The concept of charitable giving is one of humanity’s oldest philosophical precepts – so much so, that ancient religions such as Islam and Judaism have guidance about charitable giving embedded into their religious texts. In fact, in Islam, Zakat (charitable giving) is a fundamental principle of the religion – the giving of 2.5% of your annual wealth is obligatory, not optional. Likewise, Jewish Tzedakah enshrines charitable giving as a moral obligation– a customary, run of the mill part of everyday life, not a special act worthy of praise or even remarking upon. And the concept of Christian charity is already familiar in Western society – so why has the idea of charitable giving become so undervalued in the modern age? Do we really need religion to enforce this basic moral principle in us?
Well, where ethics fail, governments are starting to intervene, addressing the question of our flagging moral consciences. China has previously discussed making charitable contributions mandatory for all income-earning citizens, and in 2014 India decreed that all businesses with annual revenues of over £105 million must donate 2% of their net profit to charity. Prior to this law coming into place, the country’s charities largely relied on a handful of ultra-wealthy individuals for the bulk of their donations – tech entrepreneur Tej Kohli (net worth: an estimated £4.5 billion); Azim Premji (net worth: approx. £12 billion) and Nandan and Rohini Nilekani (net worth: approx. £1.3 billion), to name but a few. The new law was intended to create a new culture of corporate responsibility, and lessen dependence on the generosity of billionaires – but is it morally correct to make giving mandatory? And does it even work?
The concept of forcing businesses to be moral is not a new one – as we’ve seen with the many tax avoidance scandals this year, many businesses need a very firm push to encourage them to behave with basic decency. And I think few civilians would have an issue with such a law being enforced in their own country – but where it gets interesting is when we consider how we’d feel if a tax like the one China proposed, which would have affected individuals rather than companies, were to be enforced. Suddenly, the arguments for mandatory giving (that it is the right and moral thing to do, that it frees up much-needed cash for social development), start to seem less relevant, and arguments such as “taxes are a form of charity!” start to seem less ludicrous.
This is the problem at the core of mandatory giving – that most of us don’t like being forced to do a good thing. It’s a bit like when you’re little, and your mother tells you to thank an aunt or uncle for a gift – you were about to do it anyway, but suddenly you feel annoyed and resentful and ungraciously mumble your gratitude without meeting the giver’s eye. In the same way, as adults we would much rather do something good voluntarily, and get the satisfaction of feeling good about it afterwards – but the problem is, most of us just don’t do it.
So is it better to force people and businesses to do good, and does it even work? In India, some companies have gone so far in trying to cheat the system that they have donated to charities who have then returned the money, minus a commission, demonstrating the extent to which some corporations will go to avoid compliance. But overall, charitable giving has vastly increased – from an estimated £357.5 million in 2013, to approximately £2.63 billion following the introduction of the law.
So perhaps until we learn to be good, we need to be forced to act good – and if that ends up doing good, then maybe our moral intentions are neither here nor there.