At the beginning of September, Paula Jancso Fabiani took over from Marcos Kisil as president of Brazil’s Institute for the Development of Social Investment (IDIS). She talks to Caroline Hartnell about an advocacy role for IDIS, developing a culture of giving in Brazil, the role of tax incentives, the credibility of NGOs, and the role of women in the country’s non-profit sector. Below, Marcos Kisil talks about the early days of IDIS, the challenges ahead and the leadership transition.

I’d like to start by asking you what you hope to achieve in your new role as president of IDIS?
Recent experience suggests that IDIS could have an effective advocacy role. We have done quite important work putting together a study group to work on the topic of endowments. There is no legislation regulating endowments at the moment, so if the board of an organization decides to spend all the money intended for an endowment in one year, there’s no protection for the endowment to prevent that happening. Nor are there any tax incentives for donations to an endowment. At the moment, an individual donor pays tax on the part of the income they donate and the recipient organization pays tax on the donation, too. So it’s very hard to establish endowments.

The group has drafted the proposal for a law that is now before the Brazilian congress. This experience has shown us the capacity of IDIS to bring people together around an idea to come up with solutions. We can now advocate for a better legal environment for philanthropy in Brazil.

Carol Civita says in her August interview for Alliance that she doesn’t think that tax legislation is a big issue for philanthropy in Brazil. Do you agree?
I don’t. I feel that once you have tax incentives, even if people are not motivated to donate because of tax planning, they start doing something. Once you start, you become really involved and it becomes part of your practice. So I believe tax incentives can have this ‘first moving’ effect on giving.

I agree with Carol, though, that a better regulatory environment is key. Brazil’s current regulatory environment is not favourable for giving, which is why we decided to focus some effort on endowment legislation – that would be one step in the right direction. For the last 10 years, the third sector in Brazil has been discussing the idea of one general law for the sector. At the moment, what we have is more of a patchwork of legislation, which makes compliance complicated.

What about other areas that IDIS will be working in?
We want to continue helping to increase family and community philanthropy in Brazil – something that IDIS has done for the last 15 years. We already have a well-developed corporate philanthropy in the country, which IDIS supports, but I think there is much more potential to increase family and community philanthropy.

Another thing is increasing NGO validation. We already do this but only for our partners and we think that this is key to helping increase the credibility of NGOs in Brazil. Finally, we want to promote a general culture of giving, and for that we are planning to do research on giving. It’s very hard to work on strategies to promote giving if we don’t know how much is given, why people give and why they don’t give, so we think data is key.

We’d also like to introduce into Brazil something that is common in countries where philanthropy is well developed, payroll giving, and we’ll be supported in this by our partner, CAF – Charities Aid Foundation. We feel that a payroll giving platform will also help to increase the credibility of NGOs because you will have NGOs that are validated in a workplace environment, where people feel confident.

Where does IDIS’s income come from to support all of this? Is it from the fee paying services you offer?
Partly. We provide technical and advisory support to foundations, corporations, and families and individuals. We have started working with evaluation and we’re bringing the social return on investment methodology to Brazil. We also have our own projects, like the Brazilian Philanthropy Forum, which we fundraise for. It’s held in partnership with the Global Philanthropy Forum and occurs once a year. In November we will hold the third edition of this event.  We also have a programme that we are running with the Rockefeller Foundation to promote the concept of philanthropy and development in Brazil, and we are translating relevant publications into Portuguese to give our donors access to material in these areas.

What do you see as the main challenges to achieving all these things?
One is doing these things without IDIS’s founder, Marcos [Kisil]. Marcos has had a very prominent role in private social investment in Brazil. He’s been working in it and promoting it since he was the Kellogg Foundation director for Latin America and Caribbean, which was 15 years before he started IDIS.

Another issue is that advocacy is not something that Brazilian philanthropy is used to funding, so how will we support our expanding work in this area? We are also trying to work in partnership with other organizations to make more use of technology to extend our reach.

One specific challenge that we are facing at the moment is bringing the social return on investment approach to Brazil. There is a lot of debate around evaluation in Brazil at the moment, but we don’t really see many organizations doing it seriously on a continuous basis and with methodologies that are widely used internationally. So evaluation is still a challenge for Brazilians. It costs a lot to do it properly and many of our investors don’t yet see the value of it.

Do people’s attitudes to philanthropy present you with a challenge?
We did some preliminary research on giving with IPSOS, a research company, to try to identify some key issues for doing the larger research that I talked about above, that we intend to do next year. We came up with very interesting numbers on how the general population gives. We found that 30 per cent of Brazilians donate to the church, 30 per cent donate to people on the street and only 14 per cent to NGOs, to organizations. That shows us how much work there is to be done to move from a more charitable mindset to a more strategic and developmental one. This is something that should start in schools; it should be part of the agenda of the government. So we see this as a challenge, but one that we can contribute to addressing.

Another thing that the research showed is the lack of trust in NGOs. There have been a number of big scandals in the last years involving NGOs, especially with government money. There are 290,000 NGOs in Brazil and a small number of scandals is capable of damaging the image of the rest. So there is a lot of work to be done to improve the sector’s image.

Presumably this informs your work with NGO validation and the distrust is part of the reason why only 14 per cent of Brazilians give to organizations?
Yes. I personally believe that a strong civil society is very important to maintaining a democratic environment in the country. Our focus is working with donors, not NGOs but we believe that if we help to increase the professionalization and build the capacity of NGOs, we are helping donors because NGOs provide means to achieve impact in society.

Also, NGOs need to learn how to fundraise, so one of the things we are doing is helping NGOs to build a fundraising plan. We don’t fundraise for them because we see that as a conflict of interest, but we think that if they are more prepared to speak the language of donors, we increase the chance of those donors establishing relationships with them.

Another thing Carol Civita says in her interview is that she doesn’t feel the time is right for impact investing in Brazil. Is this your view, too?
I don’t think there is a right time. I think it’s a global trend and I’m glad that Brazil is now keeping up with global trends – we used to say that in Brazil everything arrives ten years later.

But I agree with Carol that our philanthropy is not strong enough and there is some debate about whether philanthropic money is going to move to impact investing. I think that impact investing should attract money from the financial markets rather than philanthropic money, because the whole concept is also about bringing a return on investment.

But I think the most important thing about this impact investing debate is the change of attitude it can promote in businesses. We also have the B Corps debate. This is not impact investing, but again  any business should have this mindset and be concerned about the social impact it generates. This I see as a very positive trend.

How involved are women in philanthropy in Brazil and is it significant for a woman to be appointed to a post like yours?
In Brazil, women are not in general in leadership positions – though in the non-profit sector as a whole, there are far more women than men. I believe in diversity – a diverse environment can promote creativity and innovation – so I think it’s important that you have women in leadership positions not only in non-profits but also in business and government.

This is a very interesting time in Brazil. We have two women candidates for president and they are leading the polls. I think that more and more we are going to see women in leading positions in Brazil. And, as Carol mentions,  it’s natural for women to be more concerned about social issues. Even if we think about our immediate environments like family and the neighbourhood, I think it’s part of our nature to be concerned about the neighbour or the family circle and this can be reflected in non-profit activities. When you look at Brazilian philanthropy and at social organizations of all kinds, there are many women involved both as paid workers and as volunteers.

Paula Jancso Fabiani has been with IDIS since 2012. From 1 September she has taken on the role of president. Email pfabiani@idis.org.br

Towards a new model of social investment

Marcos Kisil

Marcos Kisil

Back in 1999, when IDIS was founded, the prevalent model of giving in Brazil was charity. In Portuguese, the word philanthropy is perceived as synonymous with the word charity.

IDIS is an acronym for Institute for the Development of Social Investment. In its own name, IDIS introduced the concept of social investment as a way to give a new meaning to donations. It was a departure from the old model of charity to a new model. Today, the concept and practice of social investment is well established in Brazil and expanding progressively to attract old and new donors.

Linking social investment with development
Another contribution of IDIS was linking social investment with the process of development of individuals, families, communities, and society overall. Development was traditionally seen as a responsibility of government at different levels, and based on implementing public policies with public resources. Volunteer resources from citizens were not considered for developmental activities.

With the understanding that private social investment must also promote development, new models of operation were created to identify social problems and alternative solutions, monitor new processes and practices, evaluate results and impact. This required partnership among different sectors – public, private for-profit, and private not-for-profit – introducing the idea of a coalition of common interest in producing and implementing public policies for a more just and sustainable society. IDIS has created, adopted and adapted different methods to support donors to go through these issues.

Challenges facing IDIS, external and internal
Although a successful contributor to these changes, IDIS faced some challenges in its operation. The first was the absence of professionals in the market to operate new programmes and to run institutions that became specialized in donating as social investors. IDIS became involved, as a leading partner, with universities to create educational and training programmes to produce a critical mass of professionals.

The second was the absence of a favourable environment for giving. The Brazilian fiscal framework did not stimulate or enable giving, especially from individuals and families. Endowment building was almost absent.

The third was IDIS’s own sustainability as an organization. As a non-profit organization we also needed to look for resources to survive and grow. IDIS decided to pursue two ways to become sustainable: one was to offer advisory and consulting services. Today this represents half of our annual budget. The second was to obtain grants to support work in the area of innovations for the development of social investment. This work includes supporting community philanthropy organizations, publishing books, carrying out research, and organizing conferences and forums.

We have made progress, but these challenges will continue to require our attention in the years to come under a new leadership.

Planning for new leadership
My years working in the social sector, first at a major foundation, the W K Kellogg Foundation, and then at IDIS, an organization supporting donors, have made me a true believer in the importance of planning for changes in leadership. I have witnessed several social organizations where the founder who led the organization did not prepare for his/her own succession. With their retirement or death, the organization followed the same path. I did not want this for IDIS. We nurtured a process of leadership development that involved both strengthening the governance from our board and preparing our executive director to become the new president. I sincerely hope that, once again, IDIS is demonstrating with its own behaviour an example to be followed by similar organizations.

New leadership represents new understanding about the context, potential innovations for the sector, reaching out to a younger generation of donors. It represents a better understanding about the opportunities and risks. It represents an aggiornamento – a bringing up to date – for IDIS.

The past was just a prologue for the brilliant future that I foresee for IDIS.

Marcos Kisil founded IDIS in 1999. Email mkisil@idis.org.br