthropic interests.

Philanthropy in the West:

America: Carnegie-Rockefeller era of philanthropy.

Andrew Carnegie built impressive institutions (like Carnegie Library and Carnegie Mellon University), but also inspired (and instigated) the rich; the last line of his book reads: *“The man who dies rich, dies disgraced.”*

The Rockefeller Foundation also developed a vaccine to eradicate yellow fever. Both Carnegie and Rockefeller became role models, inspiring generations (including myself) to give away their wealth to improve society.

Issues with Philanthropy:

• The parochial nature of giving, which risks some of the poorest regions being ignored

• Programmatic giving doesn’t add up (for example: a number of foundations and NGOs work on school education, yet learning outcomes have not improved).

• A recipient may violate the donor’s intentin spirit or in law.

• A donor’s activities may be considered incompatiblewith those of the institution’s mission.

• Recipient may be perceived as complicit with or oblivious to a donor’s unethical practices, thus tainting its own good name, especially when an institution grants naming rights.

• A donor may receive a quid pro quo for all or part of a donation.

The way forward for philanthropy in India:

• Build institutions: Donors can fund think tanks and build area-specific (say, on energy transition) or geography-specific (such as eastern Uttar Pradesh) institutions. For e.g.: The Tata family built the Indian Institute of Science in Bengaluru, The Energy and Resources Institute (TERI), the Tata Memorial Hospital, etc.

• For e.g.: The Tata family built the Indian Institute of Science in Bengaluru, The Energy and Resources Institute (TERI), the Tata Memorial Hospital, etc.

• Fund risky R&D for the government: For example, Nandan Nilekani built an innovation ecosystem such as Aadhaar, UPI and eKYC.

• For example, Nandan Nilekani built an innovation ecosystem such as Aadhaar, UPI and eKYC.

• Support governments to improve delivery: Partnering with the government as a philanthropic entity is the most effective way to make a scalable and sustainable impact. For example, The Piramal Foundationis supporting the Aspirational Districts collective

• For example, The Piramal Foundationis supporting the Aspirational Districts collective

• Veddis Foundationis funding initiatives to improve the evidence base and outcome orientation of governments.