#SRI — 23.07.2019

Social Investing: Pioneering new ways of building philanthropy into business models

In Conversation with Francis Ngai, Vice Chair, Asian Venture Philanthropy Network


Q1: SOCIAL INVESTMENT: What are the latest trends in Asia?

So I think we don’t have a big legacy of philanthropy in the past. But I think, right now, we are going directly into considering different ways of participating in the social good. So I think social investing has become a top consideration among all those family foundations, private banks or corporate foundations.

So I think every year we get many more people are interested in this area. So I think apart from just participating and listening, I think we see that many more foundations are putting, getting their hands dirty, really get into doing the investing.

I would say, right now, the momentum is good. But one of the problems that we have to solve, I think right now, upstream is fine. We are getting many more money, like impact investing well, many more money than deals.

So the other problem that we have to solve right now is on downstream. How can we get the social innovation, more social purpose organisations coming up with good ideas? Projects is the next challenge.

Q2: FAMILY BUSINESSES: What role can they play in addressing these issues?

I think family foundations or family offices play a very important role in this growth. On the first hand, I think directly capital from the family offices. They do charity, they do investments on the foundation or the philanthropic side. Their direct involvement with social innovations or social investing, making a big participation in this trend.01:46

On the other hand, I think they do investment even in the normal corporations.

So I would say, right now, the next wave of impact, one of those, would be from the corporate. How do they do business differently?  So right now what we are advocating at least in Hong Kong and other nations, we call it the Business 2.0 trend.

So how can business find the purpose again? When you are working on property, can you find something on working on the affordable housing? If you are working on the retail, can we find a more sustainable way in educating your consumers?

So if we are influencing the family office or the family investor, they would influence their entrepreneur and their investee as well. So I think that's a value chain that we see as a whole value chain approach in approaching our social investing scene.

Q3: RAISING AWARENESS: What is the goal of Asia Venture Philanthropy Network  (AVPN)?

So right now, over the 500 members of AVPN (Asia Venture Philanthropy Network), there are a lot of them would be from their family offices and family foundations. So NextGen is always one thing that we put the high emphasis on that.

So when they are taking over in the next few years after baby booming generations is passing their works (worth) to the next generations, they will get hold. So while they are getting hold of a big kingdom how...how do they process their things with the capital and their business?

If we could plant some of the seeds on purpose, how can you turn your wealth into a more purpose capital way? How can you turn your business into a more impact business way? I think that will make a big difference.

So apart from just a group of Next Generations, we can also get the social purpose organisations.  

We can also get the intermediaries come on board, So I think it's not more one dimensional, but I think it's a three dimensional way for this Next Generations to understand the scene, and thinking about how to participate in a smaller way or way forward. When they are taking up with a bigger kingdom, they could participate in a bigger way.

Q4: INNOVATION: What practical solutions can help socio-economic problems?

So I think, what we see, innovations cannot be just one App or one technology. What we are more focusing on is, I would say, is the infrastructure innovations. So social investing alone is one thing, but also in the philanthropic world, people are thinking about new ways, like one of the innovations is called collective impact.

Funders or the givers tend to not just go on their own, do all the due diligence by themselves, and do all the works supporting our venture friends be away by themselves.

But if a few foundations or a few givers are sharing the same visions on, for example, education or housing, can they come together to work on things together?

So I think it's a collective impact, is one of the new inventions in the philanthropy world, and making with the ways of doing things much easier. So that itself remains to be one important thing. The innovation infrastructure is important to me.

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