(Illustration by iStock/Alona Horkova)
In June 2025, the Stanford Center on Philanthropy and Civil Society, the academic home of SSIR, hosted its Junior Scholars Forum in partnership with the Doctoral Seminar in Social Entrepreneurship and Philanthropy (SEPHI) at ESSEC Business School in Paris. The articles in this issue’s Research section report on papers by scholars who participated in the forum.
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Nearly a decade ago, Octavio Barros was working at a São Paulo social enterprise startup that sought to better match sponsors of social and cultural projects with potential investees. Since 1991, Brazil’s Ministry of Culture has offered a tax break for philanthropists who fund artistic and cultural projects such as museums, libraries, music, architecture and archaeology nonprofits, gaming initiatives, and more. Historically, participating firms have used their own networks to identify projects, and many projects have depended on direct outreach to seek funding, with both sides relying on nothing more than market dynamics to create the best possible matches.
“It’s a market mechanism through which they find an equilibrium,” Barros says. “They’re going to be trying to reach out to one another, but the search and matching costs in the market are very high. The potential sponsor doesn’t know the full scope of available projects and their specific attributes. They’re going by word of mouth to collect information or opening a huge selection process, soliciting proposals on specific topics.”
After a few years, a major problem emerged: The burgeoning corporate philanthropy market sent the overwhelming majority of funding, some 80 percent, to only one region: Brazil’s populous southeast and home to its two largest cities, São Paulo and Rio de Janeiro.
Today, Barros is a postdoctoral research fellow at HEC Paris Business School, where he studies the public provisioning of culture. In a new paper titled “Navigating Philanthropy Allocation Amidst Change: Balancing Institutional- and Firm-Level Drivers of Giving,” he analyzes the effects of a new policy introduced by Brazil’s Ministry of Culture in 2017 to distribute funds across the country’s vast cultural sector in more inclusive ways. An amateur musician and erstwhile social entrepreneur who has worked to improve access to culture, Barros wanted to evaluate the impact of the 2017 policy, focusing on the perspective of participating firms. How did philanthropic funders respond to the new policy, and did it change how they allocated resources in one of the world’s most unequal countries?
“The challenge we faced was that in making a policy assessment and determining whether or not it worked, you need a comparison group, a counterfactual, which we didn’t have,” Barros says, “because the policy affected the whole country and was deployed at the same time for everyone.”
Using econometric tools, Barros found a solution in a time-series analysis to test the policy’s outcomes. “It was an approximation that allowed us to observe what could be expected for the future based on past investments. While it’s a bit unusual in this kind of research and doesn’t allow for proper causal inference, it was what let us compare the forecast for the time window we were observing, four years after the policy, and compare it to what really happened,” Barros says.
The process overseen by the government includes several stages. First, nonprofits seeking funds are required to submit a proposal to the Ministry of Culture, which determines feasibility in terms of budget and schedule. Then, the government posts qualified proposals on an online portal, making detailed information about approved proposals readily available, in the hope of promoting greater inclusiveness. Firms can now navigate the platform, see the full range of possible projects, and search using keywords. Previously funded and nonfunded projects also appear, providing a history that allows nonprofits to see which projects using what language have found success. Finally, nonprofits seek sponsorship from firms, and firms, in turn, discover projects worth their philanthropic investment.
The 2017 law has, on the whole, failed to help direct more investments to underserved localities, Barros found. His research uncovered competitive market dynamics that encouraged firms to enter concentrated markets and replicate established strategies.
However, Barros found on further analysis that high-performing private firms and state-owned enterprises did increase their investments in underserved areas. These companies used the opportunity to find projects in these areas to expand their market reach.
“This research is significant for advancing the theory of corporate philanthropy and firm-NGO partnerships,” says Marina Amado Bahia Gama, an assistant professor of business at the FGV EAESP São Paulo School of Business. “It provides a detailed understanding of the impact of legislation on cultural activities, particularly on the likelihood of a company shifting its philanthropy to underserved communities.”
Research paper: “Navigating Philanthropy Allocation Amidst Change: Balancing Institutional- and Firm-Level Drivers of Giving," by Octavio Augusto de Barros.
Read more stories by Daniela Blei.