Philanthropic funding to combat the coronavirus topped $1 billion by early March, including $182 million from US donors, according to foundation research group arguably has one of the most robust philanthropy offerings in the sector. In March the Swiss wealth manager launched the UBS Optimus Foundation COVID-19 Response Fund, where UBS will 100-per-cent match donor pledges up to $5 million. This service has asked the firm what the fund has raised so far among clients. An early grant of around $500,000 has gone to Americares in the US to help support under-resourced health systems.

“We probably have 40 or 50 people overall in our philanthropy services team, that includes our advisory team plus our Optimus Foundation,” Phyllis Kurlander Costanza, head of UBS in Society and Optimus Foundation CEO told this service about its work funding large scale health projects with private clients.

Philanthropy new wave
“We know that 90 per cent of our clients are active in philanthropy so it is a topic that almost all of our big clients care about,” she said. “From high net worth up, 80 per cent of our clients are engaged yet fewer than 20 per cent are satisfied they are making an impact," Costanza said. It is why wealthy donors are increasingly asking wealth managers to help them pool resources and introduce them to like-minded peers to achieve scale, and also fund measuring the impact they are having through the companies and NGOs they support. It's an area in which traditional philanthropy often falls short. “Even if you are a billionaire, you still don’t have enough money to solve key problems on your own,” Costanza said.

Speaking before the covid outbreak about philanthropy more broadly, Costanza indicated a transformation is due. “There will be Philanthropy 2.0 that starts to shift away from a focus on activity to social impact bonds that do well and measure outcomes.

“Sustainable investing is delivering market-based returns, philanthropy is delivering zero returns, and there is this gaping hole in there that is social finance. I think we will see a lot more in that social finance space, and it will deliver concessional returns; a development impact bond delivers 8 per cent uncorrelated returns, and this is payback if the NGO delivers on what it said it would. It doesn’t matter what is happening in the market, it is a beautiful 8 per cent. I will take that any day.”

This news service has chronicled how ultra-high net worth individuals have made large gifts, sometimes to medical and health-related causes, as part of a trend in the philanthropy space. Michael Bloomberg, for example, has donated $1.8 billion to John Hopkins University to fund health research.