Philanthropy in Chile is waking up

Chile‘s foundation and philanthropy sector, at a glance:

Number of foundations:
120 foundations (operative or grant-making in the general sense) with a spend of USD 100 million

Main umbrella body:
COS (Comunidad de organizaciones solidarias), with 200 non-profit members

State of the sector:
0.12% of GDP

Biggest opportunity in the sector:

• foundations are more visible than before
• growing importance of the third sector
• more trust in foundations – as opposed to the State or the economic sector

Biggest challenge for the sector:

• to achieve collective impact and a more systematic approach
• more cooperation between foundations and more joint activities/projects
• better tax incentives
• establishing new forms of interaction between the non-profit sector and the State, a relationship based on two partners who cooperate for the common good

18. November 2019

Interview with Rosa Madera, Founder and CEO of EMPATTHY – Filantropía Estratégica e Inversión Social (Strategic Philanthropy and Social Investment Foundation), Santiago de Chile

What are the three broad issues that will drive Chile’s foundation and philanthropy sector in the next 10 years? Which topics do you expect philanthropy to focus on?

The most important issues facing the philanthropy sector are as follows:

1. The legal regulation of donations in order to foster tax benefits for donations and unify criteria that are currently regulated in a different way for every sector (culture, education, social etc.)
2. Environmental issues, and above all climate change.
3. Decentralisation, which in this context means social investment in the Chilean regions (until now very much focused on the capital Santiago de Chile and the surrounding region).

What is traditional philanthropy in Chile, and how do you expect this to develop in the future?
 Traditional philanthropy in Chile is very much focused on charity and many Chilean foundations run their own projects. They generally do not support other projects with donations or funding. Philanthropy in Chile often has the aftertaste of something from the past, a bit old-fashioned, and charity and philanthropy are mostly used as synonyms. However, 44% of the 120 foundations were established less than 10 years ago.

We hope that, in the future, there will be a development towards a more strategic approach to philanthropy, which implies more cooperation between foundations, and also between foundations and NGOs. Philanthropy is becoming more visible and so are its results and its impact. New instruments for philanthropy have come up in recent years – such as social bonds, impact investing, or venture philanthropy – that facilitate social investments. We have also seen the emergence of “hybrid” organisations that are partly companies and partly social organisations or companies with a strong social approach. Finally, new trends like B-corporations enjoy credibility and a good reputation.

The lack of systematisation and availability of data on private giving to social development generates difficulties for its study, a poor comprehension of its role, and is a real obstacle to further comprehensive analysis of the matter.

What role will philanthropy take?
Philanthropy in Chile is waking up, becoming more visible and more democratic, involving not only money but time and talent as well.

Will Chile’s philanthropy be more nationally focused, or will it also be regional and global?
Chilean philanthropy is mostly focused on Chile; it has hardly funded any international projects. Only 8% of the country’s philanthropic foundations allocate resources to other Latin American countries.

However, many organisations have now started networking internationally, are looking for best practices to learn and replicate, and are looking for inspiration. However, it will probably take some time until Chile’s philanthropy works internationally or even regionally.

Is there any other subject which you consider as vital for the sector?
It is very important to foster connections between donors and projects, and philanthropy support organisations can play an increasingly important role in this. It is also important to professionalise the sector, using for example the 4Cs Framework (capacity, capability, connection, credibility) from the Worldwide Initiative for Grantmakers Support (WINGS). Furthermore, the sector should become more visible and thus strengthen its impact and achieve better results.

Are there some developments we are not yet aware of at an international level, but which you see coming along in the future?
I think that in the future there will be more cooperation between philanthropic organisations, which will join forces to work on joint matters (e.g. the Earth Alliance, Transnational Giving Europe, Edge Funders Alliance, etc.). This is also important in order to leverage resources for collective impact and a shared agenda. The young generation is much more used to moving in networks and I hope that this trend will soon be also relevant in Chile.

If people want to get information about news and trends in the sector in Chile, where can they find this information?

• Philanthropy Impact Report Chile (November 2018)
• Institutional Philanthropy in Chile (2017)
• Philanthropy in Chile: Moving Forward to Public Good (August 2015)

Compiled by Sabine Friedel