United Ways Are Spreading Quickly Around the Globe

United Way International has come a long way since the dark days of 1992. That year, it nearly succumbed after

losing much of its support in the scandal surrounding charges of fraud and abuse by William Aramony, who presided over both United Way of America and United Way International.

Today, the charity, which seeks to spread the United Way model of charitable fund raising abroad, has affiliates in 45 countries on six continents — about a dozen more than it had five years ago — that collectively raise about $850-million a year. It has a nearly $12-million budget and a staff of 15 who work out of offices in Alexandria, Va.; Caracas, Venezuela; and Hong Kong.

The organization, which held its biennial global assembly last week in San Juan, Puerto Rico, also has a new leader. Christine James-Brown took over as United Way International’s fifth chief executive on March 1.

“We’re right on the verge of a real growth in the spread of United Ways outside the U.S.,” says Ms. James-Brown. “How we manage that growth, while also staying focused on our goal of changing communities, is our biggest challenge.”

Polishing Corporate Images

One trend helping to fuel United Way International’s growth has been a desire by multinational corporations to find reliable philanthropic collaborators to help them burnish their images in countries where they do business. Such companies, used to working with United Ways in the United States, often turn to United Way International to help organize similar institutions to facilitate their giving overseas.

Terrorism and shifting attitudes toward American companies in some regions have caused a surge in demand for United Way International’s services.

“I’ve never seen as much anti-American sentiment as I have in the last year,” says Robert M. Beggan, who served as president of United Way International from 1996 until retiring this year.

By collaborating with the United Way network overseas, he says, “many of these companies are able in a non-sales way to get in front of their customers and government regulators, showing that they’re not just taking the money and running but are going to be part of the long-term sustainability of the country.”

But United Way International’s leaders see the organization playing an even larger role, helping to inspire and channel a spirit of philanthropy even in parts of the world where giving and volunteering have been either unknown or disparaged. The charity offers training, consultation, and guidance to local nonprofit leaders on creating and running groups in their countries to raise money and promote philanthropy.

‘Cultural Imperialism’

Some observers wonder how well the United Way model can be modified to fit countries as diverse as New Zealand, Nicaragua, and Nigeria.

“There are lots of cultural differences,” notes Matthew Howe, executive director of the National Alliance for Choice in Giving. “I’m sure they make efforts to be sensitive, but can they truly embrace the philanthropic values of indigenous cultures and meet the needs of U.S. corporations at the same time?”

In fact, some critics charge that the organization is exporting a brand of philanthropy that primarily serves the interests of the large corporations that foot many of its bills.

“If you look at the third world, especially, so much of what they’re confronted with involves fundamental questions of social equity,” says Kevin Ronnie, director of field operations for the National Committee for Responsive Philanthropy. “To assume that a funding mechanism dominated by narrow corporate interests will successfully address those kinds of issues is foolhardy.”

In countries where the organization’s affiliates do succeed in raising significant local revenue, he adds, it might come at the expense of other charities working more aggressively for social and economic justice.

“The success of United Way International will hinge on its ability to be flexible and responsive to the different cultural soils in which it’s planted,” Mr. Ronnie says. “To assume that the rest of the world needs the same nonprofit models we have is a kind of cultural imperialism.”

United Way International officials say they are adapting the traditional United Way model to be a better fit in countries in which few people work for large companies, on-the-job campaigns are an alien concept, and laws and customs often hobble private giving.

Whereas in the United States corporate gifts and on-the-job campaigns fueled most of the initial growth for United Ways, outside the United States about 60 percent of the organizations’ income is from other sources, says Ms. James-Brown, who came to her new post after 25 years in Philadelphia, most recently at the helm of the United Way of Southeastern Pennsylvania.

In some countries, on-the-job campaigns yield only a small share of donations. United Way of New Zealand, for example, which was founded in 1975, raised $1.2-million last year, including $741,000 in major gifts and $421,000 from overseas sources. But just $45,000 came from employee drives.

The United Way of Baroda, in the Indian state of Gujarat, abandoned on-the-job campaigns altogether after receiving a lackluster response, says Sushama Oza, its executive director. Much of the $2.2-million it raised last year represented proceeds from special events, the largest of which is the Navratri Garba Festival, a nine-night celebration of local dance and culture.

Although income from the festival has risen steadily over the past 16 years, Ms. Oza worries about her organization’s heavy dependence on a single source of revenue. “What if this event is not possible due to some unforeseen circumstance?” she asks.

Variety of Approaches

From one country to another, the scope and structure of the international United Way affiliates vary widely.

United Way-Belarus, which was set up in 1995, “is not a United Way as we would know it,” Mr. Beggan says. It does no fund raising on its own but functions as more of a nonprofit support center, training leaders of other nonprofit groups in using computers and other technology, as well as in fund-raising and management practices. Its own expenses are underwritten mainly by the European Union.

United Ways outside the United States often end up underwriting the whole range of nonprofit endeavors, including education, environmental causes, and cultural activities, in addition to social services.

In China, for example, the China Charity Federation, working through a network of 108 affiliates, helps desert-dwelling people build cisterns, pays for operations for people with harelips or cleft palates, and offers scholarships intended to move kids away from farms, where they are often viewed as cheap labor, Mr. Beggan says.

The federation was created in 1994 and became affiliated with United Way International four years later. The money it distributes — $9.4-million in 2002 — is still minuscule, considering China’s 1.2 billion people.

Corporations Make a Push

In China’s case, government officials first invited United Way International to help it cope with a fraying social safety net in the wake of flooding and other natural disasters. Elsewhere, corporations have taken the lead.

In Vietnam, the American Chamber of Commerce had been raising between $20,000 and $30,000 a year for charitable projects before its directors last year created AmCham-United Way Vietnam, says its executive director, Cheryl Pultz.

The organization plans to start on-the-job campaigns at five companies this year, while also helping to run donor-advised giving programs for Cargill and Citibank. Through such programs, people can donate cash and other assets to special charitable accounts, and then recommend how, when, and to which charities the money in the account should be distributed.

Yet efforts to set up United Ways are most effective when they have the support of local groups, officials say. And while the United Way in Vietnam now operates out of the American Chamber of Commerce, the agreement with the chamber calls for the organization to be run by Vietnamese within three years, Mr. Beggan says.

Where conditions are ripe for United Way’s approach, growth can be rapid.

The Community Chest of Korea, for example, raised about $9-million within the country a half-dozen years ago, Mr. Beggan notes. That annual figure grew to $55-million three years ago and $75-million two years ago, and now exceeds $100-million. A single company, Samsung, gives more than $8-million a year.

Facing Competition

One fund-raising challenge some United Ways in other countries have faced is competition with community foundations.

The Charles Stewart Mott Foundation has made grants to help create United Ways and community foundations in several countries. “United Ways are like checking accounts,” collecting small donations for immediate distribution, “and community foundations are like savings accounts,” raising big gifts to be distributed in the future, says Elan D. Garonzik, a Mott Foundation program officer.

Yet Russy Sumariwalla, who led United Way International from 1992 to 1996 and who recently served as interim executive director of the Community Foundation of the Napa Valley, argues that it does not make sense in many parts of the world to keep those accounts separate.

“It can be divisive,” he says. “Both have their own infrastructures and back-room costs and compete for the same volunteer leadership.”

Instead, he says, “the ideal would be to work together to create one organization that does both: raises money from high-net-worth individuals, which community foundations do, and also in small donations, which United Ways do.”

Concerns About Size

As the United Way concept continues to spread to other countries, several members of the international network contend that it is becoming too large for a small United Way International to serve effectively.

Piotr Chadzynsky, director of United Way Poland, suggests that United Way International create several regional networks to coordinate activities at the international level. “Christine has the world to look after, and that’s a whole lot of territory to cover,” he observes.

Ms. James-Brown is mindful of such concerns, and expansion of the staff is under discussion. But even if more employees were to be added, she says, United Way International would always be stretched thin.

“We’re a small organization with an enormous mission,” she says. “What we’re going to have to do is form strategic alliances with United Way of America, with universities, with other organizations, to leverage training capacity.”

She adds: “With just 15 staff to cover the world, there’s a potential for biting off way too much, so we have to be thoughtful and strategic.”