Transcript of Michael Pascoe's interview with Kingsley Aikins

Michael Pascoe: Kingsley Aikins, aside from checking up on Australia Ireland Fund events and issues, while you were here you were talking to a couple of seminars about the philanthropy. What do you say?
Kingsley Aikins: The message is that philanthropy is exploding around the world. Australia is not going to be left behind; it’s going to be part of this. It’s growing here quite dramatically but also fund-raising is not an art or a science; it’s a process. If you follow the process and follow the steps, you’ve a much greater chance of success and there are some exciting reasons out there why philanthropy is going to take off really significantly in the coming years.

I think we’re in the early stages of a golden age of philanthropy and the reason for that is primarily because of the vast amount of wealth there now is at the top ends of societies around the world '” globally around the world and, because of what’s called the inter-generational transfer of wealth. Never before in the history of mankind is such a cache of wealth been put together, and it’s now in the hands of people aged 70 and over and there’s an old fund-raising expression in New York: they say there ain’t no roof rack on the hearse.

You can’t take it with you so there’s going to be this massive amount of transfer of wealth and it will, of course, go to three different locations. Firstly it’s going to go to heirs, children. But variously around the world, when we talked to people who were of significant wealth so many of them say they do not want to give all their wealth to their children. If you give $100 million to somebody at the age of 21 there is little purpose in them getting out of bed in the morning. I think Warren Buffett had an interesting take on this, and in America you have Bill Gates, who is giving away billions and is really a poster child for philanthropy and Warren Buffett, who gives away nothing but will give it all away when he dies. His foundation will be about a $US50 billion foundation and he’s already set up the trust deeds. He said about passing on wealth to his children, that he wants to give his children enough money to allow them to do whatever they want, but not so much that it will allow them to do nothing.

There’s fine line and it’s a different number for different people, but the sentiment is interesting. So that’s the first division of where people’s wealth will go. The second division will go in taxes. And then the third recipient of your wealth will be your non-profit organisations: schools, churches, museums, libraries, hospitals '” whatever '” and so a lot of people are reflecting. These people who have this wealth are reflecting on, 'How am I going to deal with this, and what do I want to be known for in life. What is my mark in the sand. What’s my legacy? Do I want to be known for owning more tyre manufacturing companies than anyone in the world or do I want to have a museum in my name, or a library or children’s cancer ward?' So that’s a very interesting debate bubbling around at that level and it’s happening in other countries '¦ in Britain, Ireland and it’s here in Australia.

MP: As far as getting investment, non-profit organisations, charities, are always hard-pressed. Are you saying that’s about to change or it will still remain a fight?

KA: Well, I think it’s going to get tougher in many ways. I mean it’s a kind of a good news/bad news story. The good news is there is an increasing amount of wealth out there that is available to get. The bad news is that it’s becoming more and more competitive. It’s tougher to get the dollar and that means that you have to be willing to invest; you have to be willing to put together structures in an organisation and people and staff that will allow you to chase that dollar in a very sort of professional and strategic way, but what is sure is that the macro figures, the top figures, are going to grow and they’re growing quite dramatically in the United States '” an 11% increase in 2004 over 2003 '” and Americans now give $US250 billion to charities every year: a very significant sector of the economy. That means about $2 in every $100 of the US GDP is a gift to a non-profit organisation.

Nobody rings you up and says, 'I want to give you some money'. It’s the biggest cliché of all because if you want to get, you have to ask and it’s something that many people shy away from. Very often people who join a board of a non-profit organisation will say, 'I’ll do anything except ask for money'. The number one responsibility of a board is actually to ensure the financial viability of the organisation, so there is that whole area of asking and developing an ability to ask. It’s not something I naturally had when I started this job but, you know, I very quickly came to understand that I’m not asking this money for myself. I’m asking this money to bring about enormous change for good and when you’re convinced of that, and you have that at the back of your head as you go into these meetings, great things happen.

MP: When we were talking earlier, you said people like to give to success. What do you mean by that?

KA: Well, you know, I actually live in Boston in the United States and I live just beside a university called Harvard that everybody knows. Harvard was set up in the 1660s, probably the best university then and it’s probably the best university today. Harvard has $US24 billion their endowment '” phenomenal wealth '” and yet they are the university that raises the most money. They have 600 people in their development staff, so the question is why. Well the answer is that they’re the best: they earn what they get.

No kid in America would not go to Harvard if they’re bright enough because they have now developed so much scholarship and they’ve got the best [fast] faculty. They’ve got the facilities, they’ve got the lecturers, etc, and people do like to invest in success. People do like to back winners, it’s a natural instinct. In fact, turn that on his head a little bit: Ireland’s been very successful in the past decade and we’ve raised more and more money for Ireland. That’s counter-intuitive at one level but at another level, why should anybody give money to an Ireland that’s failing. That’s not a good use of money and what’s interesting in our business is how the vocabulary has changed. We've moved from still using the word charity more now to philanthropy. Charity is more spontaneous; philanthropy being more strategic and long-term. We talk about investing rather than giving. We’ve gotten away from the kind of 'Robin Hood' begging notion, and we’ve got involved in things like partnerships and there’s a whole new breed of philanthropist now emerging around the world.

MP: And in terms of outcomes, where would we be without philanthropists?

KA: Well you know, you stand up on the tallest building in any city in the United States and you start pointing to libraries, museums, churches. You start pointing to all sorts of things and we wouldn’t have them without philanthropists and it is, we think, one of the three legs of a civil society. In a civil society you need strong, effective, efficient and honest government; you need a vibrant business sector; and then you need the non-profit sector. If you’ve got those three things working in tandem you have a mature civil society.