Through an agreement with UK-based Alliance magazine, PND is pleased to be able to offer a series of articles about global philanthropy.

Social Enterprise Is Eroding Civil Society

Social Enterprise Is Eroding Civil Society

An incisive editorial cartoon shows Mahatma Gandhi being read a letter stating that his funding proposal for spinning cloth is being rejected because the link between the proposal and the struggle against the British empire is not clear. The response is arrogant, foolish, and shows a complete inability to make sense of socioeconomic and political processes unfolding at the time. The use of the spinning wheel is particularly pointed: Gandhi made symbolic use of it not only as a tool of political action for shaking the economic basis of British imperialism, but for building a culture of self-reliance among Indians.


As a civil society practitioner, this cartoon has stayed with me as I encounter very similar behavior from too many of today's philanthropists.

The retreat of the welfare state, the rise of neoliberalism, and the growing concentration of wealth has created the conditions for the explosive growth of philanthropy on the world stage. As studies have shown, there has never been a better time for philanthropy in terms of assets and reach. In an era of dwindling state resources, even an ambitious global compact like the Sustainable Development Goals looks to philanthropy for resources. In view of its growing size and clout, however, fundamental questions about the role of philanthropy in sociopolitical change require further and more careful investigation.

Many would argue that the philanthropic capital being generated is part and parcel of a ruthless economic order that concentrates wealth in the hands of few. And turning to the super-rich for solutions to society's problems poses real ethical dilemmas. In addition to that question, there are worrying signs that philanthropy's growing influence is shaping narratives related to global social change in ways that are not necessarily helpful.

Philanthropy primarily operates through civil society, and civil society, by design, plays a critical role in the architecture of modern democracies. In this time of dramatic change in development and democratic politics, the impact of philanthropy on shaping civil society deserves more scrutiny.

Two spheres of civil society

My fear is that two distinct civil society spheres are emerging, working mostly in parallel but at times also at cross-purposes. One sphere embodies the values and principles of older nonprofits and collectives, including social movements, mass organizations, and community-based groups. The second sphere is located in the market and technology spaces and is being rapidly populated by new-age nonprofits, social enterprises, and online collectives. Unfortunately, there's a fundamental contradiction between the two spheres. Older nonprofits' worldview is premised on an integrated social sciences and systems approach in which the complexity, interdependence, and interrelatedness of diverse factors at work in a system need to be understood and addressed in order to change that system. In the new-age approach, by contrast, the emphasis is on finding technology based-managerial solutions for complex social, economic, and political issues.


Donors who look at the world through a techno-managerial lens encourage and enable civil society groups to zoom straight in on the problem at hand, without bothering to engage with the contextual difficulties of the issue. In this process, the real world in all its complexity is circumscribed or left behind. It's like living in a bubble in which a technical linear solution appears to solve a complex problem. The entire conversation around the fundamental issue being addressed gets artificially limited to the confines of the bubble. The bubble is then presented as fertile ground for systems change, innovation, and the sharing of success narratives. In turn, these "successes" and innovations lead to more investment, which results in the bubble becoming bigger and more celebrated.

In this model, the complexity of socioeconomic/political systems and human behavior are peripheral to the story — until something pops the bubble. In the meantime, donors and the civil society groups they fund have moved on to a new bubble. In other words, the techno-managerial approach artificially transforms endemically wicked problems of development and human society into eminently "solvable" problems, deliberately separating the problem from its context and isolating the intervention from the larger problems of the system or society.

For example, an NGO working on safe drinking water might go into an Indian village and install a hand-pump for the villagers, oblivious to the fact that in a society deeply divided by caste, water is one of the critical markers of "purity" and is a source of frequent and serious conflict, including riots and murder. Though the hand-pump might lead to greater caste tensions in the village, the NGO would count it a success if it is installed and provides potable water. In the short run, this kind of approach can provide a success "high," not to mention tick marks on the log frame, but it doesn't provide the analytical grid and social action tools and tactics needed to address larger systemic questions. Indeed, in the longer run, such "band aid" solutions fail because they focus on the symptoms and not the root structural causes of poverty and injustice.

The triumph of the technocrats

The rapid growth of global philanthropy has strongly favored new-age nonprofits, which has meant declining resources for more traditional nonprofits. The inclination of donors to favor newer kinds of civil society can be attributed to the growing emphasis on results and impact that we see in society more generally; the arrogant belief that complex social problems are "solvable" through short project cycles; the inability to engage with and/or comprehend the interconnectedness of socioeconomic and political systems; a faith in top-down blueprints; a preference for business management practices and solutions rooted in technology or the market sphere; and, at an operational level, the increasing numbers of philanthropy managers and donors with MBAs and backgrounds in business (as opposed to previous generations of nonprofit leaders who were primarily a mix of academics from the social sciences and frontline practitioners).

The heavy investment by philanthropy in newer forms of social enterprise is gradually changing the character of civil society, to the serious long-term detriment of society and, more importantly, the health of democracy. Apart from its many other tasks, which have included basic service delivery for the most at-risk and ignored populations, civil society traditionally has played two important functions in the postwar era, both in the Global North and in the post-colonial societies of the Global South.

The first is that of challenging power — particularly on behalf of the most powerless and excluded groups. In a democracy, civil society plays a crucial role in demanding accountability from power (primarily state power, but also other sources of power) — i.e., its so-called watchdogand pwoer  function.

The second function is to create and nurture new ideas, experiments, and alternatives aimed at driving transformative change. Very often, ideas for change do not come from the center but from the margins, prompted or articulated by civil society. For instance, in the 1950s and '60s, India took the path of building large dams to address its irrigation and water needs. Despite the fact that the mammoth financial and environmental costs — along with the human costs of displacement and loss of bio-diversity — were soon recognized, the state continued to favor big dams. Only when civil society groups started building local models of micro-watersheds and irrigation systems in sync with local ecosystems and at almost no cost did the development discourse begin paying attention to these alternatives.

The decline in civil society's ability to perform these two critical functions does not bode well for the future.

How philanthropy risks missing its way

The unfolding global narrative of populism, fundamentalism, and the rightward shift of politics, as reflected by Brexit or leaders such as Trump, Erdogan, Orban, Netanyahu, Modi, and Duterte represents an exceptional challenge for the world. In an era where power is becoming concentrated in fewer and fewer hands, the need for robust discourse on how power can be held accountable is fundamental to the future of democracy. In this context, philanthropy needs to pause and rethink its own role. And it needs to ask itself fundamental questions about the end goal of the human project. As history teaches us, the provision of health, food, and shelter has never by itself ended misery, slavery, and exploitation.

The human project — and philanthropy — should be about human dignity and justice. Philanthropy cannot remain a bystander while the gains of the twentieth century are reversed. It cannot look the other way and pretend to play an important role by fighting the symptoms of poverty while ignoring structural questions of poverty, injustice, and indignity. We need bold, new, edgy philanthropy that stands on the right side of civil society — defending democratic spaces and promoting human rights.

Amitabh Behar is the CEO of Oxfam India and former executive director of the National Foundation for India. He is also vice-chair of CIVICUS and convener of the National Social Watch Coalition, and served as co-chair of the Global Call to Action Against Poverty (GCAP) from 2010-16.