WITH the recent trend towards mass higher education, funding has become an important issue around the globe. An economic crisis from time to time makes the situation worse. There has been increasing expectation that universities should raise funds on their own from alternative sources.
Public universities in Malaysia are also under pressure to raise funds to meet a substantial part of their expenditure.
The history of fundraising for higher education probably dates back as early as 387 Common Era when Plato’s Academy was established in Athens with monetary contributions and land endowment by Cimon — a famous Athenian statesman and military leader, and by Plato himself.
Another example of philanthropic funding for higher education is associated with the University of Al-Qarawiyyin, Fez, Morocco.
The history of donation to higher education is associated with the establishment of Harvard University in 1636.
University presidents, supported by qualified fundraising staff, generally play the central role in fundraising.
In the UK, universities are recently forced to resort to fundraising as government support is declining.
European Union (EU) universities nowadays recognise that universities should engage in fundraising rather than depend solely on the government.
University fundraising efforts in the West are categorised into four major models (European Commission, 2008).
They are the alumni model, major gift model, foundation research model and multi-mode model.
The Alumni Model is characterised by a continuous collection of small donations from the alumni.
In the Major Gift Model, universities attract large donations from wealthy individuals.
In the Foundation Model, individual researchers apply for grants from public and private research funding bodies.
In the Multi-Mode Model, more than one model is combined to raise funds.
Some universities also generate funds through investment and commercial activities. It may be noted that waqf, an endowment in the Islamic tradition, can be an effective mechanism to raise funds for higher education.
The use of waqf in higher education is well established in Turkey, a couple of universities in Indonesia and some universities in Malaysia.
Public universities in Malaysia are currently trying to generate funds from different sources. University authorities are struggling to raise a substantial amount so as to become financially sustainable in the long run.
To analyse the potential of philanthropic fundraising for higher education in Malaysia, let us assume that the amount raised is correlated with the giving tendency of its citizens.
The Charities Aid Foundation has developed the World Giving Index which measures the propensity of the population of a country to give to charity.
The World Giving Index is measured by the average of the following three factors: First, percentage of the population giving money to charities; second, percentage of the population who have volunteered for an organisation in the previous month; and third, percentage of the population who have helped a stranger in the previous month.
According to the 2016 Global Giving Index, Malaysia ranks 22nd out of a total 140 countries, which is encouraging. Studies show that 71.8 per cent of Malaysians who donate to charity would like to contribute to religious causes, while 23.per cent would donate to education.
One can do a back-of-the-envelope calculation to estimate how much money can possibly be raised for higher education from philanthropic giving in Malay-sia.
Charity in the US accounts for 2.11 per cent of GDP. In the EU, it varies from country to country, with the range being 0.1-0.8 per cent of GDP.
In Malaysia, let us assume that philanthropic giving is at the lower side of the EU range, about 0.1-0.5 per cent of GDP.
Assuming that 15 per cent of this amount can be attracted to higher education, universities in Malaysia have the potential to raise between RM186 million and RM932 million every year.
The amount turns out to be between 3.0 and 14 per cent of the operating budget of all public universities, which was RM6.72 billion in 2018.
This may not be very large compared with the operating budget of 20 public universities.
Even to raise this amount, it will be crucial to create an effective fundraising ecosystem. To be successful, universities need to create internal infrastructure, engage in capacity-building, and invest in and employ trained professionals.
But the success will depend not just on universities. It will require the development of a culture of giving to the cause of higher education where the government, policymakers, civil society and other stakeholders have big roles to play.
And this will take time.
The writer is professor of materials engineering at the Department of Mechanical Engineering, University Malaya