All Forms of Leadership Commitment
Education has historically been a primary target for philanthropic activity. However, in so far as education has been discussed, the literature suggests that it may represent, at least in the contemporary era, a lower risk and cheaper social investment for business leaders compared to alternatives, such as the provision of vaccinations or birth control.
Most of the scholarly work on philanthropy, rarely disentangled education from the broader bundle of initiatives, and focused on the large-scale endeavors of super-wealthy, often celebrity-like, business leaders. Literature on business philanthropy and CSR has also gravitated towards the experience of Western economies and developed countries, where public or semi-public institutions ensure widespread quality education, supporting and fostering economic growth. The developing world has historically been penalized by the lack of access to various forms of education, so business investment in this sphere played a crucial role for local communities, and, in some cases, entire regions. In emerging markets, business investment in education developed according to the local tradition, responding to specific needs and urgencies. This study explored for the first time how and why business leaders have invested in education across these very diverse geographies.
We based our inquiry on text analysis of interviews from the Creating Emerging Market (CEM) project, established by Harvard Business School in 2007. The database today comprises more than 150 interviews with senior business leaders, who spent at least three decades operating in emerging countries. We analyzed a subset of 110 leaders from 22 countries and measured the type and impact of charitable activities as well as how business leaders narrated, explained and made sense of their investment in education.
More than three-quarters of the sample of the 110 interviewees invested in education as a non-profit activity. We identified three main drivers for education investment in emerging markets. First, business leaders explained their engagement in education as linked with family tradition, moral and religious codes, and general compassion and desire to "give back" to people in need. In other cases, investment was explicitly "firm-focused," namely it was aimed to foster and enhance business reputation and competitive advantage, and so directly benefit the firm. Finally, in some other cases, business leaders connected their initiatives with "context-focused" goals, describing an action-oriented approach to solve educational failings in their society, create the bases for future development, and benefit the local and national community beyond the firm's confines.
Investment tended to increase with the size of the business. The analysis of the initiatives across countries found significant regional variations in terms of execution strategies, structure, and impact of this investment. In South and Southeast Asia, there was a preference for long-term expenditure in primary and secondary education. In India, major family business groups addressed education through a comprehensive approach including a broad array of initiatives, from basic literacy, building of schools, large scale scholarship programs, and foundation of universities. In Africa and Latin America, some projects had a shorter-term connotation, but with high-profile activities in partnerships with international organizations and foreign universities. In Turkey, there was heavy focus on training and the creation of universities, often linked to large business groups. As for execution, foundations emerged as a preferred way of structuring investment in education across all geographies, but specifically among large family business groups. Together with the fiscal advantages that foundations often enjoy, interviews showed that they helped enhance reputation and preserve family legacy across generations.
The study concludes by reviewing the impact of this investment. This turned out to be difficult to measure, which is worrisome given the large amounts of money being spent. The paucity of financial data and the challenges of comparing different types of educational spending, made robust conclusions elusive. A rich future research agenda awaits in this area. Data however do show that millions of people have been touched by this spending between the 1960s and the present day, from plantation workers in India and refugees in camps in Jordan, to people granted scholarships to élite universities in Chile and Turkey. Among the many projects were experiments with innovative pedagogies, and there were important attempts to help those disadvantaged by political élites and social and gender norms. It seems fair to advance the hypothesis, as a result, that this business investment in education in emerging markets represented a significant social contribution which has been largely ignored until now.