Most people would connect El Pomar Foundation's mission directly to philanthropy. But how has our society’s understanding of philanthropy shifted over the last 75 years?
When Spencer Penrose donated $21 million in 1937, he was following a prominent strand of American philanthropic thought and practice. Essentially, make a fortune through business and, toward the end of life or after death, leave that money for charitable causes. John D. Rockefeller and Andrew Carnegie epitomized this modern philanthropic model.
The approach has been quite successful. Rockefeller, upon his death at 97 in 1937, had donated nearly $450 million to charity. His foundations are credited with eradicating hookworm and yellow fever and propelling education forward, among other significant accomplishments. Carnegie donated $380 million in his lifetime, creating enduring educational institutions, including over 2,500 libraries, and organizations dedicated to pursuing world peace. Here in Colorado, the Penrose legacy has enhanced communities across Colorado, with over $500 million granted since 1937 and nearly $600 million endowed today to future generations.
Despite these examples of enormous monetary and philanthropic contributions to society, intractable problems are still painfully evident in our society and in countries and communities around the world. In response, we're seeing an expansion of our collective understanding of philanthropy.
To broaden philanthropy's impact, our society is turning to enterprise and business to complement traditional giving from foundations, corporations, and individuals. The B Corporation movement extols the power of for-profit companies to drive social good, setting social, environmental, performance, accountability, and transparency standards for businesses of all shapes and stripes. The rise of social enterprise has shown the potential of aligning nonprofit missions with sustainable business models. Traditional investing is even being up-ended in the pursuit of social change, as a growing subset of investors increasingly turn to impact investing, leveraging their dollars for social returns and not only financial profit. For example, an individual or institution could align profit with social impact by investing in Warby Parker, which sells beautifully designed eyewear. Beyond selling glasses, the company also operates as a B Corporation, donating glasses around the world to address the one billion people who lack access to the eyewear they need.
Additionally, many consumers today view smaller, local businesses as community institutions first and deliverers of services or products second. And larger corporations are partnering with nonprofits like the Nature Conservancy and communities to improve the environmental and social effects their operations have, oftentimes increasing profits through increased efficiency.
The rise of modern philanthropy – the Rockefellers, Carnegies, and Penroses – did not lead to the eradication of systematic problems, but represented immense progress in how we as a society view philanthropy. Likewise, B Corporations, social enterprise, impact investing, renewed business involvement in communities and similar models have helped us reimagine our understanding of philanthropy. Like the model before it, these new approaches alone cannot properly address every problem. However, by broadening our understanding of philanthropy, we may be able to create a multi-pronged approach that truly begins filling gaps for positive impact.