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Welcome & Keynotes Thursday, 9 May 2013 Welcome remarks: Elisa Kang, Director Values-based Investing, UBS Welcome

me address: Tan Chi Chiu, Chairman, Lien Centre for Social Innovation Douglas Miller, Chairman, Asian Venture Philanthropy Network Keynote speakers: Laurence Lien, Chief Executive Officer, National Volunteer and Philanthropy Centre, and Nominated Member of Parliament Paul Carttar, formerly Director, US Social Innovation Fund and Co-founder, Bridgespan Group Session Summary: Elisa kicked off AVPNs inaugural conference, remarking on the rapid change that has been seen in Singapores venture philanthropy circle. In 2009, conversations were starting in Singapore, she said, and the response to the conference had been overwhelming in just four years time. Venture philanthropy is about being investment minded and performance based, she said. Venture philanthropists and family offices were being influenced by trends in the US. Since 2009, there has been a tremendous increase in venture philanthropy and impact investing in this part of the world. She then spoke about the theme of the conference: blending investment and philanthropic capital. Chi Chui remarked that creating social impact involves blending investment and philanthropic capital, but the definitions are still in development. In Asia, poverty has been reduced and generally profits have increased for enterprises. But if maximizing profits is the chief goal of business, were headed for disastrous eventualities such as social inequality and environmental degradation. The mission of business and the purpose of growth is to build a better society for all. If we can develop a new business paradigm where business and societal good are not mutually exclusive, then we have hope for the future, he said. He added that ciety is at an inflection point of social and economic development. Problems demand a cross-sectoral approach. There is a need for growing demand, a culture of impact, government policies for an environment that is conducive, and measuring impact. Venture philanthropy needs help such as sourcing, capacity building, due diligence, monitoring and evaluation. The challenges include different regulations across regions that complicate coordination, but here, intermediary organizations can help develop knowledge and bridge gaps.

He remarked that the growth of these movements in the West is now turning to Asia. In Singapore, in 2012, the Presidents Office has enabled organizations to set up and has also set up funds as well. Making reference to Monitors 2009 Investing for Social Impact report, he cited two perils: impact investing may be too hard, and we are warned against hype, sloppy thinking, and poor execution; and secondly, regulatory authorities will give up. The second peril is the peril of being too easy: definitions may be so diluted to be meaningless, reducing to a feel good instead of a do good exercise. Douglas thanked the Lien Centre for partnering with AVPN, the host Singapore Management University, the 76 speakers at the conference from 18 countries, the AVPN team as well as the audience. He talked about pioneering, collective action and opportunity. The world needs pioneers in the nonprofit or social enterprise sector. Pioneers have a vision to correct something wrong or to develop an opportunity, he said. Taking a risk involves failure, and we need to prepare risk takers and to encourage society to accept failure without stigma. We need to encourage people to scale. Role models get out in front and encourage others to engage. We need to encourage others to make things happen, take risks, and make things happen. Douglas remarked that the conference had more than 345 registered attendees from 31 countries at last count. He spoke about the impressive rise in the number of members AVPN has, currently standing at 135. He described the purpose of AVPN, saying it is about building a broad based platform. There are silos and he said that all these silos are not cross-networked. We break silos and get people to work together. Different experts know about their areas, and if you can break silos, you bring different areas of expertise to produce more impact, he stated. He said he envisaged the conference to be about networking, knowledge sharing, inspiration and fun. We want to build the industry, he said, and this is the opportunity. He said that the industry can do more collectively than as individual lone rangers. Laurence talked about his journey into philanthropy. I was first conscripted in October 2002 to be a board member of my family foundation, he said. We had five board members: grandfather, grandmother, father, me, and associate of grandfather. I first mentioned venture philanthropy. They did not have a clue what that meant. Impact, alliances, holding grantees accountable, sitting on grantees boards. Charities will thank you more for giving a check and not bothering them. Change can be difficult. One shouldnt plan too much but act in small steps. Other board members became open and supportive in the end. He said the second task was to make a list of grantees. Do the due diligence. I sent out letters to 35 organizations. 15 applied. Some did not even acknowledge my letter. We gave out $850,000 in grants. My lessons from that experience: NGOs in Singapore lacked hunger, lacked grant-making purposes (theory of change or impact); and needed support staff. A first step was to hire a staff to

do grant-making full time in Singapore. That was Lee Po Wah who joined in 2005. I believe you should hire well, set them free, and let them show results. He added that funders in the region have a shared frustration: the lack of deal flow. The 2011 UBS INSEAD study showed funders thought NGO were not sufficiently transparent. Philanthropy is critical for building a social contract among sectors, even though government is still needed for regulation. Philanthropy can incubate innovation, advocate for policy change, and look for answers in a rapidly change world. The rich in Singapore and around the world give less proportionally than the poor. Institutionalizing philanthropy has not caught up with wealth development in Asia, he said. NGOs need to improve their offerings. Philanthropies can play a larger role in helping scale up. Lessons: Funders need to take more risk. Funders can take a long-term view and dont need to be pulled by political stakeholders. In Asia, there is adversity to taking risk. Too much procedural formalism can reduce NGO capacity. A risk-nurturing approach has not crossed over to the social sector. Too much venture philanthropy concentrates and focuses on a small pool that does not reach traditional organizations in the philanthropic sector. Leadership is also mobilizing people to confront problems to make progress. Philanthropy often skims the surface of problems, and leaders need to take ownership of these problems. Collaboration. Collaboration requires humility, and systemic change requires engaging the diversity of players in the marketplace. A failure to attract enough talent to the sector. There is a lack of people to develop and scale up. Also, it bumps up against conventions of professional roles. Venture philanthropy is a powerful vehicle for developing solutions, and realizing the full potential will require interacting with the government, according to Paul. He said venture philanthropy is unique in that it is private and entrepreneurial. The essential element is individual citizens with a passion for improving the world. Venture philanthropy is a truly meritocratic approach to driving social change. It is not about your title, schooling, or personality, he said. Rather it is about your ability to target a critical need and to contribute positively to bring resources to develop and grow solutions to problems. He remarked that venture philanthropy is not a new phenomenon. The entrepreneurial spirit combined with capital led to the creation of solutions that had profound impacts. In the United States, Clara Barton in the 19th century worked to build the American Red Cross. Jane Addams founded the settlement house movement for new immigrants to integrate, and Carnegie built a system of public libraries which now number in the thousands across the US. So what is new? Venture philanthropy has a specific investment approach with rules intended. There are 3 phases: 1) Development (1990s-2000): Edna McConnell Clark and New Capital; 2) 3

Validation (2000s): Proof of a handful of these models through effective evaluations; 3) Scaling (now): Take effective models to scale to have systemic impact in our societies. The governments role is to: a) Provide financial resources. In the US, public social service spending is four times that of all of private giving combined b) Certain services are rightly under the jurisdiction of the government. Scaling requires involvement of the government. The legal environment and ecosystems can be helped by government. The Social Innovation Fund (SIF) in the United States was created to leverage the unique powers of government in collaboration with the private sector, Paul said. There are 3 ways it did this: 1) growth capital, 2) federal policy and other government agencies, and 3) sharing experiences and learning. In his view, venture philanthropy is well-positioned to drive large-scale impact in the next 10 years. He said Asia is particularly favorable due to the following trends: key social challenges exist, growing private wealth, increasing government interest, a rich experience base from the US and Europe and. big bargains. He had some advice to pass on to delegates: Aim high, seek models with realistic potential for large-scale impact Manage the risk of failure Trust your judgment, but demand evidence for results Proactively build mutually-beneficial partnerships even with the government Aggressively leverage knowledge and resources, like AVPN In closing, he quoted Margaret Mead, saying, Never doubt that a small group of thoughtful committed citizens can change the world; it is the only thing that ever has. In the Q&A session, when asked about the evolution of the role of government from control to investing, Laurence talked about one problem of working with government being that the government controls the nonprofit sector as subsidiaries of a national program. This reduces innovation, in his view. The government needs to let go and get out of the way, he said. Let the innovations, bottom up efforts, and go for an evidence base. Government is a main way of scaling up, but government has to be supportive and open to ideas. Paul remarked that in the US, were facing an intersection. Historically, the political right has been skeptical of the government taking the lead. Traditionally, innovation has been taken on by the private sector. The political left has supported government control of social services, but it now faces so many ineffective programs. The Obama administration understands that resources are constrained and that the private sector has been so successful in identifying and growing 4

observations. There is an opportunity for government to relinquish its control and maintain its investments in things that actually have impact. When asked when once should expect a financial return from investing in China considering it is a new concept in that country, Lawrence remarked that one cannot be a purist and one just has to be clear about what one is looking for. He said that the sector needs the entire continuum. A few things will only be public goods and can only be gotten through traditional philanthropy. In the context of countries that traditionally receive large amounts of aid, there is a question of how venture philanthropy can link up with traditional aid. Laurence said that while co-funding is a possibility in these circumstances, the bureaucracy can be a dampener. H said that his experiences working with USAID were mind-boggling. He remarked that aid agencies need to change significantly. Paul said that working with government is not always needed. For each of the interventions and growing them, there will still be in every society where government is not necessarily the dominant system, or where there other kinds of social impact that are intended to be created. There may be no reason to engage in government. The whole point is to realize the potential of the intervention. THEN, on costs, yes; however, the imperative is that the investment has to add-value. The intermediarys effectiveness has to enhance the ultimate impact. We need rigorous measures of the effectiveness of overhead and intermediary investments. To the extent that these efforts are not adding value, we need to change. Takeaways: Top indicators of a favourable environment to build the philanthropic sector in Asia: 1) increasing private wealth, 2) increasing social challenges, 3) increasing government interest, and 4) presence of Big Brains Government can play a critical role in financing scaling up of interventions, recognizing the strengths of the private sector, and limiting itself from becoming an obstacle to innovation. Definitions in this pioneering landscape are in development! A pitfall that could potentially undue progress is a mix of diluted definitions and sloppy thinking. Funders need to take more risk. Funders can take a long-term view and dont need to be pulled by political stakeholders. In Asia, there is adversity to taking risk. Too much procedural formalism can reduce NGO capacity.