people planet profit“More prosperous and healthier societies are better for all businesses,” said an ExxonMobil executive at a recent Washington, DC conference focused on the changing landscape of global health funding. Aid and investment in the developing world have proven to create jobs and open up new markets for goods and services. So it’s not surprising that corporations are investing investment dollars, not philanthropic dollars, in global health, education and other development programs in low- and middle-income countries.

With development challenges increasing, and foreign assistance dollars shrinking, traditional government funders (like the U.S. Agency for International Development) and implementing organizations (like CARE and Save the Children) are increasingly partnering with corporations, foundations and philanthropists to help bring life-saving health interventions to scale. Today, overseas development assistance represents only about 13 percent of total flow while US levels of private giving are through the roof.  Public-private partnerships dominate the field of development.

Admittedly, some of these partnerships between corporations, nonprofits and government agencies report a culture collision in the early stages of working together.  But it’s no question that these partnerships are here to stay and hold great promise in delivering high-quality health, education and other services to those who need it most.  Challenges around creating “shared value” partnerships (the latest “buzz” concept) are the same challenges that any two business partners might face.

One leading innovator is Unilever, which launched a Sustainability Living Plan in 2010, which outlines the company’s goal to expand business while reducing its environmental footprint and increasing its positive contribution to society. “We want to be successful and sustainable while increasing our positive impact on society,” says CEO Paul Polman.

A new Impact Report on Global Giving, jointly published by PSI, Devex and Fenton Communications, captured the trends and leaders in private giving for global health. Between 2006 and 2010, there were 10 corporate foundations giving $10 million or more.  The Abbot Fund topped the list with $77 million followed by ExxonMobil and Merck.  Giving by private foundations was even more significant, including a whopping $8 billion by the Bill & Melinda Gates Foundation.  Other top foundations include the Susan Thompson Buffet and Ford Foundations. Health far surpassed all fields by share of international giving among private foundations at 41% (though most of this was from Gates at 31%), followed by environment and education (11% and 10% respectively).

The complex landscape of philanthropy and investment is changing rapidly.  Corporations are moving away from charitable giving and developing business models that leave a social footprint, and at the same time, increase financial performance.  Foundations and private philanthropists are beginning to look more closely at the impact of their investment and how their contributions might spark increased government funding.  As Karl Hofmann, PSI President and CEO points out in the Impact Report: “We know that development assistance helps keep women, children and families healthy; it keeps kids in school; it helps improve agricultural production; and it reduces poverty and suffering.”  But he adds that “with so many stakeholders and so many development challenges, there is an even greater need for clarity around the metrics of success.”

To download a copy of the report, go to http://psiimpact.com/issues/