Digital Disruption Chuck Slaughter Describes How Living Goods Is Using Digital Platforms to 33 Be Bold Take Risks Deliver Healthcare On-Demand
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February 2019 Copyright © 2019 Chandler Foundation All rights reserved 04021972 No part of this document may be reproduced or transmitted in any form or by any means, electronic or mechanical, without the prior written permission of the publisher. While every care is taken in the preparation of this document, no responsibility can be accepted for any error or omission contained herein. The pages of this magazine are printed on 100% recycled paper. Contents 3 The Rise of the Social Investor Richard F. Chandler writes about the new generation of philanthropists. 11 Last Year’s Milestones in Social Investing We look back at some of the events which shaped the social investment Editor Melissa Lwee-Ramsay landscape in 2018. Copy Editor Edward Stephens 15 Impact Matters Bill McGlashan on launching Contributors Debbie Aung Din The Rise Fund and how to Matt Bannick measure social impact. Tim Barker Jeffrey L. Bradach 21 Investing Across the Returns Continuum Oliver Doran Matt Bannick and Robynn Steffen William Foster outline the range of social and Dahna Goldstein financial returns that impact Dr. Rajiv Lall investing can deliver. Dr. John C. Maxwell Micah McElroy 25 Thinking Historically About Bill McGlashan “Big Bets” in Philanthropy Wycliffe Muga Micah McElroy looks back at Pradeep Nair the bets which paid off. Dr. Rajiv Shah Chuck Slaughter Robynn Steffen Jim Taylor Dr. Tomicah Tillemann Dr. Edward Tse Scott Woodward Designers Mitchell Acreman Dawn Aik Caryn Liew Andrew Stainton Cherie Zheng Publisher Chandler Foundation 15 63 Empiricism and the Scientific Method in Philanthropy Wycliffe Muga reflects on the importance of scientific rigor. 69 From Research to Real Change Dr. Rajiv Lall shares his personal journey of moving from academia to the private sector. 77 Lessons Well Learned Ford Foundation India’s Pradeep Nair looks back on converting early missteps 49 into valuable lessons. 81 Digital Disruption Chuck Slaughter describes how Living Goods is using digital platforms to 33 Be Bold Take Risks deliver healthcare on-demand. Dr. Rajiv Shah shares thoughts on tackling problems and shaping 87 China and the Power of the future. Tech-Enabled Philanthropy Dr. Edward Tse looks at the rise of 39 The Values of Prosperity technology as a tool for giving. Dr. John C. Maxwell explores the path to prosperity. 91 How Blockchain Could Transform Philanthropy 43 How to Foster a New Era Dr. Tomicah Tillemann and Dahna in Social Change Goldstein explain how Blockchain Jeffrey L. Bradach and William can build trust in philanthropy. Foster of Bridgespan consider the potential of our generation. 49 Social Investor’s Feature Article: Myanmar’s Proximity Designs Debbie Aung Din and Jim Taylor tell the inspiring story of Proximity Designs. 57 Investing Narrow and Deep: The Art of Betting Big Richard F. Chandler explains the characteristics of impactful investments. 87 Letter from the Editor rom Philanthropy to Social Innovation In 2017, the Chandler Foundation published Philanthropy Reimagined, a book designed to challenge Findividuals to push the boundaries of what philanthropy can accomplish in today’s world. We hoped that, by exploring how philanthropists can engage in more meaningful and effective giving, we would be able to further the conversation about how we can all work together to better create shared prosperity. Two years on, that idea of “furthering prosperity” has inspired us to launch this magazine. We have learned through our experiences that much more than charity is needed to solve many of the intractable problems we see in the world today. Hence, Social Investor was conceived to try to take things one step further by asking: beyond the practice of philanthropy, what are the different ways we can drive social impact? Taking Big Bets In this inaugural issue of Social Investor, we explore one possible way – taking “Big Bets”. We look at how a philosophy of investing Social Investor was narrow and deep has the potential to bring about large-scale, conceived to try to systemic change. take things one step To do so effectively, writes the Chandler Foundation’s Founder, further by asking: Richard Chandler, requires conviction and courage (p.57), while beyond the practice of The Rockefeller Foundation’s Dr. Rajiv Shah reveals how taking risks has been integral to the foundation’s ability to tackle tough philanthropy, what are problems (p.33). the different ways we can drive social impact? Our cover story features an in-depth interview with Dr. Rajiv Lall (p.69), whose latest initiative, Social Finance India (which he chairs), aims to channel capital into activities that have 1 a measurable social impact for the country. Proximity hope is that Social Investor will help you to discover what Designs’ Founders Debbie Aung Din and Jim Taylor, also your definition of doing well while doing good is, and to tell the story of how the organization is reaping the benefits realize, just as Andrew Carnegie and John D. Rockefeller of a big bet made early on to understand the challenges of did when they took big bets on libraries and sanitation rural poverty in Myanmar (p.49). (p.25), respectively, that the value of an investment should not be measured by its dollar size alone but, perhaps more Standing on the Shoulders of Giants importantly, for the change that it can generate. That said, as the bets get bigger so do the risks. Which, in the words of Ford Foundation India’s Pradeep Nair, makes the lessons that can be learned from history and past experiences all the more valuable (p.77). The words “social investment” will inevitably mean different Melissa Lwee-Ramsay things to different people. In producing this magazine, our Editor 2 The Rise of the Social Investor By Richard F. Chandler he Search for Social Impact Yet the social marketplace also brims with innovation I embarked on my philanthropic journey in and optimism. Many individuals and organizations the early 1990s, armed with as many dreams are embracing dynamic methodologies and metric- Tas questions. When I started, the needs were great, the driven investment models, while the bull market in problems complicated, and the possible investments and philanthropy continues: in 2018, Americans alone solutions voluminous. Over the last three decades, the non- donated more than US$ 410bn to charity, a third- profit marketplace has become vastly more sophisticated consecutive record year. and populated, yet the challenge of resourcing social change has become neither simpler nor easier. We The Innovators: Millennials, Family Offices, and continue to face unacceptable levels of poverty, illiteracy, Technology Entrepreneurs disease, and violence, while the historical stalwarts of the This wave of financial commitment has been accompanied social sector – multilateral and bilateral institutions – by the widespread conviction that these resources should remain handicapped by bureaucracy and handcuffed by be used to create maximum social impact. In this season of conventional thinking. innovation, success is no longer measured by how much 3 From left: Former US Secretary of State John Kerry, Co-Founder of The Rise Fund Bill McGlashan, and former President and CEO of the Aspen Institute Walter Isaacson speak on stage during the Vanity Fair New Establishment Summit, California, 2017. one gives or invests, but by what one achieves. Outcomes structure, strategy, technology and systems, as much as trump intentions. passion and purpose. At the same time, financial investors are also converging into the space, pursuing environmental This focus has given rise to a new generation wanting and social objectives alongside financial returns. Through to make a difference: the social investors. To create impact investing these investors are bringing a greater outsized and enduring social impact, this new breed awareness of social responsibility to corporate boardrooms. of investor is rethinking the borders and paradigms of traditional philanthropy. Whether making for-profit or non-profit investments – or a blend of the two – these social investors are Some social investors are embracing more strategic converging around a common vision: moving from philanthropy, using their capital to address causes rather than “charitable giving” to “social investing.” Variously treat the symptoms. They bring the dialect and tradecraft of called venture philanthropists, philanthropic investors, financial investment and business management, recognizing impact investors, or responsible investors, all embrace that scalability and innovation depend on organizational a common set of principles and practices. They take 4 The Rise of the Social Investor calculated risks, operate with market-driven discipline, against poverty. The excitement would eventually give and above all, they seek outcomes that are anchored way to a sobering reality of the challenges. Microfinance, in a set of values linked to environmental, social, and in particular, would be racked with negative reports and governance (“ESG”) principles. political backlash, from excessive interest rates to suicide among indebted borrowers in India. A 2015 study by From Charity to Metrics-Based Philanthropy MIT’s Abdul Latif Jameel Poverty Action Lab found that My philanthropic journey began when “checkbook microcredit did not lead to transformative impacts on philanthropy” was still prevalent. This approach focused income or long-term consumption on average, although largely on how much one gave rather than what one achieved. it helped households better manage financial choices.