A growing number of social justice movement leaders and philanthropic allies are sounding the alarm about the harmful ways in which foundations typically manage their endowments: in 2020, the amount of assets that U.S.-based foundations collectively invested in extractive global financial markets was 13 times more than they disbursed in grants.
A Just Transition from our current extractive, profit-driven, capitalist economic system toward a more regenerative economy requires foundations to do more than mobilize grant dollars to organizing and movement-building efforts to advance societal transformation. A Just Transition also requires foundations to divest their assets from the dominant financial system and redirect that capital into community-controlled institutions and activities that build economic power and self-determination in BIPOC communities, thereby reducing their reliance on philanthropy over the long term. This is the vision that Justice Funders and our movement partners have articulated in the Just Transition Investment Framework.
Unfortunately, the field of investing is rife with gatekeeping, including confusing and inaccessible terminology and concepts that prevent values-aligned philanthropy professionals from questioning the status quo. Those working in philanthropic institutions who lack formal training in finance often face barriers to initiating conversations with their institution’s investment officers, executive leadership, and trustees about re-imagining their investment strategies.