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Donor-advised funds can make a meaningful impact in Asia
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Donor-advised funds can make a meaningful impact in Asia

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Such funds give donors more say in the philanthropic process, and can lead to donors being tipped off about underfunded causes. These funds also make it possible for non-millionaires to do their bit.

WHAT do Jack Dorsey, Larry Page, Elon Musk, Jack Ma and Mark Zuckerberg have in common in terms of their charitable giving?

All of them have used donor-advised funds (DAFs) in short. DAFs are popular in the United States, with over US$140 billion sitting in these accounts. In Asia, DAFs are relatively new with only Singapore, China, South Korea and Japan setting them up.

What exactly is it? In a DAF, the donor transfers money or other assets to another entity called the sponsoring organisation. While the sponsor legally owns the assets, the donor is given a huge say in determining when the fund is disbursed and causes to support, hence the name “donor-advised funds”. Typically, the sponsoring organisation will provide advisory services to the donor on how to effectively utilise the funds.

At this juncture, a reader may ask what is the difference between a DAF and an organisation like the Community Chest in Singapore, which raises funds for multiple charities?

The major distinction is the role of the donor in the DAF, as compared to the donor making an outright contribution to charity. In a DAF, the donor is an active participant, working in collaboration with the sponsoring organisation, in disbursing funds.

Let us say, we have a philanthropist who wants to make a S$1 million contribution to educational causes. While S$1 million is certainly a lot of money, it is insufficient to set up a private foundation due to the administrative costs involved. A donor who uses a DAF may direct the funds to support worthwhile causes in education, while being properly advised.

In many cases, the donor is a wealthy person who may not be familiar with what is happening on the ground. Therefore, the sponsoring organisation adds value by providing advisory services.

In this example, the sponsoring organisation may, after doing due diligence, recommend that the donor disburse funds to underfunded causes like pre-school, technical and special-needs education.

DAFs can also function as an emergency fund for a “rainy day”. For instance, there could be an emergency societal need like children living under Covid-19 lockdown conditions, who are now deprived of sponsored school lunches. Money from DAFs could then be channelled to fund food vouchers for their families during home-based learning.

In fact, this was the cause championed by The Recess@Home programme spearheaded by the Community Foundation of Singapore, a DAF.

BENEFITS OF DONOR-ADVISED FUNDS

A DAF is attractive to donors because of the many benefits it offers.

First, the DAF gives the donor a greater role in the philanthropic process. This sense of satisfaction that the donors get may encourage them to give more to charities in future and set up a private foundation. In fact, in setting up the first DAF in Singapore in 2008, then Minister for Community Development, Youth and Sports, Vivian Balakrishnan, described it as a “starter kit for foundations”.

Second, the donor is supported by DAF sponsors, who are intimately aware of the needs of the community. Therefore, the funds can support the causes that are desperately in need.

Third, the DAF, if properly used, may achieve maximum impact by making contributions to underfunded areas. Fourth, the donation to a DAF need not be a cash gift, but may take the form of company shares or other non-cash assets. Finally, some countries provide requisite tax breaks to donations to DAFs.

The biggest advantage of the DAF is democratisation of philanthropy from the ultra-high net worth families to individuals who have a modest sum to donate. A heart-warming example is the story of the late Kim Gun-Ja, who set up a fund with the Beautiful Foundation, a South Korean DAF. Ms Kim, a sex slave under Japanese rule, donated all her assets save for funeral costs to set up the Grandmother Kim Gun-Ja Fund to support college tuition for orphans. In Singapore, a DAF may be set up with a minimum sum of S$200,000.

Recently, DAFs have come under trenchant criticism in the United States; some quarters have called it a form of “zombie” philanthropy. The main critique is that donors enjoy tax breaks while disbursing too little to charities. Some have called for a law that mandates the DAF to pay out a certain percentage annually. While this criticism of DAFs is legitimate in the United States, it may not apply to DAFs in Asia, where tax breaks are not the primary motivations behind philanthropic giving.

DAFS IN SINGAPORE

There is anecdotal evidence, at least in Singapore, that the level of disbursements to charities is quite high. For example, the two DAFs in Singapore, the Community Foundation of Singapore and SymAsia Foundation Limited, show a high payout rate to charities. The Community Foundation of Singapore has collected S$192 million and disbursed S$114 million in grants. SymAsia Foundation Limited stated in its 2020 annual report that it collected S$170 million and disbursed S$120 million. In fact, donors are conscious that they ought to disburse more to charities.

RISING PAYOUTS DURING THE PANDEMIC

There is currently a campaign in the United States called #HalfMyDAF, where donors are committing to granting half of the money sitting in their DAFs to charities. During this pandemic, there are reports in the United States that payouts from DAFs to charities have indeed been higher, even as critics push for the payouts to be even more accelerated. In contrast to the cautious and structured giving inherent in DAFs, there is McKenzie Scott, ex-wife of Jeff Bezos, who upended the philanthropic world by donating US$6 billion in 2020.

With proper governance, DAFs yield a net-positive over the Asian philanthropic space, compared to an informal channel of giving that relies on one’s family and business contacts. A DAF provides a structured and cost-efficient vehicle that democratises philanthropy and identifies societal needs that are underfunded. It is hoped that there would be more properly governed Asian DAFs set up, with high payout rates to charities to tackle difficult domestic and pressing transnational problems of our time, like climate change.

To find out about donor-advised funds, read more about it here.

This article is written by Professor Tang Hang Wu, CFS Board Committee Member and a professor of Law at the Yong Pung How School of Law, Singapore Management University.

This translated article was originally published by The Business Times.  

Credit: The Business Times © Singapore Press Holdings Limited. Permission required for reproduction.  

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Sayang Sayang Fund: new initiatives

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The Community Foundation of Singapore today gave an update on the fund raising efforts for the Sayang Sayang Fund (SSF) and announced new initiatives that the Fund will support. One of these initiatives is an extension of the previously announced SeniorsOK@Home programme – CapitaLand #LoveOurSeniors – in collaboration with the Agency for Integrated Care (AIC). CapitaLand Hope Foundation will be donating $700,000 towards this new programme. This will be on top of the $3 million goal CFS has set earlier.

Todate, SSF has received $1.1 million in donations and pledges of about $1 million. The Fund is still a distance away from the goal it set for end April. As the COVID-19 pandemic escalates, there are new needs emerging from the community and the funds raised will allow the Sayang Sayang Fund to address emerging needs quickly.

Chief Executive Officer of the Community Foundation of Singapore, Ms Catherine Loh, said, “Singaporeans have been very generous and we are so touched and grateful that many donors – individuals and corporates — have come forward to donate when they hear about the Fund. I would like to encourage everyone else to come together and support the Sayang Sayang Fund, to meet the gaps in the community.

UPDATE ON INITIATIVES

1. SeniorsOK@Home
SeniorOK@Home will provide for immediate aid like food, necessities and medical supplies to seniors with limited mobility and confined at home. It also provides for digital solutions, such as video conferencing, and online recreational activities for seniors at home, to minimise social isolation. For centre-based charities who are providing essential services, CFS is funding disinfection and sanitisation of premises, as well as additional manpower to maintain the standard and quality of care for the seniors.

2. CapitaLand #LoveOurSeniors
With the rise of cases from nursing homes, the Sayang Sayang Fund has curated an extension to SeniorsOK@Home – the CapitaLand #LoveOurSeniors. CapitaLand Hope Foundation will be donating $700,000 towards this new programme, which will support community care providers with personal protection equipment and disinfection of the premises if there is a confirmed case of COVID-19. The contribution will also go towards a preparedness fund: to keep the vulnerable seniors engaged, as well as to appreciate the hard work and dedication of community care staff. AIC will be executing the programme.

3. SafeSleep@Home
Given the rapid increase in cases, there is also urgent concern for the rough sleepers in Singapore. The 2019 homeless survey published by the Lee Kuan Yew School of Public Policy indicated that there are about 1,000 homeless persons living in the streets. They are now all at-risk and need to find immediate shelter during the circuit breaker. SafeSleep@Home is an initiative to aid 500 rough sleepers find temporary lodgings, daily necessities and food supplies.

About Sayang Sayang Fund

The Fund provides care and support for vulnerable communities impacted by the COVID-19 pandemic. By convening the community and acting together, the Fund can help community partners move their essential work forward in this critical moment and support the individuals and families hit hardest by the impacts of COVID-19 and associated containment efforts.

The additional $3.7 million the Fund hopes to raise will support local charities and non-profits whose programmes and proposals meet three key objectives:

1. Provide emergency response funds that enable immediate and short-term relief for individuals and families from marginalised communities adversely affected by the COVID-19 situation.
2. Provide innovation solutions and research that address current and emerging needs to combat the COVID-19 situation.
3. Build capabilities for charitable organisations so that their clients can continue to access essential support and assistance during the COVID-19 situation.

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The competition was organised by City Harvest Community Services Association and received support from FUN! Fund, a Community Impact Fund jointly established by the Community Foundation of Singapore and the Agency for Integrated Care, with the aim of addressing social isolation among the elderly.

Senior Minister of State, Ministry of Communications and Information & Ministry of National Development Mr Tan Kiat How attended the event. He encouraged the elderly to stay physically and mentally well, as well as urging them to participate in community activities and enjoy their golden years together.

Learn more about FUN! Fund at https://www.cf.org.sg/fun-fund/.

 

The programme provides the children with a non-threatening platform to connect with peers and have positive conversations. In addition, it exposes them to different people who can assist to broaden their perspectives.

L.S., a volunteer with the Reading Odyssey programme @ Spooner Road

中心“常胜将军”胡锦盛:比赛限时反应要快

现年92岁的胡锦盛是最年长的参赛者。自2017年退休后,他几乎每天都到活跃乐龄中心报到,从此爱上了玩拉密,每次可玩上三个小时,在中心是“常胜将军”。

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Stories Of Impact

Life after winning the 2020 Goh Soon Tioe Centenary Award: Natalie Koh’s pursuit of a career in musical excellence

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a woman playing a violin

Winning the Goh Soon Tioe Centenary Award in 2020 was a pleasant surprise for talented violinist Natalie Koh, who was not usually recognised for her solo performances and had to prepare for the Award’s audition just after last year’s circuit breaker without any formal instruction.

“I am deeply honoured to have received the Goh Soon Tioe Centenary Award in 2020. Violin playing has always been something that I am very passionate about, although my growth and achievements have not always been a given,” says Natalie. 

“A lot of conscientious and diligent work was put into moulding myself into the musician that I am currently and that I am proud to be.”

Since then, the budding musician has kept herself busy and forged determinedly ahead in her musical career. These included performing in digital concert recordings, teaching the violin at Forte Musicademy as a private violin teacher, and engaging with the special needs community through various community art activities.

Apart from keeping a hectic schedule as a performer, Natalie also spends much time imparting her love of music to the next generation of budding musicians — serving as a Teaching Assistant in her Alma Mater, the Yong Siew Toh Conservatory, and as an Assistant Director for classical music concert recordings and productions by the Singapore Symphony Orchestra, alongside other local organisations.

The promising young musician was also able to present her solo recital at the Awards, for which she was extremely excited and thankful for, as her graduation recital was put off last year due to the pandemic’s restrictions. “Overall, I would say that my recital was a success, and I hope that I fared well as a representative on behalf of the Award and the music community,” Natalie recalls with pride.

The Award’s prize money has enabled Natalie to realise her dreams of going overseas to attain a Master’s in Violin Performance, which will broaden her horizons as a performing violinist, music educator and community artist. She hopes to take the experience and knowledge gained from the two years abroad and expand her musical practice upon her return to Singapore.

Natalie recognises that living and studying in Chicago will prove to be expensive, but with the $10,000 award money, she will be able to defray some of her living costs. With the reduced financial burden, the young musician will be able to focus on learning to the fullest of her abilities in the States.

The Goh Soon Tioe Award has supported yet another promising young musician in paving her way to a brighter future towards a career in music, and adding another valuable gem to the flourishing music scene in Singapore.

“I am deeply thankful for the recognition and the support from the Goh Soon Tioe Centenary Award and the Community Foundation of Singapore. This Award has raised my profile as an emerging musician in Singapore, and I sincerely hope that I can be one to shape and grow the classical music scene in Singapore,” says Natalie.

Read and learn more about Natalie’s first steps into music and how she grew to become the talented musician that she is here.

If you would like to contribute towards the arts or support causes that you are passionate about, please visit our website at https://www.cf.org.sg/

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Stories Of Impact

#MyGivingJourney x Hauw Soo Hoon: Insuring the future for vulnerable students 

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#MyGivingJourney is a series by CFS to celebrate women and their work in philanthropy. This story features Hauw Soo Hoon, Programme Director at Ulu Pandan Stars and a member of CFS’s Programmes & Grants Committee.  

Hauw Soo Hoon has always loved mathematics. So when she discovered some students in her estate were struggling with the subject, getting just 15 marks out of 100, her heart plummeted. She wanted to help them and even get them to love numbers. An opportunity came through her grassroots contacts who were looking for someone to helm a programme to tutor children from rental flats and troubled families.  

That was in 2008 and the qualified actuary had just retired after a 30-year career in the insurance industry, which included senior roles at the Monetary Authority of Singapore and Great Eastern Life Assurance. Together with five volunteers, Soo Hoon started up Ulu Pandan Stars (UP Stars), an initiative of the PAP Community Foundation and Ulu Pandan Citizen Consultative Committee.  

UP Stars began with maths tuition but classes have since expanded to reading, phonics, science and computer applications. It also runs non-academic activities such as sports, social-emotional learning and digital literacy. Every year, UP Stars have about 60 students and its pool of volunteers has swelled to 110. Most are youths from tertiary institutions.  

Soo Hoon was blown away by the commitment and big-heartedness of these young Singaporeans. “But having a good heart is not enough. You need to equip them with skills or you will have volunteer fatigue,” she says. She brings her wealth of public and corporate sector experience of managing teams, developing talent and running an organisation to UP Stars. Volunteers, meanwhile, come away learning about project management, human resources, leadership – as well as empathy. 

“Our youth volunteers truly understand what poverty means and how education is no longer a social leveller,” says Soo Hoon. Her fervent hope is that her volunteers become future leaders who are compassionate and that the ones who choose public service roles will create sound policies that benefit the vulnerable in society. 

Aside from UP Stars, Soo Hoon is on the board of the Special Needs Trust Company (SNTC), a charity that provides affordable trust services for people with special needs. She also serves on the Medishield Life Council and the CPF Advisory Panel, besides being a partner at iGlobe Partners, a venture capital company. For her services with SNTC, Soo Hoon received the 2019 MSF Outstanding Volunteer Award.  

Soo Hoon and her husband also give back regularly with the help of CFS. The couple decided to donate via CFS as it can pinpoint causes that best fit a donor’s area of interest. “CFS can also identify charities which are under-resourced as they will check on reserves and funding and do the necessary due diligence,” she adds. “When there is proper matching, giving back becomes more fulfilling and effective.” While education is the focus of their giving, they have also donated generously to support needy families.  

Begin your own journey of giving with CFS. Read more stories about the #MyGivingJourney series here. 

This article was written by Sunita Sue Leng, a former financial analyst and journalist, who believes that the written word can be a force for good. She hopes to someday write something worth plagiarising. 

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Tertiary-educated adults with autism receive training for jobs in engineering sector

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John Doe
A woman diligently operating a computer amidst the bustling environment of a factory, focused on her tasks.

Tertiary-educated adults with autism are being trained and placed in jobs in the engineering sector under a new programme by research and technology non-profit organisation Trampolene.

The Gates (Growing Autistic Talent for Engineering Sector) programme was started in May 2022, after research showed that people with autism have one of the lowest employment rates among people with disabilities.

Those with tertiary qualifications also face underemployment owing to a high entry barrier for higher-skilled jobs, said Trampolene chief operating officer Cheok Xue Ting.

Ms You Kai Xuan is among 42 graduates of institutes of higher learning enrolled in the programme. She was unable to secure internships as part of her studies at the Institute of Technical Education (ITE) as companies told the school she was unsuitable.

The 22-year-old, who has a Nitec in infocomm technology, is working full-time as an assembly technician at precision manufacturing company Grand Venture Technology (GVT).

Young adults with autism lack executive function skills, such as planning and time estimation.

Ms Hillary Lim, who works for Trampolene as a senior job coach, helped create a timetable for Ms You. It details specific duties she must undertake. For example, it says Ms You has to test iron bars for 90 minutes from 8.30am, and “pack silver things in plastic bags and paste stickers on the bags” between 10.15am and 11.40am.

Ms Lim also held Ms You’s hand during the coaching to show her how much strength was needed when using a torque screwdriver.

Ms You needs the timetable to pace herself and manage her time. When she started working in 2022, she tired herself out before lunch as she exerted too much strength on simple tasks.

“At first, I was nervous as I was new to the environment. But I am comfortable with the supervisor and colleagues now. They guided me patiently on the tasks, and were caring and willing to help.”

The Gates programme is the first to be supported by Temasek Foundation under a pay-for-success model.

The $340,000 committed by upfront funders will be repaid if trainees stay in a job for nine months and other outcomes of job training and placement are achieved.

In this funding model, foundations, financial institutions and corporations provide upfront capital to organisations like Trampolene to serve their beneficiaries.

Outcome funders such as the Government repay upfront funders only if the project achieves outcome targets.

Ms Cheok said the pay-for-success model focuses on retention rate, an issue among young adults with autism, who tend to leave their jobs after six months.

Before the job placement, Trampolene assessed Ms You and found her suitable for hands-on work.

Ms Lim also briefed Ms You’s colleagues on how she communicates, telling them that they need to repeat or simplify instructions.

She told them they can also break down the work into small steps and share her responsibilities.

GVT chief executive Julian Ng said one of the main challenges the company encountered was communication. Some staff with autism take what others say literally and have trouble understanding abstract concepts.

For example, Ms You’s colleagues will say “I’ll get back to you by a specific time” rather than “I’ll get back to you later”.

“This improves communication for everyone in the workplace,” said Mr Ng. The company has about 150 employees at its Singapore headquarters, including three with special needs.

Trampolene also works with organisations to redesign the recruitment process and job role. With GVT, it advised the company to use work assessment instead of conventional interviews.

To match trainees with employers, Trampolene conducts tests for specific skills employers are looking for, from motor skills to data entry and quality control.

It then selects trainees able to perform the tasks, said Ms Cheok.

She said Trampolene also considers work planning, hygiene and safety awareness, and sensory challenges.

If a trainee is affected by high-frequency noises even with earplugs on, for example, he might be more suited to an office job than engineering.

Trampolene is aiming to train 70 young adults over 30 months from May 2022.

To date, it has trained 42 graduates with autism and placed 18 of them in jobs, with 13 having stayed with their employers for three months or more.

Aside from Temasek Foundation, some of the other upfront funders are Ishk Tolaram Foundation, Quantedge Foundation and Asia Philanthropic Ventures.

Outcome funders include ECCA Family Foundation and the Diana Koh Foundation through the Community Foundation of Singapore.

Mr Nicholas Tay, who has autism and holds a diploma in pharmaceutical science from Temasek Polytechnic, was hired under the programme as a production worker in ice-cream manufacturing company The Ice Cream & Cookie Co.

He sets up workstations for production, prepares packaging and places products on a conveyor system for printing or metal detection testing.Mr Damian Yip, head of production at the company, said he considered Mr Tay’s basic communication skills, education level and challenges faced at previous workplaces to decide if he was suitable for the role.

Ms Lim said Mr Tay’s main issues are perspective-taking and negative thinking. For example, when the 26-year-old began doing this job, he often felt lousy about himself when he saw others working faster than him.

“A regular person would think, ‘Oh, the person is faster than me because he has been here for a longer time than me, so he is more experienced,’” said Ms Lim.

“However, Nicholas’ thinking was: ‘Oh, that person is faster than me. I have to be as fast, if not I am not good enough to work here.’”

She said Mr Tay’s co-workers often look out for him when he shows signs that he is tired or when work is too difficult for him. They then get him to switch duties, to take the load off him.

But Mr Tay initially thought they moved him because he was not doing a good job.

Ms Lim mapped out Mr Tay’s thoughts and shared with him other possibilities – for instance, that co-workers may move him to other duties because they care about him.

“It helps to widen Nicholas’ perspectives and also lets him try to think in different ways,” she said.

To learn more about the causes CFS supports, please click here.

Source: The Straits Times © SPH Media Limited. Permission required for reproduction

I have always been interested in supporting elder care. But there are many charities doing such work that I do not know of. Through CFS, I learnt about Yong-en Care Centre and having seen first-hand what they are doing, I feel that my money is being well-utilised.

For Yong-en Care Centre, meeting donors face-to-face was a valuable opportunity to deepen their understanding of its unique care model and to engage with them on any questions they may have, says Griselda. In addition, it is also an opportunity to thank CFS donors who have been supporting the charity and build a lasting relationship with them.

CFS assists charities and their underprivileged communities by connecting them with donors who are seeking to support causes and crucial needs that resonate with them deeply.


To find out more about the causes we support, please visit 
www.cf.org.sg/what-we-support/.

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