The transformation that 1% may cause

*By Paula Fabiani, CEO of IDIS – Institute for the Development of Social Investment

Private social investment – the voluntary and strategic allocation of resources for the public good – is essential for resolving deep gaps in the socio-environmental development in the country. Although the State plays a crucial role, there is no way around it. There are several challenges when it comes to providing what is necessary for everyone’s well-being, whether due to Brazil’s continental dimensions or the enormity of the country’s problems that need solving. And that is where private social investment may and must act: contributing to reducing inequalities and mitigating environmental damages. Only with the collaboration between government, companies and society will we be capable of addressing effective and everlasting solutions.

When we talk about private social investment, we’re talking about BRL 4.8 billion in corporate donations, that is, donations made by companies, according to the GIFE census 2023. A significant amount, but still below the figures recorded in 2020, during the peak of the pandemic, when the private sector’s donations exceeded BRL 5.3 billion. The historical figure reinforces that the private sector can invest more – and better.

Through this vision and inspired by the North American movement, Pledge 1%, IDIS – Institute for the Development of Social Investment and Instituto MOL launched Commitment 1% in Brazil.

Launching event of Commitment 1% which happened in São Paulo in PwC Brazil’s headquarters.

The movement has the purpose of gathering companies that already donate at least 1% of their annual net profit, as well as those that have committed to reaching this amount of donations in up to two years. Cyrela, fama re.capital, Gaia Impacto, MOL Impacto, Pantys, PwC, RD Saúde and TozziniFreire Advogados are the first signatories of the commitment, as well as other organizations who are already at an advanced stage in the process of their adhesion.

Designed for companies of all sizes and sectors, Commitment 1% has the goal to drive companies’ involvement with the present and future of society, so that they will invest in projects and organizations who need resources to continue their journey. These are donations for essential organizations that transform the realities of communities in which they are inserted through education, culture, sports, healthcare, environmental and income-generating actions.

With private social investment, companies only stand to gain. Beyond the financial advantages, since it becomes easier to raise funds on the market, companies also improve their reputation, with bigger engagement from collaborators and a more solid relationship with suppliers and clients. It’s an ecosystem that positively impacts all stakeholders.

Creating possibilities for the growth of private social investment and promoting the habit of giving in the country is, without a shadow of a doubt, a path to strengthening organized civil society as an agent of positive socio-environmental changes. This journey can only be traced to people and businesses who believe in the mobilizing and sustainable power of strategic philanthropy and commit to the generation of positive impact. Just start by committing to 1%.

After all, it is now up to us to repair the mistakes of the past and build a future for those who will come. 

What has to happen for Brazilians to see donations as more than just a response to crises?

Article originally published at Folha de S.Paulo in 09/04/2024

By Paula Fabiani, CEO of IDIS, and Luisa Lima, communication and knowledge manager

 

Altruism means spontaneous regard for the welfare of others. In broader terms, it refers to one’s ability to devote oneself to something or someone without expecting anything in return, moved solely by compassion for a cause or situation. When it comes to altruism, we are also talking about donations.

In Brazil, the act of giving is widespread and socially acknowledged, especially in times of emergencies, as the one we recently saw in the floods that hit Rio Grande do Sul – a Brazilian state – in May of 2024, leaving 497 municipalities impacted and 150,000 people displaced. However, we still face many barriers, such as the donors’ distrust of the destination of donations and even the lack of alignment with certain causes and types of organizations. 

What has to happen for Brazilians to see donations not only as a response to crisis, but also as a path for a more just, equitable and generous world?

The recently launched World Giving Index 2024, one of the biggest researches about donations ever produced, with millions of people interviewed in the entire world since 2009, reveals a scenario that may look optimistic at first, but shows that we still have a long journey ahead when it comes to generosity. 

In this edition, WGI included data from 142 countries. Participants were asked if they had taken three types of actions in the last month: helped a stranger, donated money to a charity or volunteered their time to an organization. 

Brazil climbed three positions compared to the previous year and now occupies the 86th place in the ranking. The report points to a slight 3 percent increase in the amount of people donating money to civil society organizations. Helping a stranger is still the predominant behavior, practiced by 65% of respondents.

The survey carried out between September and November of 2023, does not capture the donations made due to the climate tragedy in Rio Grande do Sul.

In 2022, with the country still under the effects of the Covid-19 pandemic, we were among the top 20 most solidary countries in the world. At the time, the study highlighted that 3 out of four Brazilians helped a stranger. 

However, since then, we have dropped more than 60 positions in the ranking. From this angle, it appears to be a discouraging result. But, in terms of absolute score, this was Brazil’s second biggest result since 2009.  

The research also presents inspiring world parameters for Brazil. In the last two years, many countries registered meaningful growth in their levels of generosity. Indonesia ranked as the world’s most generous country for the seventh year in a row, with 90% of the population donating money to social organizations and 65% volunteering their time.

Interestingly, among the top 10 most generous countries, only two are between the world’s biggest economies (Indonesia and the United States of America), while Gambia, one of the world’s poorest countries, occupies the 4th place.

Public policies designed to promote philanthropy, such as tax incentives, individual donations matching, and benefits to the practice of corporate volunteering, have had positive effects in Singapore and can be an example for Brazil.

The potential of the Brazilian donor in critical situations and emergencies is unquestionable. However, to strengthen the generosity and giving culture in the country, the practice of donating must become regular.

It is necessary to transform the act of giving into a continuous expression of citizenship and commitment, capable of generating positive and lasting socio-environmental impact in our society. True altruism manifests itself when the donations go beyond the immediate need and become a part of daily life. 

Commitment 1% calls on companies to boost engagement in donations to social projects in Brazil

This august, Brazilian companies announced their pledge to Commitment 1%. Envisioned by IDIS – Institute for the Development of Social Investment and Instituto MOL, this initiative seeks to promote donations made by companies to civil society organizations. Amongst the companies that confirmed their commitment to the movement are Cyrela, fama re.capital, Gaia Impacto, MOL Impacto, Pantys, PwC, RD Saúde and TozziniFreire Advogados as well as five other organizations are already at an advanced stage in the process of their adhesion.

 

Inspired by Pledge 1%, movement in the United States that gathers more than 15 thousand signatories, Commitment 1% aims to gather Brazilian companies that already donate at least 1% of their annual net profit and those that commit to reaching this donation level within two years. According to the publication Corporate Social Investment Benchmarking, in 2022, Brazilian companies donated R$4,026 billion. That value equals to about 1/3 of the total donated by individuals, according to IDIS Brazil Giving Research 2022. During the same period, donations made by individuals reached R$12,8 billion.

 

“The goal 

of this commitment is to contribute to the progress of private social investment in Brazil and encourage the longevity of donations as a strengthening strategy of organized civil society. The third sector plays a crucial role in reducing inequalities. Here, we have serious organizations that have been working for a long time in a meaningful way, and financing the work and strengthening of these initiatives is what will assure social transformation in the medium to long-term in the country. And this progress is the company’s responsibility as well”, emphasizes IDIS’ CEO, Paula Fabiani.

 

To the signing parties, the benefits of committing to the movement will be seen in several areas: access to a community of exchanges and knowledge, visibility to the actions taken and reputational gains with stakeholders and becoming an influential agent in your acting market.

 

“The companies that are committing with the 1% are providing and excellent example for others to follow the same path. As Ralph Waldo Emerson says: “Your actions speak so loudly that I cannot hear what you say.” – Aron Zylberman, Instituto Cyrela

At the same time as the recurring and strategic practice of philanthropy contributes to accelerating positive social change and strengthening civil society, companies can develop better relations with their contributors, suppliers and consumers. There is also potential impact on fundraising in the financial market (the strengthening of the S in the ESG helps drive valuation).

 

Launching event of Commitment 1% which happened in São Paulo in PwC Brazil’s headquarters.

The adhesion process includes the confirmation of the donations conducted and can be made online in the commitment’s website.

“Commitment 1%

 is an ambitious and impactful project, capable of driving and accelerating the way that companies commit to the present and future of society, investing to strengthen relevant projects that need resources to keep going”, emphasizes Rodrigo Pipponzi, cofounder of Instituto MOL.

 

Access the Commitment 1% website here, available only in Portuguese.

1% changes the world!

Mackenzie Scott Donates $1.5 Million to IDIS

IDIS – the Institute for the Development of Social Investment – has received a donation of $1.5 million, equivalent to R$7.5 million, from American philanthropist MacKenzie Scott.

The gift received will be the first contribution to IDIS Endowment, which is being stablished on the year the Institute celebrates its 25th anniversary. The mechanism aims to contribute to the organization’s sustainability and shall provide greater predictability for investments in projects to strengthen strategic philanthropy and the culture of giving in Brazil, including advocacy initiatives for a favorable regulatory environment and knowledge contents.

“The endowment will provide perpetual source of funding, which will be used to expand our efforts to strengthen strategic philanthropy in the country, as it provides us with greater long-term stability. It’s a recognition of the relevance of IDIS and the potential we have to generate even more positive impact,” explains Paula Fabiani, CEO of IDIS.

 

Ranked as the fifth richest woman in the world, the philanthropist is a signatory of the Giving Pledge. This commitment encourages people and families with substantial wealth worldwide to contribute a significant portion of their wealth to social causes and publicly pledged to donate at least 50% of her wealth during her lifetime. In Brazil, Elie Horn, founder of Cyrella, and the Latin American couple, David Vélez, co-founder of the digital bank Nubank, and his wife, entrepreneur Mariel Reyes, are also signatories of the commitment.

With solidarity on the rise, individual donations to Brazilian NGOs total BRL 12.8 billion ($2.6 billion) in 2022

Promoted by IDIS –Institute for the Development of Social Investment, the Brazil Giving Research is the broadest study on individual donation in the country. In its third edition, it features a special chapter on the Generation Z

Donating is becoming increasingly popular in Brazil. In 2022, 84% of Brazilians over the age of 18 and with a family income above one minimum wage (approximately $270), made at least one type of donation, be it money, goods, or time, in the form of volunteering. Two years earlier, the average was 66%. Donating directly to NGOs and socio-environmental projects was practiced by 36% of respondents, remaining stable despite the socio-economic crisis faced by the country. These findings are part of the third edition of the Brazil Giving Research, an initiative of IDIS – Institute for the Development of Social Investment and carried out by the Ipsos research institute.

The Research also explores the volume of resources. The median of donations reached BRL 300. It was BRL 240 in 2015 and BRL 200 in 2020. The growth was driven by higher donations over the last year. For comparison, in 2021, according to the Brazilian Benchmarking of Corporate Social Investment (BISC), the amount allocated to organizations and causes of public interest by the 324 participating companies and 17 institutes was BRL 4.1 billion ($833 billion).“Brazil is a country with many inequalities and the practice of donation is a fundamental aspect of our society. In the Brazil Giving Research, we set out to understand who the donors are, what are their motivations, what is their perception of NGOs, and what are the barriers presented by non-donors. This year, we also looked at Generation Z, the donors of the future. This is important data that helps us to strengthen the giving culture,” says Paula Fabiani, CEO of IDIS.

 

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WHAT IS THE DESTINATION OF MONETARY DONATIONS?

Among the respondents, 48% said they would make some kind of monetary donation in 2022. The figure is 7 points higher than that found in 2020 and equivalent to the 2015 level (52%). Part of these funds went to NGOs, socio-environmental projects, or social campaigns, with 36% of the population making what we call institutional donations. Interestingly, however, there was a significant increase in the percentage of people who reported donating alms, rising from 6% in 2020 to 16% in 2022. This growth is in line with the increase (from 1% in 2020 to 10%) in institutional donations to organizations and projects that serve homeless people, showing the heightened sensitivity to the cause.

The Research’s figures are also a social portrait of Brazil, whose homeless population exceeded 281,000 in 2022. This means an increase of 38% over the previous three years and most of this is due to the impoverishment of the population, a consequence of the economic crisis that is plaguing the country.

 

PERCEPTION ABOUT NGOs

In 2020, with NGOs playing a leading role during the pandemic, there was a significant improvement in public opinion about civil society organizations. Two years later, the data shows a considerable downturn, but even more positive than the picture in 2015.

The biggest setbacks appear in questions relating to trust in third-sector organizations. For the statement “NGOs make it clear what they do with the resources they invest”, there was a 14-percentage point drop in agreement (from 45% to 31%); and for “Most NGOs are trustworthy”, there was a 10 percent point drop (from 41% to 31%).

“The findings begin to make it clearer which effects of the pandemic are short-lived, and which are here to stay. The image of the work carried out by the Third Sector is still quite volatile and prone to following the social context. It’s important that the sectors collaborate to strengthen the perception and engagement of society in general,” says Luisa Lima, Communications and Knowledge Manager at IDIS.

On the other hand, Generation Z, youth aged between 18 and 27 years old, are much more optimistic and positive about NGOs in all respects. The difference with the general population is especially large when it comes to the statement that ‘NGOs bring benefits to those who really need them’ (74% among Generation Z against 58% of the general population). In statements such as ‘NGOs make it clear what they do with the resources’ and ‘Most NGOs are trustworthy’, Generation Z’s agreement is around 39%, which, even though it is higher than in the general population, is still a point of attention.

 

SOCIAL CIRCLE OR DIGITAL MEDIA: WHICH ONE INFLUENCES THE DONATION THE MOST?

This edition includes a question about the main drivers of donation practices. We asked the institutional donors to choose the three most important to them from a list of possibilities. The responses showed that social interaction in religious settings and communities has the greatest power to influence a donor, followed by family, neighbors, and friends. Meanwhile, social media and digital influencers came fourth with 17%. Among Generation Z, the value of the reach of digital media and influencers grows to 25% of donors.

When asked which social media influences them to donate, both among institutional donors from the general population and from Generation Z, the most common mention was Instagram (85% and 89% respectively), followed by Facebook (33% and 37% respectively),. After the top two, we have the most significant changes: while the general population considers YouTube and WhatsApp (both with 13%) to be among their other biggest influences, Generation Z, third and fourth place goes to TikTok and YouTube. In this group, WhatsApp appears with only 4% of responses, behind Twitter. In both cases, LinkedIn was the least mentioned network.

 

CITIZENSHIP ACTION BY BRANDS AND COMPANIES

We sought to understand how the perception of the reputation of brands and companies influences consumer decisions. The result shows that people punish companies and brands that behave inappropriately (77%) much more than they reward those that adopt good social investment practices (44%). This impact is even greater among institutional donors – 85% and 49% respectively.

 

GENERATION Z: HOW DO YOUNG PEOPLE BETWEEN 18 AND 27 DONATE?

As with the general population, the data on Generation Z shows that they are also donating more. Meanwhile, in 2020, 63% of them said they had made some kind of donation, and in 2022 the figure reached 84%, matching the national average. The highlights of donations in this section are mainly donors of goods (76%) and voluntary work (30%). When it comes to donating money to NGOs and socio-environmental projects, young people are 9 points below the general average, at 27% compared to 36% – a natural phenomenon, since the availability of money at these ages is sometimes lower than when compared to older people. On the other hand, they also tend to have a more positive view of donations and NGOs.

The Research also shows that young people who donate also tend to promote or contribute in some way to fundraising or mobilization campaigns to help other people. This was confirmed by 7 out of 10 young donors in 2022, and 20% of them say they have done it more than once.

When it comes to causes, actions related to children, health, and the fight against hunger are the most popular among Brazilians, and this is also true among young people. However, the ranking still shows a difference between Generation Z donors and the general population. Young people are more sensitive to homeless people, showing a willingness to take on more visible issues with more immediate impacts. The animal cause also has more supporters among Generation Z than in the population as a whole.

 

OUTLOOK 2023

In general, there is an optimistic outlook regarding the growth in donation practices. Among institutional donors, 45% say they will donate more the following year. In the previous edition, this percentage was 36%. The same movement appears among Generation Z donors: 52% say they are willing to donate more. It is also positive that 93% of non-donors said they could start donating, a big change from 2020 when only 57% were willing to do so. The trigger for the change in attitude, however, was mixed. 28% said they would donate if they had more money, 13% said they would like to know how the money is being used and 12% wanted to meet an NGO they trust.

 

METHODOLOGY

The 2022 Brazil Giving Research was carried out between May 3 and June 13, 2023, using a quantitative approach, with 1,508 telephone interviews. The sample is representative of the national scenario and the margin of error is 2.5 percentage points up or down.

Participants’ profile

– Men and women

– Class: ABC

– Age: over 18 years old

– Family income greater than 1 minimum wage

 

ORGANIZATION AND SUPPORTERS

The 2022 Brazil Giving Research is an initiative of IDIS Institute for the Development of Social Investment and CAF – Charities Aid Foundation. Ipsos was responsible for carrying out the research and Instituto Beja, Movimento Bem Maior, Raízen, Instituto ACP, Instituto Galo da Manhã, Instituto MOL, Doare, and Instituto Phi, were the financial supporters. Philanthropists Luis Stuhlberger and Teresa Bracher also contributed.

 

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