7. Development opportunity or national crisis? The implications of Brazil’s political shift for elite philanthropy and civil society organising

Jessica Sklair

The election of Jair Bolsonaro (and events leading up to it) saw Brazil’s political landscape transformed, from that of a leading nation in the rise of Latin America’s ‘pink tide’, to the regional embodiment of a global wave of alt-right populist politics. In their analysis of this shift, scholars have tended to focus on either the machinations of the country’s political elite or the apparent ideological about-turn among its electorate. Limited attention has been paid to the role and position of Brazil’s powerful corporate and financial elite. This chapter will examine the current political scenario through a focus on this group, or more specifically, on those among them who engage in the practice of philanthropy. I will argue that while the philanthropic project of Brazil’s national elite has not endorsed the recent political turn, trends seen within it clearly reflect the country’s current economic path. In the context of recent events, the fault lines between elite Brazilian philanthropy and alternative projects for social and economic development pursued by organised civil society1 have become ever more apparent.

In Brazil, elite philanthropic organisations are usually called institutos (institutes), and occasionally fundações (foundations). Elite philanthropy in Brazil is generally a corporate affair and most institutos are run by large Brazilian businesses, many of which are family owned.2 Family business institutos blur the typical British and North American distinction between ‘family’ and ‘corporate’ philanthropy, which is based on a separation between family wealth and corporate wealth that rarely figures in the Brazilian context (see Sklair, 2018). The most reliable source of data on Brazilian philanthropy is the biannual census conducted by GIFE, the Grupo de Institutos, Fundações e Empresas (Group of Institutes, Foundations and Businesses), which counts the country’s largest and most influential philanthropic organisations among its members. The 133 respondents to GIFE’s last census reported that they invested a total of R$3.25 billion (£590 million) in 2018, with the most popular causes for philanthropic activity listed as education, professional training for young people, income generation programmes and culture and the arts (GIFE, 2019).

Also in divergence from the British and North American model (but in common with other Latin American countries), most Brazilian foundations are ‘operating’ rather than ‘grant-making’. This means that while most British and North American philanthropy takes the form of grant-making to fund the work of civil society organisations (CSOs) and other third-sector actors, most Brazilian foundations design and run their own philanthropic programmes, either exclusively or alongside grant-making activities. While grant-making does therefore take place in Brazil and has increased in recent years (GIFE, 2019, p. 42), it still tends to be a secondary philanthropic practice for Brazilian foundations. As I will examine in more detail below, this means that elite Brazilian philanthropy has never been a primary source of funding for the country’s civil society sector, and has instead pursued a broadly autonomous programme of activity within the country’s development landscape.3

Brazilian philanthropists represent a small and comparatively progressive strand of Brazil’s corporate and financial elite, and they are deeply committed to tackling the country’s development challenges through the activities of their philanthropic foundations. Few among their ranks have explicitly endorsed the recent political shift, and many are profoundly disturbed by the repressive cultural-political turn taken by the country since the impeachment of President Dilma Rousseff and the fall from grace of her Workers’ Party (Partido dos Trabalhadores or PT) in March 2016. I will argue below, however, that the economic consequences of the recent shift are very much in the interests of these philanthropists, and the wider corporate and financial networks of which they form part. In addition, recent events have consolidated a political-economic environment in which current trends within elite philanthropy (and the particular aspirations for national development contained in those trends) can thrive. Given these circumstances, there exists little incentive for elite philanthropy to mobilise in opposition to recent events. These political shifts have thus exposed the fault lines between elite philanthropy and the activities of Brazil’s social movements and activist CSOs, struggling to defend an alternative rights- and justice-based agenda in the context of the recent political turn. In doing so, they have also brought into sharper focus the ‘horizon of (im)possibilities’ that lies ahead for Brazil, as explored in the collective contributions to the current volume. In the distinct visions for Brazilian economic and social development contained in the projects of elite philanthropy and organised civil society, the shifting line between possible and impossible comes clearly into view, even as it is repeatedly redrawn across the country’s unstable political landscape.

This chapter is based on observations during two periods of field research on changing trends in elite Brazilian philanthropy. The first of these comprised eight months of ethnographic fieldwork in São Paulo and Rio de Janeiro, carried out between 2008 and 2010 as the second term of PT President Luiz Inácio Lula da Silva (commonly known as Lula) was coming to a close, and just before the election of his successor Dilma Rousseff (known as Dilma). The second comprised two shorter fieldtrips to São Paulo in April and September of 2018, in the lead-up to the election of Jair Bolsonaro in October 2018. My arguments draw on this research alongside broader reflections on the very different consequences of recent political events for, respectively, elite philanthropy and radical civil society organising in Brazil.

I begin this chapter with a short overview of the parallel histories of elite philanthropy and civil society organising in Brazil, which I argue sheds light on Brazilian philanthropy’s reluctance to fund CSOs. In the next section I examine the conceptual distance between Brazil’s elite philanthropic project and the counter-movements for social and economic development pursued over recent decades by the country’s social movements and activist CSOs. I examine how, unlike the rights- and justice-based models promoted by the latter during and after Brazil’s military dictatorship (1964–85), elite philanthropy has pursued an approach to development based on deeper incorporation of the entrepreneurial poor into the country’s capitalist marketplace.

Against this historical backdrop, the second half of this chapter will examine the consequences of recent political and economic shifts for civil society organising, for Brazil’s financial and corporate elite and for elite philanthropy. I begin this part of the chapter with a brief overview of the precarious situation of social movements and civil society organising in the current political climate. I then examine recent events in Brazil from the perspective of financial capital, and the ways in which the deepening financialisation of the Brazilian economy has influenced elite philanthropy. I will argue that recent trends seen in elite philanthropy over the last few years – and particularly the rise of ‘impact investing’, in which philanthropists invest in social businesses in the pursuit of both social impact and financial return – reflect broader processes of financialisation, and emerge as preferred development strategies in the new political and economic climate. In conclusion to this chapter, I return to my argument that while elite philanthropy may not serve as an explicit endorsement of the recent political turn in Brazil, a closer examination of the influences shaping its practice reveals broad alignment with the economic trends playing out in parallel to shifts within the country’s political landscape. The alignment between elite philanthropy and current economic trends contrasts sharply with the situation of civil society organising in this new landscape, thus also revealing the contrasting visions – and horizons of (im)possibility – for national development underlying the projects of elite philanthropists and activist social movements and CSOs.

Elite philanthropy and civil society organising in historical perspective

In order to understand the reasons for elite philanthropy’s reluctance to support Brazil’s CSOs through grant-making activities, it is useful to examine the conditions under which the latter were first consolidated into an organised sector. Brazil’s civil society sector emerged within the politically charged landscape of the country’s military dictatorship. Under military rule, growing discontent with the suppression of political and human rights led to the emergence of a wave of small popular movements. Often taking place under the radar of the military government, they took the form of informal community groups, self-organising to meet their own needs in the absence of state provision. These focused on a wide range of issues. While landless workers in the countryside carried out land occupations,4 associações de moradores (residents’ associations) on the outskirts and in the shanty towns (periferias and favelas) of Brazil’s rapidly growing cities held collective mutirões to build each other’s houses, opened community crèches and organised access to water and electricity (Fernandes, 1994, pp. 42–6). These movements were supported by the Catholic Church, particularly by followers of the progressive liberation theology movement (Fernandes, 1994, pp. 36–42; Landim, 1988, pp. 30–58). The first wave of Brazilian non-governmental organisations (NGOs) (although they didn’t adopt this terminology until later on) began to appear on this scene in the mid-1970s. These small, informal organisations were created by middle-class intellectuals opposed to the military dictatorship, many of whom were engaged in resistance activities or had recently returned from political exile abroad (Landim, 1998, pp. 40–4). The NGOs they created were designed to support the popular movements outlined above, providing them with technical and financial assessoria (assistance or advice).

Brazil’s emerging NGO sector and the country’s older institutions of local elite philanthropy, however, were characterised by radically different aims and ideologies. Elite philanthropy at this time was channelled through a variety of projects. These included support for religious charitable institutions such as Brazil’s network of Santa Casa hospitals, the charitable projects of commercially successful immigrants directed towards poor members of their own communities (such as the prestigious hospitals run by São Paulo’s wealthy Syrian-Lebanese and Jewish elites), and the activities of early Brazilian business foundations, run by human resources departments and designed to provide benefits to company employees. While the military state cultivated close relations with the corporate philanthropic elite behind these projects, the identity of the emerging NGO sector was – as discussed above – defined explicitly in opposition to the state (Fernandes, 1994, p. 129). Local elite philanthropy was not therefore a significant source of funding for Brazil’s early NGOs. These organisations depended instead on the funding and institutional support of foreign NGOs and philanthropic foundations, which in Brazil was termed cooperação internacional (international cooperation). Major British funders at this time were the religious development NGOs Cafod and Christian Aid and the secular NGO Oxfam, and funders in the USA included the Ford, Kellogg, Rockefeller and MacArthur Foundations (Fernandes, 1994, pp. 80–2).

The NGO sector played an important part in the collapse of Brazil’s military dictatorship in 1985, and quickly assumed a central role in the building of Brazil’s new democracy. By the early 1990s, NGOs had gained extensive visibility and influence in Brazil, and increased state funding for their activities – a radical change in status from the semi-clandestine militancy of ten years earlier. Brazil’s new political landscape also created the conditions for the emergence of new forms of elite philanthropy and corporate social responsibility (CSR) programmes. The advent of a new era of democratic politics and neoliberal economic policy had seen significant deregulation of business activity. Unfettered by state control, the Brazilian business sector could now concentrate on building a strong capitalist economy under the newly democratised state, and wider involvement in social issues was seen as an important element of this project. In particular, investment and intervention in education was considered a national priority, as a better-educated society would lead to a more skilled and productive workforce, and thus to economic growth (Agüero, 2005; Sanborn, 2005; Rossetti, 2010).

The Brazilian elite’s new interest in social issues, however, did not extend to those on the agendas of the NGOs and social movements founded under military rule, which continued to rely predominantly during this period on funding from foreign NGOs and development agencies. This reliance on foreign donors was soon to become a problem for Brazilian NGOs, as improved economic performance and democratic stability during the 1990s and early 2000s saw Brazil lose its status as a priority country for international development funding, leading to significant withdrawal of funding streams. In preparation for their departure, some of these foreign funders began to train Brazilian NGOs in techniques for the diversification of local funding sources (Daniliauskas and Gouveia, 2010, p. 34), and in parallel, they also began to explicitly support the consolidation of Brazil’s (closely related) CSR and institutionalised philanthropy sectors. Most notable among these funders were the Kellogg and Ford Foundations and the Synergos Institute (all North American foundations), Avina (Swiss entrepreneur Stephan Schmidheiny’s foundation) and the US government’s Inter-American Foundation, who all provided seed funding, formed partnerships and funded research into Brazilian CSR and elite philanthropy at this time (Fernandes, 1994, p. 99; Falconer and Vilela, 2001, p. 13; Rossetti, 2010, p. 276).

By the mid-2000s, CSR and philanthropic organisations in Brazil formed part of a wide network of international funders, foundations, NGOs, universities, think tanks and research centres. This network was explicitly global in its objectives, and Brazilian advocates of CSR and corporate philanthropy have enthusiastically adopted what Garsten and Jacobsson (2011, p. 381) have identified as a discourse on CSR’s globality or ‘worldism’, reflected in the common pursuit of a homogenisation of standards and norms for its practice. Despite growing calls from Brazilian CSOs for more local funding of their activities in the wake of the withdrawal of international funders, however, this burgeoning philanthropy sector showed little sign of stepping in to take the place of its foreign partners. Instead (as mentioned above), the Brazilian philanthropy sector was rapidly consolidating its own form of operating (rather than grant-making) philanthropy, based on the design and rollout of its own philanthropic programmes. These in-house philanthropy programmes bore little resemblance to the rights and social justice development initiatives pursued by many in Brazil’s civil society sector. Instead, these programmes were usually founded on the premise that solutions to Brazil’s development problems were to be found within the expanding neoliberal market economy, particularly in its provision of economic ‘opportunities’ and its fostering of entrepreneurialism among the poor.

Brazilian philanthrocapitalism and the fashioning of the entrepreneurial poor

In this section I will draw on ethnographic research carried out among elite philanthropists and their foundations in São Paulo and Rio de Janeiro between 2008 and 2010. Much of the elite philanthropy I observed during this time was predicated on the idea that by providing the right ‘opportunities’, philanthropists could aid the poor in lifting themselves out of poverty. In the programmes I observed in Brazilian philanthropic foundations, such opportunities usually took the form of educational or professional training activities that would improve participants’ chances of finding paid employment in the formal job market. By accessing formal employment opportunities, it was assumed that the poor participants in these programmes would become able to support themselves and their families, and to increase their capacity for consumption. Philanthropic programmes designed in this vein took on a variety of forms. These included training programmes for work in areas such as hospitality and the service sector, and the promotion of small-scale income generation projects and business initiatives designed to create new markets for the poor. In an article on new forms of Brazilian philanthropy, Marcos Kisil (2006, p. 6), one of Brazil’s most prominent philanthropy advisors, explained that ‘the redistribution of wealth takes place when marginalised groups are stimulated to create income generation projects. In this case, philanthropic funding works as a lever for new business opportunities, generating wealth and a new circuit of accumulation.’

At this time, this approach to philanthropy was also common to the new global breed of elite philanthropists working under the banner of ‘philanthrocapitalism’. Although most commonly associated with widely recognised philanthropists such as Bill and Melinda Gates and Mark Zuckerberg, the term philanthrocapitalism was first coined in 2008 by Economist journalist Matthew Bishop and Michael Green, ex-head of communications at the UK’s Department for International Development, in their book of the same name (Bishop and Green, 2008). Based on the idea that philanthropists were leading a new movement of social change via the application of corporate practices to the solution of social problems, these authors placed the philanthrocapitalist firmly in the ranks of the transnational corporate elite, and grounded their arguments explicitly in the political and cultural ideology of global capitalism. The philanthropic strategies promoted by this movement are based on the assumption that the most effective way to further development aims is by further entrenching the capitalist project – and by entrenching the poor more deeply within it.

The practices and premises of philanthrocapitalism have been critiqued from a number of perspectives, ranging from examination of the hubristic claim that business can offer superior solutions to global development challenges (Edwards, 2010) to analysis of how philanthrocapitalism serves to legitimise the accumulation of wealth among the super-rich (McGoey and Thiel, 2018). Particularly striking during my research in Brazil, however, were the ways in which philanthrocapitalist discourse intersected with ideas about philanthropy’s role in encouraging entrepreneurialism among the poor. Central to many of the philanthropic programmes I observed in Brazil was the idea that the opportunities offered by philanthropy can only lift people out of poverty if they are approached with the right attitude; the poor beneficiaries of philanthropy were expected to display high levels of entrepreneurialism and to apply motivation and individual effort to the project of their own transformation. Responsibility was thus placed on the beneficiaries of philanthropy for lifting themselves out of the conditions of poverty, and philanthropic programmes were tasked not only with the provision of opportunities for the integration of the poor into Brazil’s formal economy, but also with teaching and encouraging values of entrepreneurship and motivation to their participants.

These ideas can be seen in an example from the philanthropic foundation of a leading Brazilian asset management and investment banking firm that I visited during my research in São Paulo. In the foundation’s annual report, a photograph and quote showcased a successful example of the process of philanthropic ‘transformation’ from dependent poverty to proactive economic inclusion. The photograph featured a participant in one of the foundation’s programmes, which offered training for jobs in the hospitality sector to young people. Previously unemployed, one of the programme’s beneficiaries was pictured proudly at work in her new job as a waitress in a cafe, dressed in the cafe’s uniform, holding a tray laden with coffee and snacks and smiling broadly. The caption under the photo stated that ‘Alexandra’ was ‘now employed, and very happy’, and quoted her as follows: ‘I feel like I took advantage of all the opportunities, because I used to feel weak and like I didn’t have the means to achieve anything. But just look at what happened: now I feel strong and able to achieve what I want to with my own will and perseverance. Today, I’m a new Alexandra’ (Instituto Hedging-Griffo, 2007, p. 26).

In São Paulo, one Brazilian philanthropist that I interviewed elaborated on this notion of the personal effort required for the transcendence of poverty, stressing that philanthropy can only go so far in providing opportunities for this highly individualised endeavour. He told me, ‘I’m here to help people make their dreams come true, [but] not everyone’s . . . I’m not going to go around [the shanty town] banging on everyone’s door . . . It’s got to be for people who want to get themselves out of this situation. Because just like in all social classes, there are people who are interested in their own evolution and people who aren’t.’5 Similar ideological approaches to the alleviation of poverty through entrepreneurial self-transformation have been noted by scholars such as Kohl-Arenas (2016) in her study of philanthropic programmes in California’s Central Valley, and in work on Bottom of the Pyramid (BoP)6 initiatives such as that carried out by Dolan and Rajak (2016) and Dolan and Roll (2013) in sub-Saharan Africa. These programmes reflect conceptual shifts in international development over recent decades, from earlier macro-economic approaches based on the implementation of structural adjustment policies to a market-based approach posited on the entrepreneurial potential of the world’s poor to create and sustain new global markets.

While the ideological framework underlying Brazilian philanthropic discourse thus attributes the country’s development challenges to a lack of economic opportunities and to individual behaviours and attitudes among the poor, those leading the country’s social movements and progressive CSOs have located the roots of these challenges elsewhere. For these grassroots activists, Brazil’s social problems are the result of the country’s unequal economic and social structures, widespread tolerance of human rights abuse and disregard for issues of social justice (see e.g. Mendonça, Alves and Nogueira, 2016; Araújo and Junqueira, 2018). I suggest that this ideological mismatch goes far in explaining Brazilian philanthropy’s continued resistance to supporting the work of local social movements and CSOs, even as events of recent years have seen many of these movements and organisations plunged into crisis. In the second half of this chapter I will give a brief overview of this crisis, before returning to the question of elite philanthropy’s lack of mobilisation in support of civil society organising in the current political landscape.

Civil society organising in the shifting political climate

While Brazil’s PT governments introduced significant changes in social policy, particularly through the roll out of welfare initiatives such as the Bolsa Família conditional cash transfer programme, the expansion of access to higher education, improved labour rights and increases in the minimum wage, these did not live up to the expectations for deeper structural reform held by many within the country’s CSOs and social movements. Many members of these movements and organisations had been closely connected to the PT during its formation and early history, helping to define the Party’s agenda and bring it to power with Lula’s presidential election in late 2002. These civil society actors were thus disappointed to find themselves granted limited opportunities to engage with the new government. By the end of Lula’s first term in office, Hochstetler (2008, p. 34) notes that CSOs had ‘abandoned the presumption that a PT government will resolve all their problems and now are looking for alternative conceptions of how they might interject their views into national politics’. Such hopes for greater incorporation into the political landscape, however, were to be further dashed by what was to come.

If many civil society actors found their demands falling on deaf ears under the administrations of Lula and Dilma, the period since Dilma’s impeachment in 2016 has been one of increasing direct repression of CSOs and social movements by both state and non-state actors. Amnesty International (2019b) has reported that Brazil is now ‘one of the most dangerous countries in the Americas for human rights defenders, and . . . the riskiest in the world for defenders of human rights relating to land or the environment’. In particular, social movements and NGOs engaged in long-term projects for the articulation of alternative social models based on social and economic justice have increasingly come under attack. Members of the Movimento dos Trabalhadores Rurais Sem Terra (MST), Brazil’s widespread Landless Workers’ Movement, have suffered growing numbers of arrests and murders, with 71 violent deaths of people involved in land conflict recorded in 2017 (Human Rights Watch, 2019; Silva, 2019). Similarly, the Movimento dos Trabalhadores Sem Teto (MTST), the urban housing movement now active in 14 Brazilian states, has seen rising incidence of arrests and intimidation (Fox, 2019).

CSOs promoting the protection of Brazil’s most vulnerable populations have fared equally badly during this period. Those working to prevent gender-based violence, for example, have been frustrated by the lack of implementation of the landmark Maria da Penha law, which – after years of campaigning by CSOs – introduced more stringent measures against domestic violence in 2006. Reduced government funding also saw the closure in 2017 of 23 shelters for women and children at risk of violence, leaving only 74 shelters in a country that officially registered 1,133 femicides in the same year (Human Rights Watch, 2019; see also Jornal Nacional, 2019). The period since 2016 has also been characterised by a broad trend towards the criminalisation of poverty. Following interim President Michel Temer’s decision to transfer the policing of Rio de Janeiro and its violent drug trade to the military in 2018, Amnesty International (2019a) reports that 1,249 people were killed at the hands of the state in Rio in 2019, ‘the highest amount since records began in 1998’. The majority of these killings have been of young, Black men in the city’s impoverished favelas (shanty towns).

For his part, incoming President Jair Bolsonaro made clear his own approach to human rights and progressive civil society activity shortly after his success in the first round of the presidential elections in October 2018, when he labelled social movements a form of ‘terrorism’ and pledged to ‘end activism in Brazil’ if elected to office. This statement provoked an open letter from three thousand NGOs and social movements, expressing concern for their freedom as enshrined in the Brazilian Constitution (see Conectas, 2018). Such objections, however, had little effect and Bolsonaro’s first year in office saw various moves to reform legislation designed to protect human rights. These were accompanied by a rise in rhetoric on the part of the president and those close to him against diverse marginalised populations, including indigenous groups and the LGBT+ community. INCRA, the government’s National Institute of Colonisation and Agrarian Reform, attempted (unsuccessfully) to evict the MST’s largest rural training centre (Valadares, 2019), and across the board, state monitoring of activist organising began to rise, as did incidences of hate crime and threatening behaviour directed towards social movements and the CSOs that support them (personal communications to the author; see also Amnesty International, 2019b; Fox, 2019). Most emblematic of the crackdown on human rights activism in Brazil in the period leading up to and following the election of Bolsonaro, however, was the professional killing of Rio city councillor and activist Marielle Franco. An outspoken critic of violence against women and Black and LGBT+ communities, and of police brutality in Rio’s favelas like the one in which she was brought up, Franco was gunned down alongside her driver by two ex-military policemen on her way home from giving a speech in March 2018.

It is possible to imagine that the precarious situation in which Brazil’s social movements and CSOs now find themselves might have spurred the country’s elite philanthropists to put aside their ideological differences, and come to the aid of those grassroots actors concerned with the issues of social development and the alleviation of poverty that ostensibly occupy their own philanthropic foundations. While the historical differences between elite philanthropy and civil society organising outlined in the first half of this chapter go some way towards explaining why philanthropy has not mobilised in support of these movements, further analysis of two factors – to which I will now turn – adds to our understanding of philanthropy’s reticence in this respect. The first concerns the ways in which the economic interests of Brazil’s wealthy elites have been served by the deepening financialisation of the economy over the last two decades, and the second concerns the ways in which these trends for financialisation have directly influenced the landscape of elite philanthropy, taking the elite’s philanthropic project even further away from the alternative projects for social development promoted by Brazil’s social movements and CSOs.

The Brazilian elite and the rise of financial capital

Even before he was elected to office, Lula had made clear his intentions of combining a progressive social welfare agenda with a corporate-friendly economic policy. Attempting to assuage fears within the national business community about the potential economic consequences of a left-wing political shift, Lula issued an open letter to the Brazilian people in June 2002. This reassured financial markets and investors that he was committed to maintaining the conservative economic policy of his predecessors if he were to be elected in the upcoming presidential elections. True to Lula’s word, the PT’s economic agenda over its three terms in government amounted broadly to what has since been described as a ‘poverty-reducing variety of neoliberalism’ (Loureiro, 2019) and the lion’s share of the financial gains brought about by Brazil’s economic boom was channelled directly into the pockets of the financial and corporate elite. The Brazilian stock exchange grew by 523 per cent during Lula’s time in office, delivering enormous gains to shareholders (Anderson, 2011, p. 8) and the early 2000s saw growth in the numbers of new millionaires, private helicopters and security guards in Brazil (Oliveira, 2006, pp. 17–18).

These elite gains were in large part due to the deepening financialisation of the Brazilian economy over recent decades, a period in which finance has become the strongest faction of capital in Brazil. This process has seen the growing influence of financial markets and institutions, delivering rising profits to investors, traders in financial assets and those engaged in other rentier activities. As Perry Anderson (2016, p. 3) has noted:

The combined capitalisation of [Brazil’s] two largest private banks, Itaú and Bradesco, is now twice that of Petrobras and Vale, its two biggest extractive firms, and far sounder. The fortunes of these and other banks have been made from the highest long-term interest regime in the world – crippling for investors, manna for rentiers – and staggering spreads between deposits and loans, with borrowers paying anything from five to twenty times the cost of the same money to lenders. Flanking this complex is the sixth largest bloc of mutual and pension funds in the world, not to speak of the biggest investment bank in Latin America, and a swarm of private equity and hedge funds.

Boosted by these staggering interest rates, financial capitalisation has become a key source of income not just for banks, but also for corporate elites within Brazil’s older factions of capital, including agribusiness, industry and commerce. Brazilian sociologist Jessé Souza (2019, p. 174) has drawn attention to the fact that these elite financiers now count the public budget among their most lucrative assets. Under the PT rentier incomes from payments on the public debt, received mostly by an estimated ten to fifteen thousand Brazilian families, accounted for 6 to 7 per cent of GDP or US$120 billion annually. In contrast, spending on the Bolsa Família accounted for 0.5 per cent of GDP, or around US$6–9 billion annually (Anderson, 2011, p. 8). Meanwhile, Brazil’s deeply regressive tax system has ensured that the wealthy contribute proportionally far less than the poor to the state budget and the servicing of its debts – and this of course when the wealthy meet their fiscal obligations. Souza (2019, p. 173) draws attention to the scale of tax evasion in Brazil, which in 2018 accounted for R$345 billion of lost revenue for the state.7 In the comparative light of the nearly R$1 billion recuperated (by mid-2017) as a result of the Lava Jato corruption investigations (Janot, 2017), Souza (2019, pp. 173–4) argues that the economic significance of political corruption in Brazil dwindles alongside the various mechanisms for the capture of capital by the elite, and their crippling consequences for the Brazilian state. In addition, Lena Lavinas has explored how financialisation also shaped social policy under the PT. Like other conditional cash transfer programmes popular throughout Latin America at this time, the Bolsa Família depended on a vision of social inclusion based not on increased provision of public services, but on deeper integration of the poor into the Brazilian economy of consumption. Alongside the rapid expansion of consumer credit, the Bolsa Família has thus seen the Brazilian state become the guarantor for a financialised programme of debt-fuelled consumption among the poor (Lavinas, 2013, 2018).

If economic, fiscal and even social policy under the PT were broadly aligned with trends for deepening financialisation, things have only got better for the financial elite with the fall of the left. Dilma’s impeachment in 2016 saw the installation of interim President Michel Temer (formerly Dilma’s vice-president). During the eighteen months of his tenure, Temer successfully dismantled much of the progressive social policy put in place by his predecessors, as well as pushing through deregulatory reform of the Consolidação das Leis do Trabalho (CLT), Brazil’s labour legislation package. Of even greater benefit to the country’s elite, however, was Temer’s passing of the constitutional amendment PEC 55. This limited growth in annual federal expenditure to the inflation rate of 2016 until 2037, thereby freezing public spending for 20 years. In effect, PEC 55 guarantees payment of the public debt to the state’s financiers (Souza, 2019, p. 174), thus taking state support for the interests of financial capital to a level far beyond that seen under the PT administration, while further restricting the state’s capacity to respond to escalating social need among the poor (Prandini Assis, 2016; Carta Capital, 2016).

In the new political era cemented by the election of Jair Bolsonaro in 2018, the financial elite look set to further deepen their grip on the national economy. On gaining office, Bolsonaro’s Finance Minister Paulo Guedes (a Chicago-trained economist who taught in Chile during the Pinochet regime and later co-founded BTG Pactual, Brazil’s largest private investment bank) set out an orthodox neoliberal vision for Brazilian economic policy, including plans for tax reform and further privatisation of state assets. Brazil’s fiscal crisis and attempts to placate the concerns of international investors have provided further legitimation for a retreat from investment in social policies. Civil society organisations have seen cuts in funding from government sources, deepening a funding crisis already exacerbated by the steady reduction in international development aid over the last two decades (Mendonça, Alves and Nogueira, 2016). In the final section of this chapter, I explore the ways in which these trends have been mirrored in the emergence of new practices in Brazil’s elite philanthropy sector over the last decade. I argue that, while it will be catastrophic for many of the country’s social movements and CSOs, the current political and economic landscape may well be one in which these new philanthropic practices will thrive.

The financialisation of Brazilian philanthropy

As outlined above, elite Brazilian philanthropy in the first decade of the twenty-first century was posited on the capacity of the entrepreneurial poor to effect their own social and economic development, through greater incorporation into the precarious marketplace of the national capitalist project. In line with economic trends among the country’s corporate and financial elite, however, the decade from 2010 saw the emergence of new trends within the country’s philanthropy sector. In this section, I will argue that these trends reflect ambitions for the financialisation of philanthropy itself.

Shifts seen in the Brazilian philanthropy sector during this time are part of a wider global trend, defined by Emma Mawdsley (2016, p. 265) as ‘a distinctive acceleration and deepening of the financialisation-development nexus’. This, in turn, is one (increasingly, the defining) aspect of the changing role of business in international development, in which private-sector actors have been called upon to provide both market-based development policy solutions and the financing necessary to implement them. The corporate sector thus played a significant role in designing the UN’s Sustainable Development Goals (SDGs) in 2015 (Scheyvens, Banks and Hughes, 2016), and UNCTAD (the UN Conference on Trade and Development) has claimed that private finance will be essential to meeting an estimated US$2.5 trillion annual funding gap for achieving them (UNCTAD, 2018). In the conception of Michael Blowfield and Catherine Dolan (2014), the role of business has now shifted from that of a ‘development actor’ to a ‘development agent’.

As the development industry had increasingly turned towards the private sector to help shape and fund its activities, so too have the logics of financialisation permeated development discourse and practice. This trend has seen the task of foreign aid redefined as one of leveraging private capital into new investment opportunities, providing development outcomes alongside financial incentives to investors (Carroll and Jarvis, 2014, p. 538; Mawdsley et al., 2017). In parallel, the development industry has seen the emergence of new forms of public–private partnership (Bayliss and Waeyenberge, 2018), a proliferation of new investment mechanisms and financial technologies (fintech) (Gabor and Brooks, 2017) and multiple variations of microfinance (Roy, 2010), green finance (Scales, 2015) and blended finance.

Among these new development finance models sits ‘impact investing’, a practice at the forefront of recent trends in the elite Brazilian philanthropy sector. Impact investing sees individual and institutional investors – including multilateral aid agencies, philanthropic foundations, wealthy individuals and family offices – invest capital into social businesses and Bottom of the Pyramid initiatives, in the pursuit of both ‘social impact’ and financial return. Impact investing is a fast-growing global trend, already attracting considerable financial resources around the world. In 2019, the Global Impact Investing Network estimated the value of the impact investing market at over US$502 billion (GIIN, 2019) and the B Corporation initiative, which provides certification for social businesses – the main recipients of impact investing – had certified more than three thousand companies across 71 countries.8

Over the last decade, Brazil has emerged as a regional hub for experiments in both social enterprise and impact investing. The country’s impact investing market is small but growing; in 2016–17 a survey conducted in Brazil by the Aspen Network of Development Entrepreneurs (ANDE) recorded 69 impact investment deals totalling US$131 million, and US$343 million of assets under management dedicated to impact investing (ANDE, 2018, p. 10). Providing investment opportunities for this market, 122 social businesses held certification in 2018 from Sistema B (the Brazilian affiliation of B Corporation) (GIFE, 2018). This market represented a diversity of private and institutional investors, both Brazilian and foreign, investing in a range of local social enterprises, particularly in the fields of information and communication technology, education, health, financial inclusion, housing, renewable energy and biodiversity conservation (ANDE, 2018, p. 11). The discourse surrounding impact investment in Brazil clearly reflects ambitions for the financialisation of philanthropy. During an interview carried out in São Paulo in 2018, one wealth manager explained to me that earlier models for philanthropy always involved the loss of capital, whereas impact investing means ‘I can give [the investor] the chance to recuperate all or part of this capital, which is an idea that, until recently, wasn’t part of the philanthropic mindset . . . So now I’m saying to families, “Look, you can make money by doing good.”’ In parallel, the website of one of Brazil’s leading social business ‘incubators’ promotes the message: ‘Between making money and changing the world, choose both.’9

The financialising logics inherent to impact investing also dictate that investors must turn to the creation of metrics and tools for the measurement of social impact and environmental sustainability alongside financial profits. In this, impact investors follow financial modellers working at the service of diverse development initiatives – particularly in the arena of microfinance – through which poverty itself is financialised (Schwittay, 2014; Roy, 2010, p. 31) and defined in terms of globalised metrics. The imperative for rendering ‘social impact’ both scalable and financially accountable has thus seen social businesses and impact investors prioritise areas of development amenable to the application of technology and the measurement of results. In Brazil, this has led to a proliferation of social businesses providing microfinance schemes, solar panels and other alternative energy systems, and tech solutions for education and healthcare. Leading examples include Geekie, which builds bespoke online educational tools for use in classrooms and claims to have reached more than 12 million students,10 and Dr Consulta, a low-cost healthcare provider. Drawing on digitalised patient data and machine learning algorithms, Dr Consulta operates through private walk-in clinics on the high street and has a customer base of over a million patients (Crichton, 2018).

In its redefinition of philanthropic practice to encompass capital investment into social businesses such as these, Brazilian impact investing thus emerges as a form of financialised philanthropy. Through their endorsement of impact investment and related practices, Brazilian philanthropic elites demonstrate their commitment to the deepening financialisation of the economy, promoting the idea that financial capitalisation holds the key not only to economic growth but also to the achievement of social development outcomes on a national scale.

Conclusions

This chapter has explored how an analysis of elite philanthropy might contribute to debates on recent and unexpected shifts within Brazil’s political landscape. Taking as my starting point the ambiguous position of the country’s philanthropic elite, who have been broadly tolerant of recent political events despite not offering a wholehearted endorsement of the new political climate, I have examined the parallel but distinct projects for national development pursued by elite philanthropy and organised civil society during and since the fall of the country’s military dictatorship. Building on this historical perspective, I have explored the consequences of political events since Dilma’s impeachment in 2016 for civil society organising and elite philanthropy respectively. I have argued that while the country’s political shift to the alt-right has resulted in wide-scale oppression and intimidation of Brazil’s social movements and activist CSOs, it has created an environment that has been both favourable to the economic interests of the corporate and financial elite, and broadly conducive to their pursuit of new philanthropic practices. Unlike the alternative rights- and justice-based models for social development promoted by organised civil society, recent philanthropic trends such as impact investing aspire to the financialisation of philanthropy, in line with broader trends for the deepening financialisation of the Brazilian economy. I have thus argued that, in a continuation of the historical fissions characterising the relationship between elite philanthropy and civil society organising in Brazil, recent trends towards the financialisation of philanthropy do not emerge as a movement towards greater philanthropic support of Brazil’s social movements and CSOs. Instead, these trends appear to run counter to the possibility of future forms of collaboration between these sectors and their divergent aspirations for national development, or of the mobilisation of the philanthropic elite in resistance to the political and economic scenario currently playing out in Brazil.

As this chapter goes to press, uncertainties around the future of Brazil’s CSOs and social movements have been thrown even more sharply into relief by the Covid-19 pandemic sweeping the planet. Brazil’s underfunded public health system, alongside Bolsonaro’s denial of the severity of the crisis and adamant refusal to mount a concerted national response, have seen the pandemic rip through the population with devastating effects, both aided by and exacerbating existing social and economic inequalities (Phillips, 2021). As many working in Brazil’s organised civil society sector have noted, this could be an ideal moment for elite philanthropy to reconsider its relationship with rights-based CSOs and social movements (Krämer, Hopstein and Mahomed, 2020). Given the historical and ideological barriers to greater collaboration between these sectors, however, and a political climate broadly hostile to attempts to overcome them, it remains to be seen whether this (im)possibility is on the horizon.

Acknowledgements

Parts of the research on which this chapter is based were kindly funded by the Royal Anthropological Institute (Emslie Horniman Fund/Sutasoma Award 2008) and a British Academy/Leverhulme Small Research Grant (ref. SRG\170255, 2018).

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