Scientific philanthropy boost : Revista Pesquisa Fapesp

Physicist Lia Queiroz Amaral has lifelong ties with the University of São Paulo (USP), where she graduated in 1962, studied her master’s and PhD, and spent her academic career until retiring in 1995—to this day she works as a collaborating professor at the university’s Institute of Physics. “I received some money when an old property belonging to my family was expropriated, and I decided to offer it to initiatives battling the pandemic,” she says. Amaral has already donated more than R$300,000 to various institutions since March. Almost half of that sum went to USP. Some was given to the teaching hospital (Hospital das Clínicas). The remainder, almost R$68,000, was donated to USP Vida, a program created to raise funds for COVID-19 research and actions at the university.

Launched in April, the program allows companies and individuals to donate to one or more of six lines of research related to the pandemic, including the development of vaccines, drugs, and artificial respirators, studies on antiviral processes, and support for diagnostic networks. Donors can also give money to a single fund managed by a steering committee, which allocated the money to the most advanced research. This is what Amaral chose to do. USP Vida has already received 2,836 donations, raising approximately R$3.5 million. More than half came from individuals. Any amount can be donated, starting from R$20. “People have even begun looking to donate to research not related to COVID-19,” says Carmen Fávaro Trindade, USP’s associate vice dean of research. “This shows that there is a desire for scientific philanthropy in Brazil, as long as there are channels that facilitate and encourage the practice.”

Another notable example is microbiologist Natalia Pasternak, a collaborating researcher at the university’s Institute of Biomedical Sciences (ICB). In June, she and her family donated R$2 million to the project to fund the production of INSPIRE low-cost pulmonary ventilators, an effort led by engineers Marcelo Zuffo and Raúl Gonzalez, from USP’s Polytechnic School (POLI). In April, Pasternak contacted the pair to learn about the project and offer support. “I knew they needed a major contribution to be able to start developing prototypes,” says the researcher, who has previously donated to the Santa Casa School of Medicine, the University Hospital of the University of Campinas (UNICAMP), and ICB itself. The INSPIRE project now has more than 900 donors and has raised almost R$6.6 million, half of which came from individuals. Materials, machines, and equipment are also donated, mainly by companies. “A few days ago, Procter & Gamble gave us a lung simulator worth R$400,000,” says Zuffo.

In the USA, almost 26% of the US$436 billion received by universities in 2017–2018 was donated by alumni

Pasternak has been working for some time on efforts to stimulate scientific philanthropy in Brazil at Instituto Questão de Ciência (IQC), of which she is a founder. One approach involves the creation of a platform that allows people and companies to donate to a single fund, managed by the institute, which curates and allocates funding to research projects related to its area of operation. “The IQC, in turn, is responsible for informing donors how their donations are being used, including updates on the progress of the research they have funded.” Another initiative is a grant fund for master’s research conducted at public universities in the field of public policy based on scientific evidence.

These initiatives have been gaining momentum across Brazil since the pandemic began. In recent months, several universities have started investing in fund-raising strategies for programs and research related to the novel coronavirus. In April, UNICAMP launched Ajude Unicamp, through which people can donate food and cleaning products to vulnerable families in the region, as well as PPE, equipment, and supplies for the university’s hospitals and money to support research and underprivileged students. Donations already amount to almost R$15 million, of which just over R$10 million came from indemnity funds—money left over from public civil judicial actions, obtained via links between the dean’s office, judges, and prosecutors in Campinas. The rest came from companies and individuals. “The pandemic is helping to show the public how important donations are to maintaining the work done at universities,” says physicist Marcelo Knobel, dean of UNICAMP. “This is largely due to the major role these institutions are playing in the crisis, both in studying the disease and in developing strategies to combat it.”

At the University of Brasília (UnB), this movement was stimulated by a call for research proposals earlier this year. The strategy resulted in the approval of 180 proposals in a range of fields related to the pandemic, with a total budget of around R$70 million. “We decided to create a donation fund to raise some of the money needed for these projects,” says Cláudia Amorim, director of research at UnB’s department of research and innovation. In June, the university signed an agreement with the Foundation for Scientific and Technological Enterprise (FINATEC), its research support agency, to establish the fund, which accepts donations for specific projects or for a general fund.

Angela Keoghan / Bridgeman Images / Fotoarena

Donations from alumni, entrepreneurs, and philanthropists are crucial to universities and research centers in many countries. In the USA, for example, roughly 35% of the budget at institutions like Harvard University is funded by donors. Brazil has no such tradition of scientific philanthropy. The main obstacle, according to researchers, is the lack of a permanent donation culture, fueled by an absence of fiscal mechanisms to facilitate and encourage the practice. “In the USA, legislation provides tax incentives for philanthropy. People get tax breaks for donating,” says Pasternak. Since the beginning of the twentieth century, US law has guaranteed these tax deductions. Donating to museums or universities, for example, can reduce a person’s income tax by up to 50%. In 2019, the limit increased to 60%—in Brazil, the maximum is 8% for individuals. Another important element that stimulates philanthropy in the USA is inheritance tax. The rate for families with assets worth more than US$10.6 million (or couples with US$5.3 million each) is 40%, so many choose to donate money to reduce the amount of tax they pay when they die.

The change to US tax legislation resulted in a 6% increase in the total amount received by the country’s universities in 2017–2018 over the previous two-year period. According to data from the Council for Aid to Education, American higher education institutions were given US$43.6 billion, the highest amount recorded since the survey began in 1957. Universities are estimated to hold approximately US$616 billion in philanthropic funds, also known as endowment funds—which is equal to or greater than the Gross Domestic Product (GDP) of many countries. This has generated a national discussion about how endowments are administered and why they have not been able to reduce the costs of higher education or provide greater access to low-income students.

In January 2019, Brazil took an important step to help stimulate scientific philanthropy, passing its own legislation on endowment funds. The aim was to establish a legal basis and judicial assurances for private investment in teaching, research, and innovation. In contrast to a traditional donation—like those being made during the pandemic, used to directly purchase equipment and research materials—endowment funds are intended to provide long-term equity. Donations are made to investment funds and allocated periodically based on the size of the fund.

The law passed in early 2019 established tax rules similar to those in the USA, but the sections relating to incentives for donors were vetoed by President Jair Bolsonaro. One clause allowed companies to deduct the equivalent of 1.5% or 2% from their operating profit for donations used to create these funds (see article “A legal framework for endowments”). Brazilian Congress managed to partly reverse the situation in June 2019 by overturning one of the presidential vetoes, which prevented public university funding agencies from managing endowment funds. But the other vetoes remain, which according to Knobel, from UNICAMP, will greatly limit the effects of the legislation, restricting the funding of scientific research through private donations. “Tax benefits are probably the best strategy for stimulating philanthropy,” he says. The physicist points out, however, that donations will never replace the contributions made by the state, which are fundamental to the maintenance of public universities. “A lot of people think that endowment funds would lead to the privatization of these institutions, but that is not the case. Endowment funds only use the profit they generate, maintaining their value, to complement a university’s primary budget.”

Ajude Unicamp raised almost R$15 million, of which just over R$10 million from indemnity funds

Increasing scientific philanthropy in Brazil due to the pandemic follows a trend also seen in other countries, such as the USA and the UK. Data from the COVID-19 Donations Monitor show that almost 480,000 individuals, companies, associations, and institutes from a range of sectors have donated R$6 billion to initiatives to combat the pandemic in Brazil. In early August, a group of eight companies and foundations, including Ambev, Itaú Unibanco, and the Lemann Foundation, announced that they would be investing R$100 million to help build a COVID-19 vaccine factory at the Oswaldo Cruz Foundation (FIOCRUZ) in Rio de Janeiro. Todos pela Saúde, an initiative launched by Itaú Unibanco and FAPESP, also contributed R$82.5 million to the Butantan Institute, with R$50 million from the bank and R$32.5 million from FAPESP. The funds will be used to conduct phase three clinical trials of the Coronavac vaccine, produced in partnership with Chinese biopharmaceutical company Sinovac, and to adapt a factory for vaccine production. One of the major donors to the USP Vida program is industrial aluminum company Novelis. In August, it donated R$200,000. “Contributions from companies are more focused on donating equipment and materials for research, as well as to help reduce the risk of contagion and adjust treatment conditions in our hospitals,” says USP’s Fávaro Trindade. “In our case, they already total almost R$13 million.”

There is no way of knowing whether the rise in philanthropy will continue after the pandemic is over, but the experience offers important lessons that can be used to encourage more donations in the future. One example is the creation of specific platforms to attract and facilitate the practice. “There are various initiatives, like those at POLI-USP, but no university in Brazil has a specific institutional channel to facilitate and stimulate philanthropy,” says Pasternak. In 2018, USP created a Partnerships Office, with the mission of enabling private investments into research projects at the institution. The department was responsible for attracting funding to renovate the Ipiranga Museum, for example which is planned to reopen to the public in 2022.

Many institutions intend to expand recently established platforms. UNICAMP and USP are expected to formalize the creation of endowment funds in the coming months. “This is important because it will help us to establish a clear and transparent strategy, capable of stimulating and facilitating donations, as well as keeping donors up to date on how their money is used and engaged in the research they have helped to fund,” says Trindade. Fostering a culture of scientific philanthropy in Brazil also involves efforts to strengthen relationships between institutions and their former students. In the USA, for example, almost 26% of the US$43.6 billion raised in 2017–2018 was donated by alumni. In recent years, institutions such as USP, the Getulio Vargas Foundation (FGV), and São Paulo State University (UNESP) have started to invest in platforms that identify and unite alumni (see Pesquisa FAPESP issue no. 264). In August, UNICAMP launched a similar initiative. “The aim is to establish a sense of community among those who graduated from the institution, reinforcing the role it has played in their professional success, and encouraging them to help maintain and improve the university by donating,” explains Knobel.

Increasing the culture of philanthropy also requires a greater effort by researchers to publicize their work in order to attract donations from companies and individuals. “This is quite common in other countries,” says Pasternak. “Universities frequently organize social events to bridge the gap between researchers and potential donors.” Some of these approaches serve as inspiration for Brazilian universities. Amorim, from UNB, points out that KU Leuven University in Belgium has staff dedicated exclusively to fundraising. “Every now and then they issue internal calls for proposals, from which they select the most promising and then help the researchers raise funds from donations and partners.” Pasternak acknowledges that many scientists worry about losing professional freedom when receiving donations from sources other than funding agencies or the university where they work. “It is up to universities to establish rules and limits that encourage donation without interfering with researchers’ freedom and the direction of their research,” he adds.

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