Singapore can be a philanthropic hub for Southeast Asia, says social investor network

Singapore’s status as a key financial centre could help make the country a hub for philanthropic activity in Southeast Asia, according to a network of social investors in the region.

AVPN, as the network is called, has raised around US$11 million (S$15 million) from members, including family offices, foundations and policymakers, to address social and environmental challenges.

Its chief executive Naina Subberwal Batra said there are opportunities to “support underserved populations, early-stage innovations, and underfunded sectors in Asia” – areas that conventional sources of funding tend to avoid due to the perceived risks.

This is where philanthropic funds can be mobilised to catalyse financing, Ms Naina noted, adding that Singapore can play a key role in facilitating these capital flows, given its role as a global financial hub with the infrastructure for wealth management and investment.

The Republic has a wealth of ancillary service providers such as tax consultants, legal advisers, and technology platform providers on hand as well.

The Singapore Government is building up the specialist talent pool, and there are various tax incentives to encourage philanthropy, Ms Naina added.
 

Ms Deepali Khanna, vice-president for the Asia regional office at The Rockefeller Foundation, said networks like the Asia Philanthropy Circle and the Philanthropy Asia Alliance form part of that vibrant giving ecosystem here.

“By harnessing the collective strengths of all the various stakeholders, we can multiply, impact, accelerate positive change, and facilitate urgent actionable solutions to tackle the challenges we face today,” she added.

Asian family offices have emerged as an important source of funding for these early-stage projects, noted a report released by DBS Private Bank that surveyed senior executives from 200 family offices across Asia.

It found that philanthropy is becoming more important for Asia’s wealthy families despite economic and geopolitical uncertainties.

These efforts have in turn evolved from the traditional cheque book donations to charity, into a deeper engagement with such organisations.

Mr Lee Woon Shiu, group head of wealth planning, family office and insurance solutions at DBS Bank, said many philanthropic families in Asia now recognise that ad hoc activities are no longer enough.

They do not want to just give a donation and then walk away, with 61 per cent of families saying they want to be more actively involved, Mr Lee said. “There is accountability, and there is active mentorship.”

The Kewal Ramani Foundation in Singapore is guided by this active mentoring principle and hopes to “provide more meaningful support”.

Ms Sapna Kewalramani Malhotra is the philanthropy director of the foundation, which is involved in education, health and development, and the welfare and protection of women and children.

She noted in the DBS report: “We have gained domain understanding of how schools and eye hospitals operate, and how welfare for children operates in shelter homes, so we can share our learnings with new grantees.”

DBS’ Mr Lee added that 71 per cent of Asian family offices are increasingly thinking about the well-being of future generations when they shape their philanthropic activities.

This is reflected in the importance they place on environmental initiatives and those that support vulnerable young people.

Mr Lee further noted that family offices are involving their next generation in the philanthropic process as they believe this will help them “to forge a common shared purpose” among the different age groups, which will in turn contribute to the “longevity and resilience of the family enterprise”.
 

Ms Chua Weiling, director of philanthropy at Chua Foundation in Singapore, noted in the DBS report how her grandmother would take the family to homes for the elderly and disabled to volunteer and distribute food.

When her grandmother died about 10 years ago, Ms Chua said the family started a foundation “to instil in future generations the value of giving and helping the needy”.

The Chua Foundation continues to support initiatives in special needs and elderly care, with Ms Chua noting: “In this way, we hope to advocate compassion and a sense of responsibility towards the less fortunate.”

AVPN’s Ms Naina said the funds and grants from Asian family offices tend to come with expectations of low or no return.

This means the money can be used to fund projects in their early and growth stages, which “often experience a dearth of funding” because they may be too risky for commercial investment appetites.

Ms Naina added that this sort of approach helps fund some public-sector projects, which frees up government resources to focus on other initiatives.

Social projects cover areas such as health, education, housing, and the disadvantaged.

Philanthropy in the form of concessional capital from Asian family offices can also play a critical role in the climate agenda, the DBS report noted.

“A lot of these early projects are simply not bankable from a conventional analysis of the balance sheets. But they are crucial to steer Singapore towards meeting certain long-term climate targets,” it stated.

Asian family offices that have “the depth of intellectual capital to appreciate the green trend” and “the flexibility to deploy their capital to fund these early startups” are well-poised to plug into the growth in the green movement space, Mr Lee added.
 

Source: The Straits Times © SPH Media Limited. Permission required for reproduction.