EUROPE: Mystery of untapped funds

Unlike America, Europe has no clear and firm tradition of using philanthropic funds to finance higher education, least of all in the research area, which could suggest significant untapped potential, says a new report.

Giving in Evidence - Fundraising from philanthropy in European universities finds that philanthropic fundraising is not, on the whole, taken seriously in European universities and asks, why is this and can it be changed?

First, there are important misconceptions to be corrected, says the report, which was written for the European Commission by academics at the University of Kent in the UK and VU University in Amsterdam.

Only a very small number of European institutions raise significant sums from philanthropy and even fewer are accessing philanthropic funding to pay for research and research-related activities. But this does not apply across the board.

"Our data demonstrate that success in fundraising is related to institutional privilege (ie, what kind of a university it is, in terms of wealth, reputation and pre-existing relationships with different types of donors), as well as to the efforts made by universities (in terms of fundraising activities) and environmental factors (where the university is located and the geo-political context)," the report says.

The researchers found that both the geographical location and the welfare state regime within which institutions are based have some impact on fundraising outcomes. Most of the successful fundraising universities are located in Northern-Western Europe and/or in welfare states characterised as 'liberal'. External factors are "influential, but not decisive in affecting a university's prospects for raising funds from philanthropic sources", they say.

In seeking philanthropic contributions, the report leaves a clear impression that European universities have set their sights too low. While some three-quarters of them have used philanthropy to fund research in the past five years, the amounts raised are small. "Only six HEIs report raising more than EUR10 million [US$14 million] for research on an annual basis [and] almost half (44%) report raising less than EUR1 million a year."

Success, or the lack of it, "may be related to levels of effort" says the report. Less than half of respondents reported making constant or frequent efforts to raise funds for research, with most saying it was an 'occasional' aim.

But even given strong motivation, the drive to increase philanthropic funding is founded on two understandable but mistaken assumptions: that HEIs could do better if they changed their internal organisation; and if there were improvements in external factors, such as better government incentives for donors.

In fact, say the researchers, "the separate variable of accumulative advantage, relating to the presence or absence of institutional privilege, has been shown to be a crucial factor in outcomes". Specifically, "donors show an inclination to support institutions that already possess inherent advantages, especially in terms of pre-existing relationships with donors; this factor must be understood and factored into policies that seek to promote philanthropy, in order to ensure that they are realistic".

"For this reason, we suggest that the concept of 'accumulative advantage' should be understood as an important factor, alongside 'efforts' and 'context' which have so far featured more prominently as key levers in the policy-making literature," says the report.

COMMENT:

A better question is "SHOULD, not could, the philanthropic funds be tapped?"

At first sight, extra funds seems more appealing but in the wider context of higher education, this could lead to a US style of funding for teaching and research which leaves thousands of undergraduates with huge debts. Often their parent are extremely anxious about whether they will stay in employment and be able to afford to support their children.

Far better a government to support its people's quest for higher education. Excessive reliance on philanthropic funds has many hazards.

George Brown