Why Europe needs a single market for philanthropy

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV.COM Ltd.

"Of more than €60 billion in philanthropic funds per year, only a fraction in the double digit millions makes it across borders." [Shutterstock]

“Who do I call if I want to speak to Europe?” The quote is associated with Henry Kissinger but he never actually said it. He knew very well who to call if he wanted to. Similarly, European institutions have no problem with reaching out to European philanthropy, writes Felix Oldenburg.

Felix Oldenburg is secretary general of the Association of German Foundations and chair of DAFNE, a network of over 10,000 foundations, including the Association of German Foundations.

With a set of new EU policies, and with a next EU Parliament and Commission on the horizon, there is a new reason to open communication. After all, the EU and philanthropy work towards many similar goals. First, of course, both sides have to fully understand the potential of collaboration.

The institutions’ challenge is more fundamental: while working towards many of the same goals, the EU has neither been aware of many of the barriers facing European philanthropy nor the potential of working together. In short: there was little reason to call in the first place.

An event last week – innovatively framed as “PhilanthropyScrum” – has started to move in the right direction, Three key philanthropic infrastructure organisations, DAFNE, EFC and EVPA have joined forces to discuss a coherent policy agenda.

This agenda starts with a simple statement of fact: goods and services travel freely across Europe yet philanthropic support cannot. Whether this is by design or neglect, it must change.

Of more than €60 billion in philanthropic funds per year, only a fraction in the double-digit millions makes it across borders. This may not be the only indicator for the effectiveness of European philanthropy in solving increasingly international social, environmental and cultural challenges, but it highlights the many barriers to joining forces even within Europe.

Together, European donors and foundations ask for a single market for philanthropy and citizen action that recognises philanthropy, reduces barriers to cross-border philanthropy, enables and protects philanthropy, co-grants and co-invests for the public good.

Each of these four tasks have a number of concrete measures supporting them, ranging from a fairer VAT deal to stopping foreign funding restrictions, and from guaranteeing the free flow of capital to creating joint project pipelines for European public and philanthropic funders.

Representing one of the first major achievements of this joint advocacy effort, the European Commission has included a partnership with philanthropy in its proposal for the InvestEU fund, one of the signature projects in the multi-annual financial framework that will guide EU funding until 2027.

In a move to achieve more with less, the European Commission has included a co-granting mechanism as well as technical support and an innovative guarantee program de-risking foundations’ impact investments. Looking a few years into the future, it is easy to see how these measures alone could leverage substantial funding towards joint impact.

In addition, grantees supported by the program could potentially attract further cross-border funding without having to jump through the hoops of local charitable status discussions.

What we witnessed at the PhilanthropyScrum is the timely beginning of an ambitious roadmap that continues through the European Parliament elections in 2019 and the early days of the next European Commission in 2020.

There is no time to lose. More than at any time in the past decades, philanthropy faces a dual challenge: it needs to help solve problems that are more interconnected than ever before, and it needs to enter into a renewed effort to protect democracy and civil society at the same time.

We will need more than one telephone line. And we will need to speak with one voice.

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