GIVING Thematic Issues in Philanthropy and Social Innovation

EDITORIALGIVINGThematic Issues in Philanthropy and SocialInnovationGiuliana GemelliDuring recent years, philanthropy hasemerged as a modus operandi for socialaction shared by different kindsof institutions, both public and private,and by individuals as well as bygroups and communities. The patterns,which previously characterised philanthropicaction, are currently undergoinga profound transformation. Fromthe form of charitable alleviation of theills that afflict society, philanthropic actionis gaining an entrepreneurial nature,aimed at generating social innovation.Philanthropy is one of the emergingphenomena in a context characterisedby vast-reaching changes, whichconcern the forms, dimensions, socialrepresentation and methods of wealthinvestment. The very concept of profit,focused on the production of moneyand material goods, is beginning to incorporateother values and assets of animmaterial nature, which are inseparablefrom the generation of wealth, andnot only those linked to business but alsothose of a purely financial nature.159

GIVING01-07 The Social Responsibility of WealthCurrently, from a scientific and academicperspective, philanthropy is increasinglyinteresting for experts fromvarious different disciplines, and it isincreasingly focused on by editorial initiatives.The number of training courses forexperts and workers in this field hasincreased exponentially at prestigiousuniversities, both in the United Statesand in Europe.The project of creating a new journal,in Italian and English, which has anacademic characterization, but whichaims to address a wide readership, onthe basis of a vast range of collaboratorsand advisors, including experts from thesector, journalists, commentators, nonprofitorganisation managers, foundationofficers and executives, not to mentionentrepreneurs and business leaders.Each issue of the journal will focuson themes which are researched indepth and which should stimulate debateon topical issues. The journal is theresult of several years of experience ofthe International Master Programme onPhilanthropy and Social Entrepreneurship(MISP), created at the University ofBologna in collaboration with the “Centeron Philanthropy” at Indiana Universityand several other academic institutionsin Africa, Europe and the USA.The project stems from the need tocapitalise on the resources created bythe scholars, experts and key figures ofthe philanthropic field, who actively participatedin MISP research. These figureshave great potential for commitment interms of the fact that they are driven byan entrepreneurial vision, which focuseson investment as a tool for achieving innovationand social change. This flow offigures has resulted from the communicationand meetings, which were generatedby the activity of the Master Programme,as well as by the process of consolidationof its organisational culture. The MasterProgramme is characterised by a specificobjective: the coordination of a researchcommunity, which has led to the emergenceof studies on philanthropy, bringingtogether both academic elements andthose which emerged from a wide rangingbrainstorming workshop. This workshopwas particularly stimulating, inthat it was characterised by a strong inter-disciplinaryconnotation, and by variousforms of contribution, not only fromscholars, but also from “men of action”from the world of business, public institutions,and social entrepreneurship.It is without doubt an ambitiousproject that takes up a challenge andoffers many opportunities but, at thesame time, faces many obstacles, inthat it aims to support and provoke achange of mentality. Such a change isparticularly radical, as it focuses mainly(although not exclusively, given thejournal’s international nature) on theItalian context, where traditional methodsof philanthropy are still dominant.Until recently, the concept of philanthropyhad negative connotations in Italy,as it was frequently associated with charity,or the Latin concept of munus (duty).It was therefore considered an extemporarydonation, and as an end in itself.It has very different connotations inan international context, and in particularin English-speaking countries, especiallythe United States, where philanthropyemerged in a scientific formfrom the beginning of the 20th centuryonwards. Philanthropy has establisheditself as a combination of organisationalstructures and networks of professionalexpertise, which aim to promote developmentof communities as well as individuals.In its most evolved historicalforms, philanthropy is a vehicle for civicand social entrepreneurship, whichmakes use of financial tools, organisationalmethodologies, management andadministration techniques in order tocarry out social innovation projects.160

EditorialGIVING isAn academic journal, in Italian andEnglish, and its aims are:• to produce studies, research andrelevant reflections on philanthropyas social investment;• to analyse the essential tools for acritical and rational assessment ofphilanthropic issues and practices;• to align philanthropic practices withthe themes of scientific reflection, bymeans of the analysis of case studieswhich have a emblematic and guidingvalue.It is fundamental that institutional figuresfrom both the private and the publicsector, as well as figures from business,public administration, foundationsand non-profit organisations, universitiesand research centres collaboratetogether in order to achieve suchobjectives.GIVING aims to beA mean for research and action, aworkshop for practical ideas aimed atsocial innovation, thanks to collaborationbetween those who operate in theworld of socially responsible entrepreneurshipin different fields. This meansnot only those from the private sectorbut also from the public sector, as thestudies of Julien Le Grand 1 have clearlyillustrated, by focusing on a theme,which is an essential part of the visionof Giving. This theme is the characterisationof philanthropy as a vehicle ofsocial justice, rather than the mere redistributionof public resources or privatewealth. On the contrary, it must beviewed as a triangular trade, based ona third dimension in the framework ofthe relationship between profit-makingactivities and social innovation activities.It must form part of a journey ofreciprocity, which can generate innovationthat is shared by those who investand by those who develop investmentin innovative ways. It must be able togenerate new forms of circulation forthe capital invested and to combine theproduction of material goods with thatof immaterial assets in a journey of circularevolution.This workshop for ideas and practicalsolutions aims to boost communicationand interaction between a network of extremelyhigh level consultants who representthe intellectual capital of the journal.They will be entrusted with planning thethematic series, and forming a researchcommunity, which can play an influentialrole on a practical level, by spreading anew vision of social action.As far as the theme that will be discussedin the journal are concerned,there are various topics, which will beexamined, also by means of the organisationof workshops during the intermediatephase, between the definitionof the project of the individual thematicissues and their creation.The forthcoming thematic issues include:• Models of social entrepreneurshipto help individuals: the hospice.• Social entrepreneurs: individuals,networks, communities.• Community Foundations: local developmentand social capital.• Corporate Foundations: the corporations,the market, their reputation.• Governance and Leadership: strategicchallenges in philanthropic organisations.01-07 The Social Responsibility of Wealth1 See J. Le Grand, Motivation, Agency, and Public Policy. Of Kights and Knaves, Pawns andQueens, New York: Oxford University Press, 2003 and J. Le Grand, Equity and Choice. An Essay inEconomics and Applied Philosophy, New York: Harper Collins Academic, 1991.161

GIVING01-07 The Social Responsibility of Wealth• Philanthropy and welfare: social inclusionand social justice.• Finance: foundations, ethical funds,assets, investments.• Multi-utility companies and corporatecitizenship.• The pharmaceutical industry: thetwo sides of philanthropy.• Philanthropy and risk capital.• Micro finance and micro credit.• Art, science and philanthropy.About the first issuePhilanthropy and the social responsibility ofwealthThe final years of the 20 th century weremarked by the reaffirmation of the roleof entrepreneurship as a driving forcein economic processes and businessdynamics, which joined the behaviouralmodels of the past, reintroducing thedivision between economic action andsocial action. This division, which wasa result of the separation of the internalfunctions of businesses and of the tendencyfor such functions towards bureaucratization,as well as the crystallizationof economic models, which focusedexclusively on profit-making andthe creation of financial capital, was theproduct of a historical process, whichhad loosened its ties with the original,core concept of entrepreneurship itself.If we look at the Latin etymology ofthe words “entrepreneur”, “enterprise”,to “undertake”, we can see that theirroot is the verb suscipere, which refersto the concept of sustaining in a responsibleway. More precisely, the meaningof suscipere is “to generate by recognising”,or in other words, by taking responsibilitynot only for the act of generatingbut for the process that followsthat act as well. This entails both consciousnessand a conscious assumptionof responsibility for the effects of sucha process. A broader meaning of theterm suscipere is to receive in a consciousway, welcoming the action generatedby others as a principle of actingin a way that is equally responsible.The concepts of entrepreneur andentrepreneurship, if defined in thisway, contain various consequences ofboth theoretical and practical nature:• the first is that the entrepreneur assumesthe role of a representativesubject of social and civil action.Thus, the entrepreneur is capableof defining and implementing valuesand, by interacting with othersubjects, encourages them to bringabout shared aims and objectives,and to generate further actions thatare also directed towards responsibility.The entrepreneur is the regulatorywatchdog of a process of assumingshared values. These valuesare not made visible by codesof ethics or certification but by people’sbehavioural background, andby cognitive patterns that translateinto modes of action;• the second consequence is that theconflict between economic and sociallyresponsible action, and betweendonation and profit, disappears,and a web of relational assetsemerges, which are closely linked tothe investment of wealth and thenetwork of tangible values (materialeffects of its use) and intangibleones (moral effects and behaviouralroots compared to the forms of theuse of wealth);• the third is that an entrepreneur isnot just a person who acts in themarket sphere, but is also a personcapable of undertakings in variousspheres of social action, (culture,education, art, science, the healthservice, local administration), drivenby values and ideas oriented towardsa goal. This action in the so-162

Editorialcial and civil sphere, and not onlyin an economic setting, involves theentrepreneur as a person, as a promoterof active knowledge, or as agenerator of social change and respectfor other people, and especiallythat category of “other people”,which are the future generations.The main vehicles of entrepreneurialaction, namely family, wealth, communityand inheritance, have particularsignificance in this network, in a circularprocess based on the combinationof economic, social and cultural values,and between tangible and intangiblebenefits. In this circular evolution, thewealth produced by a family, viewed asthe original core of the cell generatingentrepreneurial action, cannot be consolidatedand strengthened over timeunless it interacts responsibly, not onlywith the values of its culture of referenceand the identities that shape it, butalso with the structural configurations,the needs, and the ideals of the communityof reference. This is how these valuescirculate, transforming themselvesinto the vital sap of an interactive processwhere the functional distinction betweenthose who give and those whoreceive has been transcended.This model of interaction generatesnew modes of exchange, which,although they do not exclude the marketand profit, do not view them as thebasis for their concepts and ideals, andnor do they make them the exclusiveobjective of their action. It is from thecombination of family, community andsociety that inheritance takes shape notonly as a principle of accumulation ofwealth but also as a core capable of becomingan aggregative force for a systemof shared values and as a generatorof legacy. In other words, this legacyis both a generational link in the contextof entrepreneurial families and arelational link, as far as the communityis concerned, to the local area whereentrepreneurial action takes shape,consolidates, is transmitted and transformed,through different forms of investmentand action that although theyare varied, maintain the same originsas a point of reference.By means of the spreading of the interlinkedvalues of inheritance, namelythe economic and social values, the materialas well as the immaterial ones,wealth becomes a civilizing principle,as a vehicle for the of accumulation ofresources for the community as well asthe accumulation of profits for the individual.From this point of view, entrepreneurialfamilies not only generatewealth, which is destined to be used byits members, but are also active participantsin the production of the regulatoryvalues of society. This process of aggregationbetween family, wealth andsociety, not only generates appropriationbut also empowerment. It createsthe basis for shared action betweenfigures involved in a kind of entrepreneurshipthat is rooted not only in thecontext of industry but also in the managementof financial inheritance. Thismodus operandi has a civic nature andcan be expressed in different ways, incultural, scientific and social contexts.From the combination of these elements,a model of behaviour emergesthat is capable of reproducing itself, notonly by optimizing financial assets butalso by aligning them with the values ofreference, the main aim of which is thesocial return of investments. Thus, givingis not a separate activity to investment,but rather ethically linked to economicactivity, as a principle that regulatesand directs the nature of investments.This depends on the developmentof the most advanced models ofeconomic and financial investment forappropriation and transfer in a socialcontext, with the aim of combining economicand social values.01-07 The Social Responsibility of Wealth163

GIVING01-07 The Social Responsibility of WealthOnce and for all, entrepreneurialbehaviour expresses itself by generatingprojects with a strong economicnature, as well as a strong socialelement. This occurs by means ofthe bond created by participation in anew vision of “public function”, andthe social role of wealth, thus combiningprofit with the accumulation of socialand cultural capital. In this contextprofit must come from within, and notbe seen as an additional, ornamentaland therefore instrumental factor.This accumulation of social and culturalcapital should, in retrospect, cultivatethe very cell that led to its generationand that forms its holistic background,whether it be economic, socialor relational, which steers the activitiesof the entrepreneur.164