We sometimes find it helpful to think about philanthropy as a tool for social change in terms similar to how Winston Churchill famously described democracy: “Democracy is the worst form of government except for all those other forms that have been tried”  There are (and always have been) valid critiques of philanthropy as a means for promoting social change and tackling complex social challenges. As in other aspects of life, effectiveness and innovation in philanthropy exist across a continuum, from self-serving and out-of-touch to self-aware and systemic. When philanthropy is done well, by patient, self-aware, and committed philanthropists, it can drive lasting progress on some of our world’s most challenging problems — problems whose ultimate resolution will require both public and private attention and resources. From climate change to entrenched poverty, inequality, and the social friction that accompanies these issues, the challenges facing humanity are becoming ever more complex and more urgent. Lasting solutions to these and many other challenges seem increasingly unattainable, driving a rise in public anxiety as well as growing skepticism about the role of self-appointed philanthropic saviors. In this era, the world doesn’t, and shouldn’t, need to reject philanthropy as a catalyst for transformational change. What our world needs is different and better philanthropy — what we at Building Impact call forward-thinking philanthropy.

Is Philanthropy Up to the Job?

It is important not to focus solely on the cons of contemporary philanthropy. That said, there are certainly reasonable objections to its overreaches, excesses, and blind spots. Indeed, there is a growing critique of philanthropy as fundamentally not up to the job of tackling the deeper challenges we face. Anand Giridharadas’s Winners Take All: The Elite Charade of Changing the World is a best-selling example. Others include the Institute for Policy Studies’ Gilded Giving and David Callahan’s The Givers: Wealth, Power and Philanthropy in a New Gilded Age. Here are some specific critiques of philanthropy that these authors, and others, highlight: Good intentions are no guarantee of good outcomes for those you are trying to benefit.

• This is likely to be true when you are trying to address long-standing challenges that have been repeatedly resistant to change. Because of unintended consequences, it is fairly easy to violate the call to “do no harm” when you start messing around with complex systems.
• This is especially true when you yourself are coming from outside the system or community impacted and are not immediately sensitized to feedback about how things are truly playing out on the ground.

Powerful people often rely too heavily on their own limited worldview, intuition, and experiences to problem solve, rather than digging deep to understand the real-world dynamics and complexities of a problem as it actually exists.

• Giridharadas makes a compelling critique that some philanthropists get too caught up with their visions of themselves as data-driven saviors to see the real-world dynamics at play in the problems they are claiming to solve.

Philanthropists are not accountable to the public.

• Critics also raise valid concerns about the interaction of philanthropy and democracy and how philanthropists could and should be accountable to the voting, tax-paying public. In a similar vein, philanthropy can sometimes lessen the imperative for the public sector to address major social problems by providing a Band-Aid instead of a structural social fix.

Even as we acknowledge the many ways philanthropy can let us down in addressing the world’s most pressing issues, it is important to remember that not all philanthropy is the same. While some philanthropists may embody these critiques, others actively work toward making lasting progress on challenging problems, and many others exist in between.

What is Forward-Thinking Philanthropy?

At Building Impact, we are developing an advising practice at the intersection of philanthropy, advocacy, politics, and personal development. Over the past seven years, we’ve had the opportunity to work with a number of individuals and institutions deeply committed to stepping up their game as thoughtful and effective backers of sustainable change in complex social systems. Through working with those who do philanthropy differently than most, we have learned that the most effective at harnessing philanthropy to tackle society’s toughest challenges tend to share and/or cultivate a set of attributes and approaches.

Attributes of a Forward-Thinking Philanthropist

In our work, we’ve learned and continue to learn which attributes make forward-thinking philanthropists particularly effective when it comes to tackling complexity. First, let’s start with a working definition. Forward-thinking philanthropists are those who:

• Focus on systemic change, with the understanding that true leverage comes from getting all the way down to the root causes of the most pressing social issues
• Invest patient capital over a long time horizon, recognizing that resolution will not come in the next year or the next election cycle
• Cultivate an adaptive mindset and a learning orientation – this means continually seeking to refine our understanding of how the world works and going where the evidence leads us
• Commit to an ongoing journey of personal development and lifelong growth
• Are aware of and willing to engage around issues of identity, race, equity, diversity, and inclusion
• Build alliances by engaging and influencing others, including fellow change agents, grasstops and non-profit leaders, and members of the communities most impacted
• Support the use of a range of mechanisms (philanthropy, impact investing) and tools (investment in innovative ideas, equitable business practices and market-based solutions, coalition building, politics and advocacy) to drive change
• Believe meaningful impact with people and communities is the ultimate measure of success

Forward-thinking philanthropists think before they act and intervene strategically at the points of greatest leverage in dynamic systems. They avoid linear approaches that so often fail to deliver expected results — or worse, produce unintended consequences that worsen situations. If philanthropists like this sound rarer than unicorns, rest assured. We have observed that forward-thinking philanthropists are not born; they are developed. Moreover, few, if any, master all of this at once — it’s a lifetime journey. In our work, we often use the “innovation adoption curve” to explain our theory of forward-thinking philanthropy. We see forward-thinking philanthropy as the leading edge of the field. It is currently embraced by the innovator and early adopter groups and has yet to spread to the majority of philanthropists.

So, Why is it Moving So Slow?

One key challenge in the field of philanthropy is that innovations and best practices don’t spread as rapidly as we might wish. True to form, you won’t typically hear forward-thinking philanthropists announcing their own victories or seeking the spotlight to talk about their work. Additionally, Building Impact shares the field with very few others who are helping forward-thinking philanthropists blaze the trail and spread the word. Philanthropy itself is notoriously well insulated from the pressures for change that apply in many other sectors of our economy and society. This insulation is part of what angers many of philanthropy’s fiercest critics. It is also why the growing critique of philanthropy is helpful. Even when it doesn’t directly provide more effective practices, public critique of ineffectiveness puts social pressure on philanthropists to pay more attention to the real world and to the practical results of their efforts. This, in turn, will help spread the effective practices of philanthropy’s forward-thinking innovators and early adopters farther and faster.

What’s Next?

Despite all of philanthropy’s flaws as a vehicle for addressing our toughest societal challenges, we are excited about the prospects for building on the best forward-thinking philanthropy that is already out there on the leading edge of the innovation curve. At Building Impact, our mission is to help forward-thinking philanthropists hone their practices and increase their effectiveness. We find it just as important to spread the word that there is a different, better way to do philanthropy when it comes to helping achieve sustainable, long-term positive movement on our most deep-rooted social challenges. All this gives us hope that the best of philanthropy is yet to come.