The century of the African philanthropists is here, but wise choices must be made

First Published in The Daily Maverick – Read the full article here.

African philanthropists have the capital, influence, local knowledge and moral authority to address pressing challenges that face the continent, but we need to rethink the relationship between government, the private sector, and philanthropy.

Philanthropy is a product of a successful business in the private sector. It is inspired by a desire to give back to society, and for the very wealthy the remit is almost global. In this form it is more deliberate, often goes beyond the scale of kin and the local community, and seeks to make an impact that is visible and measurable. This requires structure, and philanthropy at this scale is organised through foundations.

This distinguishes philanthropy from charity both in scale and in the targeted recipients.

Governments need to work collaboratively with philanthropists, civil society and the private sector in innovative ways to make more impact on the continent. Colonial capitalism made newly-independent African governments ambivalent about capitalism and meant there was no capitalist middle class in Black Africa. There was more interest in wealth redistribution than wealth creation. The high net worth individuals in Africa who have been profiled in Forbes emerged mostly over the last two decades. That their rise coincided with the era of NGOs (non-governmental organisations), and their championing of advocacy, make governments uneasy about the foundations of the new African wealthy organised as NGOs.

It is important to rethink the relationship between government, the private sector, and philanthropy, as Africa’s developmental agenda overwhelms any single government. In Africa, philanthropy has engaged in disaster relief, poverty relief, in education, job training and employment opportunities. In these areas, they intersect with government and must collaborate for maximum impact, especially since government sets the policy agenda for areas such as education, and in terms of disaster or poverty relief has the infrastructure to intervene more effectively.

Philanthropy cannot displace or disrupt government. A partnership is crucial. It is estimated that the funding gap for Africa to achieve the SDGs (Sustainable Development Goals) is about $2.3-trillion. Government, the private sector and philanthropy will have to work together on innovative solutions for social change, especially with the declining levels of international development assistance.

The role of government is to provide essential services – physical and social infrastructure (roads, railway, hospitals, schools, etc) – ensure a conducive policy environment that enables the pursuit of potential, provide law and order and maintain security, etc.

The role of the private sector is to invest in the stock of productive capital, to create jobs, working closely with the government to meet the government’s developmental vision, and with educational institutions (especially technical institutions and universities) that train the workforce of the future. The private sector services the financial market and finances economic ventures with an eye on returns.

Some wealthy African philanthropists have created foundations that emulate the West with strategic goals and processes, but with or without a foundation, these African philanthropists tend to give on local and personal interests. Philanthropy on the continent can be transformed through philanthropy education, that gives African high net worth individuals a better understanding of the landscape of philanthropy in Africa, and how to give in more impactful ways. Legacy is an integral part of giving, and it is more appealing to be remembered nationally, regionally or continentally than to be remembered in just one’s hometown.

On May 16-17 2019, the Harvard University Center for African Studies, Centre on African Philanthropy and Social Investment at the Wits Business School, Trust Africa and the African Philanthropy Forum held an African Philanthropy Conference in Johannesburg to increase awareness and set the agenda of philanthropy in Africa. Here are a few areas where philanthropy could play a major role in Africa:

1. Invest in knowledge development: Invest in higher education, in technology, science, medicine and other areas that touch local societies broadly. At the top US universities, the production of knowledge is a partnership between philanthropy and universities: programmes, labs and buildings are named in the pursuit of knowledge and legacy.

    

2. Reduce social inequality: Invest in schemes that reduce social inequality. Africa has a rising number of ultra-high net worth individuals (754), defined as individuals with $50-million and above. Though this does not compare favourably even with a developing country like India with 3,399 individuals worth $50-million and above, more wealthy Africans have been profiled in Forbesin the last decade than at any time. The rising number of poor in Africa, clearly a challenge the governments have failed to redress, places a special responsibility on the ultra-wealthy in seeking to reduce social inequality. The World Bank estimates that 77% of the world’s poor will be in Africa in 2030.

    

3. Create a better future for the youth on the continent: Africa’s population is set to double by the year 2050 from 1.2 billion to 2.5 billion. Already this is the continent with the most youthful population. Our understanding of early childhood development has underscored the importance of the first 1,000 days in health and cognition based on good nutrition and early education. This is an area where philanthropy can work with the government to ensure a better future for the continent and to avoid a demographic disaster.

    

4. Invest in areas that are left unattended by government and business: There are areas of rising concern that governments with their numerous responsibilities lack the nimbleness to respond to in a timely manner. Climate change is one example. In the US the private sector has begun to invest in climate studies, especially with the current government’s disinterest in climate change. The preservation of culture in museums, the conservation of historic buildings, nature conservation, etc, have all fallen into disrepair. These could be avenues of philanthropic giving, as together they provide a fuller African narrative.

As academic institutions, we wish to facilitate effective giving by building strategies for transformative change in Africa through philanthropy.

Prof Emmanuel K Akyeampong is Oppenheimer Faculty Director at Harvard University’s Center for African Studies and Ellen Gurney Professor of History and Professor of African and African American Studies at Harvard. Dr Bhekinkosi Moyo is Director and Adjunct Professor at the Africa Centre for Philanthropy and Social Investment, University of the Witwatersrand.