Philanthrocapitalism Is Disrupting Charity Work Which Can Impact Government
Mark Zuckerberg and his wife Pricilla Chan recently announced the Chan Zuckerberg Initiative, which is to give away most of their wealth. However, they aren’t setting up a traditional non-profit foundation, they have created a limited liability company (LLC) which provides a little more freedom whether supporting nonprofits, making private investments, or participating in policy debates. This ‘philanthrocapitalism’ could help different types of organizations, including local and state government organizations.
As discussed in “How ‘Philanthrocapitalism’ Could Transform Government,” posted by Justin Marlow on Governing.com, Zuckerberg and Chan are planning to invest over $45 billion in Facebook stock into their Chan Zuckerberg Initiative, which is a lot of money. For the sake of comparison, $45 billion is roughly about what the state of California will spend on their K-12 education this year. On the other hand, that amount of money may not be a game-changer for a city or state budget director. Either way, this level and type of philanthropy could bring new opportunities to local and state governments.
After the terrible flooding in South Carolina last fall, the state estimates that $2 billion is needed to improve storm water infrastructure. That’s a lot of money for local governments to borrow. Making matters more complicated, investors won’t loan money without a plan that results in a complete payback by the governments. In many cases, these situations become just as much of a political challenge as economic, which makes these situations better suited for philanthrocapitalism. The Chan Zuckerberg Initiative, for example, or other LLCs for that matter, could guarantee loans from lenders or buy stock in public-private partnerships, or leverage capital that encourages other investors to buy into storm water systems. These partnerships present a new way for local and state governments to make needed changes that can improve health, safety, and economic conditions for citizens.
Governments can also take a proactive stance with strengthening financial operations by deploying a powerful enterprise resource planning (ERP) solution. Today’s ERP solutions are affordable and provide an efficient way to manage spending, budgets, grant programs, and other financial operations. Contact AKA Enterprise Solutions for more information about making every dollar count with ERP.