Inyathelo in the Headlines

Universities' dependence on overseas donors could backfire - 22 May 2017 - Business Day (In-Depth)

Universities' dependence on overseas donors could backfire Sean Jones and Nazli Abrahams Study suggests institutions largely rely on a handful of benefactors Many South African tertiary educational institutions depend highly on a few international donors for their philanthropic income. For many years, information about the state of philanthropic support to higher education in SA was sparse and scattered. This lack of information took on added significance in the context of the growing national crisis in university student funding and the protest actions. To tackle the need for reliable and consistent information, Inyathelo, the South African Institute for Advancement, released its first Annual Survey of Philanthropy in Higher Education two years ago. Inyathelo, established in 2002, works to sustain and strengthen civil society and grow local giving in support of a vibrant democracy in SA. One of its roles is providing higher education institutions and civil society organisations with training and technical support to strengthen their sustainability. The latest philanthropy report, conducted by EduActive Solutions on behalf of Inyathelo with financial support from the Kresge Foundation, offers fascinating insights into higher education funding. The 11 participating universities reported a collective total of more than 1ll.2bn in receipted philanthropic income during 2015. This is R515m more than recorded for the 10 universities in the first (2013) sample. A total of 8,519 donors made philanthropic contributions to the 11 institutions compared with 4,355 donors in 2013, when the sample was 10 institutions. The proportion of income from domestic sources was 48%, down from 53% in 2013. Only 7% of donors, all of whom were foreign, accounted for 52% of total philanthropic income to this sample of South African institutions. The gravity of this situation becomes apparent when comparing the numbers of foreign donors with individual institutions. The median number of international donors per institution was four. although one institution did have as many as 446 international donors. Only two universities out of the 11 have more than 30 international donors. This suggests that institutions largely depend for their philanthropic income on just a handful of international donors. While international funding is welcome and vital, the heavy dependence of universities on philanthropic income from abroad is dangerous and potentially disastrous in the light of geopolitical shifts globally. As is being borne out now by the new policies in the US, foreign philanthropic income streams are unpredictable and unreliable. Support from abroad can be curtailed by shifting political moods, new crises elsewhere in the world, new leadership of charitable organisations, foreign exchange fluctuations and a host of other uncontrollable variables. One strategic priority in terms of time and resources must be to prioritise, in terms of time and resources, the heavily strengthening and extending of relationships with existing local donors and cultivating new local donors among those who have yet to fund higher education institutions. The largest proportion of income comes from trusts and foundations (58%) while individuals comprise the largest donor category (83% of all donors). A possible way to approach this challenge is a concerted national campaign by or on behalf of the higher education sector as a whole to recruit local individuals, organisations and companies as donors to higher education. Another strategic priority should be to convince the corporate sector of the value, for its own wellbeing and the national good, of serving as a bulwark to higher education. In terms of the private sector, this study showed from 2013 to 2015 the proportion of philanthropic income increased from 14% to 17%. In real terms, this was a shift from about R92m in 2013, tc about R204m in 2015 — an increase of about R112m. This was admittedly with one extro university in the sample, but ii accounted for only a small fraction of the increase. There is anecdotal information that private sector contributions to universities continued tc increase during 2016, at least in some instances as a direct response to the #FeesMustFall movement resulting in protests and other disruptions. This is an extremely encouraging development, albeit still much smaller in monetary terms than might be desired. It is of fundamental importance to the higher education sector that corporates show confidence in it. If business supports universities, others — notably high net worth individuals, alumni and a broader range of charitable trusts and foundations — can more easily be persuaded to follow suit It is vital that less wealthy universities receive higher levels of support from the donor world, particularly for the funding of students. This study has shown that socalled nontraditional universities and several poorly endowed traditional ones, receive gravely disproportionate support from the philanthropic sector. Clearly, this skewed distribution of giving perpetuates a raft of other inequalities. It is important to recognise it is precisely these nontraditional and less affluent traditional universities that tend to have the largest numbers of students falling outside the various student funding schemes. They are therefore most fragile and prone to instability. These institutions would naturally be more stable if their stu dents were better supported by the philanthropic offerings of businesses, individuals and others. There is strong economic motivation too: large numbers of graduates and university dropouts carrying high levels of debt are a drain on the economy, while graduates with smaller levels of debt and at least some disposable income contribute towards building it. A systematic and integrated approach to building and managing relationships with key constituencies to attract financial and stakeholder support Jones is MD of EduActive Solutions and an associate of Inyathelo, the South African Institute for Advancement Abrahams is programme director of Inyathelo.Jones is MD of EduActive Solutions and an associate of Inyathelo, the South African Institute for Advancement Abrahams is programme director of Inyathelo. SUPPORT FROM ABROAD CAN BE CURTAILED BY SHIFTING POLITICAL MOODS AND NEW CRISES IN THE WORLD CLEARLY, THIS SKEWED DISTRIBUTION OF GIVING PERPETUATES A RAFT OF OTHER INEQUALITIES Activism: Private sector contributions to universities continued to increase in 2016. in some instances in direct resoonse to the #FeesMustFall movement that led to 'protests and disruotions. /Daily Dispatch



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