PGPM principles of philanthropy policymaking (notes)

Rhodri Davies- Programme Director, Giving Thought at Charities Aid Foundation
Cass MSc lecture
 I’m here because last year I published a book
about philanthropy (whilst also being lucky
enough to have a full time job!)
 That book was Public Good by Private Means:
How philanthropy shapes Britain. (SLIDE)
 It looks at the history of philanthropy in this
country, and what it can tell us about the role
of philanthropy in modern society and how
policymakers should address it.
RUNNING ORDER (SLIDE)
 Bit of background to why I wrote the book:

o I have long been interested in the interplay
of philanthropy and the state
o Came to realise over nearly a decade of
working in philanthropy/charity policy that
there was often little clarity about how
politicians and policymakers see
philanthropy and charities
o The approach tends to be by assumptions
and inferences, rather than a coherent
political narrative about the role of private
giving in supporting the provision of public
goods
o Vol sec policy had reached a particularly
stale point (austerity, failure of Big Society,
PSD consensus)
o SO: I thought it was time to take a step
back and look again at the big picture
rather than fiddling with the details

o Question I asked myself was “how should
policymakers understand the role of
philanthropy”?
o As I began to read more around the
subject, I began to realise that there was a
lot I didn’t know about the history of
philanthropy. I also realised that many of
the things I was discovering had obvious
relevance for the issues I continually came
across in my policy work and often
provided valuable insight and context.
o So I decided to combine historical
evidence with my knowledge of the current
state of philanthropic practice and charity
sector policy, in an effort to show where
we have come from and where we are
now.
o AND: give some suggestions for where we
should go next.

o SO: I proposed 8 principles that should
guide policymaking when it comes to
philanthropy
o Partly, it has to be said, driven by
colleagues who were keen to spell out the
relevance of all this charming historical
anecdote as much as possible!
 And I want to take those 8 principles as the
basis for today’s lecture
 I want to look at those 8 principles, explore the
theoretical basis behind them, look at some
examples of where they have been either
demonstrated or tested (both historical and
current), and also give you the chance to
discuss both whether you think these
principles themselves are right and whether
there are others that we could add.

(SLIDE)
EXERCISE: Take 5 mins and write
down YOUR three key principles
that policymakers should have in
mind when making policy designed
to promote or support charitable
giving/philanthropy
ONGOING EXERCISE (SLIDE):
• I also want to introduce a little game that is
sure to be sweeping the nation soon, called
“Descriptive or Normative?”

• As we discuss 8 proposed key principles of
philanthropy policymaking, consider the
following question:
“To what degree is each principle descriptive or
normative?”
• i.e. does it say something objective about
how philanthropy is at the moment, or
something subjective about how it should
be?

Key principles of philanthropy (SLIDE)
1.Philanthropy is about people and their
choices (SLIDE)
 Philanthropy can be understood in a micro
and macro sense:
o MICRO: As an activity focused on the
voluntary decisions of individuals to
give away assets for the benefit of
others
o MACRO: As a mechanism for the
redistribution of wealth within society.
 As Reich et al put it (SLIDE): “Philanthropy
can refer both to actions and institutions.
We can think of philanthropy both as a
form of individual giving and as a complex

economic and policy structure – as the
institutionalized practice of privately
funding the production of public benefits. If
regarded from the first, agential
perspective, philanthropy stands apart
from other forms of giving, such as gift-
giving to friends and family, and from
spending for private consumption. If
looked at from the second, structural
perspective, it stands apart from
alternative, institutionalized mechanisms
of finance, such as taxation or market
exchange.”
(Reich, R., Cordelli, C. & Bernholz, L.
(2016) Philanthropy in Democratic
Societies: History, Institutions, Values.
Chicago: Chicago University Press)
 My point is that there is a danger of a
disconnect here because the features of
philanthropy at a micro level do not match

up to the expectations sometimes placed
upon it at a macro level
 Philanthropy at an individual level is an is
an inherently voluntary activity, and a
largely irrational one (in an economic
sense)- it is dependent on a complex
range of factors including upbringing,
personal history, emotion, religious belief
etc.
 Whilst this gives it some unique strengths
it also makes it very ill-suited to other
things.
 For instance, philanthropy can be very
good at being responsive, risk-taking,
taking a longer-term view or running
counter to the status quo or popular
opinion
 BUT: it is not good at matching supply with
demand (geographic and wealth

disparities) or ensuring equity, and often
not good at bringing ideas to scale.
 AND these are things one might
reasonably want of a rational macro-level
system of redistribution
 SO: there are 3 choices for policymakers
(SLIDE):
1)Accept the current reality of
philanthropy at the micro level (i.e.
voluntary & irrational) and shape any
policies about the role it can play at a
macro level accordingly
2)Have a vision of how philanthropy
should work at the macro level and
use policy to try to shape it at the
micro level to ensure it meets
requirements. OR, what most often
happens:

3)Accept philanthropy at the micro
level, have some vision for it at a
macro level, hope the two match up,
get frustrated.
 I think the ideal scenario is 1: informed
policymaking that accepts the voluntary nature
of individual giving, and looks to utilises its
strengths as a force within society while being
aware of its weaknesses.
 BUT there are those who espouse something
more like 2 (e.g. Cordelli). Usually driven by
concerns about philanthropy creating
plutocratic bias, distorting democracy or
exacerbating inequality. Diagnosis is that
natural state of philanthropy at micro level is
sufficiently problematic that we should
constrain it or direct it in order to fit with
macro-level vision.

 “Philanthropy should be understood foremost
as a duty of reparative justice… Affluent
donors should, as a matter of moral duty,
exercise no personal discretion when deciding
how to give and to whom. Indeed, they should
regard their donations as a way of returning to
others what is rightfully theirs.”
(Cordelli, C. (2016) “Reparative Justice and
the Moral Limits of Discretionary Philanthropy”
in Reich and Cordelli).
 Unfortunately, most policy-making when it
comes to philanthropy (certainly in liberal
democracies) is more like 3. Politicians and
policymakers feel compelled (to a greater or
lesser extent) to extol the virtues of individual
choice when it comes to giving, but also see a
role for it as a tool for delivering public
services and social welfare without necessarily
acknowledging the tensions inherent in this
position.

 Some politicians may not be the bothered if
they believe that philanthropic provision of
welfare is in fact preferable to state provision,
BUT as we shall see shortly this is not a very
easily tenable position
 MOST just haven’t thought it through
 It is possible to square this circle if you are
willing to argue that philanthropy has emergent
properties i.e. it is irrational at the individual,
micro level, but taken en masse at a macro
level it converges on rationality.
 Is this believable? Is there any evidence for it?
I leave that up for discussion!
2.Philanthropic choices are about both
head and heart (SLIDE)

 Having asserted that philanthropy is all about
people and their choices, the second assertion
is that these choices are influenced by a
mixture of rational (objective, evidence-based)
factors and irrational (emotional, cultural)
factors.
 Point here is to give another warning to
policymakers about the challenges of using
philanthropy at a macro level as a means of
redistribution.
 BECAUSE, one could accept principle one
(i.e. that philanthropy is all about individual
choices) but still believe that those choices are
all rational (or at least should be) and therefore
will result in a rational redistribution, albeit
perhaps a different one than would be
achieved through taxation.

 HOW? E.g. take an Effective Altruist position.
(SLIDE)
 EA is the movement based on the work of
moral philosopher Peter Singer, which
advocates a utilitarian view that donors should
be cause neutral when it comes to their giving,
and merely seek to maximise the amount of
good they do with their money.
 We could spend pretty much the next two
hours just talking about the pros and cons of
Effective Altruism, but that is a different
lecture.
 Suffice it to say that whilst I think EA is an
interesting philosophical position, and
represents an approach to philanthropy that
has proven popular in some quarters (notably
among Silicon Valley philanthropists), it does
not reflect the reality of the vast majority of
philanthropy today.

 So EA is a normative ideology (i.e. it seeks to
tell us how philanthropy should be done).
 Interesting question: will more and more
philanthropy converge towards EA in the
future as big data grows, and the possibility of
automation through AI opens up?
 One could design policymaking with this aim in
mind: i.e. put forward policies which rewarded
EA approaches, in order to try and make this
the norm.
 HISTORICAL PRECEDENT (SLIDE): Victorian
era, scientific giving and the Charity
Organisation Society
 Let’s just come back to the distinction between
rational and irrational outlined above, which
puts e.g. EA on one side and traditional
philanthropy on the other.

 In order to draw such a distinction, we need to
take a view on what the purpose of
philanthropy actually is, as it is only by
measuring against a clear goal that we can
assess whether an approach is rational or not.
 The EA position is that the goal of philanthropy
is the maximisation of good (which is itself a
pretty thorny issues), and that traditional
philanthropy does not measure up well against
this.
 HOWEVER: what if this isn’t the goal of
philanthropy?
 Worth taking into account the economic
account of charitable giving/altruism at this
point.
 Basically, classical economics couldn’t deal
with charitable giving because it was based on
the idea of rational agents trying to maximise
their own comparative utility.

 Altruism doesn’t make sense in this framework
because by giving away private assets to pay
for public goods you are acting against your
own economic self-interest.
 Furthermore, there is what is known as the
“free-rider problem”: since public goods are
non-excludable (i.e. you can’t stop other
people benefitting even if they haven’t paid), if
you assume that a given good is going to be
produced anyway, then the economically
rational thing to do is not contribute and
benefit anyway.
 There is a reason that studies suggest that
studying economics makes you less likely to
give to charity!
 Basic approach to solving this problem is to
shift the goalposts, away from “pure altruism”
and introduce the notion of “impure altruism”.
Best known from work of economist James

Andreoni, who came up with the “warm glow
theory” of charitable giving, which posits that
seemingly altruistic acts are selfish after all,
because the donor gets a personal benefit in
the form of a “warm glow”. (SLIDE)
 The nature of this “warm glow” is the subject of
some debate (is it an evolutionary adaptation,
pleasure at compliance with religious
teachings, desire for social reward etc?)
 BUT: Neuroscience experiments using FMRI
have shown that charitable giving does
stimulate the same parts of the brain that deal
with reward in other contexts (SLIDE) (the
frontal meso-limbic system, release of
dopamine). So warm glow does appear to
exist.
 SO: perhaps purpose of philanthropy is to
maximise one’s own warm glow, and

effectively meeting need is just one way of
doing that?
 OR: it is a mixture of maximising public value
and personal warm glow.
 This has implications for policymaking:
1)Thought needs to be given to how to map
the public value element of philanthropy at
an individual level onto any macro level
policy aims
2) It suggests that macro-economic tools like
tax incentives may not be the only way to
encourage giving (or even the most effective
way).Instead, micro-economic approaches
based on e.g. behavioural economics may
be more effective. EXAMPLES OF THIS.
(SLIDE)

3)Philanthropy is not the same as
public spending and cannot replace it
(SLIDE)
 Why is it that a policymaker or politician might
want a macro-level policy approach to
philanthropy?
 Because they see it as a supplement or
alternative to public spending on welfare etc.
 This might be for ideological reasons (i.e.
belief in small state, preference for individual
action) or for pragmatic reasons (i.e. there
simply isn’t enough money to pay for public
services).
 Point of this principle is that philanthropy can
act as a supplement (and ideally be
additional), but it can never be a replacement.
 TWO MAIN REASONS

1)As above, philanthropy is inherently voluntary
and irrational with respect to the provision of
public goods (COMPARISON OF PROFILE
OF DONATIONS VS PUBLIC SPENDING
PRIORITIES)(SLIDE)
2)The scale of philanthropy doesn’t begin to
match that of public spending (SLIDE)
(BLOOMBERG HEDGE FUND MANAGER
ANECDOTE, GATES “Rounding Error”)
(SLIDE)
 Advocate of philanthropic welfare might argue
that this is only because the theory hasn’t
been properly tested, and that if public
spending and taxes were radically reduced,
philanthropy would ramp up to fill the gap.
 No real evidence in favour of this view
 Historical lesson from Victorian era is precisely
the opposite if anything

(QUOTE FROM OWEN) (BOOK)
4) Tax relief on philanthropic
donations is not a subsidy for services
the state would otherwise have to
provide (SLIDE)
 Have moved this one up from number 8, as I
think it follows on naturally from the first three.
 Originally put it at the end so as not to make
people glaze over by talking about tax!
 ACTUALLY tax policy is where you really see
the issues we have discussed so far come to
life, because it’s where there is money on the
table.
 HENCE the way in which incentives for
charitable giving are designed, and the

justification for offering them in the first place,
force you to face up to many of these issues.
 NB: not to say that most systems of tax
incentives for philanthropy arose out of a
careful process of translating a clear
philosophy and political ideology into policy- in
most cases the justification is at best implicit
and more often than not is entirely opaque.
 Take the UK: we have had income tax since
1799, and since the beginning there has been
some sort of relief for charitable activities.
 At first limited to charitable organisations, then
in 1842 charitable deed of covenant was
invented, allowing donors to transfer their
personal liability to a charity via a covenant
arrangement (and charity was tax-exempt).
 This Gentleman’s agreement continued for
around 80 years, despite some strong attacks

(most notably from Gladstone, of which more
in a moment)
 Gradually the mood music changed, and the
government decided it wanted to clamp down
on this practice
 So, in the 1922 Finance Act they introduced a
new stipulation that any Deed of Covenant
between an individual and a charity of less
than 7 years was not sufficient to allow them to
avoid their tax liability.
 Their intention was obviously to close the
existing loophole, but unfortunately the net
result was that, by implication, any deed of
covenant of 7 years or more was valid. Hence
the 7 year charitable deed of covenant was
born.
 This was the only form of individual tax relief
for many years, until it was augmented by

Payroll Giving in 1986 and then superseded by
Gift Aid in 1990.
 Just by way of contrast, the US charitable
deduction was introduced in very different
circumstances: in 1917, only four years after
the introductionof a permanent income tax. It
was in part in recognition of a desire to
encourage people to continue to give to
relevant purpose despite the fact that the rate
of income tax had shot up from 15% to 67% in
order to fund the war effort. (It was also a hell
of a lot simpler from the outset!)
 Despite the fact that the introduction of
philanthropic tax breaks has in so many cases
been due to a combination of pragmatism and
accident, when the issue comes to the fore,
there are still those who confidently offer
opinions on why the justification is clear.

 Before we look at a couple of examples, we
need a theoretical framework.
 Here, I am going to borrow shamelessly from
Rob Reich from Stanford University, as I have
long thought his exploration of the
philosophical justification for tax breaks on
giving is the last word on the subject. (NB: it
also borrows heavily from the detailed
discussion of the topic in the Filer Commission
report )
 Reich offers three possible rationales: (SLIDE)
1)Tax base rationale: Tax incentives for
charitable giving are not really tax 'breaks' at
all, because you need to deduct any charitable
gifts from an individual's income in order to
properly define what that person should be
taxed on. The reasoning is that people should
only be taxed on personal consumption or

wealth accumulation, and money given away
to charity does not count as either.
2)Subsidy rationale: It is appropriate for the state
to offer tax breaks for people to be charitable
because by doing so it stimulates greater
social value than the state could have
produced on its own. The underlying
reasoning here is that the state collects taxes
in order to pay for public or social goods, and
charities and civil society organisations work to
produce these same goods. Hence it is fair
and efficient to allow people to choose to
contribute to social good directly through
charitable gifts rather than through paying their
taxes.
3) Pluralism rationale: Rather than justifying the
tax break because of any specific social good
produced by a particular charitable gift, it
should be justified more broadly on the basis

that there is inherent value to society in having
a thriving charitable sector - i.e. the public
good is civil society itself. Hence any decent
liberal democracy should support the ongoing
health of civil society by offering tax breaks to
those who want to contribute to it.
 I think the Pluralism Rationale is the only one
that works (hence putting it forward as a
principle)
 The Tax Base rationale doesn’t work because
it doesn’t differentiate between gifts to valid
charitable causes and any other discretionary
gift (e.g. to family or political parties). Why
shouldn’t I get tax relief on gift to my children if
sole basis is the fact that I have given it away
so shouldn’t be taxed on it?
 In order to draw distinction, you need to say
something about fact that charitable gifts

deliver public benefits, but then you have
already moved on to external justification.
 SO: clear that the justification is something to
do with what is produced by the gift, and the
fact that the government recognises its value.
 One version of this is that philanthropic
donations result in public goods, and since
these are things that the government might
otherwise have to provide, it makes sense to
offer tax breaks for them. This is the Subsidy
Rationale.
 Problem with this is that, as we have already
seen, philanthropy is not a good substitute for
public spending as it stands, because the
profile and scale of giving doesn’t match that
of public spending.
 One option is to align charitable tax incentives
more overtly with government priorities (which

some countries have done), but this falls foul
of my first principle.
 If you don’t then situation is that you are
offering a subsidy for delivering public goods
that is ineffiecient on two counts:
 As already pointed out, you would be
subsidising a wide range of things
outside the remit of government
priorities
 Even in the areas of overlap, this kind
of subsidy is only barely treasury
efficient (i.e. £1 in charitable subsidy
only results in about £1 of spending on
public good), so why not simply give a
grant to civil society orgs?
 This points to the fact that you either need to
change the approach to offering charitable
giving incentives, or adjust your rationale so
that:

 You make a virtue of plurality
 You make a case for why voluntary
giving is preferable to direct public
spending of the same value on the
same thing
 SO: one reason to support civil society through
subsidising giving is that it ensures support for
those parts of the sector that are not primarily
concerned with service delivery and may run
counter to government interests.
 I am thinking here in particular of campaigning
for social change (which we will consider more
in the next section).
 Another crucial thing is the added value of
giving people a sense of individual agency.
 So the only solution is to get away from
government-directed priorities and take a

pluralist approach which allows that all causes
which meet the required criteria to count as
charitable are equally valid and deserving of
tax relief on donations.
 HENCE the tax relief is not a subsidy for
specific services the government would other
wise have to provide, but a generalised
subsidy for the maintenance of a healthy civil
society
 NB: Three sides to the value of this: (SLIDE)
1)In terms of specific social outcomes delivered,
some of which will overlap with governmental
priorities
2)In terms of the broader value of a healthy,
pluralistic civil society as a vital part of a
functioning democracy
3) In terms of the inherent value of giving people
a sense of personal agency

Historical examples: (SLIDE)
 Difference of opinion over tax base vs subsidy
rationale at the heart of a fierce debate
between Gladstone and Disraeli
 Filer Commission claims that tax base
rationale was at the heart of original
introduction of the deduction
 BUT by 1939 US House of Reps report gave
an explicit version of the subsidy rationale.
 More recently, a 2008 Conservative party
policy paper outlining an early version of the
Big Society concept returned to the tax base
rationale. (CF GIBG)

 We have talked quite a lot about what
philanthropy is not.
 i.e concluded that philanthropy needs to be
understood as the macro level expression of a
multitude of individual choices, all of which are
to some degree not rational,
 So we might well ask what role it should play
 Next 4 principles address this to some extent-
suggesting ways in which philanthropy can be
understood and/or practised so as to maximise
the value of its role within society
5) Philanthropy is often ‘political’ (and
that is a good thing) (SLIDE)
 Particularly timely given that this is the day of
the general election result

 And political campaigning by charities has
been quite a big issue- largely due to their
notable absence (SLIDE)
 Not going to get into details of the Lobbying
Act
 Suffice it to say that there has been growing
concern about negativegovernmental
attitudes towards the idea of charitable
campaigning for a while
 E.g. Brooks Newmark- “Stick to their knitting”
 More of a concern is global trend for closing
space for civil society. (SLIDE)
 UK’s role as a beacon for civil society policy,
legislation, regulation risks being undermined.
 NB: A lot of criticism seems to imply that
political campaigning by charities somehow a
new thing

 BUT: this show total ignorance of the history of
philanthropy (SLIDE)
 Campaigning for social change has always
been just at much of a part of philanthropy as
support for direct provision of services.
 NB: Deep impact on small number vs shallow
impact on greater number.
 ALSO: conflation of “political” with “party
political” or “partisan”. Charities are prevented
from the latter by charity law, but this is often
mis-applied to criticise them for the latter
 Idea that the public/political sphere is the sole
preserve of professional politicians runs totally
counter to history and seems very unhealthy.
 Interestingly, the rule against political
purposes may (again) only have been
introduced by accident.

 Can be traced back to a 1917 court case-
Bowman vs Secular Society
 In his judgment, Lord Parker made the
assertion that “a trust for the attainment of
political purposes has always been held
invalid”.
 BUT: this was far from clear in terms of
existing case law at the time, and almost
certainly not true.
 HOWEVER: once established, it quickly
became part of subsequent case law and
passed into common law in many other
countries which take our lead on charity law.
 DESPITE this, there are perhaps valid reasons
to be concerned about the interplay between
philanthropy and politics.
 E.g. 401c(4) designation in the US and the rise
of super-PACs (SLIDE)

 Concerns about UK Super PACs were used to
make arguments for the Lobbying Act.
 BUT: context totally different
 AND: possible that things will go in totally
opposite direction in the US: Johnson
Amendment etc. (SLIDE)
 SO: perhaps no regulation as bad as too
much?
 Another important point about the political role
of philanthropy is that it is often by its nature
involved in promoting causes that are not part
of mainstream public consciousness, or which
run counter to the political status quo.
 As such, there is a sense in which
philanthropy is profoundly anti-democratic
because it potentially allows those with large
financial resources to influence the directions

of debate and policy to an unreasonable
degree
 The question is not whether you agree with
what the philanthropist is doing (that is another
criticism e.g ideology, effectiveness), but
whether you think they should be able to exert
that level of influence.
 Callahan (SLIDE): “When donors hold views
we detest, we tend to see them as unfairly
tilting policy debates with their money. Yet
when we like their causes, we often view them
as heroically stepping forward to level the
playing field against powerful special interests
or backward public majorities… These sort of
a la carte reaction don’t make a lot of sense.
Really, the question should be whether we
think it’s okay overall for any philanthropists to
have so much power to advance their own
vision of a better society?”

 Even when the motive is good and the
intervention sound, the fact that the
philanthropist bring so much extra capital may
skew the direction of policy (e.g. in US
education sector).
 BUT: flipside is that sometimes the best
examples of philanthropy are when it is
undemocratic (i.e. taking a minority issue and
forcing it into public consciousness, so that
opinion strengthens and politicians are
required to act.
 Should we be sanguine about this on the basis
of a “pluralism of plutocracy”?
 OR: will there be a natural skew because the
political views of those with wealth converge
on a particular point on the political spectrum?
 Leads to next point

6)Philanthropy should be progressive
(SLIDE)
 Clearly the most normative principle!
 Basic point is that philanthropy should be
about solving problems and making society
and the world better, rather than about
maintaining the status quo or turning the clock
back.
 HOWEVER: far from clear that this is always
the case. (SLIDE)
 E.g. many conservative donors in US and
elsewhere funding deeply non-progressive
causes like climate change denial (Koch
brothers etc.)

 At a more benign level, some philanthropy can
be criticised as being unimaginative or risk-
averse (of which more in a moment)
 CF: criticism of Victorian philanthropy as too
conventional. (BOOK)
 Flip side is that sometimes in order to be
progressive you need to embrace the anti-
democratic nature of philanthropy outlined
above.
 E.g. philanthropy of Julis Rosenwald, building
schools for black communities in the deep
South during Jim Crow. (SLIDE)
 At the moment in the US philanthropy is
playing a key role as a bastion of progressive
values and thought, counter to the current
administration.
 E.g. Soskis (SLIDE): “Philanthropy must be a
place in which [the fundamental liberal values of
tolerance and respect for others, of decency,

charity, and moderation] are preserved, defended,
and championed, a sort of glass-walled sanctuary
for the best of American ideals.
 Big part of being progressive is having
something to say about tackling inequality
(global and societal), and this is a challenge
for philanthropy
 Philanthropy requires uneven distribution of
wealth and power, so can it ever be part of the
solution to inequality or is it always going to be
part of the problem?
 ALSO: the way in which some philanthropists
make their money exacerbates inequality to
such an extent that it negates any good they
do through their philanthropy
 CF: criticisms of Carnegie, Peter Buffett etc.
(SLIDE)

 I think there are ways of using philanthropy to
address inequality, but it is far from easy.
 (E.g. supporting broad- based grassroots
movements, ceding power, remaining largely
anonymous)
7)Philanthropy should be prepared to
take risks (SLIDE)
 The discussion just now of being willing to
stand for progressive causes even when
these run counter to the political or public
opinion of the time highlightsanother key
principle of how philanthropy, at its best,
should operate: i.e. it should be prepared
to take risks.
 This risk can take many forms (SLIDE),
e.g.:
o Political risk

o Financial risk
o Outcomesrisk
o Reputational risk
 The reason for being willing to take risks is
that this is one way in which philanthropy
can play a distinctiverole, even within the
framework of a welfare state
 Precisely because they are not accountable
to shareholders or voters, philanthropists
can try out approaches or tackle problems
that would be almost impossible within
either the public or private sector.
 AND: An individual philanthropist is not
even beholden to trustees or donors, so
they are free to determine their own
appetite for risk.

 If they can do this with a view to
demonstrating the value of new
approaches or highlighting the importance
of certain issues so that it influencesthe
way that governments and/or companies
operate in the future then philanthropy can
be seen to play a vital catalytic role.
 SO: risk often tied to innovation, and this is
something that is often cited as a strength
of philanthropy (SLIDE)
 BEVERIDGE QUOTE.
 Philanthropists who fund things that could
easily be funded by donationsfrom the
public, government grants/contracts or
commercial income are not maximising the
potential value of their giving.
 Thomas Hare quote (SLIDE)

8)Philanthropy can enable a long--term
view (SLIDE)
 Linked to point above: philanthropy is not
tied to short-term political or commercial
requirements (e.g. elections, shareholders
etc).
 As Eli Broad puts it: “Neither Bill Gates nor
I have to worry about getting fired. We take
big risks in pursuit of big rewards.”
 HENCE it should not only be able to accept
more risk, but also to focus on the longer-
term
 This will have a number of benefits
(SLIDE):

1)Bring attention to issues
 Philanthropy can also bring issues to
public consciousness and into mainstream
political debate by sticking with them: e.g.
the decriminalisation of homosexuality and
introduction of gay marriage
2)Keeping attention on issues
 For some issues, e.g. climate change, the
role of philanthropists and philanthropic
organisations in keeping the momentum
behind efforts to address it is vital.
 Even though governmentsshould in theory
have long-term considerationsin mind (as
should businesses), in reality they often
prioritise short-term political gain over
difficult longer-term choices.

3)Allow for longer-term solutions
 In addition to keeping attention on issues
for longer, philanthropy can also allow for
trying out longer-term solutions to those
problems
 E.g. early intervention: very difficult to shift
the focus of state services from addressing
symptomsof social problems to their root
causes by acting earlier without very firm
evidence that this works.
 Philanthropy can help to build that
evidence base.
 The knowledge that philanthropy can take
this longer-term view, and sustain a greater
degree of risk seems important for policy-
makersto take on board, as it points the
way to some potentially fruitful
partnerships/coalitions in which actors

from differentsectors can all come
together to address social problems while
harnessing their individual USPs.
 SO: we’ve had a look at my proposed
principles that I think those making
policy designed to encourage or
promote philanthropy should take into
account.
 NOW: it’s time for your turn… (SLIDE)
 Split into Groups? (Or not, if everyone
too tired)
 In groups, come up with your key
principles of philanthropy policymaking
(5-8 of them)

 Use mine, tweak them, or suggest
entirely new ones of your own.
 Rank them in terms of importance

PGPM principles of philanthropy policymaking (notes)

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