Cre8tive Philanthropy

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Investment and innovation in the for-profit social impact community.

Activists criticize Gates Foundation securities holdings

As someone who provides impact investment research and consulting services, this blog post on The Chronicle of Philanthropy is fascinating. Investments made by philanthropic organizations are generally more public, and therefore, more open to criticism. Explicitly, this post speaks to the ethical question of whether or not the foundation’s agriculture work in Africa will be used to help create markets for Monsanto’s GM crops. (More details between the relationship between the foundation and Monsanto but that almost smells of self dealing and conflict of interest.)However, there is an underlying tone: Why is a “good” foundation  investing in a “bad” company?

Since charitable and philanthropic organizations are sometimes perceived as ethical beacons, it is assumed their actions will reflect this commitment to “good” and “right” that serve to improve society and the world. Perhaps that is why foundation investment in a questionable company can cause uproar. Foundation assets are, by their nature, linked to their purpose – the money is there to serve that purpose regardless if it is corpus or grant.

For that reason, charitable and philanthropic organizations should be aware of what their investment say about their commitment to their purpose; not for the public’s sake, but for genuine belief in their mission and goals. Every foundation investment does not need to be socially responsible, but there should be a “negative” screening of investments that are out of alignment with the foundation’s core purpose.

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Filed under: Challenges, Foundations, Philanthropy

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