Five lessons from Colombia’s family-led philanthropy  

In a country with numerous unmet basic needs and limited government presence in many areas, philanthropy has played an indispensable role. Although the financial resources of philanthropy pale in comparison to those of the government, philanthropic initiatives have covered gaps between established government programs. In some instances, philanthropy has even taken the lead in addressing some of the issues in question.

It is not enough to pay taxes. We need to contribute in other ways to reduce inequity and ensure that people in need have more and better opportunities. Colombia has made significant progress and boasts one of the most well-organized social sectors in the region. However, there is still a considerable journey ahead to align with the practices developed in the United States and Europe over the years.

In most cases, Colombian companies are family-owned, many of which have established foundations or non-profit organizations from their inception. These organizations have now grown into significant players leading the country’s philanthropic sector, such as Fundación Carvajal, Fundación Corona, Fundación Luker, Fundación Bolívar Davivienda, Fundación Fanalca, among others.

In recent years, family philanthropy has gained prominence, as many families have organized their financial strategies and networking organizations have emerged: Filantrópico, Family Business Network, AFE, and Latimpacto. One of the most rewarding aspects of my work in philanthropy has been engaging with family philanthropy, as it serves as a compelling pretext for bringing families together and involving newer generations. It provides an ideal platform for expressing family values, a space to forge a lasting legacy, and offers opportunities to strengthen the familial connection to societal issues.

Fundraising for nonprofits has become increasingly challenging as corporations and donors have structured their own philanthropic strategies. This challenge is compounded by Colombia’s transition from a low-income to a middle-income country, resulting in reduced financial support and decreased priority in the eyes of international cooperation. In the country, non-profit organizations serve as the predominant vehicle for social investment, with education being the primary focus area, followed by entrepreneurship and economic development.

With such context in mind, here are five key lessons that have helped me navigate Latin American philanthropy:

1. Collaboration, rather than isolation, is paramount. The challenges at hand are vast and intricate, and they necessitate joint efforts. Philanthropy stands out as the most flexible source of capital, allowing for the pursuit of endeavors that governments and the private sector often cannot undertake. Open communication and clear ways of working with the public sector are vital for potential project scaling with state funds.
2. Strategic philanthropy transcends mere monetary contributions. Younger generations desire to be active participants in the process. The dynamic between donors and beneficiaries has evolved into a two-way street where learning is mutual. Collaborative endeavors, co-designing, and co-creation are indispensable because making decisions about populations or issues outside our purview and understanding is no longer tenable. Start by checking out how diverse your board of directors is. Do you have representation of the communities or groups you work with?
3. Having a focus is key! Sometimes, there are so many needs that we wish we could help with all of them. Unfortunately, the more we spread ourselves thin, the harder it will be to make fundamental changes. Resources are finite, and societal change demands time and dedication. Thus, a unified approach is essential to maintain our effectiveness.
4. Increasing the allocation of resources does not inherently equate to a greater impact. The complexities of the problems demand organized approaches and well-structured plans. While financial resources were once considered paramount, it has become evident that knowledge, management capacity, and connections are equally, if not more, vital. In many cases, a relationship between a non-profit and a foundation, donor, or expert can enhance and alter the course project or organization even more than monetary resources.
5. Sharing lessons learned and best practices is critical to preventing others from repeating the same mistakes. Also, recording knowledge is crucial, as undocumented wisdom is bound to erode over time, necessitating a fresh start. This underscores the significance of documenting processes and expertise within social impact organizations. Time and experience are money!

If we compare philanthropic resources to the resources of the global economy, it would be a drop in the ocean, but that doesn’t make it any less critical. Philanthropy has shown in many cases to be the only hope of change in communities that have been forgotten by the state. Colombia still has a long way to go to achieve a social ecosystem with strategic and organized philanthropy. Yet, we must recognize the efforts made by social impact organizations to contribute to the construction of a fair and equitable society.

Through meaningful collaboration, active stakeholder engagements, identified focus areas, active relationships and knowledge sharing we can walk towards a strategic philanthropy.

Mariana Castro currently serves as the executive director of Filantrópico, where her role revolves around working with family businesses to structure or restructure their philanthropic objectives and strategies.