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Designing philanthropy for impact

By Ramesh Mangaleswaran and Ramya Venkataraman

While there is significant dialogue in India today on the amount of money donated, there is very little focus on making thoughtful choices on “where” and “how.”

The major focus of the dialogue surrounding philanthropy in India is the amount of money donated or the “quantum of philanthropy,” which is well below the global average (as indicated by several studies). Many efforts are being made to increase giving—including movements such as the Joy of Giving Week and the Mumbai Marathon; high network donor circles and occasional forums by philanthropists and foundations; and significantly, a law passed in Parliament recently, that requires companies to contribute 2 percent of their profits toward corporate social responsibility (CSR).

Meanwhile, dialogue on the impact of philanthropy (versus just the quantum) has also started, though the majority of recommendations focus on high quality measurement, selecting the right organizations to support, building a strong team to drive philanthropy, and so on. While these elements are indeed critical, they assume that the design and strategy are correct and instead jump focus to managing and ensuring impact.

Philanthropic activity can be seen as a three-step journey: one, deciding how much to give; two, making choices on where and how to give (or what we call “designing for impact”); and, three, ensuring high quality execution and measurement. While there is significant focus on the first step in India currently and the third is starting to get some attention, there is very little dialogue on the second. A positive change has been that donors, foundations, and corporates interested in CSR are gradually but increasingly asking two questions:

  • Which sectors or causes should one try to address (“where to give”); and
  • What types or modes of intervention and contribution are likely to achieve sustainable transformation at scale in the chosen area (“how to give”).

However, answering these questions can be a major challenge because of the lack of readily available information and research.

Download the full report on which this article is based, Designing philanthropy for impact (PDF–564KB).

About the author(s)

Ramesh Mangaleswaran is a director in McKinsey’s Chennai office, and Ramya Venkataraman is an alumna of the Mumbai office.
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