Sir: For decades, Africa’s development story has been told through a narrow lens—foreign aid, concessional financing, and external intervention. This framing is not just incomplete; it is also misleading. It obscures one of the most powerful, yet under-analysed, engines of Africa’s socio-economic resilience.

According to the African Development Bank (AfDB), indigenous Africans’ contributions, both monetary and non-monetary, will amount to nearly $400 billion by 2030. This is almost eight times the value of all aid flowing into Africa each year as part of its Official Development Assistance (ODA) inflows. While media coverage focuses on foreign aid, this massive local and regional capital-creation system remains largely invisible in corporate strategy and international investment planning. This is an error!

Fundamentally, indigenous philanthropy in Africa is not about charity in the traditional sense. It is not even about giving but rather about building a local, reliable finance infrastructure through which individual families, neighbourhoods, and communities allocate their income, fund education and health care, and cushion themselves against economic shocks. Whether it involves rotating savings groups in West Africa or self-help initiatives in East Africa, these arrangements are not marginal but integral.

The difference with this system is the philosophy on which it is based—Ubuntu, an African philosophy centred on shared humanity and communal responsibility, often expressed as “I am because we are.” In contrast to the Western notion of corporate social responsibility, where social investing is seen as a byproduct of making money, Ubuntu blurs the distinction between business and community. The firm does not approach the community from an external perspective; rather, it becomes an integral part of it.

This carries major implications for business managers. Firstly, the concept changes the way that business should think about entering into and expanding within a market. In many of the African frameworks considered, trust, not law, is the principal means of exchange. Businesses that do not take into account the current social network structure will find themselves unable to sell despite having competitive prices and technology. Businesses that do, however, will have access to a whole suite of marketing, customer relations, and capital mechanisms that would otherwise be closed off.

Secondly, it calls into question the separation between philanthropy and business investment. A growing number of African business leaders are already operating within this blended logic. The philosophy of Africapitalism, popularised by Tony Elumelu, recognises that long-term profitability and social impact are mutually reinforcing rather than contradictory.

During the COVID-19 crisis, private-sector partnerships in Nigeria deployed resources faster and on a larger scale than many official bodies—proving that indigenous mechanisms can be much more flexible and responsive. Thirdly, it presents an avenue for innovation. The informal financial system, often perceived as outdated and chaotic, holds significant assets and plays a vital role in keeping SMEs and individual families afloat. To financial service providers, FMCG companies, and tech firms, aligning with indigenous structures is not philanthropy; it is business sense.

But then, one key challenge remains, and that is data. Indigenous philanthropy is socially constructed and therefore not easily quantifiable using conventional measures, leading to its exclusion from mainstream economic analysis and ESG sustainability assessments. Closing this gap is crucial to ensuring that our approaches align with the dynamics of African markets.

Then there is the policy angle. In many African economies, regulatory structures favour Western models of philanthropy while ignoring indigenous traditions altogether or even limiting them. For future-oriented companies, now is the time to help create policy environments that support such flexible systems as part of your sustainability strategy.

The broader point is this: Africa is not waiting to be developed. It is already financing itself—quietly, collectively, and at scale.

The new challenge facing investors and business leaders is no longer whether to invest in Africa’s philanthropic ecosystem; it is “how.” Investors still trapped in the old aid-centric model—treating philanthropy as charity rather than capital—will miss critical market insights. This is because the business leader and investor who drive the shift away from an old aid-based approach will reap greater success.

Our shared prosperity in Africa will not depend solely on foreign aid but on indigenous initiatives enabling shared value on the continent through structured African philanthropy.

Dr Kelechi Nnamdi is a Senior Associate, Industry Services & Research, Lagos Business School Sustainability Centre, where he co-manages the Ford Foundation-funded project on sustainable impact philanthropy.