Feature February-April 2005
India's Tata Group: Empowering marginalized communities
As the Tata Group, a leader in Indian business and philanthropy, observes the centenary of the death of founder Jamsetji Tata, the company is riding on a wave of national economic growth that its successes have contributed to in measurable ways. With 2004 revenues of more than $14 billion, the firm accounted for 5 percent of India's exports, and 2.6 percent of its GDP.
In the philanthropic arena, Tata Group Chairman Ratan N. Tata faces complex challenges. While India enjoys strong economic growth and has recorded an impressive 19 percent reduction in poverty over the past decade, those figures mask deep regional disparities in access to resources.
An estimated 400 million people remain under poverty, three-quarters of them living in rural areas. Forty percent of the population is illiterate, with rates even higher for women, tribal people and scheduled castes. And at least 171 million lack access to safe drinking water.
Several factors have now opened a window of opportunity to address these conditions, including an increase in private wealth, the beginnings of a philanthropic infrastructure, a diverse and growing civil society sector, and a recent change of government that is bringing new focus to poverty at national and regional levels.
A new opening for philanthropic leadership
As even India's new leaders have acknowledged, however, the vast scope of the challenges facing the country are placing great pressure on all sectors of society -- particularly the private sector -- to help to mobilize resources, expertise, and innovative thinking.
Whether an effective response is mounted to these challenges will depend largely on the efforts of leaders such as the Tatas, says Pushpa Sundar, Executive Director of the New Delhi-based Sampradaan Indian Centre for Philanthropy (SICP -- www.sampradaan.org) one of a small handful of organizations to emerge at the national level in India in recent years to facilitate philanthropy and increase its impact.
"It's part of the Indian ethos -- each one plays on their own and there is little collaboration between funders," says Sundar. She maintains that the Tatas are one of the few philanthropic forces in India with the potential, by virtue of their credibility, professionalism, and reach, to play a convening role for collaborative action on the problems that threaten individual, local and national development.
The Tatas were the first of India's wealthy private donors to move beyond charity into organized, strategic giving, says Sundar, who has researched and written extensively on private philanthropy in India. "They operate one of the very few grantmaking foundations in India -- the oldest and certainly the largest."
"This grant support is valued by NGO grantees since there are very few private, non-governmental sources of support in India. They are more able via smaller grants than foreign donors to fund indigenous initiatives. Foreign donors find it difficult to reach smaller, but worthy NGOs due to governmental regulations," says Sundar.
The Tatas are distinguished by their professional, "arms length" approach to philanthropy, and for the transparency of their operations, through publication of detailed annual reports. They also employ an endowment funding strategy, unusual in India, according to Sundar.
The Tata legacy: "constructive philanthropy"
Jamsetji Tata set the tone in the 1860s with his determination to harness his wealth to bring self sufficiency to Indians at a time when its citizens were still laboring under the yoke of British colonial rule. The founder's values of "constructive philanthropy" became embedded in Tata Group's business ethics and giving philosophy.
The next generation of Tatas helped carry their country into the industrial age by establishing India's first private sector steel mill and power utility. The Tata concern for nation building was exhibited not just in industry, but in the area of human development. Jamsetji's sons used their wealth to endow the Sir Ratan Tata Trust (SRTT) and Sir Dorabji Tata Trust (SDTT), the first large Indian grantmaking foundations of a national, multi-purpose character.
The Trusts established a number of pioneering institutions -- including the first institute for higher learning in science, the first institute for social sciences, the first cancer hospital and research center, and the first institute for basic research in mathematics and physics. Beyond these institutes, the Trusts' main grantmaking priorities include natural resources management -- particularly water harvesting and conservation -- rural livelihoods and communities, education, health, civil society and governance and arts and culture. Together, the Trusts disbursed nearly $18 million to grantees in 2003-2004.
A survey of wealthy donors in India suggests that Jamsetji Tata's legacy remains a role model for many of today's private philanthropists, according to Noshir Dadrawala, Executive Director of the Mumbai-based Centre for Advancement of Philanthropy (CAP -- www.capindia.org). Dadrawala's survey was conducted as part of a study of private giving practices in a number of Asian countries by the Asia Pacific Philanthropy Consortium.
Adapting to complex challenges
To meet the challenges of philanthropic leadership in today's complex global society, Tata Group Chairman Ratan N. Tata is combining the institution-building legacy of his predecessors with the more freewheeling, entrepreneurial style of giving emerging among the wealthy drivers of the tech boom. Under his leadership, corporate social responsibility activities of the diverse Tata Group companies have been coordinated and professionalized. As he expands the Group's business activities in the area of new technologies, he has shown a corresponding interest in the application of new developments in this field to Tata philanthropy.
In recent years, the Tata Trusts have been attempting to leverage philanthropic resources by forging synergies and links between grantees wherever opportunities exist. The Trusts increasingly have turned to corpus grants to nongovernmental organizations as a means of building capacity and sustainability in a sector that is diverse but underdeveloped.
SICP's Pushpa Sundar sees room for even further work in these areas, and would welcome a return to the grand vision and larger-scale institution building that vitalized the earlier days of Tata giving.
While Tata philanthropy continues to evolve, what has remained constant is the strategy of empowering marginalized communities to take the reins of their own development. As the following initiatives of the Tata Trusts and Tata Group social responsibility illustrate, this commitment will be vital for addressing the daunting challenges facing India today.
Read related story on Ratan N. Tata: Linking shareholder value and social responsibility.
Toward the end of his tenure at Tata Consultancy Services (TCS), Fakir Chand Kohli, widely regarded as the father of India's software industry, began to wonder whether his company's vaunted expertise in software development could be applied to one of the most pressing problems in Indian society -- the high rate of illiteracy.
In the midst of a technology-driven economic boom, it was a source of great concern that 300 million of India's adults -- an estimated 35 percent -- were unable to read at even the most basic level. Comparison with other countries suggested the social and economic impact of illiteracy: for example per capita income in China and India were almost the same in 1990; by 2000, China, with a literacy rate of 92 percent, had nearly double the per capita income of India.
Given the urgency of the problem, conventional methods of literacy training were just too slow -- at the rate of increase recorded by traditional literacy education, India was not expected to reach 90 percent literacy for another 30 years.
Under the aegis of TCS, a volunteer team of experts from divisions across the company came up with a low-cost, technology-based approach that promises to substantially increase the country's literacy rate.
The Computer-Based Functional Literacy (CBFL -- www.tataliteracy.com) method, which focuses on reading, rather than writing, is designed to provide a basic 300-500 word vocabulary to adults over the course of 40 hours -- about a third of the time of traditional training. CBFL uses a combination of animated graphics and repetition of sound patterns to engage the learner. The computer-based curriculum provides flexibility to adjust to the varied schedules of working adults with families, and does not require trained teachers.
"You don't need a state of the art computer for this program to really fly," says Tata Group Chairman Ratan N. Tata, which means that the training can be conducted on donated 486 Pentium computers deemed obsolete by many users but adequate for CBFL.
CBFL has been field tested in five of India's 18 languages -- Telegu, Tamil, Hindi, Marathi, and Bengali, with the help of government and NGOs in various locations throughout India. To date, nearly 50,000 adults have learned to read at a functional level using computer-based training. In the early phases of the program, most instructors were retired teachers or part of the state literacy effort; many classes are now conducted by those the program made literate.
As the program grows, so do the applications of CBFL across many sectors of society. Companies are organizing CBFL courses for less literate members of their workforces, and some self-help and savings groups are beginning to use CBFL as a prerequisite for loan applications. In rural communities in numerous parts of India, existing Internet kiosks that provide a variety of online services to consumers are incorporating CBFL into their offerings.
CBFL has even been exported to South Africa, thanks to the interest of First Lady Zanele Mbeki. A TCS team is helping experts in that country to map the sounds of unwritten South African languages and develop a script for use in computer-based literacy training.
While advocates of CBFL say that national roll out of the program could help India achieve 90 percent literacy in a matter of three to five years, instead of 30, substantial challenges remain: the size and diversity of India's population; red tape surrounding the importation of donated computers; and the need for more and better collaboration with government, which has the reach and the authority critical to widespread implementation.
Prof. Kesav V. Nori, TCS Executive Vice President for Research and Development and a member of the core team that developed CBFL, takes it as a hopeful sign that he was recently invited to join the Executive Committee of the government's National Literacy Mission Authority. In his view, CBFL is essentially a partnership venture involving the government and other agencies, with TCS providing the technical and technological support.
"If we could reach 85 percent literacy in five years, it would be satisfying. What seems important is to seed beginnings in areas that have very poor literacy rates and substantial gaps in literacy between genders," concludes Nori. "The start up is very hard and requires enlightened administration. The logic for literacy is very compelling for us, but opaque to those very poor people who have been steeped in illiteracy for centuries."
For his part, Tata said he is "hopeful that if we can register success and showcase in larger areas the benefits of what we're trying to do, then I think there is every likelihood that we will succeed."
"The poorest people in India live in its tribal drylands," says Dr. Mihir Shah, director of Samaj Pragati Sahayog (SPS), one of India's largest NGOs working on water and livelihood security. Largely neglected by the mainstream development process in the nearly 60 years since independence, the residents of these forgotten tribal drylands today are experiencing massive problems of poverty, unemployment and outward migration.
Using watershed development as a focal point for intervention, Samaj Pragati Sahayog (which, loosely translated, means Association for Social Advancement in Hindi) is mobilizing these rural communities and building their capacities to take over the leadership of their own development process.
Headquartered in the drought-prone Dewas tribal district of Madhya Pradesh, SPS has for the past 10 years worked with about 50 tribal villages in the region, often with women's self-help groups as key facilitators. Together SPS and villagers have conducted projects including drought proofing, micro-irrigation, sustainable dryland agriculture, biodiversity conservation, renewable energy, low-cost housing, sanitation, and women's empowerment.
Results have been dramatic, with the addition of one million cubic meters of water storage in the region, drinking water security for 20,000 people, a three-fold increase in irrigated land, a doubling of the value of agricultural output, 90 percent reduction in indebtedness, and an 80 percent decline in out migration.
Rather than expanding its own operations, SPS has chosen to build on its achievements by training and supporting NGOs and other community-based organizations. A key element of this support is provided through the Baba Amte Centre for People's Empowerment established by SPS at the tribal village of Neemkheda.
The Centre is located in the middle of two micro-watersheds and serves as a "living laboratory of learning" for others to adapt to their own locations and needs. Through the training and support programs of the Centre, the lessons learned in the 50 tribal villages of Dewas are benefiting some of rural India's most resource-deprived districts.
SPS is one of the Tata Trusts' most significant partners in a steadily growing commitment to watershed protection. Over the past eight years, about 25 percent of SPS grant funding has come from the Sir Dorabji Tata Trust. Without support from the Trust, Shah says, the Baba Amte Centre's very survival would have been in doubt. Recently, the Trust provided a grant for the corpus fund of the Centre, a move which will build sustainability through core support.
Shah says such funding strategies display a flexible and welcome approach to "the ever-changing challenges of working in remote rural India. We have found a great intimacy in the way we both look at challenges of rural development."
For more information on the work of Samaj Pragati Sahayog, contact email@example.com.