AVPN Country Session 3 – Japan (Presentation)

From Conventional Grant Making to New Partnership Approach

April 2015

The Nippon Foundation

1Agenda

1. The Nippon Foundation (TNF)

2. TNFs Granting Approach

3. From Conventional Grant Making to New Partnership Approach:

Loans and Investing

4. Pilot Projects

21. The Nippon Foundation (TNF)

1. Established in 1962

2. Active in more than 100 countries to date

3. In partnership with 40,000 non-profit organizations

4. Makes grants to more than 2,500 projects annually

5. Gives almost US$ 300M annually

6. Most funds are from proceeds of

motorboat racing

7. Also collects donations from

corporations and individuals

through new mechanisms

(e.g. vending machines,

a venture philanthropy fund)

32. TNFs Granting Approach

1. Project-based grant making as the principal approach.

2. However, in some cases, a capacity building approach is used through

support to co-designed programs with partner organizations, covering not

only project expenses but also core operating costs, rather than support to

individual projects.

Same with Venture Philanthropy (VP) in concept

3. Japan Venture Philanthropy Fund (JVPF), the first comprehensive venture

philanthropy fund, was established in 2013, funded by both individual /

corporate donors and TNF.

42. TNFs Granting Approach:

Japan Venture Philanthropy Fund (JVPF)

1. The first comprehensive venture philanthropy fund in Japan founded in

2013.

2. Current fund size is US$1.5 million and supports 2 investees.

3. Target social issues are:

a. Support for education and youth employment

b. Childcare, employment of women

c. Revitalization of local community

4. Management support is provided through the partner organization, Social

Investment Partners and pro-bono partners such as Bain & Company,

Clifford Chance, and Vox Global Japan.

52. TNFs Granting Approach:

Japan Venture Philanthropy Fund (JVPF)

Non-profit

organization

Individual

Donors

For profit

social enterprise

Corporate

Donors

Management SupportGrant/Loan/Equity

Donation/Grant

62. TNFs Granting Approach:

Japan Venture Philanthropy Fund (JVPF)

The first investee of JVPF, Houkago NPO Afterschool that provides a childcare program

73. From Conventional Grant Making to New Partnership Approach:

Loans and Investing

1. New approach includes social lending and credit guarantee, giving

momentum to social investing (yet to come).

2. Pilot projects are ongoing both in Japan and abroad.

a. Wagamachi Fund Project in Japan

b. Social Lending for Persons with Disabilities in Vietnam

c. Disability-inclusive Business Incubation Center in Myanmar

d. Creation of a Women Entrepreneurs Network, centered on Thailand

* (c) and (d) aim at incubating future loanees / investees

3. Target issues in overseas: persons with disabilities and women social

entrepreneurs.

84. Pilot Projects:

(a) Wagamachi Fund Project

1. In an effort to support reconstruction of the areas affected by the 3.11

earthquake, TNF started the Wagamachi Fund Project in partnership with 5

local credit unions in December 2013.

2. To support these 5 credit unions,

TNF provides about $4 million, and the credit

unions offers loans at zero or low interest rates.

3. Target businesses include:

small businesses which are necessary for reconstruction

newly established social businesses for the purpose of reconstruction

4. 1,059 loans have been offered. The total loan volume is about $230 million.

Products of a borrower

94. Pilot Projects:

(b) Social Lending for PwDs (Disability-Inclusive Finance) (1/3)

Advocacy work sees limitation: Small budget capacity of developing countries

governments. Helping PwDs become economically self-reliant has a more

sustaining impact.

Social Lending for Persons with Disabilities in Vietnam (since 2012)

This is a two-step loan project, where:

1. TNF provides the principle for a revolving loan fund

2. Vietnam Bank for Social Policies (VBSP) manages the loan operation,

including disbursement and collection

3. Eligible borrowers: Businesses owned / managed by PwDs and

businesses employing PwDs in Hanoi, HCMC, and Danang.

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4. Loan size: From USD 2,000 to USD 50,000

5. Interest rate: 7.8 -10.8% / year

6. Payment period: 3 years (could be 5 years, depending on each case)

7. Use of funds: Equipment investment (Production machinery, etc.)

8. As a capacity building component, credit appraisal training for the partner

bank is included.

9. Also includes business training for (prospective) borrowers.

(e.g. fund management, bookkeeping, financial reporting, etc.)

4. Pilot Projects:

(b) Social Lending for PwDs (Disability-Inclusive Finance) (2/3)

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4. Pilot Projects:

(b) Social Lending for PwDs (Disability-Inclusive Finance) (3/3)

An IT company in Danang (Business Process

Outsourcee).

The business owner has a disability in his hand

and language difficulty.

He expanded his office and purchased

computers with a loan of about $25k.

Before, he employed 50 workers (13 of them

have disabilities).

He employed 34 more (15 have disabilities)

thanks to the investment.

The business owners company has developed

an original Japanese-typing training software.

With the software, PwDs learn how to read and

type the Japanese (photo below), and qualified

trainees work for his company.

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4. Pilot Projects:

(c) Disability-inclusive Business Incubation Center (1/2)

The Disability-inclusive Business Incubation

Center is located on the premises of MILI

(Myanmar Independent Living Initiative, a self

help group spearheaded by youth with

disabilities).

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4. Pilot Projects:

(c) Disability-inclusive Business Incubation Center (2/2)

In addition to the financing scheme to ongoing businesses, there needs to be

a project to support PwDs to start their businesses, especially taking

advantage of ICT, which could lower the barrier experienced by PwDs.

Disability-inclusive Business Incubation Center in Myanmar

1. For a fee, users can use internet-connected PCs and take IT training.

2. Will be used as a remote office. Some companies are interested in

employing PwDs who can work remotely at the center.

3. The center will start a printing business as an income-generating activity.

4. Expect to produce entrepreneurs with disabilities, who will be investees /

loanees, and the role model of the next generations.

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4. Pilot Projects:

(d) Creation of a Women Social Entrepreneurs Network (1/5)

Limitation in its sustainability of NGO grant. Taking a business approach to

solve the social problems has a more sustaining impact.

Asian Women Social Entrepreneurs Network (since 2014)

1. TNF focuses on Women and Social Entrepreneurs in Mekong countries.

2. Our long-standing partner, Association for the Promotion of the Status of

Women (APSW) in Thailand is in charge of the project implementation.

3. In August 2014, an Asian Women Social Entrepreneurs Seminar was

organized and the Asian Women Social Entrepreneurs Network was

established.

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4. Pilot Projects:

(d) Creation of a Women Social Entrepreneurs Network (2/5)

Asian Women Social Entrepreneurs Network (since 2014)

4. In 2015, an Asian Women Social Entrepreneurs Network Conference will

be organized in May and November.

5. The main purpose of these conferences is to provide a networking and

experience-sharing platform for women social entrepreneurs from Mekong

countries.

6. In the future, there is a possibility that the network will provide various

kinds of assistance, including financial support, to those women social

entrepreneurs for expanding their own business.

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4. Pilot Projects:

(d) Creation of a Women Social Entrepreneurs Network (3/5)

Session 2: Mainstreaming Gender in Social Entrepreneur Fields

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4. Pilot Projects:

(d) Creation of a Women Social Entrepreneurs Network (4/5)

Session 3: Group Discussion by Sector (Photo of Handcraft Team)

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4. Pilot Projects:

(d) Creation of a Women Social Entrepreneurs Network (5/5)

Establishing Asian Women Social Entrepreneurs Network (AWSEN) on August 1, 2014

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Perspective for the Future

1. G8 Task Force

2. Dormant Bank Account Fund Legislation

3. Social Impact Bond

Proprietary & confidential 1

Impact InvestmentFor Tsunami Recovery Efforts

Mitsubishi CorporationCSR & Environmental Affairs Department

Yoshiyuki Nojima

Todays contents

How we started

Implementation

New initiativeProprietary & confidential 2

Proprietary & confidential 3

How we started

Proprietary & confidential 4

Corporate Philosophy The Three Corporate Principles

Proprietary & confidential 5

Initial commitment of USD100mil for 4 years

Proprietary & confidential 6

Implementation

Establishing another vehicleSpeed

Flexibility

Governance

Proprietary & confidential 7

Proprietary & confidential 8

Scholarships

Grants for Non-profits

Impact Investment

CORE PROGRAMS

Proprietary & confidential 9

ScholarshipsMore than 3,600 students

Proprietary & confidential 10

Grants for Non-profitsMore than 420 organizations

Proprietary & confidential 11

Impact InvestmentUSD 20mil to a total of 44 projects

Proprietary & confidential 12

Impact Investment

MitsubishiCorporation

Local Bank / NPO

Mitsubishi CorporationDisaster Relief

FoundationDonation

Coordination(Sourcing / Screening)

Operation

Investment/Finance

Small to Mid-sizeCompanies

which create job opportunities

Rebuildingfactories

Replacing /Restoring equipment

Starting up new businesses

Why invest?Close relationship with investees

Re-investment for sustainable recovery

Proprietary & confidential 13

Impact Investment

Proprietary & confidential 14

Impact Investment

Job creation for over 2,000 people

Repayment/Return: USD 40,000

Proprietary & confidential 15

New initiative

Proprietary & confidential 16

New initiative in Fukushima

Proprietary & confidential 17

Thank you!