Private philanthropy for development identified in this report, from 205 foundations, amounted to USD 42.5 billion between 2016 and 2019, an annual average of USD 10.6 billion. Most of these funds are cross-border flows, with more than half coming from the United States (USD 24.3 billion).
The sources of philanthropic giving for developing countries are highly concentrated. Most cross-border philanthropy was provided by the Bill & Melinda Gates Foundation (USD 16.1 billion, or 38% of total philanthropic funding), while the largest provider of domestic philanthropy in the sample was the Tata Trusts, which allocated USD 0.9 billion in India. The largest ten cross-border funders provided USD 26 billion, or 76% of all cross-border financing, while the largest ten philanthropic organisations operating domestically provided USD 4 billion, or 50 % of all domestic giving identified.
Domestic foundations in emerging countries provide substantial support locally. A total of 116 out of 205 foundations from the sample are based in emerging markets. Together they provided USD 7.9 billion, or 19% of total philanthropic flows for development over 2016-19. In some countries in the sample, like India, the People’s Republic of China and Mexico, domestic philanthropic financing surpassed the flows from cross-border philanthropy. To fully unpack philanthropy’s contribution to development, it is essential to consider the growing domestic philanthropic sector in the Global South.
Private philanthropy has remained modest compared to official development assistance (ODA). Over the period 2016-19, ODA from members of the OECD’s Development Assistance Committee (DAC) totalled USD 595.5 billion; private philanthropy identified in the report amounted to 7% of that level. Despite the relatively small size of private financing in comparison to ODA, foundations are key funders in certain areas, particularly health, and education. More than one third of funding (43%) was allocated to health and reproductive health, representing a total of USD 18.4 billion over the period.
Gender-related giving amounted to 8% of all private philanthropy for development. Funding from the total sample of 205 foundations in support of reproductive health, family planning, women’s rights and efforts to end gender-based violence amounted to 8% of all giving in the sample over 2016-19.
Most philanthropic funding targeted upper middle-income countries. About USD 9.9 billion was allocated to upper middle-income countries over the period 2016-19. Lower middle-income countries received USD 9.1 billion (38%), while a small share of philanthropic giving was directed towards low-income countries, reaching USD 3 billion (13%). The region receiving the largest share of total philanthropic funding (cross-border and domestic) was Latin America and the Caribbean, followed by South Asia. Sub-Saharan Africa received the largest proportion of cross-border philanthropy.
Foundations are using responsible investing to achieve their goals, and are exploring ways to mobilise additional resources to promote sustainable development. A total of 69% of foundations in the sample are endowed (71 of 103). Among them, 77% practice responsible investment. The most common strategies cited are the application of environmental, social and governance (ESG) criteria to define an investment portfolio and the positive screening of investments. Loans, guarantees and equity are used less often to deploy philanthropic capital.
The majority of foundations engage in advocacy but face time and resource constraints. Their most frequently cited objectives when advocating include informing public policy (79%) and changing social norms and behaviours (82%). However, many foundations continue to face barriers to advocacy, including fear of negative publicity and a lack of time, resources and expertise.
Foundations are not yet realising their full potential regarding monitoring and evaluation. They invest in learning to improve programming and grant making, yet evaluations tend to focus on programme design and implementation rather than impact. Programme and grant evaluations are seldom made public, limiting the learning potential within and beyond the philanthropic sector, while foundations find it challenging to produce quality evaluations (60%) and translate evaluation results into lessons for policy makers (54%).
Limited transparency is holding back collaboration among philanthropic donors. Respondents to the OECD survey reported that the biggest barrier to collaboration is finding partners with similar interests, independent of whether they are part of a donor collaboration or not. This indicates a lack of awareness among private donors and ODA providers about each other’s giving. In addition, foundations lack transparency when it comes to sharing data on their investments’ impact.
