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Vishal Koul

The World's Greatest Philanthropists

India's second freedom movement
A private equity maven explains why improved the education quality is the key to reform and philanthropy in India

Ashish Dhawan

When it comes to trends in Indian philanthropy, our freedom struggle set a powerful precedent for future generations to follow: some of India’s wealthiest families dedicated their resources towards the liberation of the country. However, despite 67 years of independence, India has not yet turned into a land of opportunity for the majority of its citizens. Today, the country faces a crisis because its education system has failed three generations and currently faces the threat of failing a fourth generation as well. Our failure to provide quality education to our children not only undermines their dignity but also puts India’s overall development at risk. The bright side is that this is something we can change within our lifetimes. Members of the Indian elite thus have a responsibility to harness change for the millions of their countrymen without the same access to resources, thereby bringing about a second freedom movement. 

While the government has done a remarkable job when it comes to improving access to education, it has fallen short in providing an education that prepares our children to become responsible and productive citizens. We may have achieved 97% enrolment in grade 1 but only 35% of the 355 million children in India today reach grade 12. Policies such as the Sarva Shiksha Abhiyan and the Right to Education Act have ensured that children are enrolled in schools but there is no guarantee that they are learning effectively. Foundational skills such as literacy and numeracy are severely lacking and most children are ill equipped for employment opportunities. As a result, learning levels remain abysmal, individual dreams go unrealised and India struggles on a variety of socio-economic indicators. 

Private philanthropy, an age-old tradition in India, has played an important role in the education sphere. We have seen its impact in private initiatives such as charitable schools, programmes focused on the girl child and skills training for youth. While these programmes have had a positive effect on individuals and communities, they have not contributed to systemic change. What is required is a concerted effort towards philanthropy that can spark a transformation in the Indian education system. This type of catalytic philanthropy uses a business approach to solve social issues in long-term, systemic ways. It involves strategy development, execution, measurement and review as part of a continuous improvement cycle.  

Scoping the field

There is a massive opportunity for this kind of philanthropy to influence change. Philanthropy’s most effective role is to catalyse promotion of innovations that address pressing social challenges. But first, we need to look at education strategically and understand the broader issues facing our country’s education landscape. 

In school education, we face large-scale challenges in improving the quality of teachers and school leaders, using data to measure student achievement and policy impact and finding ways to utilise technology for maximising learning and instruction. We need to identify best practices, develop strategies towards scaling the processes that work and be open to innovative approaches. These tasks require open-mindedness towards creative solutions as well as a respect for rigour and accountability. Philanthropic institutions offer an ideal space to incubate these strategies, thanks to their inherent independence and flexibility. 

Over the past couple of decades, we have seen several instances of civil society initiatives being scaled up to improve the quality of education. For instance, the ASER Centre, a sister organisation of NGO Pratham, began conducting its annual survey in the early 2000s. Today, this survey has become the most cited assessment of learning levels for Indian children, and states such as Bihar are adopting its indicators as measures of quality for their reform efforts. Similarly, the Kaivalya Education Foundation has done pioneering work in introducing school leader training in India. Principals in India do not receive specialised training and yet are expected to carry out administrative duties. Research suggests that 25% of students’ learning outcomes are determined by the quality of the school leader. Supported by the Piramal Foundation, Kaivalya experimented with its school leader-training model in Rajasthan and today works with over 1,000 school leaders across three states every year.  

Baby steps

I founded the Central Square Foundation with a group of like-minded friends in recognition of the fierce urgency of the education situation in India. We want to ensure that all children in India, irrespective of their socio-economic backgrounds, get a high-quality education that enables them to fully realise their potential. The foundation supports innovative ventures; builds the ecosystem for educational entrepreneurs to come together and share ideas; creates the research base for evidence-based policy-making; and advocates with the government to implement systemic reforms. 

Coming from the private equity space, we believed that our ability to identify and develop entrepreneurs offered us an opportunity to adopt a unique venture philanthropy approach. We provide social entrepreneurs with financial, strategic and operational support while holding them accountable to specific outcomes. For instance, we helped Teach For India alumnus, Gaurav Singh, start the 3.2.1 Education Foundation to educate children from low-income backgrounds. 3.2.1, which operates as part of a partnership with the Municipal Corporation of Greater Mumbai (MCGM), had its beginnings in a government school housed above a wholesale fish market. In three years, 3.2.1 has created a vibrant school of 350 students across three grades, where children are learning in a joyful atmosphere. The organisation is now codifying its teaching practices in order to provide training to other schools catering to a similar population of children. 

Through our interactions with entrepreneurs, we realised that the education sector needed platforms that fostered collaboration. In fact, we named our foundation Central Square drawing from the concept of a common space where education reformers could collaborate. Earlier this year, we brought together a group of influential individuals in Pune to catalyse a movement for education reform. Anchored by notable citizens such as Rajya Sabha member Anu Aga, Daljit Mirchandani of Ingersoll Rand and Ravi Pandit of KPIT, a group of 50 people convened to draw up a new vision for education in Pune. This group continues to meet independently to implement their vision for the city.

 Finally, we wanted to maximise return on investment by influencing public policy. On the one hand, we need to introduce long-needed changes in the government school system. On the other, we need to create an effective regulatory framework that enables private providers to flourish. Today, low-cost private schools are the fastest growing segment as parents opt out of the government school system, and yet they operate in an uncertain and often antagonistic regulatory environment. Therefore, we are actively working with governments at the central and state levels to identify and formulate policy reforms.  

PPP is the buzzword

An idea that we have been actively pursuing is public-private partnerships in education. The central and state governments in India are already looking at PPPs in education — the human resource and development ministry plans to run 2,500 model schools across the country on the PPP model. Then, in 2013, the MCGM passed a PPP policy that allows private operators to run government schools with a formula for reimbursement of per-child costs incurred by the private player. Looking at these emerging sparks, we realised that there was a need for a coordinated response to this opportunity from civil society, which is why we seed-funded a coalition called The Education Alliance in partnership with experienced international funders, which is now working with municipal and state governments to develop outcomes-oriented PPP policies. 

In the process of these partnerships and initiatives, we absorbed some key lessons along the way. Here are four ways through which we believe organisations can practise effective philanthropy:

•Develop a strategy: Philanthropists must have a clear sense of the challenge they are seeking to address and the approach they think will work towards achieving this. We started out with the simple goal of improving education in India but the complexity of the education system forced us to identify areas in which we thought we could be most effective. 

•Take risks: Given India’s complex challenges, we need more effective organisations working to create change. Most institutional philanthropy in India goes to projects that have a demonstrated track record of impact and fulfil donors’ thresholds of integrity. There is a clear gap in the philanthropic market at the seed stage, where one is investing in the entrepreneur and the idea. It is more complicated to work at this stage as it requires more handholding, but the rewards of developing successful models are immense. 

•Think of scale: With 240 million school-going children in India, achieving scale is a critical component of social innovations. Organisations should implement solutions that will either be scalable because there is a market for them or because the government may adopt the solution to meet its needs. If solutions do not meet either of these criteria, they will forever be stuck being dependent upon donors, will hit natural limits of scale rapidly and then stagnate. 

•Measure effectively: Measuring the impact of social projects is complex and difficult. Yet, philanthropists must work with partner organisations to develop mutually agreeable measurement frameworks and assess their progress regularly. In the corporate world, it would be inconceivable to not have progress metrics; the same standard should apply for philanthropy. We have found that even simple tracking of indicators give us a sense of a whether a project is on track towards its goal effectively. Often, these systems just require discipline and commitment on part of donors and grantees to ensure that they are used.

The education crisis that we face today is colossal and no one person or organisation can solve it. While the government is mandated to focus on education, philanthropy has a huge opportunity to address this crisis.

There is an added opportunity for India’s corporate entities to play an integral role in the education space, thanks to the Companies Act 2013, which mandates corporate social responsibility. The business fraternity has immense incentive to provide better standards of education because an educated workforce can contribute directly to a better bottomline. Corporates should embrace the spirit of the Companies Act and invest in strategic initiatives that ensure quality education for all children in India. They should not only think about financial grants but also assist non-profit organisations with the basics of successful businesses — measurable goals, strong monitoring processes and data-driven decision-making. 

As the late author Maya Angelou said, “When you learn, teach, when you get, give.” It is the responsibility of those of us lucky enough to have learnt and earned in life to share with those that are in need. We can reform India and help our nation achieve freedom in the true sense. This is the greatest need of our time and the time to act is now.

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