The British private bank Coutts released its first Million Dollar Donors Report last week detailing all US$1 million-plus donations given internationally in 2012. The Middle East section of the report featured donations from philanthropists in the GCC countries. Amir Sadr, managing director and co-head of Coutts Middle East, reveals more.
Tell me more about the report.
This is essentially the leading authority on the nature and scale of $1m donations around the world. The report focuses on six regions: the US, the UK, Russia, the Middle East — the Gulf states — as well as China and Hong Kong. There were in excess of $19 billion of donations in all these locations.
What were the key findings?
From an international perspective, education got the most in terms of donations and accounted for almost 37 per cent of the $19bn of donations — and that really went to higher education. Individuals gave much more money than foundations; but foundations gave more gifts. In all of the regions, except for the Middle East, the vast majority of the donations were for domestic purposes. In the Middle East it was the other way around: 65 per cent of the donations went outside of the Gulf region. This tells me two things: it gives an input on the state of the economy here — the strength and depth of the economy; and it [reveals] culturally how people tend to look outside of their own boundaries. Quite a lot of the funds went into hot spots around the Middle East: the Gaza strip or the conflict in Syria. But there was a very big donation that came out of Kuwait that went to support the nuclear disaster in Japan — that was over $100m.
In total, $720m in donations out of the $19bn came from the GCC. The biggest donor was the UAE and the second largest donor was Kuwait. The other point about the Middle East is that you can measure and get a lot of data about what the donations were in other regions, whereas in the Middle East it’s very difficult to get the actual numbers; we have this number of $720m but we actually believe that the donations are far higher than that because, culturally, people will give donations but from an Islamic perspective they never talk about it.
You have published a UK report on philanthropic giving for the past six years. Why did you start looking at the Middle East now?
The international markets from a strategic perspective at Coutts are becoming very prevalent. There are now six core markets that Coutts wants to operate in and we want to make sure we are resourcing these markets and giving them attention from a strategic perspective. The Middle East has been identified in our new strategy over the past two years as one of our core markets — so it’s absolutely critical that we try to capture as much data as we can.
While philanthropic giving has a long tradition in the US it hasn’t been so common in this region. It that changing?
That’s clearly one of the trends we’ve seen in this report. Another trend we are seeing is that individuals are not just writing cheques; the whole process of philanthropy and giving is becoming quite institutionalised, quite professionalised. These individuals are now very involved in their own activities. What they are doing is setting up philanthropic structures, working with institutions like us so we can help advise them on what their passions are because they want a very hands-on approach.
What kind of advisory service does Coutts offer?
Within Coutts, we have a dedicated team called the Coutts Institute. We have a number of professionals who are very active and very experienced in the areas of charities and setting up philanthropies. We come across a client who wants to give money and is very passionate about giving money but may not know how to do it. We advise them from A to B, with a structure in place and help them articulate what their passions are.
What kind of person becomes a philanthropist?
There are individuals who have been very successful in their business activities during the course of their lives. They reach a certain age, they reach a certain level of wealth and, all of a sudden, feel the need to give something back. Others are at the embryonic stage of their wealth cycle but feel very passionate from a young age that they have to be involved, that they need to give, that they need to participate in some level of philanthropic activity; and if they can’t afford philanthropic activities they do volunteering work.
lgutcher@thenational.ae