1. State University – Higher School of Economics Centre for Studies of Civil Society and Nonprofit Sector The potential of the corporate philanthropy in the local community development and limitations of the third sector organizations involving Irina Solodova

2. The Monitoring of the Russian Civil Society 2 The empirical data originates from the monitoring of Russian civil society: the monitoring was launched in 2006 sociological methods are used to collect the data the monitoring covers the population, NGOs, local self governance bodies etc. research objectives are multiple The presentation is based on empirical data from a country-wide representative population surveys and surveys of NGO’s Сhief Executives (CEOs). Data collection method – personal interviews The size of the samples - 3,000 persons (2007) and 1,600 persons (2008) The NGOs survey covered 1000 NGO’s CEOs, selected by a special sample.

3. 3 Social Conditions for Engagement in Civil Society activity

4. “Who should be engaged in philanthropy, and who is most engaged in philanthropy?” (% of respondents to a multiple choice question that allowed for no more than three response options) 4

5. ”Who most of all should help people who are considered “socially vulnerable” (the elderly, people living alone, disabled, single mothers, orphans, and families with many children)? In reality, who most often helps them?” (% of respondents to a multiple choice question that allowed for no more than five response options) 5

6. Corporative philanthropy: core preconditions Corporate philanthropy - the use of corporate resources to support causes or/and organizations outside of the corporation’s defined business or industry for the benefit of the community (Frame, 2005); Corporate philanthropy often is an addition and complement to a state social policy, one of mechanisms of solving social problems on territory; Conceptual framework of corporative philanthropy research consists of four possible perspectives: altruistic, strategic, political, managerial (Cambell, 2002). They might be reduced to (Dennis, Buchholtz, Butts, Saiia, Carroll, 2009): –strategic - improves the firm’s relative strategic position, including positive economical effect, while achieving community betterment; –altruistic (traditional) - unselfish regard for the welfare of others, donor has no knowledge of the beneficiary and receives no external recognition for contributing. Involvement of corporative philanthropists in network communications and communities might have a positive impact in rise of corporate philanthropy efficiency (Peizer, 2003, Pratt, 2001).. 6

7. Corporate philanthropy perspectives: Russian context Business typeCharacteristics Small and medium businesses Irregular help, address current help: Poor development of predicting and preventing programs, of principles of early prophylaxis ; Mainly financial help, narrowed use of voluntary forms of help: Low development of inter-sectoral partnership, low role of NGOs as an institutional contractors: Insufficient development of financial and financial competence. Large corporationsConsistency with strategic aims of a company; Structuring corporative philanthropy by program or project principle, direction towards social infrastructure and preventing of social problems development; Long-term programs; Choice of adequate mechanisms of programs realization, including corporate philanthropy funds, spreading of program-structural approach; Practice of in and inter-sectoral partnership; Evaluation of results of philanthropy programs; Using various forms of philanthropy, including corporate volunteers. 7

8. Donors community: characteristics Understanding of philanthropy - non-public and even private character, personal altruistic action (more for small and middle businesses); Mutual knowledge – rather low. Do not discuss philanthropic practices a lot: Horizontal communications as donors – rather weak. Coordinating centre – no regular centre. Role of nonprofit organizations is not significant; –In considerable degree communications are mediated by public authorities as a coordinating centre (including directives or recommendations in choice of recipient, volume, form, organizational procedure and controlling organization of corporate philanthropy); Conjoined philanthropic programs – very few. Corporate philanthropy is mostly made by donors by themselves. Regional corporate donors are not engaged in subject interactions for forming their own identity as a philanthropist and reproduction of this status among others. Quoting classical sociological theories of gaining identity through action we are to conclude that social self-identification of corporate philanthropist on a local level is poorly developed. 8

9. Donors community: Cognitive maps of donors communications 9 Based on research results by Centre for Studies of Civil Society and Non-for-profit Sector at the State University - Higher School of Economics, 2009.

10. NGO contractors NGOs have potential to be involved as mediators and contractors in a corporate philanthropy for community development through following models: – voluntary actions, – grant competitions, – shared costs, – purchasing NGOs’ production and services, – financial aid, in-kind aid, – mechanisms of social partnership–competition, socio-technical and organizational- structural ones (Iakimets, 2001). In practice NGOs (mainly excluding community foundations) are involved in rather limited number of communications (only 10% on NGOs are communicating with business in forms of contracting). 10

11. System limitations of NGOs involving Macro level – institutional problems: Amount of acting NGOs; Weakness of NGOs material resources; NGO role as a philanthropy contractor; Meso level - problems on a level of individual subjects; Poorness of NGOs informational field; Lack of specialists of certain qualification; Insufficient level of financial and management competence. Micro level – limitations on a level of individuals Luck of trust to institutional contractors of philanthropy; Absence of personal experience of participation in NGO; Insufficient awareness of NGOs. 11

12. Macro level – institutional problems Amount of NGOs: 2/3 of registered NGOs do not function. Only 38% of total amount of NGOs really work - 136 302 organizations (2009); Weakness of NGOs material resources: lack of material resources is the most actual problem for 60% of NGOs; NGO role as a philanthropy contractor: on average only 10% of citizens make charitable donations with the help of NGOs. Potential of growth - 13%. 12

13. How many full-time employees work in your organization in present? 13

14. How many volunteers monthly participate in work of your organization? 14

15. Meso level – problems on a level of individual subjects; Poorness of NGOs informational field: –Undervaluation of a role of communications with community for increasing an awareness about aims, directions and results of NGOs activity: –Insufficient informatively of NGOs materials and web-sites. This are restrictions for current and potential donors and volunteers; Lack of specialists of certain qualification: –Luck of qualified profile specialists with e.g. medical, pedagogic, legal education; –Luck of qualified specialists to work in organization (managers, PR and fundraising managers). Insufficient level of financial and management competence: –Poor knowledge and default of competitive selection rules; –Low variety of proposed projects for competitions; –Low development of audit and evaluation procedures for nonprofit organizations and projects. 15

16. Main directions of NGOs activities (international classification, %) 16

17. Micro level – problems on a level of separate individuals Lack of trust: –53% of citizens – most of NGOs might be trusted. 24% - most NGOs can not be trusted. –Most of citizens make charitable donations by themselves, individually – 46%. –22% of citizens are ready to donate more in they would be sure the money would by used in purpose. Lack of personal experience in participation in NGOs activities: –Help to NGOs – goods and money – 3% of citizens; –Personal voluntary participation in philanthropy organizations - 1% of citizens; –Potential of personal voluntary participation in NGO – 3%. 17 Know / heard about some types of NGOs and civil initiatives

18. ”How often have you made a charitable cash donation to help a needy stranger including beggars?” ” If you have made a charitable financial contribution to help a stranger during the last year, estimate the total amount of your donations?” (Per cent of the respondents who stated the amount of their donations) (Per cent of respondents) Level of Russian’s involvement in making donations 18

19. Conclusion - 1 19 A typical Russian: considers private philanthropy as an imperfect substitute for state activity, distrusts institutionalized philanthropy but approves its support, actually is involved in philanthropic activity in its primitive ineffective forms A typical nonprofit organizations: either a personal instrument of a single businessman or extremely anxious of fundraising, leaded by one person (board of trusties doesn’t exist or plaid a decorative role), not very transparent

20. Conclusion – 2 Optimal model of communicating with corporate donors Conjoined projects with business, using co-financing; Administrating of corporate philanthropy programs of a contract base; Interactions with business for attracting resources of public philanthropy and charity; Participating in competitions of business: Establishing of cooperation with developing and growing companies. 20

21. Conclusion - 3 21 Authorities: gradually recognize importance of philanthropic activity, are suspicious to potential political role of charitable organizations, are going to support, but sluggish and not well informed about prior needs What are the prior needs: to create independent infrastructure for information dissemination and exchange, to support institutionalization of middle-size giving, to encourage voluntary acceptance of higher standards of transparency and corporate governance

22. Centre for Studies of Civil Society and Non-for-profit Sector National Research University – Higher School of Economics http://grans.hse.ru isolodova@gmail.com 22