While India’s economic growth accelerates, the landscape of private philanthropy is growing steadily. However, a crucial question arises: Is the affluent segment giving in proportion to the escalating wealth? Dasra unveiled its India Philanthropy Report 2024 in collaboration with Bain and Company during the Dasra Philanthropy Week, followed by an insightful panel discussion.

The panel featured diverse stakeholders, including Aarti Mohan from Sattva Consulting, Aparna Uppaluri from Tata Trusts, Arnav Kapur from the Bill and Melinda Gates Foundation, and Radha Goenka from RPG Foundation, with moderation by Shrutika Jadhav from Dasra.

The session commenced with four pivotal insights from the India Philanthropy Report 2024, laying the groundwork for the ensuing discussion:

1. Despite increased social sector spending, India falls short of NITI Aayog’s spending targets needed to achieve SDG commitments by 2030.
2. While the donor base in India expands, CSR and HNI/Affluent giving show moderate growth.
3. Women, Now-Gen, and Inter-Gen donors exhibit potential with their focus on GEDI and climate action.
4. Collaboratives established in India annually have surged over 5x in the last three years, yet their future growth hinges on sustaining momentum.

Towards a new era of giving

Reflecting on the overarching message of the report and key insights, Arnav remarked, “Indian philanthropy has evolved massively and will continue to shape the entire sector and amplify India’s social outcomes over the next decade.” While philanthropy has made remarkable progress in recent years, the panel outlined four key trends that are defining how private philanthropy is leveraging resources to maximise impact as we move forward:

1. Philanthropists are increasingly inclined towards undertaking larger and more ambitious big bets, with a focus on collaboration and institution-building.
2. Institutional giving needs to establish clear objectives, whether it’s supporting downstream initiatives or strengthening upstream levers.
3. Philanthropy has transitioned towards more structured giving, leveraging the strengths of funding partners and aligning with the government to achieve scaled impact.
4. There’s a rise in catalytic giving, emphasising sustainability and greater engagement from the private sector.

Taking bigger bets to catalyse impact

While the government remains the predominant spender in the social sector, accounting for 95% of total expenditure, private philanthropy contributes a mere 5% of the INR 23 Lakh Crore expenditure. This shortfall in funding underscores the critical role of philanthropy as a catalyst for establishing and scaling impactful social initiatives, emphasised by Aarti. Arnav highlighted that the philanthropic landscape is witnessing a shift, with an increasing number of donors making larger investments that have the potential to catalyse significant returns, a trend observed not only among New-Gen philanthropists but also legacy funders.

While the development of physical infrastructure has traditionally been vital for rural development, philanthropy is increasingly directing attention towards establishing and enhancing digital public infrastructure. The growing importance of data and digital public goods in decision-making processes, particularly in prioritising funding, underscores the need for platforms like the Social Stock Exchange. Such platforms can operate transparently, foster trust, and spotlight impactful stories, thereby addressing the hesitancy to fund newer or lesser-known organisations.

The evolution of private family giving and foreign funding has been reinforced by substantial CSR initiatives aimed at infrastructure development and fostering systemic change. As emphasised by Aarti, “Business is what business does,” indicating that corporates are increasingly adopting a unified approach towards CSR and sustainability. This entails a growing commitment to making businesses sustainable throughout the value chain, addressing both community development needs and systemic issues. For instance, the Mastercard Centre for Inclusive Growth has collaborated with the social innovator Frontier Markets to empower 100,000 rural women entrepreneurs across three states in India, focusing on elevating their income. Aparna echoed the importance of embracing a comprehensive, systems-change approach, emphasising the necessity of developing a robust framework to measure such transformative shifts.

Strengthening collaboratives and sustaining their momentum

The Philanthropy Report 2024 noted a remarkable surge in the establishment of Collaboratives in India, increasing by 5 times over the last 3 years. Successful initiatives like the India Climate Collaborative, the Growth Fund, and Life Skills Collaborative have been anchored and implemented by various organisations. Arnav highlighted the significance of Collaboratives, stating, “I think that collaboratives are now a big phenomenon that is here to stay as it also helps to pool in capital from many philanthropists and expand the work that one could look at, because I don’t think one foundation can do everything on their own.”

Expanding on Arnav’s point, Aparna emphasised that Collaboratives not only enable significant pooling of resources but also facilitate knowledge exchange within the ecosystem. She further shared, “the impulse of the collaborative is not only about shared knowledge, but also the relationships that you build around that knowledge. When I say knowledge, I’m not specifically just focusing on what we think about an issue, and what can be done to solve it, but also knowledge on how we give and how that form of giving actually generates a change.”

However, Aparna highlighted the need to develop frameworks to measure change in systems which will encourage more stakeholders to participate in collaborative experimentation and action. “Collaboration also needs a lot of letting go, a lot of willingness to experiment and to really understand quite deeply the strengths of the other. And at some level also letting go of some of the strengths that you might have some attachment to. And we are increasingly seeing the willingness to do that.”

Lastly, Aparna also issued a call to action for Trusts and other institutional donors to take the first step and be an anchor funder. She noted that a significant number of collaborative actions that have generated a pool of funding over time did not begin with the idea of a Collaborative but rather with the idea of putting in that patient capital, taking that first risk, and then evolving into platforms of collaboration. Further, adding to the point on Collaboratives, Aarti emphasised that while the appetite for collaboratives has significantly increased, it is also important to look at roles, incentives, and resources that can sustain that initial momentum that often gets built but then eventually begins to dwindle down.

Need for capacity building of nonprofits and institution building

Over the past seven years, philanthropic expenditure totaling INR 1.5 Lakh Crore may appear substantial. However, only 50% of this capital is directed towards nonprofits, highlighting a significant gap in resource allocation. The distribution of remaining funds encompasses a diverse range of entities, structures, and pools, indicating a varied approach to philanthropic deployment. Furthermore, there is a growing trend of directing philanthropy towards rural areas, particularly in aspirational districts. However, identifying capable partners for effective program implementation in these regions remains a challenge. Grassroots NGOs face formidable obstacles in capacity building, including the development of internal systems and processes, as well as recruiting suitable personnel. Moreover, the absorptive capacity of nonprofits poses a significant challenge, with fewer than 19 NGOs with budgets exceeding 100 crores annually. Collectively, the budgets of the top 100 NGOs in the country amount to less than a third of the capital allocated to CSR initiatives each year.

Organisations such as Tata Trusts, Azim Premji Philanthropy, and new-age philanthropists like Kris Gopalakrishna have made substantial and enduring contributions to institution building. In today’s landscape, this often intersects with capacity building efforts. As Aparna suggests, institutions can serve as pivotal points within an ecosystem, facilitating change at various levels. This sets them apart from organisations requiring capacity building support for downstream implementation. Aparna illustrated this concept with the example of the Tata Institute of Genetics and Society, which is driven by a deep intent and belief in translational impact of research in genetic science.

The RPG Foundation-led initiative, ‘Pehlay Akshar Foundation,’ serves as an exemplary instance of downstream capacity building established by a corporate foundation under Radha’s leadership. While CSR initiatives have achieved significant, scalable impact across sectors, a notable gap remains in addressing capacity development at the ecosystem level. Consequently, enhancing the capacity of nonprofits, particularly in underserved sectors, and bolstering their overall absorptive capacity emerge as crucial areas where philanthropy, including CSR, can lend support for enduring impact.

Emergence of new-gen, inter-gen and women givers leading a significant shift in inclusive, structured giving

The Philanthropy Report 2024 has analysed data from the GivingPi network wherein, 54% members indicated women-led family philanthropy while 70% reported active women’s participation in the family philanthropy. They have been reported to have channelled their efforts towards intersectional approaches that integrate the diversity, inclusion, and gender lens, principles to address multifaceted societal challenges. Additionally, the now-gen (first-generation wealth creators) and inter-gen cohorts (current family members managing traditional family wealth) have increasingly prioritised systemic change, leveraging collaborative action and innovative technology to strengthen the philanthropic infrastructure.

Radha Goenka, representing an Inter-Gen Giver stated that “It is interesting to see that women are putting a lot more skin in the game.” Aparna added to this by stating that “it indicates a significant shift in power if women are controlling more of those resources and contributing to decision making around how those resources should flow.” Aarti pointed out that while women-led giving has seen an increase, it is also important to see this translate to more funding towards women and gender-related causes.

While education continues to remain the highest recipient sector, the panellists also highlighted some of the emerging trends in giving such as increased focus on Arts and Culture and increased CSR funding towards environment sustainability. Radha also focused on the importance of structured giving by defining the key pillars adopted by RPG Foundation – 1) Identifying the need on ground, 2) leveraging strengths of funding partners and 3) achieving impact at scale by working with the government. The panellists concluded the discussion by highlighting the importance of deploying patient capital while focusing on intersections between Businesses, Government and Philanthropy.

Rini Jincy Paul is a Knowledge Specialist at Sattva Knowledge Institute and Lekhya Reddy leads the Capital for Impact (CFI) Practice Area at Sattva Knowledge Institute of Sattva Consulting.