Learning: Where New Philanthropy Meets Old

Learning: Where New Philanthropy Meets Old
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We often refer to the debt we owe to Andrew Carnegie and John D. Rockefeller for translating their charitable impulse into organized philanthropy, providing the model for the many foundations that have since emerged. But perhaps more important than the institutions they built was the questioning ethos they instilled. Both men insisted on maximum flexibility for future leaders of their philanthropies. They wanted lasting institutions that could learn and adapt.

Perhaps their most powerful legacy was that commitment to continuous learning.

When the industrial age gave way to the information age, not only the source of wealth but the techniques of philanthropy changed. What remained the same was a willingness to invent and an eagerness to learn.

Novel approaches, the evidence that supports them, and the questions that persist will be fodder for a lively conversation among "new philanthropists" at the Global Philanthropy Forum (GPF) Annual Conference in Washington D.C., on April 16 to 18. The donors and investors who comprise the Forum can be counted on to take a hard look at their own innovations, to assess what works and doesn't, and to note when an idea requires more time, dollars and political will to prove its worth.

Expect the unexpected connection at GPF, including:

When "Shared Value" Meets Africapitalism: Nigerian philanthropist and businessman Tony Elumelu will discuss his energetic efforts to advance "Africapitalism" as a primary vehicle for building economies and improving lives throughout the continent. Having himself transformed a failing Nigerian commercial bank into a two billion dollar pan-African powerhouse, Elumelu now trains business leaders and helps finance local enterprises that can contribute to what he calls "economic prosperity and social wealth" in sub-Saharan Africa. Fittingly, he'll be in conversation with Mark Kramer of FSG, who has written widely on the ways that corporations can create "shared value" for both company shareholders and society's stakeholders.

When Politics Meet Practical Solutions: Social Impact Bonds, or "pay for success projects," will be the focus of the challenge posed by Social Finance Inc.'s Tracy Palandjian. When the political will to provide public dollars for services is lacking, she would squeeze out the risk, and have governments only pay for services once they are delivered. How does that work? Governments would contract with intermediaries which, in turn, would float "impact bonds" to attract the up-front capital needed to pay for those services. Once the money is raised, the intermediary will contract for the services, for which the governments then pay. Bond holders get their money back, plus two kinds of return on their investment -- a cut of the ultimate payment made by governments, plus the satisfaction of knowing that government services had indeed been provided.

When Grant Dollars Meet Investment Capital: Acumen founder and pioneer Jacqueline Novogratz is among the earliest and most effective champions of investments in "social enterprises" that produce both a social and a financial return. But she will challenge the notion that investment dollars alone can build small and growing enterprises that provide goods, services and income generating opportunities for the poor in the developing world. Like their counterparts in the developed world, small enterprises in the developing world go through many phases -- from business plan to proof of concept to the moment for scale. Like their developed world counterparts, they too need patient capital. Investors waiting on the sidelines for the next whopping success will wait a long time if that early assist is not there. While some might argue that grant dollars are not needed, Jacqueline will differ, describing the role and the moment for philanthropic grants and loans.

When Smart People Meet Hard Truths: This focus on evidence will be carried through the last day of the conference, when the Ford Foundation's Luis Ubiñas will describe many moments when evidence prompted a fundamental shift in the foundation's strategy. A believer in building what he calls an "impact culture," he argues that learning is a central philanthropic value that requires a commitment to "impact evaluation." But foundations built on the legacy of learning are not alone. Public sector leaders like Hilton Humanitarian Prize keynoter Robert Zoellick and Caroline Anstey of the World Bank will describe their institution's pivotal moments of discovery that changed its course. And UNICEF leader Anthony (Tony) Lake will speak to recent findings that have the potential to turn the notion of triage on its head -- at least in the delivery of health care to children in need, and the realization of the Millennium Development Goals (MDGs). Conventional wisdom argues that the greatest efficiencies and therefore the most gains will be made by giving priority to "low-hanging fruit," the children most easily reached with time-tested interventions. However, UNICEF's elaborate set of peer-reviewed studies and simulations suggest otherwise. By focusing on the poorest and most marginalized, UNICEF may, in fact, save the lives of more mothers and children, making far swifter progress toward the MDGs, on budget and on time. Importantly, those most desperately in need will have been served. What is referred to as s an "equity-based approach is, in Tony Lake's words, not only "right in principle," but also "right in practice."

While the terms "shared value," "social impact bonds," "social enterprise," "impact evaluation" and "equity-based" would be foreign to Carnegie or Rockefeller, the effort to grapple with hard truths would not. The willingness to invent and the eagerness to learn has been a constant and essential ingredient of social change.

It is at that point that new philanthropy meets old.

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