Dr Andrew Young from the Centre for Social Impact asks ‘Where are the game-changing philanthropists?’

How many philanthropy investments can claim to have transformed annual expenditures in the tens or hundreds of millions of dollars? How many Australian philanthropists have fundamentally changed a community’s outcomes?

In the BBC TV series Hitchhiker’s Guide to the Galaxy – in one of the many irrelevant Guide “entries” – two warring alien races are swallowed by a dog on planet Earth “due to a terrible miscalculation of scale”. It’s reminiscent of the context of philanthropy in the Australian social purpose system.

Every year Australia spends over $400 billion (and growing) in welfare, education, health and a host of other social issue areas. On best guestimates, the sum total of all larger-scale giving (by high-net-worth-individuals, philanthropic foundations and corporate foundations) is less than $2 billion- less than a half of one percent.

I once asked a group of foundation managers “what is the role of philanthropy in Australia?”  One brave representative eventually answered “we find gaps in government funding and fill them.”

What I wanted to say – but didn’t – was “Really? With less than half of a percent of the system funding? You must be really effective at what you do.”

Before I go on, there is a very important caveat to my comments. Giving matters. There is no doubt that philanthropists have made enormous differences to many organisations, programs and individuals. For a new philanthropist to find and support a cause that they feel passionate about is a great thing to do. Keep doing it.

However, for a few – those who aspire to achieving a bigger impact – there is a challenging question. The evidence is in. In communities facing complex social issues, decades of funding amounting to (in some cases) billions of dollars has not achieved change in community outcomes. In these social issues and these communities, funding another program or pilot simply is not going to fix the issue.

The Search for an alternative

Recently, the Centre for Social Impact (CSI) and friends had the enormous privilege of announcing Burnie, Tasmania as Australia’s most promising early stage collective impact initiative.

The Search – an initiative offering up to $1 million in support to an Australian community working to address society’s biggest challenges – commenced in June last year.  49 communities applied and in November 11 were shortlisted. In March their Excellencies Peter and Lady Cosgrove generously hosted the announcement of Burnie’s success at Admiralty House in Sydney.Generosity_The-Search-Burnie-Winning community

Collaborative approaches to complex issues are not wholly new, however, I am optimistic that these communities have the potential to fundamentally change how we address complex social issues in Australia. I have three key reasons why.

First, there is a sense of “realistic optimism” in many of these communities.

In a discussion with one of the community’s leaders, I asked why she felt hopeful, given the community had been involved in at least two failed attempts to resolve the same issues they face today. She said, “This time it’s different. There is more in it this time. More commitment. More resource. More structure. We’ve got a lot of work to do, but we’re in it for the long haul.”

Many share this positivity grounded in a real understanding of the challenges that lie ahead.   We have learnings from the previous attempts, and we’re better placed to succeed this time.

Second, governments in most states are grappling with at least one “collective impact” community approach. I am hearing constructive questions from bureaucrats including, “I am convinced that approaches like this are fundamentally important . . . however, I can also see these approaches fundamentally challenging how we think about funding, accountability and control. How can we work with five or ten approaches like this, let alone hundreds?” More importantly, I am starting to sense real commitment to working out the answers.

Governments are also starting to commit some significant resources to some of these community collaborations – for example, GoGoldfields project in Victoria, which recently received $2.5 million from that state.

Finally, it’s no secret that as a country we’ve run out of money. For the first time in decades we have no choice but to seriously consider new approaches that might—in time—deliver more social outcomes and at less cost. Commonwealth and state governments are recognising collaborative, community-based approaches as one idea worth genuinely worth testing.

The challenge for philanthropists

Here lies the big opportunity for philanthropists, whether individuals, companies or foundations. Unfortunately, it’s an opportunity so far largely missed (notwithstanding the leadership of organisations including the ten20 Foundation, Woodside and The Search partners including the Westpac Foundation).

In my view, to have real and lasting impact, philanthropy needs to be catalytic; it needs to invest in ideas that can be system-changing.

I don’t know of a better opportunity than these collaborative approaches. Where else does an investment of around $2m over a few years have the potential to leverage and transform service funding of $100m pa or more?

Take the example of the Tow Foundation in New York. An initial philanthropic investment of just $140,000 stimulated nearly $1 million in other funding to develop a collective impact approach to reforming juvenile justice.  The new approach leveraged millions of dollars in annual expenditures already in the system.  Within a few years the number of youth arrests fell by a quarter and the number of youth in custody by 45 per cent.

Great philanthropy is more than money.  These are opportunities for philanthropists to bring their thinking and influence to bear.  Governments are exploring communities’ collective impact approaches with a view to something much bigger.  The right influences now will make a huge difference in few years’ time.

Game-changing philanthropists: please apply.

 

Dr Andrew Young is Chief Executive Officer of the Centre for Social Impact. 

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Philanthropy Australia is proud to support this Collective Impact edition.

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