From tradition to modernity―Eight ways that Asian philanthropy is evolving
The pandemic aggravated and highlighted many social and environmental issues, that had not previously received the attention they so evidently deserved. But Asian philanthropy was already undergoing a significant evolution before covid-19, and it has gained in prominence since then. We set out what we see as the eight principal trends characterising Asian philanthropy.
1. Out of the shadows | Philanthropists are becoming more public about their giving.
In many Asian cultures, modesty is a revered virtue. At the same time, there is a lack of trust in the charity sector, whose reputation has been tarnished by some isolated but well-publicised scandals. But all this is slowly changing, as more and more philanthropists become transparent and vocal about their giving, they are also more mindful of how to deploy their voice and influence to achieve their philanthropic goals.
2. Many hands make light work | Greater collaboration between philanthropists
Until recently, the opportunities for collaboration between leading philanthropists in the region were limited. But with more next-generation wealth holders getting involved, a more modern and formalised approach to philanthropic collaboration is developing across Asia. The pandemic has catalysed demand for more and improved collaboration, revealing the power of public-private partnerships. We expect to see individual philanthropy become the exception in the future.
3. Maximize overall impact | Greater focus on the management of philanthropic capital
Historically, investing and giving were considered two distinct activities. This was especially true in Asia. Today, however, there is increasing awareness that combining investing and giving is more powerful in advancing one’s mission than carrying out the two activities without correlation. Impact investing, which seeks to create a positive social or environmental impact in addition to financial return, is growing in popularity among endowment investors.
4. Tackle the issues | Taking a more strategic approach
The growing popularity of a more strategic approach to philanthropy is a recognition that despite the rapid growth of philanthropy, it is dwarfed by the scale of the problems that the world faces. This approach is particularly popular with younger, next-generation philanthropists, who are attracted by the high-impact, strategic approaches, including utilising innovative social investment tools. For many philanthropists, the robustness of their giving strategy is as, if not more, important than the amount they are giving away.
5. From hospitals to health systems | Deeper engagement in health philanthropy
The covid-19 pandemic took a sizeable toll on healthcare systems across the region, revealing the widespread health related disparities between communities, further exasperating existing social inequalities. In many Asian countries, private philanthropists are looking to improve public health systems. There is a growing consensus about the need to build stronger primary healthcare systems.
6. Beyond building schools | More diversified education philanthropy
Education has historically been the most popular cause for Asian philanthropists as there is a strong focus on education in many Asian cultures. This focus on education remains, but it has evolved due to the increasing inequality in education that has come to light in recent years.
7. For a greener future | A growing interest in environmental philanthropy
Over the past decade, a consensus about the urgency to act against climate change has emerged. Despite this, less than 2% of the estimated USD730 bn of global philanthropic giving in 2019 was spent on fighting climate change. In China, the proportion was estimated to be as low as 1% in 2018, despite Asia-Pacific being the world’s most vulnerable region to climate change. Going forward, we expect to see more philanthropists take climate and sustainability into account in their existing philanthropy.
8. Common prosperity | Philanthropy’s role in reducing inequality
Asia’s rapid economic growth has lifted millions of people out of poverty, but inequality has worsened at the same time. The pandemic has exacerbated this situation, with low-income groups unable to make ends meet due to lockdowns and the collapse of some service sectors. As a result, there is an increasing focus on reducing income inequality, with governments expected to play an active role in guiding the market.
In recognition of both the region’s importance and its great potential, the 21st century has been referred to by many as the Asian century. But as momentum builds in economic growth, so too will the need to address the mounting social and environmental challenges the region faces. With its coming of age, philanthropy looks set to play an important role in Asia’s development. For Asian philanthropists, the new trends have made philanthropy more exciting, and also make it more important to learn from each other.