Uncharitable billing for philanthropy
ITS A CONTRAST WORTH PONDERING OVER: against the backdrop of buoyant tax revenues and enduring profit growth, the extent of public-spirited contributions, largesse and generosity seems distinctly lacklustre. Its one of the great puzzles in our economic life. And more so, now that India has more billionaires and the very wealthy than most other nations, Japan included. Why is it that philanthropy, altruism and charitable giving remains mostly out of sync with the quantum of wealth creation and level of economic activity?
Its not that we lack a tradition of philanthropy across time, region and community. The talk of giving and reference to altruism is as old as the Vedas. Or even that theres no history of corporate philanthropy. At least one notable endowment was operational way back in circa 1892, much before the first major foundations were formed in the US. But a survey of charitable donations some years ago put the annual pan-India corpus at a ludicrously small amount. The figure would doubtless have gone up since, but not by very much, if the lack of regular inquiry is any inkling. We need to find out why philanthropic beneficence continues by and large to get a low billing.
Could it be that a general lack of clarity on the purpose of giving comes in the way of corporate philanthropy? Or, is it rather that the absence of clear-cut and long-term public policy that dampers funds flow? Now, philanthropists may perceive utility a warm glow, in the very act of giving, of feeling good. But the fact remains that charitable giving, given out of altruism for education, health, culture et al create public goods out of benevolence which, as a matter of policy, ought to be better understood and much encouraged. After all, private philanthropy and giving wisely can often substitute, and in any case complement, public provision of services and goods. Besides, as a recent study revealed, philanthropy is actually seen as the most significant driver of social responsibility in corporate India. Also, given the favoured tax-treatment of charitable donations, it needs to be asked what effect does the tax regime have on giving. In the US, where philanthropy is widespread, the tax code seems to be proactive in encouraging charitable oblations. Ultimately though, tax incentives can hardly act as suasion for stepped-up philanthropy.
This is where systematic business research of philanthropy is called for. One basic challenge in the Indian context would be to understand the motives of givers (and non-givers). The warm glow concept could serve as a working assumption, but we do need to analyse philanthropy in greater detail and study the deeper and more complex considerations that account for giving and generosity. Hopefully, the new laboratory techniques in economics and field experiments could throw light on the practice of philanthropy and the fund-raising mechanisms that we follow, and how they could be improved and fine-tuned, for instance, with partially matching grants. In this ancient land where profit is sacred and wealth divine, modern forms of philanthropy do need to prosper and thrive. Charity, after all, begins at home.
Its not that we lack a tradition of philanthropy across time, region and community. The talk of giving and reference to altruism is as old as the Vedas. Or even that theres no history of corporate philanthropy. At least one notable endowment was operational way back in circa 1892, much before the first major foundations were formed in the US. But a survey of charitable donations some years ago put the annual pan-India corpus at a ludicrously small amount. The figure would doubtless have gone up since, but not by very much, if the lack of regular inquiry is any inkling. We need to find out why philanthropic beneficence continues by and large to get a low billing.
Could it be that a general lack of clarity on the purpose of giving comes in the way of corporate philanthropy? Or, is it rather that the absence of clear-cut and long-term public policy that dampers funds flow? Now, philanthropists may perceive utility a warm glow, in the very act of giving, of feeling good. But the fact remains that charitable giving, given out of altruism for education, health, culture et al create public goods out of benevolence which, as a matter of policy, ought to be better understood and much encouraged. After all, private philanthropy and giving wisely can often substitute, and in any case complement, public provision of services and goods. Besides, as a recent study revealed, philanthropy is actually seen as the most significant driver of social responsibility in corporate India. Also, given the favoured tax-treatment of charitable donations, it needs to be asked what effect does the tax regime have on giving. In the US, where philanthropy is widespread, the tax code seems to be proactive in encouraging charitable oblations. Ultimately though, tax incentives can hardly act as suasion for stepped-up philanthropy.
This is where systematic business research of philanthropy is called for. One basic challenge in the Indian context would be to understand the motives of givers (and non-givers). The warm glow concept could serve as a working assumption, but we do need to analyse philanthropy in greater detail and study the deeper and more complex considerations that account for giving and generosity. Hopefully, the new laboratory techniques in economics and field experiments could throw light on the practice of philanthropy and the fund-raising mechanisms that we follow, and how they could be improved and fine-tuned, for instance, with partially matching grants. In this ancient land where profit is sacred and wealth divine, modern forms of philanthropy do need to prosper and thrive. Charity, after all, begins at home.