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Global Philanthropy + Development Trends: Opportunities for Social + Financial Innovation

Global Philanthropy + Development Trends: Opportunities for Social + Financial Innovation. Tim Draimin Executive Director, Social Innovation Generation (SiG) Chair, Causeway British Columbia Council for International Co-operation (BCCIC) AGM Vancouver, November 28, 2008.

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Global Philanthropy + Development Trends: Opportunities for Social + Financial Innovation

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  1. Global Philanthropy + Development Trends: Opportunities for Social + Financial Innovation Tim Draimin Executive Director, Social Innovation Generation (SiG) Chair, Causeway British Columbia Council for International Co-operation (BCCIC) AGM Vancouver, November 28, 2008

  2. Growing Donations But Declining Donors: 1984 to 2005 Donors as a % of Taxfilers Average Donation ($) Source: CRA compiled by Imagine Canada Courtesy Michael Hall @ Imagine Canada

  3. “Population aging is a worldwide phenomenon that will affect Canada and all G-7 countries”

  4. Global Trends • Changing global philanthropy and financial architecture • Rise of remittances • Relative decline of ODA’s importance • Technology’s impact • disintermediation • Rise of social entrepreneurship, social enterprise, social finance, and expanding hybrid cross-sectoral (nonprofit <->for profit) universe

  5. New Strategic Philanthropists:“Philanthrocapitalists” Primarily self-made entrepreneurs More sophisticated & engaged Strong outcomes focus Bring time, treasure, talent and an entrepreneurial lens See selves as a “partner” Seeking leverage: gifts plus loans, quasi-equity, leveraging social change strategies

  6. Social enterprise is… A business with primarily social (and/or environmental) objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners...

  7. Social finance is… finance with a social or environmental mission Or, Social finance is a sustainable approach to managing money that delivers social, environmental dividends and economic return through social enterprises operating in the non-profit or public benefit universe.

  8. HIGH INVOLVEMENT Social Finance Exists Across A Broad Continuum… Venture philanthropy Venture capital CHARITABLE COMMERCIAL Traditional grant making Bank lending LOW INVOLVEMENT Adapted from Margaret Bolton, 2003

  9. Social finance’s most visible example is MICROFINANCE…

  10. Social finance for public benefit Sources Intermediaries Mechanisms The flow of financial capital to human need uses: Affordable Housing Social Enterprise Support for working families Health & Home Care Community Development Social Economy Clean Technology Microfinance Fair Trade Green Building Education Bottom of the Pyramid (source: market sector listing adapted from www.xigi.net) Recipients Uses

  11. Collaborative approaches and blended returns Projected Income New Social Finance Growing social and environmental pressures + government and market failure = the conditions for social innovation Expanding Earned Income Existing Earned Income Gvrnt Gs & Cs Charitable Donations Courtesy CAUSEWAY

  12. Low Profit Limited Liability Companies (L3C) Social Finance Supports Businesses in the Public Benefit Universe

  13. Future Directions • Growing role of major donors • Cross border giving will further open up, challenging monopoly of traditional players • Growth of southern philanthropic structures, like Trust Africa, community foundations, etc • Global trends towards cross-sectoral strategies, social entrepreneurship, social enterprise, hybrid social business structures (moving beyond tax status “silos” • Deepening globalization of philanthropy…

  14. Philanthropic Brokering Roles for International NGOs • Using: • Capital, financial innovation, practical know-how, strategic partnerships, emergent social innovation • Among • Philanthrocapitalists with shared interests • Philanthrocapitalists and key actors in sector or doing • Across • Geographies • Sectors (voluntary, business, government) • Financial pathways

  15. Causeway New national collaboration accelerating a social finance market place for financing social innovation serving public benefit SiG@MaRS

  16. Thanks to Arthur Wood (Ashoka), Michael Hall (Imagine Canada), Michael Lewkowitz (Causeway) For more information about CAUSEWAY: www.causeway.socialfinance.ca For more information on the charity sector visit: www.imaginecanada.ca For more information of Social Innovation Generation visit: www.sigeneration.ca

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