Kuwaiti Endowments: From Charitable Donations to Sustainable Development

Kuwait's endowment experience is a leading model for transforming charitable work from mere urgent aid into an effective tool for economic and social development. Endowments are no longer just individual donations and initiatives; they have become an integrated institution that manages and invests its funds with high professionalism to ensure the sustainability of its returns. This has been embodied by the General Secretariat of Endowments since its establishment in 1993.

A Qualitative Shift: The General Secretariat of Endowments

Although institutional endowment work in Kuwait started late and initially relied on private management, the need to organize this sector led to a gradual development in the government apparatus. In 1921, the Department of Endowments was established as the first centralized institutional body responsible for setting regulations and systems for the development of endowments. This development continued until Kuwait's independence, when the Department of Endowments became a ministry in January 1962, and then Islamic Affairs were added in October 1965 to become the Ministry of Awqaf and Islamic Affairs.

The most significant and important transformation occurred in 1993, with the establishment of the General Secretariat of Endowments by Amiri Decree. The General Secretariat of Endowments was not just an administrative addition; it was a qualitative leap in terms of institutional form and the philosophy of endowment work. The Secretariat worked to activate endowments as a developmental tool through:

• Endowment Investment: Instead of directly spending the endowment's assets, they are invested in well-studied projects such as real estate, stocks, and commercial ventures. This approach ensures the growth of the endowment and diversifies its income sources, increasing its ability to fund more charitable projects.
• Diversification of Expenditure: The Secretariat's role was not limited to supporting mosques and schools; it expanded to include vital areas such as scientific research, healthcare, community development, and supporting youth projects.

Endowment Funds: Flexible Mechanisms for Donation

To give citizens and residents the opportunity to participate in charitable work effectively and flexibly, the General Secretariat of Endowments created the endowment funds system. This is an organizational framework developed internally to enable the Secretariat to achieve its strategic vision for promoting and developing endowments. Kuwait has established about 11 endowment funds across the country to expand the practice of endowment work through the cooperation of public bodies with official institutions to achieve common goals, which are to revive the Sunnah of endowments by launching social development projects, inviting endowments for them, and spending the returns of each fund on its designated purpose. These funds are specialized investment vehicles whose funds are allocated to achieve a specific charitable goal through work programs that achieve the highest developmental return and an integrated vision that takes into account the needs and priorities of society. Among the most prominent of these funds are:

• The Endowment Fund for Health Development: This fund is an essential tool to support the efforts of institutions that work to care for public health. It finances the construction of hospitals, the provision of medical equipment, and the support of health research. To achieve these goals, the General Secretariat has allocated endowment assets worth about 5 million Kuwaiti dinars to be spent from their returns on the various activities of the fund.
• The Endowment Fund for Culture and Thought: This fund focuses on spreading serious culture and developing creative thinking. The General Secretariat has allocated assets worth one million Kuwaiti dinars to be spent from their returns on the fund's activities, based on the importance of culture and thought in Islamic heritage and community development. The fund's efforts focus on media outreach, organizing seminars, encouraging talent, and developing a culture for children.
• The Endowment Fund for Scientific Development: The fund works to support scientific research and education by spreading a scientific spirit, nurturing talent, and supporting achievements. The returns from this fund are used to finance innovative scientific research and studies that serve national development, provide grants to talented students and provide ways to develop their abilities, and coordinate and cooperate with scientific institutions inside and outside Kuwait.
• The Endowment Fund for the Care of People with Disabilities and Special Needs: This fund focuses its efforts on rehabilitating people with special needs, alleviating their suffering, and working for their integration into society. The General Secretariat has allocated endowment assets worth 5 million Kuwaiti dinars to be spent from their returns on the various activities of the fund.
• The Endowment Fund for Family Care: This fund was established to support the family and enhance its cohesion through charitable social support. It aims to provide appropriate care for the family, create a suitable atmosphere for its stability, in addition to addressing social problems. The fund also supports the revival of the Sunnah of in-kind and cash endowments and encourages volunteers to specifically support the fund.
• The Endowment Fund for Environmental Protection: This fund was established in 1995 to support sustainable development efforts and work to find the best ways to protect, develop, and preserve the environment so that it is sound and healthy for future generations. This is done by coordinating policies and programs to support government and private agencies working in the field of pollution control and environmental rehabilitation. The fund focuses on financing environmental protection projects, training national cadres in environmental work, implementing pollution control projects, in addition to spreading environmental awareness among community members to preserve the Kuwaiti environment as pure and clean.

Evaluating Kuwait’s Endowment Experience

Despite the relatively short lifespan of the endowment funds experience in Kuwait, some indicators can be used to judge its success, including:

• The number of endowers increased from 408 before the establishment of the Secretariat to 538 after its establishment, an increase of 130 new endowers, which means that what the Secretariat achieved equals 24.2%, with an annual increase rate of 12.5 times after the establishment of the Secretariat compared to the annual rate before its establishment.
• The volume of endowments established within 3 years after the establishment of the Secretariat amounted to more than 4.2 million Kuwaiti dinars, which is about 18 times the volume of endowments established in 1993, the base year for the Secretariat.
• The total value of endowments increased from 98 million Kuwaiti dinars before the establishment of the Secretariat to 131.7 million dinars after its establishment.
• The growth of the net returns from endowment investment after the establishment of the Secretariat amounted to about 10.1 million Kuwaiti dinars, which is about 204% of the volume of returns before the establishment of the Secretariat. The growth of spending on endowment development activities and projects also increased by more than 4 million Kuwaiti dinars, an increase of 594% of the volume of spending before the establishment of the Secretariat.
• The institutional development has brought about a qualitative leap in the policies of investing endowment funds, in the areas of spending their returns, and in the tools of their distribution, whether in the form of funds or Kuwaiti endowment projects.

A Global Endowment Model

Kuwait's experience in the field of endowments offers an important lesson for the whole world. It shows that endowments, if managed with professionalism, transparency, and governance, can be transformed into an economic and social lever capable of achieving long-term sustainable development. This success would not have been possible without the forward-looking vision that transformed the traditional concept of endowments into a modern economic institution that contributes effectively to building society.