Domestic foundations in emerging countries accounted for 19% of total philanthropic flows for development over 2016-19. In India, the People’s Republic of China and Mexico, their financing surpassed incoming international philanthropic flows, according to Private Philanthropy for Development 2021.
While launching the report today, OECD Secretary-General Mathias Cormann said: “Private philanthropy for development is playing a pivotal role in providing targeted resources, leveraging private capital, and testing innovative approaches in support of many communities in the Global South. It can be agile in the face of changing conditions to address development needs.”
The second edition of the report, which covers 205 organisations in 32 countries, finds that private philanthropy for development amounted to USD 42.5 billion between 2016 and 2019, an annual average of USD 10.6 billion. Most of these funds were cross-border flows, with more than half coming from the United States (USD 24 billion).
Most philanthropic funding targeted upper middle-income countries, which received about USD 9.9 billion over the period 2016-19. Lower middle-income countries received USD 9.1 billion. A smaller share of philanthropic giving was directed towards low-income countries, reaching USD 3 billion. Latin America and the Caribbean received the largest share of total philanthropic funding (cross-border and domestic), followed by South Asia. Sub-Saharan Africa received the largest proportion of cross-border philanthropy.
The sources of philanthropic giving for developing countries were highly concentrated. Most cross-border philanthropy was provided by the Bill & Melinda Gates Foundation (USD 16.1 billion, or 38% of total philanthropic funding), while the largest provider of domestic philanthropy was Tata Trusts, which allocated USD 0.9 billion. The largest ten cross-border funders provided 76% of all cross-border financing, while the largest ten philanthropic organisations operating domestically provided 50% of all domestic giving identified.
The report also stresses that private philanthropy remains modest compared to official development assistance (ODA).Over the period 2016-19, the former was the equivalent of 7% of ODA from members of the OECD’s Development Assistance Committee, at USD 595.5 billion. Nevertheless, foundations remain key funders in certain areas, particularly health and education. More than one third of funding (43%) was allocated to health and reproductive health, representing a total of USD 18.4 billion over the period.
The report provides new insights into the strategies of philanthropic foundations in terms of spending, investment, advocacy, monitoring and evaluation. It points to a series of challenges that limit their contribution to development: risk aversion, limited time and resources for rigorous learning and advocacy, a lack of transparency, and limited capabilities to further mobilise finance for development.
Based on this diagnosis, the report provides recommendations for foundations and governments to further leverage global private philanthropy for development.
The OECD Centre on Philanthropy provides data and analysis on global trends on philanthropy for development in the context of the 2030 Agenda. The data from the report is accessible at https://oecd-main.shinyapps.io/philanthropy4development/
For more information or to request a copy of the report, journalists are invited to contact Bochra Kriout (Tel: +331 45 24 82 96)