By Floyd Keene, Triple EEE Foundation
Recently I attended a special reception at Exponent Philanthropy headquarters. In attendance were fellow board members, D.C. area foundation leaders, corporate partners, and a special guest from the White House: Jonathan Greenblatt, Special Assistant to the President and Director of the Office of Social Innovation and Civic Participation in the Domestic Policy Council. As Director, Jonathan leads the Office’s efforts to use human and financial capital to bring attention to community solutions.
Jonathan was kind enough to join us even though he had a very busy day. At a White House conference that day, the administration announced a number of actions to stimulate impact investing, including $1.5B in commitments from a group of dedicated private and philanthropic entities.
At the reception, Jonathan described the conference and President Obama’s views on philanthropy and public/private partnerships. My fellow board members told me that I beamed during Jonathan’s entire presentation. I cannot disagree. Never before had I heard a speaker talk about conceptual topics, where I felt like he was plucking them directly out of the beliefs of my heart and the depths of my soul. At the conference, and in the press, the Obama administration indicated the following, with my reactions stated in italics:
1. President Obama’s new stress on philanthropic initiatives was inspired by a site visit to the B.A.M. (Becoming a Man) program run by Youth Guidance in Chicago. The visit helped spawn My Brother’s Keeper, a far-reaching Presidential initiative announced in February.
Whenever I hear this story, I almost have trouble keeping it together. My foundation has long supported Youth Guidance, which began B.A.M. as a small pilot program several years ago. To now see it inspire an entire Presidential initiative is indescribably moving.
2. The Obama administration believes that governments and philanthropists alone cannot solve social problems. Rather, the private sector must be a key player in addressing social concerns.
This thought—almost an irrefutable reality—is rapidly becoming the mainstream view. It implies a changed world of philanthropy not considered possible 10 years ago. Jonathan’s words reminded me of a belief I have held for years: World hunger will not be solved by a big food drive. It will be solved by one brilliant entrepreneur, who figures out how to make money by solving world hunger.
3. The Obama administration indicated that it will stress less regulation to help philanthropy and impact investing.
Now that’s the kind of progressive government that we need! One important step in this direction would be for the IRS to further rewrite existing regulations to make it easier to do PRIs and MRIs. Foundations could then undertake such actions in an environment of legal certainty, without needing two separate legal opinions to protect themselves. This would be bad news for lawyers, but good news for everyone else.
Simply put, the Obama administrations’ approach to philanthropy is direct and right on point. Hearing Jonathan Greenblatt talk about it inspired me. His main message was that philanthropy is changing. More than that, it simply must change to meet the social needs of our world.
The fact that philanthropy has existed for centuries, yet mammoth social problems remain, is testimony to the fact that new ways of doing things are essential. Also, looking at the numbers dictates the same conclusion:
- U.S. GDP: $17 trillion
- U.S. charitable giving: About $315 billion (1.8% of GDP)
- U.S. foundation giving: About $50 billion (3/10 of 1% of GDP)
These numbers show that philanthropy, while important, cannot itself solve social problems. Rather, incentivizing private assets to address social needs is drastically needed.
Also, government’s role should not be to drive truckloads of dollars across a bridge and dump them on social problems. Rather, government should be the bridge connecting private enterprise and social needs. It should be the catalyst, not the funder of last resort.
It is very, very comforting to hear that the Obama administration shares these views.
Jonathan Greenblatt is an entrepreneur. He has built several business enterprises and sold them for a substantial profit. Now he is turning his attention to connecting business and philanthropy. Hopefully, there are many, many other Jonathans out there—brilliant, insightful, powerful people who can inspire others.
If that is the case, I am more hopeful for our world than I have been in a long time.
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Exponent Philanthropy board secretary Floyd Keene is president and founder of The Triple EEE Foundation in Deerfield, IL. He received his bachelor’s and law degrees from the University of Wisconsin and, before leaving the business world, was a senior executive at Ameritech, a Fortune 500 company. He is a strong advocate of impact investing, and his foundation’s assets are currently 100% impact invested. Follow Floyd on Twitter @EEEFoundation.
