Long-Life Philanthropy in a World on Fire

Hilary Pearson

We are living in urgent times. Needs and uncertainties multiply in the context of energy and food insecurity, inflation, war, and attacks on democracy. The expectations and pressures on funders understandably continue to grow in the face of this urgency. The question of the value of the endowed foundation model must be posed again. When the world is on fire, should long-life foundations reconsider their time span and focus on the present?

One of the advantages of an endowed foundation is that it can make an independent decision about the temporal nature of its work. And this is a question it should ask itself repeatedly. In 1966, McGeorge Bundy, the president of the Ford Foundation, said that “a foundation should regularly ask itself if it could do more good dead than alive.” He concluded then on behalf of Ford that “we find that there is no present reason to believe that the world will have less need of a large foundation in 1980 than in 1967; the forces we help to counterbalance are not likely to be smaller – the need for an independent agency not likely to be less.”

Bundy was not wrong. The Ford Foundation continues to this day to contribute in significant ways to the struggle for social justice under its leader Darren Walker. But it doesn’t mean that the question should not be raised or the answer not tested.

Nor is the question unique to Canadian and American philanthropy. It is being posed on both sides of the Atlantic. At the Philanthropic Foundations Canada Conference on October 4 in Montreal, I will be speaking in a session on the legitimacy and temporal challenges of foundations in Canada and in Europe with my colleague Michael Alberg-Seberich of Wider Sense a philanthropy consultancy in Berlin. In Europe, philanthropy is being challenged by the consequences of war, with its pressures on migration and energy supply compounded by inflation. We in Canada face similar pressures from inflation. The increasing costs of climate emergency are also creating enormous negative impact, which falls disproportionately on those most in need. Both in Canada and in Europe there are increasing worries about the strength of democratic institutions. The rise of social media, the narrowing or polarization of public opinion, the lack of trust in leaders and institutions, the decrease in volunteering and civic engagement are all contributing factors to the weakening of democracy. We are seeing low turnout in our elections. Europe is facing shifts to the right and to extremist political views.  

The urgency of the present is clear. Foundations must respond, in ways that support their social legitimacy. How should foundations change in reaction to these pressures and what can, or must they do to help our societies adapt? What is the role of foundations today in supporting democracy and civic engagement? Should foundations engage more directly in activism and what might that mean for foundation public accountability? Should they simply spend down? Are we facing a call for radical change in the long-life philanthropic model?

There are no easy answers. But one question that foundation leaders could ask themselves now is whether to think differently about risk. Michael and I have both had long conversations with foundation leaders over the last year. Risk came up frequently. There are many risks for foundation leaders to manage: financial, administrative, legal, regulatory, and reputational. Foundations arguably focus too much on risk particularly when considering impact investing, or unconditional funding, or more participatory and trust-based grantmaking strategies. In the public eye, many foundations are seen as too risk-averse, and this limits their responsiveness. How can foundation leaders think more creatively about risk in turbulent times and avoid retreating into what is safer? Should we think of risk as being something for foundations to embrace as fundamental to the unique value they bring to society? So many important questions. Our conversation at the PFC Conference promises to be a lively one. More to come.

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