Arab philanthropy faces hurdles in push to move beyond charity

Giving in the Arab world is evolving, but red tape and a lack of public trust are slowing the shift towards a more strategic model of philanthropy, finds report

Restrictive laws, sector fragmentation and a lack of public understanding are among factors slowing a shift from charitable giving to a more strategic model of philanthropy in the Arab region, a new report has found.

Giving in Arab countries is expanding beyond the confines of community-based charity, driven by the need to tackle widespread poverty, unemployment and other social challenges.

But new laws issued following the Arab Spring unrest of 2011, which aimed to counter the perceived threat of some civil society groups, have starved NGOs of funding and sapped efforts to promote a more developmental approach.

“A curve went up and went down around the Arab Spring,” Atallah Kuttab, founder and chairman of advisory firm Saaned, noted in the report. “In 2012 and 2013 we saw a change, but it has now flipped back to old habits.”

“The philanthropy sector hasn’t found a role for itself since the highpoint when it felt it could support the Arab Spring”Donors have been withdrawing from progressive philanthropy because of fears of alienating regional governments; choosing instead to supplement state budgets, or projects that deliver support services such as feeding, schooling or healthcare.

Other complicating factors include the public’s lack of trust in NGOs, and poor understanding of how strategic philanthropy can be a force for positive social change.

“People can get into trouble if they support organisations not approved by government,” Kuttab said. “All in all, the philanthropy sector hasn’t found a role for itself since the highpoint when it felt it could support the Arab Spring [and] freedom of citizens.”

The report, by the Philanthropy for Social Justice and Peace (PSJP) network, is the third in a series examining the state of giving in emerging economies. It examined trends across 22 Arab countries in sectors including high-net-worth giving, private and corporate foundations, and impact investing.

Bright spots include the rise of social enterprise in the Arab region, a trend hailed as a partial antidote to high youth unemployment rates, and increased engagement from the private sector.

“There are clear signs companies are taking CSR seriously and moving from traditional unstructured philanthropy” to more sustainable and innovative initiatives, the report noted. Early-stage dabbling in social investment is also seen as a positive sign.

Among foundations, while most still favour in-house programmes over grants to NGOs, there is a clear move towards a more strategic, scalable model of philanthropy.

However, Naila Farouky, CEO of the Amman-based Arab Foundations Forum, noted that any meaningful change in regional philanthropy would take time.

“For any real paradigm shift to occur, one must expect to be patient to the tune of two generations, or 50 years,” she said.

About the report

Philanthropy in the Arab Region is published by the PSJP network in association with Alliance, the Arab Foundations Forum, the John D Gerhart Center for Philanthropy, King Khalid Foundation, Philanthropy Age, Saaned and Wings. To download the full report - or a summary of the report in Arabic - please click here.