Because I can!

“System change” – this is the holy grail of highly ambitious philanthropists. The aim is not just to tackle the symptoms of social problems. The commitment should tackle the causes, preferably at it’s root cause. 

Some rely on the support of promising social entrepreneurs. Others work directly with governments, administrative bodies and social or environmental organisations, sometimes achieving astonishing results. 

But if more and more highly influential philanthropists are shaping society with the help of their wealth, will the limits of legitimate engagement be reached or exceeded at some point? 

The influence of civil society

Traditionally, the opportunities and influence of philanthropists and foundations have only been a tiny fraction of those of the state and the economy. In Western countries in particular, where the largest assets and foundations have traditionally existed, large parts of social life, the economy and the social sector are thoroughly legalised. Changes take place in democratic and parliamentary processes, and a democratically legitimised administration is responsible for implementation. The influence of civil society is limited to a say in political processes and its own activities, mainly in the charitable and cultural sectors. 

Strategic philanthropy as new challenge

This image has been shaken in recent years. It was not only with the establishment of the Bill and Melinda Gates Foundation that the owners of large private fortunes began the transformation from classic chequebook philanthropy to strategic philanthropy aimed at changing systems. 

Never in the history of mankind have more assets been concentrated in the hands of a small group of people. And more and more of them are discovering the field of “catalytic philanthropy”, another common term in the scene, as a meaningful and challenging task. 

This development is driven not least by the perception that, on the one hand, global crises seem to be replacing or even exacerbating each other. The dangers of climate collapse, the effects of pandemics, poverty, food insecurity, water scarcity and violent conflicts – these challenges are being recognised with increasing awareness. More and more philanthropists are coming to the conclusion that it is not enough to alleviate symptoms, but that it is necessary and possible to bring about radical and sustainable changes to the causes. 

Positive examples of systemic change

Encouraged by positive examples such as the global fight against polio, an initiative by Rotary International has grown into a global movement, not least thanks to the courageous commitment of some major donors, as a result of which the polio virus has been eradicated in almost every country in the world through nationwide immunisation and the disease has thus been defeated. Today (2023), the virus is only endemic in Afghanistan and Pakistan and there are only a few hundred cases of polio left worldwide. 

In order to achieve systematic change, philanthropists and foundations use a variety of means and resources: they work together with other donors, but also with field organisations and often the public sector, commission researchers, develop strategies and finance selected organisations and projects, sometimes with massive funds. 

In recent years in particular, an ecosystem has emerged for this purpose. Platforms such as Project Together and Catalyst 2030 aim to support and orchestrate collaboration between different stakeholders. 

A role model without a question mark?

This far-sighted commitment to sustainable change is hailed by many as exemplary. But can we fully endorse this view? 

Despite all the good intentions, some facts cannot be ignored: philanthropic engagement is always characterised by a power imbalance between the giver and the recipient. The more influential the position of the philanthropist, the more relevant this balance of power is: the Bill and Melinda Gates Foundation, for example, is the second-largest donor to the World Health Organisation (WHO) – just behind the USA. Is it conceivable that the foundation has no influence at all on the organisation’s priorities and activities? 

For the most part, the work of the Gates Foundation is perceived as beneficial and orientated towards the good of humanity. However, the greater the number of those who can have a significant influence on social processes, the more urgent the question of the legitimacy of their interventions becomes. With great opportunities comes great responsibility. 

Conditions for legitimate engagement

In the “Influence for Good” report published in 2023, numerous wealthy private individuals were interviewed about their motivations and perspectives. These were compared with the findings of experts in the field and representatives of leading social organisations. 

The report not only describes how wealthy private individuals can initiate or support social change. It also clearly identifies the conditions and expectations that need to be met in order to set out on the path successfully, but also in an ethically acceptable manner. 

In addition to the demand extensive transparency to rule out conflicts of interest, these requirements include intensive reflection on one’s own motives and competences. A successful entrepreneur or an innovative programmer are not necessarily the greatest experts when it comes to combating homelessness or the consequences of climate change for coffee cultivation in Latin America. 

The report argues in favour of not only listening to representatives of the affected groups and experts, but actively involving them in decisions, handing over influence and control and primarily strengthening the actors in the field and on the ground. 

Cooperation with the state

Another important point is the relationship with state processes and institutions. In the last two decades, many social entrepreneurs have tended to primarily set up their own organisations and thus private parallel structures. But here, too, the truth is that there is no alternative to public structures in many areas, from education to healthcare and energy supply to protection against crime. 

Successful “system change” here requires a cooperative, supportive attitude on the part of philanthropy, which recognises the logic of state and democratic action and finds innovative ways of working together. 

Conclusion

Is “system change” now the Holy Grail of philanthropy to save the world? If that meant releasing the state and democratic processes from responsibility, that would certainly be a mistake. However, in the perspective of the growing and time-critical global challenges on the one hand and historically unprecedented opportunities for private commitment on the other, the focus on sustainable, effective change gives more cause for hope than concern. 

Critical reflection on one’s own behaviour and the greatest possible transparency of interests and motives help to reduce reservations regarding the ethical dimension of this form of philanthropic activity.