Presented by: Timothy A. A. Stiles, KPMG LLP ’s Global Grants Program Hanoi, Vietnam 06 February 2007 Presented by: Timothy A. A. Stiles, KPMG LLP ’s Global

Presented by:

Timothy A. A. Stiles, KPMG LLP’s Global Grants Program

Hanoi, Vietnam

06 February 2007

Presented by:

Timothy A. A. Stiles, KPMG LLP’s Global Grants Program

Hanoi, Vietnam

06 February 2007

G L O B A L G R A N T S P R O G R A M

T A X

Management for Development Management for Development Results – The Private SectorResults – The Private Sector

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ANY TAX ADVICE IN THIS COMMUNICATION IS NOT INTENDED OR WRITTEN BY KPMG TO BE USED, AND CANNOT BE USED, BY A CLIENT OR ANY OTHER PERSON OR ENTITY FOR THE PURPOSE OF (i) AVOIDING PENALTIES THAT MAY BE IMPOSED ON ANY TAXPAYER OR (ii) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.

The information contained herein is general in nature and based on authorities that are subject to change. Applicability to specific situations is to be determined through consultation with your tax adviser.

ANY TAX ADVICE IN THIS COMMUNICATION IS NOT INTENDED OR WRITTEN BY KPMG TO BE USED, AND CANNOT BE USED, BY A CLIENT OR ANY OTHER PERSON OR ENTITY FOR THE PURPOSE OF (i) AVOIDING PENALTIES THAT MAY BE IMPOSED ON ANY TAXPAYER OR (ii) PROMOTING, MARKETING OR RECOMMENDING TO ANOTHER PARTY ANY MATTERS ADDRESSED HEREIN.

The information contained herein is general in nature and based on authorities that are subject to change. Applicability to specific situations is to be determined through consultation with your tax adviser.

© 2007 KPMG LLP, a US limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. © 2007 KPMG LLP, a US limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. Printed in the U.S.A.All rights reserved. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. Printed in the U.S.A.

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OverviewOverview

Private Sector is a major player in international Private Sector is a major player in international philanthropyphilanthropyBenefits and ChallengesBenefits and Challenges Putting the Best Foot ForwardPutting the Best Foot Forward


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Private Sector is a Major PlayerPrivate Sector is a Major Player


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Grants from Private FoundationsGrants from Private Foundations

Grants from Public CharitiesGrants from Public Charities

Grants from Private UniversitiesGrants from Private Universities


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Net Government Foreign Aid in 2004

Country US $Billions

United States 19.70

Japan 8.91

France 8.47

United Kingdom 7.88

Germany 7.53

Netherlands 4.20

All Others (16) 22.82

Total 79.51

Organization for Economic Development and Co-operation (OECD), Development Co-operation

Report 2005, Vol. 7, No. 1, 2006

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However, in 2004, the U.S. private sector However, in 2004, the U.S. private sector contributed US $71.2 Billions!contributed US $71.2 Billions!

Nearly 100% of all the governmental aid given Nearly 100% of all the governmental aid given by the highest 22 contributing countriesby the highest 22 contributing countries

More than the aid given by the highest 12 More than the aid given by the highest 12 contributing countries.contributing countries.


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US Private Foundation International Funding

11%14%

18%

0%

5%

10%

15%

20%

Years

Perc

ent o

f Tot

al G

ivin

g

Organization for Economic Development and Co-operation (OECD), Development Co-operation Report 2005, Vol. 7, No. 1, 2006

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Benefits & ChallengesBenefits & Challenges


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Benefits and Challenges (Benefits)Benefits and Challenges (Benefits)

Fund activities that are too controversial for Government or where Governments refuse to Fund activities that are too controversial for Government or where Governments refuse to fund (e.g., current debate over abstinence v harm reduction in the HIV field)fund (e.g., current debate over abstinence v harm reduction in the HIV field)

Policy & Program Continuity (i.e., no major changes that accompany change of Policy & Program Continuity (i.e., no major changes that accompany change of Government)Government)

Speed and flexibilitySpeed and flexibility

Take a longer term view (i.e., no ‘political’ need to demonstrate results to meet an election Take a longer term view (i.e., no ‘political’ need to demonstrate results to meet an election cyclecycle

Can openly discuss and admit successes and failures and move onCan openly discuss and admit successes and failures and move on

Focus on monitoring program impact, not process (e.g., purchased goods requirements)Focus on monitoring program impact, not process (e.g., purchased goods requirements)

Support programs in-country where Governments might be opposed (e.g., women’s Support programs in-country where Governments might be opposed (e.g., women’s rights/human rights)rights/human rights)

Apply private sector standards of monitoring & measuring success (e.g., use of an Apply private sector standards of monitoring & measuring success (e.g., use of an independent firm to monitor grants)independent firm to monitor grants)


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Benefits and Challenges (Challenges)Benefits and Challenges (Challenges)

IRS rules (e.g., prohibition on activity to change legislation, reporting IRS rules (e.g., prohibition on activity to change legislation, reporting requirements, capital equipment/endowment grants, etc.)requirements, capital equipment/endowment grants, etc.)

No independent oversight (e.g., no Congressional committee, sometimes no No independent oversight (e.g., no Congressional committee, sometimes no Board or Board is dominated by one family)Board or Board is dominated by one family)

In the case of corporate ‘private foundations’ overlap with the corporation’s In the case of corporate ‘private foundations’ overlap with the corporation’s interestsinterests

Tendency to support many small projects and not be capable of funding large-Tendency to support many small projects and not be capable of funding large-cost, scaled-up programs that have a major impactcost, scaled-up programs that have a major impact

Tendency to be wary of Governments – leads to programs not supported by in-Tendency to be wary of Governments – leads to programs not supported by in-country Government (sometimes this is a good thing) or not complementary to country Government (sometimes this is a good thing) or not complementary to Government programs (e.g., Russia and India)Government programs (e.g., Russia and India)

Less restrictive rules for engaging contractors/consultants (sometimes this is a Less restrictive rules for engaging contractors/consultants (sometimes this is a good thing)good thing)


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Putting the Best Foot ForwardPutting the Best Foot Forward


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Putting the Best Foot ForwardPutting the Best Foot Forward

Build the relationship with your funder (be cooperative, don’t treat it Build the relationship with your funder (be cooperative, don’t treat it as “free” money, ensure goals are aligned with the foundation’s goals)as “free” money, ensure goals are aligned with the foundation’s goals)

Is a “quid pro quo” necessary (e.g., what is free, what is the company Is a “quid pro quo” necessary (e.g., what is free, what is the company doing in your country)doing in your country)

Programs that make an impact (“venture philanthropy”)Programs that make an impact (“venture philanthropy”)

For corporate foundations, what “quarterly story” can be toldFor corporate foundations, what “quarterly story” can be told

Collaborations, partnerships, consortiaCollaborations, partnerships, consortia

Differentiate from the “government”Differentiate from the “government”

Follow throughFollow through

Transparency and accountabilityTransparency and accountability


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KPMG KPMG LLPLLP

Timothy A. A. StilesTimothy A. A. Stiles

Global Grants Program, Global Grants Program,

Partner in ChargePartner in Charge

[email protected]@kpmg.com

+1.415.963.7551+1.415.963.7551

© 2007 KPMG LLP, a US limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a © 2007 KPMG LLP, a US limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. Printed in the U.S.A.Swiss cooperative. All rights reserved. KPMG and the KPMG logo are registered trademarks of KPMG International, a Swiss cooperative. Printed in the U.S.A.

Documents

Presented by: Timothy A. A. Stiles, KPMG LLP ’s Global Grants Program Hanoi, Vietnam 06 February 2007 Presented by: Timothy A. A. Stiles, KPMG LLP ’s Global