Debut Issue of Philanthropy Management: Will the Profit Motive Taint Social Impact Investing?

NEW YORK, April 24, 2012 /PRNewswire/ -- In the inaugural issue of Philanthropy Management, the CEO of PlaNet Finance Group acknowledges concerns that the profit motive may distort the social benefits of microfinance and the head of a prominent Indian family suggests that tax reform could boost philanthropic giving.

In an interview focused on microfinance and social impact investing, Arnaud Ventura, founder and CEO of the PlaNet Finance Group, recognizes that the line between socially-motivated philanthropy and commercial investment has blurred. He admits that some "new entrants" may have been attracted to microfinance and other impact investment initiatives "simply because this has been shown as a sector where you can make money." He argues, however, that the majority of participants in the sector are likely to retain their original social motivations.

Elsewhere in the issue, Jamshyd Godrej, chairman of the board of Godrej & Boyce, one of India's oldest and most diversified family-owned companies, suggests that philanthropy in India would increase if the nation's tax treatment of charitable gifts was more in line with other jurisdictions where the benefits of philanthropic giving are overtly recognized. Godrej points to the U.S. as a model for more generous tax relief on individual donations. He also suggests that the imposition in India of "death duties" - otherwise known as an estate tax - might encourage people "to give money away in their lifetime rather than pass all of it on to their children."

John Lee, Asset International's Europe managing director, notes that the issue of tax harmonization is of common concern to readers of several Asset International titles. "One result of globalization is that a growing number of potential donors have business interests and residences in multiple countries, and it makes sense to have a coordinated approach to tax relief that simplifies and encourages both domestic and cross-border giving," he said.

The tax treatment of philanthropic donations is a subject of vigorous debate, notably in the UK, where the recent government budget introduced new caps on tax relief to the consternation of many charities and donors. "National revenue authorities are notoriously reluctant to rein in their options in the interests of international cooperation," notes Richard Schwartz, editor-in-chief of Philanthropy Management. "Nevertheless, a comparison of different approaches and their impact both on tax receipts and aggregate levels of giving might help encourage more considered policy-making. This is a subject we will be returning to in our next issue."

About Philanthropy Management
Philanthropy Management, an Asset International publication, focuses on the financial, operational and strategic services provided to foundations, endowments and other large-scale grant makers by banks, asset managers and other professional advisors. It is distributed globally to more than 11,000 senior executives within the largest grant making entities in the Americas, Europe, Asia and Middle East, including foundations and endowments, family foundations and family offices. 

Philanthropy Management aims to provide philanthropic institutions with a broader and more refined range of tools, resources and research to measure their own success and the impact of the advisors and services they use. Philanthropy Management is edited by Richard Schwartz. Please visit philanthropy-management.com.

About Asset International
Asset International is a privately-held provider of information and technology to global pension funds, asset managers, financial advisers, banking service providers, and other financial institutions in the private and public sector. Its industry-leading brands include Strategic Insight, SIMFUND, Plan For Life, PLANSPONSOR, PLANADVISER, aiCIO, Philanthropy Management, Global Custodian, and The Trade. The company has offices in New York, Hong Kong, London, Melbourne and Stamford, CT.

SOURCE Asset International