Philanthropy Or A New Trend In Investment?
Corporate leaders are now actively investing in education either through institutions or foundations
Photo Credit : Umesh Goswami,
For industry leaders and job creators, necessity over time, has crossed its boundaries from self to family, then to society, country and beyond. Mammoth achievements brought about the bigger idea of ‘giving back to the society’. Almost every industry leader wants to anchor their boat at the philanthropic shore of education — be it for children, higher education students or skill development.
Is It Philanthropy?
The most relevant question at this juncture is whether ‘education’ can still be considered philanthropy; especially when the market demands sizing of this particular industry. The Education Sectoral Report by IBEF (India Brand Equity Foundation) estimated the size of the education to be $116.4 billion in FY 2016-17, up from $100 billion in FY 2015-16.
“Trends towards philanthropy will increase,” says Rajan Saxena, vice chancellor, NMIMS, co-chair, FICCI Higher Education Committee, an Indian management expert and author.
“India has about 300 million students to cater to. No one individual or government by itself will be able to impart quality education to all the students. Industry support in a large way has to come in. Hence, we are witnessing increasing numbers of corporate-driven universities, which support research exercises in a serious way since the government does not. A large number of philanthropists exist outside the country too, who are immensely interested in investing in education in India. Hence, the government is inclined to open up foreign direct investment in education,” he explains.
With institutions mushrooming in India, it rather seemed tempting to understand the growing trend of educational philanthropy among the top 20 super rich corporate leaders of India.
Out of top 20 industry leaders, 13 actively invest in education as a social responsibility initiative while six join hands with regional, national and international non-governmental organisations to take education to the underprivileged.
The odd one in the pack is Dilip Sanghvi of Sun Pharmaceuticals who rewards excellence in pharmaceutical and medical sciences through Ranbaxy Science Foundation.
The moot point here is: When do we call education a social responsibility? Is it when education comes subsidised or free? Is higher or skill-based education that aims to create enlightened and employable youth more important than creating a strong base for school education? Is providing education to the rural or urban underprivileged more social than establishing upgraded institutions for the urban population?
These questions lead to the obvious need for understanding the kind of educational initiatives that have been taken up by the country’s super rich.
It is important to note, however, that education is just one of the corporate social responsibilities. A new trend is setting up disciplinary schools in premier management or engineering institutions. For instance, the Bharti Foundation has set up Bharti School of Telecommunications Technology and Management in IIT Delhi, Bharti Centre for Communication in IIT Bombay and Bharti School of Public Policy in Indian School of Business, Mohali.
The contention squeezes itself into the situation, yet again. Does a school or college by a super-rich leader not charge fees? Not all and not-at-all. Like every other school or university, these schools, colleges or university too charge competitive tuition fees, subject to the region they are based in. They are like any other educational institution. The differentiating factor here is the quality of industry-academia connect, faculties, teaching learning resources, incubation centres, and so on.
Says Saxena, “Corporates invest in education institutions as part of their corporate social responsibilities. This investment is primarily used for setting up the infrastructure and kick-starting the institution. Tuition fees help these institutions to run on their own, to cover the operational expenses. So, charging fees and investments should nowhere be connected.”
Where To Invest
The IBEF Education Sectoral Report predicts the school education industry (for 0-14 years) to grow at a compound annual growth rate of 10.16 per cent by 2020 and higher education at 17.5 per cent by 2025. Does this mean we will see more investments by the super rich in the education market? Only time will tell.
What are the areas corporates should be looking to invest in? Says Saxena, “There are three main areas that corporates should look at investing. First, education technology. India’s educational institutions are very slow to adopt technology. Accepting new technologies and adapting to them quickly is a now a necessity. Technology should be used to create online tutorials. It should be offering solutions to overcome faculty shortage.”
According to Saxena, the second important area for investment is school education. “A lot of work has to happen there. With international schools accredited to International Baccalaureate curriculum and IGCSE curriculum making quality education available to a small section of society, a lot of investment needs to be made in the mid-range schools. The choices are still limited when it comes to the mid-range schools.”
Skill building and vocational education is the third and most important area for investment, according to Saxena “In India, we still do not have a model of integrating vocational education with higher education. We often find diplomas in vocational education but it has to proceed to advance diplomas and more.”
Saxena says that other areas of investment should be research-based universities and institutions to teach and reinforce liberal arts and other aspect of humanities.
Education as an industry needs a lot of work to grow and evolve. And as such, more public private partnerships should be welcomed with stress on the technology aspect of education.