Triumph or Temporary Fix? What Happens When You Take This Revolutionary Approach to Giving?

Philanthrocapitalism: How the Rich Can Save the World and Why We Should Let Them was first published in 2008. It offered what many experts then—and now—have seen as timely insights into how to improve traditional systems of philanthropy by making them more like the market practices that drive the private sector. The book has also sparked considerable controversy.

The book quickly became what some commentators called a “bible” for the modern-day philanthropists. Yet other observers have critiqued the book’s ideas as offering a style of “neoliberalism” that only further empowers wealthy individuals and companies and exacerbates societal inequalities. 

It’s worth taking a renew look at Philanthrocapitalism’sviewpoints and solutions, as today’s conversations in the philanthropic world often center on rethinking a number of traditional approaches in this pandemic era.

Treating Philanthropy like a Business

One of the book’s authors, Matthew Bishop, was then a business editor at The Economist and is now a senior fellow at the Brookings Institution, working in the Global Economy and Development section. His co-author, Michael Green, has long worked as an expert advisor on international development at intersections of the governmental and non-governmental sectors.

A 2009 edition (with perhaps the gentler new subtitle of “How Giving Can Save the World”) featured a foreword by former President Bill Clinton, just one of the notable personalities interviewed in its pages.

Bishop and Green also talked with celebrity philanthropists who included U2 frontman Bono and Angelina Jolie, as well as powerful CEOs known for their philanthropy, such as Bill Gates, Sir Richard Branson, and the late Ted Turner. The book, which took two years to research and write, featured conversations with philanthropists who are especially noted for the revolutionary, results-oriented approach they bring to their task, as well as their focus on using their dollars to produce the greatest possible impact.

This way of looking at philanthropy views it through the lens of using donations to reshape society in ways that are more just and more broadly equitable, and that produce high yields on long-term social investments. The viewpoint draws on the experiences of practitioners at the helm of large-scale capitalistic enterprises to apply the same lessons to building and sustaining charitable wealth. This mindset contrasts with the perception of traditional philanthropy, in which many donors gave money away to specific organizations or initiatives without necessarily structuring their giving into any overall social impact plan. The reality is often somewhere in-between and has been for decades.

The Tradition of Impact-Oriented Philanthropy

As some critics of Philanthrocapitalism have pointed out, results-oriented capitalism with a focus on making strategic investments into social welfare actually long pre-dates Bill Gates and his friend Bono. Andrew Carnegie, John D. Rockefeller, Sr., and other household-name philanthropists of the late 19th and early 20th centuries were skilled practitioners of the art of successfully applying careful cost-benefit analysis and other business knowledge to measure the impact of their charitable giving.  

One example: Rockefeller’s team included Frederick T. Gates, a former Baptist minister who advised the tycoon based on principles of the then-popular Efficiency Movement. This school of thought aimed to apply the precision measurements of the Taylorist factory management system to every aspect of business and social welfare. Gates worked with Rockefeller to help ensure that every charitable dollar spent would be maximized in terms of doing the most good. 

Or take Carnegie’s plan to build and maintain public libraries across the United States through the implementation of long-term strategic trust funds and endowments. In operation for more than a century, these and other funds focused on education and peace continue to deliver measurable results. So, we might more reasonably approach Bishop’s and Green’s analysis of the “new” approach of philanthrocapitalism more as a 21st century evolution of principles and practices that originated in the previous century.

In Philanthrocapitalism, the two authors enumerate how private corporate-based donations are filling in funding gaps due to governments’ reluctance to engage in widespread social spending—which was also the case in Rockefeller’s and Carnegie’s time—and how this approach may even represent one of the biggest sustainers of social and educational change in the world. In fact, one of the individuals Bishop and Green spoke with for their book was an official at the Rockefeller Foundation, which today is working to move a 20th century operation into the 21st. 

The limited government spending landscape has also changed, potentially only temporarily, with the infusion of trillions of dollars of government capital within the United States alone during the COVID-19 pandemic.

Critiquing the Philanthrocapitalist Mindset

Critics suggest philanthrocapitalism is a “neoliberal” enterprise that actually bolsters systems of inequality. Some argue that corporate foundations’ donations deprive public treasuries of the tax dollars that could be helping overhaul systemic injustices on a larger, more effective scale.

Indeed, some scholars have found that a relatively small proportion of “philanthrocapitalist” giving is directed to the most economically and socially marginalized people. A significant portion of these dollars go to fund already wealthy institutions such as legacy universities and religious organizations. 

Enduring Value and Inspiration

These caveats acknowledged, the book Philanthrocapitalism still has plenty for readers to consider a decade out. The anecdotes and intimate glimpses of the decision-making processes of famous philanthropists remain intriguing and enlightening, their strategic techniques and analyses can still provide useful guidance, and the power of their passion to create a better world continues to inspire. 

Leadership and Management – What’s the Difference?

Many of us think we understand the difference between leadership and management, and for some people, there may appear to be no difference. But the distinctions between these two overlapping ways of engaging with others at work are significant. Thinking through them can be of immense use in developing staff at any level of an organization—and in helping emerging stars understand when they need to lead and when they need to manage.

Technical know-how and motivational guidance

One distinction involves how managers and leaders get to their respective positions. A manager is typically someone within an organization whose skills, technical capabilities, knowledge, and expertise in a particular field qualify him or her to direct the work of a team. This implies a certain level of experience and understanding in that particular field.

Leaders, on the other hand, can emerge among people with any level of technical knowledge and skill. Their defining quality is their ability to inspire, motivate, and guide others, and to set forth an easily understandable vision of what success looks like. 

Complementary skill sets

The distinction between managers and leaders becomes particularly noticeable when highly competent managers show themselves to be less-than-inspiring as leaders, or when inspirational and even transformational leaders lack the organizational skills to effectively run a day-to-day operation. 

On the other hand, many people who are not officially in management positions step up to lead and inspire their coworkers. Many leaders develop the nuts-and-bolts experience and expertise they need to become skilled managers.

Most organizations thrive when they bring on talented people who are excellent managers, as well as people who are strong leaders. This is especially true when an organization is fortunate enough to hire people who excel in both roles.

Leaders drive an organization’s mission and vision forward, motivating their teams to do their best work. Managers carry out policy directives and oversee the effective administration of procedures and projects in order to turn mission and vision into reality.

The big picture vs. the fine details

Another way to think about the relationship between the two roles is the idea that leaders set the tone and sense of purpose in an organization, and managers follow the vision set forth by leadership.

Leaders primarily focus on building ideas, whereas managers concentrate on executing the plans based on those ideas. Leaders inspire others, and managers organize and direct the work of others toward successful conclusions. Leaders set the tone for an organization’s culture; managers endorse and promote that culture. Leaders consistently keep their sights trained on the future, while managers devote most of their energy to making things happen in the present.

Managers – the glue that holds things together

Here is where managers play a central role as translators of vision to reality: close to three-fourths of employees responding to a recent survey reported feeling that their organization’s leaders do not devote enough time and effort to communicating their strategies and objectives. Some 80 percent stated that they wanted to learn more from their bosses about how their organization is doing. 

One job of a manager is to ensure that employees stay aligned with the organization’s basic set of values, as well as its goals. This means that a significant portion of a manager’s time is spent explaining, clarifying, and facilitating communication from leadership to employees, and vice versa.

Seven transitional challenges for managers

One of the most challenging transitions in business is the move from manager to leader. The scope and complexity of the work facing a new leader of a large organization can be overwhelming.

Career expert Michael D. Watkins has identified seven groundbreaking changes that front-line managers confront as they become leaders of multifaceted, large enterprises. They transition from specialists to generalists, meaning that instead of falling back on the comfort zone of their particular specialty, they need to take the broad view and give others room to handle many of the details.

They also move from being data analysts to learning how to weave together information from numerous disciplines or fields of knowledge. In this view, “bricklayers” become “architects” who can master analytical systems thinking. Problem solvers transform into agenda-setters. Implementers of tactics turn into strategists. Front-line “soldiers” intent on breaking records or scoring wins on behalf of their own units become diplomats who must engage with a range of stakeholders.

In addition to all this, new leaders must also learn how to step out from the wings and stand center stage in the glare of the spotlight.

Leaders as change agents

Harvard Business School professor John Kotter, an expert on leadership and change, once defined the work of leadership as the “creation of positive, non-incremental change.” This includes the establishment of a strategy to direct the rollout of that change, as well as the “empowerment of people” who will carry the vision forward no matter what challenges they face. Kotter’s definition of leadership also encompasses the creation of a “coalition” of people who develop the momentum to keep things moving forward. 

And, as other scholars on the subject have offered, leadership is all about drawing up the roadmap that others will follow. A leader’s main function is to galvanize others so that they internalize a mission and execute the individual and group tasks essential to realizing it.

7 Key Steps To Developing a Vibrant CSR Program

In a recent Global Giving survey, half of Millennials responding said they would accept a lower salary to work in an organization aligned with their values. Another firm’s studies reflected 70 to 89 percent approval from workers who responded to companies’ support for employee volunteer programs. A consumer survey revealed more than two-thirds of respondents across 60 countries prefer to deal with companies with a demonstrable positive effect on the world around them, whether that encompasses ethical treatment of employees, ethical sourcing of materials, charitable giving, or overall environmental impact.

Corporate social responsibility (CSR) has become a central component of companies’ strategic planning and their marketing and branding activities. CSR has come a long way from when it was looked at as an afterthought or something “nice” to do, but not an essential activity. 

Today, the CSR landscape is completely different: Stakeholders at every level – customers, board members, employees, and the public – routinely look at a company’s ability to engage as a responsible corporate citizen when they make purchasing and employment decisions. Today’s CSR activities may address global issues such as climate change or the refugee crisis, or they may spark conversations on the community level about social justice, equity, and diversity.

The gold standard of CSR

A wealth of examples demonstrates that, when a company practices CSR during even the most stressful of times – such as the COVID-19 pandemic – it can drive significant positive change, not only for the greater good of the surrounding community but to support its own bottom line. 

Patagonia is among the world’s most successful CSR practitioners, seamlessly uniting its core brand identity with a strongly linked and authentic mission in the global community. The outdoor supply company has built its image around good corporate citizenship.

Among Patagonia’s most effective initiatives are closing its doors on election day to give every employee the opportunity to vote; linking its supply chains to sustainable resources; and returning, as a means of helping combat climate change, a multimillion-dollar tax break it received from the government. It even pioneered the development of innovative and more sustainable materials, produced environmentally centered documentaries, and crafted public awareness campaigns, such as a recent one to promote active participation in democracy through voting. 

So how can a company new to CSR start scaling up to reach Patagonia-like levels?

Prepare to do the work

Experienced practitioners say it’s not easy and requires a commitment of time and resources over the long term. Additionally, what CSR looks like at one organization will likely be very different from how it rolls out at another, calling for a thorough study of the company’s identity, values, resources, and goals.

Each company that determines to carry out a genuine CSR program is making a big commitment: pledging to consider all its decisions in light of their impact on individual human beings, society, and the planet. 

Talk to the C-suite

Early steps need to involve buy-in from leadership. Getting a company’s executive team on board is vital. Without this support, needed changes won’t happen. Even if the CEO is not interested, another member of executive leadership might be able to act as a champion and get behind needed strategic planning efforts. 

Find what’s achievable

Start out with a CSR project of manageable size and work up from one smaller success to a larger one. For example, consider donating a portion of annual sales to a community nonprofit whose mission and values align with your company’s. Likewise, an initial effort could focus on phasing out the use of less environmentally sound materials in packing and shipping, or in some other way addressing your company’s environmental footprint through the materials you use.

Get the right fit

Any emerging CSR effort must be built around a company’s core identity and must involve partners who offer the right fit. A financial planning firm might find numerous natural opportunities to support financial literacy classes for adults re-entering the workforce, or a program that would help under-served children receive access to needed educational resources. 

Measure for multiple kinds of success

Establish metrics that will record performance over time. Keep in mind that some benefits of a well-developed CSR strategy will be intangible, such as employee satisfaction or the happiness of students who participate in a company-sponsored cultural education program.

Share knowledge

Network with other companies focused on executing well-thought-out CSR programs, and stay connected to take advantage of others’ experiences and insights. 

Share your story

Communicate the goals of your CSR program to employees at every level of the organization, so they can clearly articulate them to the public and act as brand ambassadors for the ways in which your CSR activities engage the community.

In addition, be sure to involve employees in the building and growth of your CSR work. Rather than feeling they are forced to participate, you want them to develop their own enthusiasm for the mission they can then share with others.

Once you have your CSR strategy in place, communicate mission, goals, and success stories widely, paying particular attention to social media. The more customer support you can build for your company and its efforts to make the world a better place, the more resources you will have to further that mission. 

Spotlight on Beautiful Rehoboth Beach – An Old-Fashioned Delaware Gem

One of Delaware’s most popular beaches, Rehoboth Beach offers visitors the chance to escape back into a simpler time amidst the soft sands of a traditional Atlantic coastal seaside town.

Historic and contemporary posters of every description show some of the beach’s most notable selling points: as a family camping destination where children fly kites and build sand castles on a sun-drenched summer day; as a paradise for surfers and cyclists; as a joyful stretch of game-filled arcades and carnival rides; and much more. 

Simply put, it’s one square mile of simple pleasures and outdoor fun in the “Nation’s Summer Capital.”

The History of Rehoboth Beach

Local historians trace the ultimate origin of the beach’s name to the Bible. The Hebrew name “Rehoboth,” found in Genesis 26:22, is often translated as “broad places.” At the beginning of the 17th century, English explorers called the local bay “Rehoboth,” likely due to its wide sweep of water.

In 1873, the Rehoboth Beach Camp Meeting Association of the Methodist Episcopal Church purchased land from local farmers and established a resort area, constructing hotels, a post office, and a series of small wooden houses it called “tents.”

The organization also built the 3,000-foot-long Rehoboth Boardwalk, now one of the central tourist attractions of the quaint small town. And in 1891, the City of Rehoboth Beach incorporated itself as a municipality in the state of Delaware after briefly using the name Henlopen City. 

Rehoboth Beach is now Delaware’s largest beach resort town. Thanks to the construction of a paved highway in 1925 that stretched from Georgetown to Rehoboth Beach, residents of Washington, DC, in particular have long loved the place. Members of the United States government workforce, as well as foreign diplomats, have spent numerous summers there. As our family demonstrates, Rehoboth Beach is easily accessible from Philadelphia as well as Baltimore. Today, visitors from all around the world come to Rehoboth throughout the year. 

On the Boardwalk

Stroll along the Boardwalk at Rehoboth Beach and find Ibach’s Candy by the Sea, offering handmade classic fudge, salt-water taffy, caramel popcorn, and other treats from the beloved century-old local brand Dolle’s Candyland. Ibach’s, a third-generation family-owned and operated company in itself, purchased Dolle’s in 1959. 

Funland Rehoboth has enchanted families visiting the Boardwalk since the 1960s. With enhanced social distancing, masking, and COVID-19 cleanliness protocols put in place for its reopening in summer 2021, this local institution offers dozens of rides and midway games, an arcade, a Skeeball area, and its signature attraction in the Haunted Mansion ride, one of the most popular adventures of its kind in the country.

The Boardwalk Plaza hotel, with its wrought-iron overhang at the entrance, recreates the look and feel of a Victorian-era seaside getaway with full suites of contemporary conveniences. Victoria’s Restaurant overlooks the sea, and even offers traditional-style high tea.

The Historic Cape Henlopen Lighthouse

In a roundabout at Rehoboth Beach stands a replica of the legendary Cape Henlopen Lighthouse. The replica, built in 1924 by a local realtor to call attention to his offices, serves as a reminder of the storied lighthouse, which collapsed in 1926.

The first foundations of the real lighthouse dated from 1764, with a lantern rising 100 feet at the entrance to Delaware Bay. The lighthouse served as a welcome sight to sea-weary travelers for centuries, and survived British bombs during the War of 1812. Local legends tell a rich variety of semi-true and completely fanciful tales about it, including that it was set on fire by the Redcoats during the American Revolution. 

Due largely to natural wearing-away processes at work amidst the disintegration of sand dunes and the constant action of the waves, the lighthouse at last fell in on itself. But its value as a symbol of the history and character of coastal Delaware lives on in countless images of the state. 

Natural Beauty

The beauty of the Atlantic coast’s natural world is a constant in and around Rehoboth Beach. Nearby Lewes has a Seaside Nature Center with a marine aquarium and extensive environmental education programming. The Rehoboth area also offers several picture-worthy city and state parks.

A walk on the trails that wind through the parks’ growths of oak and pine can yield sightings of birds, deer, and other native wildlife. The town’s wooded areas are also home to numerous sweet-scented magnolia trees. 

The nearly 3,000-acre Delaware Seashore State Park at Rehoboth Beach is filled with possibilities for camping, swimming, and surfing. Local shallow bays are perfect for boaters and windsurfers, and students of nature will find much to learn from the brackish and freshwater wetlands that provide homes for numerous varieties of plant and bird species.

Hikers will find half a dozen family-focused hiking trails through a variety of habitat areas, and easy-to-follow digital trailheads unlock the world of nature at such popular destinations as Thompson Island Nature Preserve. The Thompson Island Trailhead’s approximately three-quarters of a mile of crushed stone surface traces a route featuring memorable views of forest lands thick with conifers, as well as the characteristic tide marshes of the region. 

Featured Image courtesy Jeffrey | Flickr