How philanthropy could change higher education funding

1 Mar 2018

Originally published in The Conversation on 1 March, by Mark Dodgson.

This article is part of a series exploring ideas for reforming higher education in Australia. We asked academics to analyse overseas models, innovative ways forward in a digital world, and ideas we may not have considered.

Donations from wealthy individuals and organisations have sustained universities since the Middle Ages. Today, the ambitions of universities extend well beyond governments’ preparedness to pay for them. Philanthropy – the donation of wealth towards the welfare of others – can provide an important contribution to the scientific and social advances universities aim to deliver.

The transformative potential of philanthropy
Attracting and effectively using philanthropy requires a level of strategic sophistication and professionalism that has been absent until recently in many countries, such as Australia and the UK. This means universities need to be more sophisticated in the way they use donations, not just using them to fill in budget holes. They need to use it to transform.

They also need to employ more and better staff, and have more effective systems and processes in place.

Traditional reliance on government funding in such countries has not developed the cultures and practices of giving found in the US. There, private donations have always been of greater significance.

Harvard University embarked on its first fundraising campaign in 1643. According to some measures, it now receives an average of A$3.83 million a day.

Around one-third of the research budgets of the US’s leading universities come from philanthropic gifts. The impact of these donations is greater than their financial scale would imply. Philanthropic giving, for example, funds longer-term, more adventurous research, and is especially important for younger, less well-established researchers.

It is also impactful. According to one estimate, 47 Nobel science prize winners have had significant funding from Rockefeller philanthropy in one form or another. Philanthropy has also massively improved the teaching and accommodation facilities for students.

What we can learn from the most successful universities
One of the most important strategic considerations about philanthropy is the possibilities for transformation. If it’s all just about the money, philanthropy fails to deliver its potential. By building deep and continuing relationships with knowledgeable donors with shared values, partnerships can stimulate new ideas and directions in universities.

MIT, for example, built successfully on the expertise of Mohammed Abdul Latif Jameel in alleviating root causes of global poverty in its Abdul Latif World Water and Food Security Lab.

Philanthropy can also be valuable in stimulating important inter-disciplinary initiatives. London’s Imperial College has a new centre for biomedical engineering, funded by the Michael Uren Foundation. It became a foundational investment in the university’s new research translation campus, which connects companies with researchers to turn scientific and technological innovations into new products and services.

One of the most marked examples of transformative philanthropy in Australia was the A$100 million series of directed gifts to The University of Queensland from Atlantic Philanthropies. This was leveraged into the A$1 billion Smart State Institutes, such as the Institute of Molecular Bioscience.


The full article is available on The Conversation.