FIRG Seminar – Matthew Bishop, the Rockefeller Foundation

(upbeat music) – It’s an honor to have
Matthew Bishop here before. As you know, he is the author of a book that as far as I know,
created a new way of referring to the philanthropic sector in the world, philanthrocapitalism
and it is now 10 years since he wrote it. He and his partner, Michael
Green wrote it together down here at the Sanford
School while they were relaxing and enjoying the sunshine
and occasional rain but it was he and he is, before that, Matthew was the philanthropic
columnist for The Economist for a number of years
and earned the respect of a lot of people in
philanthropy, major donors, foundation heads, everything else because he wrote extremely well and
continues to be interested in writing but he decided I think to try, having written
philanthrocapitalism and having worked with a lot of foundation
people and philanthropists, he decided that he would like to try the inside side of things so
he was recruited to run the to the Rockefeller
Foundation where he has been I think for a year, about a
year now and is responsible for a number of things, the
most, I guess, celebrated part is he is oversees the Bellagio
Conference Center in Italy which the Rockefeller
Foundation has been running for how many years? – 60 years. – 60 years. And for those of you who
aspire to go to a place where you can think and
write about philanthropy, there’s no better place
in the world I’m told, I’ve not been there. I said to (talks) you know, I don’t really wanna go
actually but in any event, that’s because I just
don’t do things like that. I rather stay home in my study
and write but in any event, that is Matthew’s, it’s
not his only responsibility but it’s one of his major responsibilities at the Rockefeller
Foundation and so we assume we’ll see lots of changes
occurring at Bellagio under his administration. So Matthew, thank you so
much for joining us again, 10 years after the publication
of philanthrocapitalism, why don’t you reflect a
little bit for us (talks) you, what things have happened that
you think are interesting, anything you wanna say. I encouraged Matthew
at lunch today saying, given what’s been written
about the philanthropy sector and philanthropists and
foundations in the 10 years, it’s really time for him to do a sequel to philanthrocapitalism and deal with many of the changes that occur. So Matthew, welcome to Duke again. – Thank you. It’s great to be back. I think we have a presentation
it’s gonna come up which is a very, just a
series of pictures (talks) – There are more chairs over here. – Not too taxing on the eyes but thank you for having
me back, it was great. We’re saying 10 years
after philanthrocapitalism, it’s actually 10 years and 50 weeks ’cause the 11th anniversary
will come up very soon. I happen to know that
because we published the book four days after the
collapse of Lehman Brothers which in the world of publishing
books about philanthropy, if you wanted to time a book worse, I think I would take on
all-comers on that challenge. I think literally people
were incapable of thinking about philanthropy even
if they had a lot of money because in their minds, they
didn’t have that money anymore and they wonder where the world was going. So it was about the worst possible moment but I’ll come on to talk
a bit more about that. In one of the, I should
say before we start, Joe very kindly mentioned
the Rockefeller Foundation and the Bellagio center. I wanted to say two things. One, that in this talk,
I’m giving my views entirely at a personal
capacity reflecting on my experience since writing
the book and certainly not in any sense reflecting the opinions of the Rockefeller Foundation. Secondly that the Bellagio
center for those of you that don’t know anything
about it is a beautiful place on Lake Como in Italy but
was given to the Rockefellers by a princess, Italian
princess, who turns out to have been the heiress to the Canadian Club whiskey
family, who was one of a number of Americans and Canadians in
that period I think were quite sought after trophies
of down on their luck, aristocracy in Britain and Europe and she ended up being married to a count to becoming a princess
and have this villa. She gave the villa to
Rockefeller Foundation to really be a center for the
study of international peace (talks) and human understanding and
we have a residency there. So people who are writing books can apply to write a book and spend a month there really in a small group, the
only obligation is to eat with your other residents
and to present once to the residency during that time. People naturally, I think, who are writing very interesting
books tend to go there. – [Joel And they have
staff of chefs there too. – Good chefs but all sorts
of people have been there from Ruth Bader Ginsburg
to Marian Wright Edelman and beyond Maya Angelou, all sorts of characters over the years. We also have two very small
conference centers with that take 20 or so people
at a time and the mission of the events and those conferences, which is about 50 or 60 events a year is to bring people together around trying to solve a particular challenge
that’s out there (talks). So I would say to someone
who has a, you know who is doing really interesting
work in social change, you know, if you ever sit down and think if I could get the following
20 people in the room for a week, we could really
come up with some ideas that would move the needle on this work, I say please apply to us and
we’ll see if we can get you in half the events a year
or outside organizations that host those events with us. And over the years, things
like the Global Alliance on Vaccines was the
whole that whole Alliance was formed there, the funders
were found, everything, the concept of impact
investing came out of a conference that happened there. Further back, I think the
field of as we know it, a modern international
relations was really conjured up in the context of the Cold
War and more recently, fields like planetary health were sort of conjured up there as well. So it has a tremendous
history and we’re trying to build on that going forward. So if any of you do have
ideas, please get in touch. So as I was saying, where do I point this thing? Now here we go. So philanthrocapitalism,
in the summer of 2007, written here at Duke, came out the week after Lehman
Brothers with the title, How The Rich Can Save The World. Good reviews in the circumstances but Phil Buchanan who has written a book that’s particularly getting
a lot of circulation at the moment wrote this
absolutely brutal review in the Chronicle of
Philanthropy which he headlined Lehman Brothers to the
rescue is the way that he sort of summed up our analysis
of the world of philanthropy. My co-author and I sat down
after that moment and said, Well, you know, normally
when you write a book, publish a book, you get
a few months grace period to go out and sell your book to the world, should we give up at this point and just leave town and
never be heard of again or, we actually started, (talks)
actually in the context of the global crash that
was going on at the time, there were all these
articles being written about how the age of business is over, the age of the nonprofit sector is over, it’s all gonna be big
government coming back ’cause only government is capable of picking up the mess and
solving it and we said, well, no, it’s true, there’s
gonna be a lot of demand on government but that’s gonna
be largely about bailing out all the existing failed institutions. There’s gonna be even less money around for the sort of thing
that we were talking about in philanthrocapitalism
which was this new money that was coming in to the
so world of social change from the new entrepreneurial
class that had emerged that had made unprecedented
fortunes and that how they use that money is
gonna be more significant rather less significant
in the post crash period and so we said actually,
we’re gonna stick to our guns, we’re gonna carry on talking
about this and we’re gonna go and find anyone that will
listen to this message and really try and share with
them and help them figure out how to do a better job of using that money because I think one of the
things we did notice in the book was there were lots of
people with brilliant ideas about or brilliant aspirations but actually brilliant
execution of philanthropy is very, very difficult. One thing we did do is change the title of the book a little bit. We dumped the rich at
that point and replaced it with How Giving Can Save The World and we got rid of the
dollar sign and we put some, we put a rock star and a famous
TV host and Bill and Warren on the front of it in the hope
that that would boost sales and we got Bill Clinton to write, he offered to write a foreword
to it which we accepted against Joel’s advice who said,
“Stay away from that man.” But anyway, we took his
foreword and that was the re, we relaunched the book about a year later. So this is 10 years since the relaunch of
philanthrocapitalism. Warren Buffett and Bill
Gates are the starting point of the book for those of
you that haven’t read it. And we start with a moment at
the New York Public Library in 2006, where I was lucky
enough to be a reporter in the room where Buffett gets up on stage with Bill and Melinda and
says, “I’m gonna give away “most of my money to tackle problems “of extreme poverty in the world.” And we had this situation of
these three people up on stage, probably the two most
successful business people in history at that point,
certainly in modern history and unprecedented in terms
of getting up at this point of their lives and saying
we’re gonna give away most of our money to help the
poorest people on the planet, the most vulnerable people on the planet get out of their misery and
get into a better trajectory. And so sitting in the
audience, my view as well, you know, is this possible? Is this just an
extraordinary one off event? Are they mad? Are they serious? How would they do this? What’s brought them to this point? And with Michael Green,
who was someone I was at high school with and
then had reconnected at various points over the years. He was working for the Department for International Development
in the United Kingdom, really dealing on the front end of the Make Poverty History campaign which was a big campaign around
trying to get a lot of aid and trade work moving forward and we just spent a lot
of time debating this and said let’s write a book about it and that’s where the book
begins and what we found was that this wasn’t a one
off, it was clearly a movement that lots of people who
were making a lot of money in America initially but also
increasingly around the world, were turning to philanthropy
and they were taking on some very big, difficult challenges and as Warren Buffett said
when he gave that money to Bill Gates, his foundation, making money is the easy part, giving it away is very much harder. You know, we’re trying to take on problems that many great people over
the years have taken on and not succeeded in as
much as we hope to succeed and we recognize that we’re
standing on the shoulders of giants and trying to
tackle really, really deep rooted problems and
so lots of other people we reported on the book who also were going about philanthropy in that way. And I think the book did have immediate sort of criticisms thrown
against it for just the fact that we stood up and celebrated
this new wave of philanthropy even though we at the same time
raised a number of questions about what it would have to do to succeed. So Michael Edwards, who was a long time
Ford Foundation leader, he wrote a book before we came out, before he’d even seen our book actually, which was an interesting
strategy, attacking our book because we were apparently against grassroots based philanthropy and he didn’t really
like the idea of scale. So he was the main opponent at the time and that all kind of fizzled
out because of the crash and no one really cared
about grassroots people in that moment because they were worried about the world falling apart. I think now that has come
much more back into vogue is one of the criticisms
that we’re hearing a lot as the book is being attacked
for a second time round now, most prominently Of course
by Anand Giridharadas. You know with his book which is accuses philanthrocapitalists
of being practitioners of an elite charade and I’m gonna talk a bit about that later. My summary is that I was very disappointed on reading the book, I felt
he didn’t really report on philanthropy at all. It was a very narrow
book, very much picking on some obvious charlatans
and highlighting them but without really
looking at other examples which would have maybe
told a different story such as the Bill and
Melinda Gates Foundation which you would think anyone writing about philanthropy today
would feel some obligation to write about it
although it’s interesting that Bill did endorse the book perhaps because he wasn’t written about
in the book, I don’t know. Anyway, interesting
speculation on that one. But also George Soros is attacked for not being interested
in systems change. I would again say if you properly
reported on George Soros, it would be very hard,
whatever you think of him good or bad to think
that he wasn’t interested in systems change. So I have a lot of problems with the book but it clearly has touched a nerve I think because it has picked up on two things that we actually anticipated in the book. One, the rise in inequality
and at some point, if you don’t have a response,
if the people who do well out of inequality aren’t
responding to the many people who aren’t doing well in that environment, then you’re gonna have a
social crisis of some kind and clearly we’ve heard that
that we’re in the middle of it. And you know, I think
secondly, just a general anger towards the rich and business which is continuing I think to grow. So he did strike, he
did and I think the book has done very well because
he captured that anger. Now, I would say that many
of the philanthropists that we wrote about in
philanthrocapitalism have been concerned about
the rise in inequality and have been trying to
do something about it and it’s very hard to make
a very clear connection as he alleges that all
their philanthropy is acting in their self interest to try and preserve their business interests. I mean, I think in some
cases, you can probably make that argument more easily
than in other cases but generally, I think the
people I would be attacking is the people who aren’t
doing philanthropy and those who are perhaps the most successful
philanthropists of our time who are those who are fueling
the anti-government movement at the moment and (talks) to
have made a great success of it not just here in the States
but around the world, you know, obviously David Koch died recently but his brother Charles
Koch continues to preside over extraordinary effective
philanthropy in its own terms but which is in the
interest of its backers but probably isn’t in the interest of the society as a whole
I would argue but anyway so that book, we can
come back and talk about. We had two other main critiques. One is the Phil Buchanan,
who I mentioned earlier who’s written a book
(talks) – Called Giving Done Right which is actually a very
positive book about philanthropy. I don’t know why Phil disagrees
with me so (talk) or feels he disagrees with me so much
’cause I feel we agree a lot on a lot of the basic points. One of the points we make
in philanthrocapitalism is that actually, you need
to build up organizations that are working on the
ground so that they have the capacity to do the
work they’re setting to do that one of the curses of
the philanthropic world is you have to spend all
your time raising money, you have to spend all
your time raising money for particular projects,
no one funds overheads, no one funds the back office
and all that kind of thing, which is all the sort of thing that Phil has been talking about in his book and I completely agree with him on. What he doesn’t like is the notion that anyone would view
philanthropy as an investment and one of the things we talk a lot about in
philanthrocapitalism is that one of the things
that some of or many of these new philanthropists
are bringing to the, the philanthrocapitalists
are bringing to the table is that they like to think
about their philanthropy in a similar way that they
think about their businesses so they ask questions about
what are we trying to achieve? How do we think the money is
being invested effectively? What sort of outcomes are we hoping for? What return on our money are we getting? And I think it’s easy to
confuse that with saying we wanna turn charities into businesses which I think some of them do but most of them don’t want to do. But I think an investment
mindset which says, I’m gonna view my donations
as rigorously as I view my financial investments,
I’m gonna really ask what’s this money going to be used for, how’s it gonna be deployed, what am I expecting back from it? That just seems to me the definition of being responsible with your money and investment language
helps you think about that. Now obviously some
investors do crazy things with their money and so I’m
not encouraging philanthropists to do that although some of
the people who’ve like Soros who have taken the
biggest risk as investors also have taken very, very
big risks as philanthropists and have been successful and I don’t think any philanthropic advisor would
have said to George Soros, “Yes, put a lot of money
into the former Soviet Union “and Soviet controlled parts of Europe “in the hope that you’re
gonna bring down communism “and produce liberal societies.” – [Joel] But he did.
– And (talks) – But he did it and it actually probably, you will probably say he
made more contribution than many other people, diplomats,
politicians and the like in bringing that down. So I actually still think
that the investment framework is a good way to think about most of, your long term serious philanthropy. I think there’s also should be a place for just discretionary,
emotional response philanthropy but the investment framework is a good way to think about it. And then we have this book by Rob Reich from Stanford University and he makes the point really which is that most philanthropy reflects a different set of priorities to those that the government has and he has a problem with
that because he says, the philanthropists pay
tax privileged in some way and therefore, you would
expect that the tax privilege ought to go into activities that reflect the priorities of the government or maybe the people more broadly defined. And I think he has a point up to a point and certainly, I think
any philanthropy has to, you have to be able to if
it’s getting a tax break, it ought to be able to
answer the question, are you making better use of this money than the government would do in terms of driving social good? That ought to be an exercise
that has gone through. On the other hand, I
think that we are dealing with a number of, there
is a reasonable critique of some government which is that it doesn’t innovate very well and a lot of well I’m seeing from philanthrocapitalists is about investing in
experiments and pilots that test new ideas and
if those ideas succeed, they often get embraced
and scaled up by government and so they become a sort
of r&d, an experimental lab for government in some
ways because government is the most likely,
the most capable entity of taking small ideas and scaling them up so they have a massive impact. So I think of those
books, Rob’s is I mean, it’s kind of interesting but
I think he’s a bit utopian about what government can do at its best and hasn’t really answered
the question for me of how do you drive
innovation in government given particularly in
democracies as we are finding at the moment, the constant election cycle really does work quite hard against people who wanna take risks ’cause
anything, anything you do that doesn’t work out, you
immediately are gonna get a front page story
criticizing you for doing it. So I think it encourages
a lot of risk aversion and makes that quite a
difficult act to do innovation I mean and the classic
example I would take is Michael Bloomberg when he went into to be the mayor of New York. He wanted to start what
he basically a very, very intense management training center for school principals for public schools and he realized very quickly
that given it was gonna cost about a hundred and fifty
thousand dollars per headteacher to be a principal to
be taught to be trained that he would never get
this through the budget in New York City because
the New York Post and mail, New York Post and News
would be all over this and shut it down. So he with a number of
philanthropists like Eli Broad funded this training,
this teacher cen, (talks), this principal training center
and then after a few years, it was so clear that the
schools that were being managed by these principals were
doing so much better that it was a no brainer for the city to take over the funding of that entity. So that’s sort of classic,
I think good case study of philanthrocapitalism working. Anyway, so January of 2009,
I get invited to Davos to sort of chair a discussion
on philanthrocapitalism and philanthrocrisis with
people like Clinton and Gates and Muhammad Yunus and Richard
Branson and that point, I, this is where I
would have some sympathy with Anand and his book is I
asked the question at the time, do you think this is a
crisis of capitalism? Do you think we need to see a
fundamentally different view, a different set of behaviors from the leaders of
philanthropy in this moment, should the rich be stepping up and should companies be stepping up to the next level in terms of
their giving back to society? And I was really kinda
disappointed by the answers I got. Only Muhammad Yunus actually said I think there are serious flaws
in the model of capitalism and we need to really focus
on fixing those flaws. Branson said yeah, I think this is still, capitalism is still the best system that we’ll come through
this and Bill Gates and I think this is where
he would be very different to say Andrew Carnegie’s,
you know, when he and Andrew Carnegie’s
gospel of wealth written in the late 19th century, he is very clear that unless the successful
people in society give away most of their wealth and
indeed the man who dies rich dies disgraced by his wealth
is basically what he said. The basic socialism or communism
would bring down the system and anarchy would follow. Gates won’t go there for whatever reason and what he was saying back in 2009 was, for me giving has been very fulfilling, it’s been the most
fulfilling thing in my life, I would urge other wealthy people to give because there’s nothing
better than helping to save millions of people’s
lives which you can do as a very wealthy person. So it was a very positive message. He wouldn’t get into any of the
social structural dimensions whereas David Rockefeller
senior who I had interviewed shortly before that,
he was in his late ’80s I think at the time. He was very, very obsessed
with the rise in inequality and how philanthropy needed to
fulfill and respond to that. And I think if we look
at what’s happened since, you’ll find some of the
philanthrocapitalists that really are concerned about
inequality, many still I think have blinkers around that. They were addressing particular
problems I think sincerely but they don’t feel that the system itself or they hadn’t done until quite recently was under serious challenge. And I think as a result, they
missed a lot of opportunities to really give more I think and to give more effectively around trying to reform the system
earlier in the process than now which is now it’s
getting a lot of attention, you’re seeing lots of
philanthropic gatherings around reimagining capitalism
and reimagining society which I think should have been happening seven or eight years ago or at least. So anyway but Yunus I think did get this. He understood this importance
of a business rediscovering its social purpose and
philanthropy needed to be a glue in society rather than sort of
a more focused and or narrow, a narrow sort of personal activity. It should be seen as
something that’s much more part of a movement, that’s about ensuring that society continues
to flourish and prosper. So how are we doing on time here so. – [Joel] Okay. – So billanthropy was,
this was what got me going. When I was at The Economist,
I wrote an original article when Buffett and maybe I
should have called the book Billanthropy and it would
have sold a lot better. So another piece of
advice when writing books is words that no one can
say not good on the title and philanthrocapitalism
turns out to be very for some reason people get
their tongues twisted about it. Billanthropy would have been good. Anyway, moving on so I asked Bill, I interviewed him on stage
a couple of years afterwards and I said, “What do
you think of the book?” And he had two answers. One, I thoroughly agreed
with, the other one I thought was very odd given his
subsequent behavior. The answer that I thought
was correct was Melinda, you didn’t really write
about the role of Melinda in the book, you wrote about me and didn’t take her into
account and generally he critiqued the book for
not giving enough space to the role of women in philanthropy and I think if I was
writing the book today, I would absolutely recognize that that was a terrible
omission and wasn’t done… It was a bit like the
Forbes list of innovators that came out this week
which you know, 99 of them the best hundred innovators
in America according to Forbes are men which I think
reflects the uselessness of their algorithm rather
than what they really think and I think with the philanthropy thing, so many of the philanthropists,
the money was made by ostensibly by the man in
the partnership and so you tend to write about
them as the philanthropist whereas in fact, most of the
actually serious thinking about the philanthropy
turned out to have been done by the other half of the partnership who also probably made a big contribution to the making the money as well. So, which is also not very well reported. So, he is and I think Melinda’s role in the Bill and Melinda Gates Foundation, I think will turn out to have been huge in all sorts of ways. Whenever somebody gets around
to writing a proper accounting of the Bill and Melinda Gates Foundation, that will be one of the
stories that comes through and I think without any doubt, that foundation has completely
changed the way the world will think about philanthropy forever or to think about philanthropy
whatever, no one could say it was a (talks) organization
(talks) has many weird and sprawling bureaucratic elements trying to get money out of them, you enter a sort of maze I
think and it can often be, you often wonder whether
Bill and Melinda really know what’s going on in the
foundation but nonetheless, it has saved millions of
lives I think without a doubt and he through his personal example, she through her personal
example have really set a very high benchmark for
what is expected of people in their own peer group as they succeed. Now, it’s interesting that maybe
if you take the Anand view, you just don’t want the
rich to do anything, you want them just to be
taxed very, very heavily but if you do take the
view that you want the rich to actually give back significantly, they have really set the benchmark. – [Joel] For those who don’t know, Melinda Gates is a Duke alumni. – There we are. – And was a trustee of Duke for a while. – Excellent. So the other thing was that
he said, (talks) the book you write about the philanthrocapitalist as if there’s a movement going on. And I said, “Well, I think
there is a movement going on.” And then he launched the Giving Pledge about six months later which,
if it’s not a movement, I don’t know how you define a movement but it’s like a movement
around the billionaires of the world to say, “Let’s sign a letter “promising to give away
by the end of your life “at least half of your wealth.” And now I think it was a hundred
and fourteen at that point, there may be more, probably more now. – [Joel] It’s nearly 200, it’s nearly 200. – Nearly 200 now. Now, I recently heard from
people who were involved in the launch of the Giving
Pledge that at the time when they were gonna launch it originally, they were gonna have three requirements. The letter that you give away
half by the end of your life, a requirement that you actually
start doing so immediately. So an act of giving just material increase in how much you give and a requirement about how effective the
giving was but I think one or more of the principals ruled that you were only gonna get
people to sign one thing in a pledge and you gotta
pick one of those three and the one that they
chose was the amount, half of your wealth during your life, by the end of your life and so but I think that it does reflect a problem with the Giving Pledge that
I think some people would say is quite a serious one
which is, a lot of people are signing the letters
but a lot fewer of them are really making the kind
of big step up in giving that you would hope to
see and so many of them do seem to be leaving it
until the end of their lives which is great as far as it goes but I think a big missed opportunity. I think Carnegie again
would say you actually can bring tremendous
skills to bear in deploying your money now while you’re
alive rather than leaving it to an organization to
deal with it afterwards. And so, others have done, I
mean some really have increased their giving dramatically
as a result of the pledge but I think I would still say
that we’ve not seen enough of that money really moving. And I saw a chart about a year
ago that someone had tracked how much the giving had
gone up for each of the first hundred signatories
of the Giving Pledge and how much their wealth had gone up since they signed the Giving Pledge. And it turns out, their
wealth has gone up about 400% and their giving has
gone up about 30 to 40% so that kind of, you know, I guess these have been
particularly good times to be rich in the last few years because of the way markets have gone and so
forth but nonetheless, you would hope that the Giving
Pledge would have produced a much more significant
outflow of funds than. – I’m not gonna get the
figures right but Tom Tierney who was the co-author
with me on Give Smart has been doing work on just
that question and it turns out that if you look at the wealth
of let’s say the top two or 300 people in the United States, the percentage they’re giving
away is something like 1.2%. I mean, that’s not the
exact figures, what it is what it does say is that
the massive undergiving for people of that wealth
given the problems in society. – Yep. So I just wanted to talk very briefly because I think one of
the messages that people may have taken away from the Anand book and some of the other critiques
of philanthropy is that, nothing gets achieved
and I would just take the Gavi Vaccine Alliance that Bill Gates was very early involved
in which at the time, it was launched in 2000. Basically, five million
children a year were dying under the age of five because they hadn’t got basic vaccines and over the last 19 years,
that number has been reduced by about and I think,
somewhere around 60 to 70% because of vaccines getting
out to people, maybe even 80%. And so the people have tried
to do economic calculations of what a dollar given
to Gavi is worth in terms of the long term economic
benefits of the society and it’s somewhere between 15 and 80 times the value of the dollar that goes in if you take those economic
analyses to be valid and– – It’s also interesting, the
first major step in dealing with AIDS was financed by
the Diamond Foundation. They’re the ones who put
up the money back in 1982 right when the AIDS epidemic was first beginning to be recognized. They put up the money for scientific work at the New York City AIDS Research Center which produced the first
cocktail treatment for AIDS that had never been invented. So you see, there’s a direct
line between the philanthropy that created that first
step and what GAVI has done ever since and the hundreds of millions of dollars that (talks). They still haven’t found a vaccine but they seem to be moving closer. – Yeah, (talks) Gavi was
followed by the Global Fund which did the AIDS,
– Right. – Malaria and tuberculosis. Again, huge success as you
say, what would, again, both of those funds are now
seeking new finance at a time when progress is starting to stall a bit in a number of those areas for
various reasons ranging from, maybe getting to the heart of cases to, certainly in Pakistan, I think there was because of the way spies were trying to track down Bin Laden, they
were posing as vaccine people and so the people obviously reacted against anyone coming offering vaccines. So there’s different reasons
that things have stalled but massive success it
shows you know, Bill Gates his basic point was he was reading the World Development Report
back in the late ’90s. There was an explanation
that you could save millions of lives through investing
in these vaccines of various kinds, I think TB to start with and he has proved that’s
true and I think a lot of other people who invested in that model but there’s still now, there’s
still one child in I think, still of the initial group
of people, populations that weren’t being vaccinated,
they’ve got 80% of the way so there’s still 20%
of the original target of people each year they need to vaccinate that still have to receive vaccination so there’s still some way to go. Let’s take marriage equality. I think, you know, obviously
massive social movement but when the history of that
movement is properly written, it may have been written already
and I haven’t read the book but lots of philanthropy
played a huge role in that funding key court cases. – [Joel] Tim Gimbel. (talks) – Big, big success. I mean, imagine half the
world’s view on this topic has literally been transformed
in less than 20 years, probably less than 10 years in some ways. The role of philanthropy in
that was absolutely crucial. This man Nandan Nilekani is someone I wrote about in the book. He co-founded a company called Infosys. He has basically he’s the
man behind something called the India Stack or Aadhaar
which basically, they just got, in India, 10 15 years ago,
most people didn’t have their birth registered, they
didn’t have any unique ID. He created a system which gives (talks) 1.2 billion Indians a
unique ID with biometrics in and then on top of that has
been built this whole series of bank accounts, systems
to transfer welfare payments to people bypassing very corrupt officials that used to take most of that money away, they’re building all
sorts of other services and building a whole digital
platform for the country of India that is a very
complicated alliance of businesses, philanthropists and government
and he managed to persuade the Congress Party to do
the initial setup of this and then when Congress
lost power to the BJP, the normal expectation in India
would be the new government would shut this down. He went in, persuaded Modi
that they should carry on with this experiment and now, you know, I think if you wanted
that one example of how in a very, very brief period
you could drive massive change, India now, you know, I think India now is really in a position where
it can use data in a way to drive social change and
to get benefits to people who need it, to provide education, to provide healthcare services
through a digital delivery that just is better than
anywhere else in the world in terms of its own inherent platform. Now it’s not without its
controversies as here. People worry about it
rightly about the data world that we’re living in and how
do we regulate it properly and one of the challenges in a country that doesn’t have strong
regulation, India I think wouldn’t have a strong
enough regulation is that, there’s surveillance opportunities that government may exploit
some of those powers that the platform gives
it but I think, again, it’s a democracy, they’re
having those debates, they’re sorting it out
and what you’re gonna have out of India is probably one
of those much talked about but rarely observed cases of leapfrogging where they will have a
digital state platform that will be the best in the world. And it’s thanks to them. So and then another thing if you look back over the 10 year period,
we wrote about business and its social responsibility. This is a man called Hamdi
Ulukaya, he founded Chobani of which many of you will
have had their yogurt. He is a, he himself was a Kurd from Turkey who came to America with
like 300 bucks or 3000 bucks and somehow managed to start a company and about half of his
employees are refugees. And he started a foundation
to bring businesses together to address the refugee
crisis around the world. That kind of business model
was not really considered appropriate in America 10 years ago where the Milton Friedman
view was still dominant that the social responsibility of business was to maximize profits. Now I think we’ve had the
Business Roundtable come out in the last few weeks and
say we are now adopting a stakeholder framework that we recognize we should be investing back in society and not just maximizing
shareholder profits. Very interesting and he is one
of this new breed of leaders, you get Marc Benioff at
Salesforce and around the world, all sorts of new business
leaders who are starting to come out and say
something and actually act, I think in ways that
are much more long term in their orientation and
as they’ve the longer term, you view your role in the world, then the more likely you are
to do constructive things rather than just take money out. So that’s been a huge
shift in the last 10 years. We’ve had this emerging
field of impact investing come out which is still I
think a lot smaller than I would like to see it
be but it’s this notion that investors actually
are deliberately using their investments to both
make money and try and deliver a specific social or environmental
outcome at the same time. You know, now we’re having
fund, the funds have been raised (talks) managing billions
of dollars going around seeking those kind of
investment opportunities. And (talks), if you look at
the capital markets as a whole, there’s definitely a shift
in the center of gravity in the markets happening where
the biggest fund managers like BlackRock are talking a
very different sort of language to what they were talking
about 10 years ago. Now, again, I would say
there’s a danger that with this is a kind of reputation washing, I personally think it’s
there is enough sincerity that if the rest of us
can put the right activism and peer pressure on these groups, they could really move
significantly in that direction but it’s definitely the
battle of philosophies is one for now by people
who have a much more philanthrocapitalistic mindset
and we just need to make sure that that really translates into action. It’s also gone global. I mean, I put this business, this is my all time favorite business card that anyone ever gave me. This is a Chinese philanthropist who, I mean just the list of I’m not sure he’s the best
philanthropist actually in China, I think he’s the most anywhere. – Is it really a business card? It’s a real business card. – It’s a real business card. I blanked out his details so that when you’re all calling him up. – [Woman] If you’re calling (talks) – It’s environmental
preservation demolition expert is a particularly good
one but anyway, but anyway but actually, I’m making (talks) flipping about a serious point is
that we’ve seen again, when philanthrocapitalism came out, there were very few notable
examples of new entrepreneurs in the developing world
embracing philanthropy. Now, you know, they’re very serious. When Jack Ma, the founder
of Alibaba has I think stepped down today.
– Today. – As chairman of his company to go full time into
philanthropy and is very much being advised by Bill Gates and other eminent philanthropists. What you’ve seen, I think
partly as the result of Giving Pledge is that– – [Joel] Right. – As you go around the
world, this very American, traditional American idea of
being successful businessperson means that you become you have to go and become a serious
philanthropist you know it’s really taking off as
a global idea and again, I think there’s an enormous
opportunity in that if we can actually scrutinize properly and hold these new
philanthropists to account that they will actually start to do that giving in a very effective
way and it’s gonna be very interesting to watch
Jack Ma and what he does because he’s very smart
and he’s very plugged in to the best thinking
around on these issues but operating obviously in
a very different environment where you have a Chinese
state that really still hasn’t made its mind about what it thinks about private wealth. You know how does he
operate in that environment. I want to just talk also about two things I personally have been
involved in co-founding since we wrote the book and one is called the Giving Tuesday campaign
which was really founded by a friend of mine called
Henry Tims who’s written a very good book called New Power which I would recommend
too if you haven’t seen it but essentially we launched
it in 2013 as a hashtag and it came out of a
conversation around Thanksgiving which was, why is Thanksgiving
such a lovely holiday followed by this sort of orgy of shopping on Black Friday and Cyber Monday? Why don’t we do something
about getting back to the spirit of giving on Giving Tuesday, have an online campaign around that? And I think it’s just we
were very lucky in that we coincided with lots of companies have and charities having organized millennials to run their websites and had
no idea what to do with them so they were all very
keen to be given a project and as a result, they
were very, very inventive in getting this out there
but now, this we never saw it as anything other than a
US orientated campaign. I hosted a meeting in
Bellagio in the spring for the Giving Tuesday global group and there are now 50 countries
with a Giving Tuesday event none of whom, very few of them
have Thanksgiving (talks). I think they’re all Black Friday, I think they have Cyber
Monday somehow but anyway, there are now 50 countries where they have a Giving Tuesday. It’s basically about
just celebrating giving and what you’re most
passionate about giving to and the fact that there
is such global traction for something like this and
then we think on the day, this last year raised several
hundred million online above what you would have
expected without any real and it’s entirely distributed
model, it’s just a platform, every organization goes
takes whatever the logo and other things and the
press releases off there and customizes it for
themselves and it sort of it just has an amazing momentum. The other
(talks) – Yeah, go ahead. – I was just gonna say
that, thinking about the global effects of the Giving Pledge, it’s really interesting that until the Giving Pledge
occurred, at least the first part during the first period
of the Giving Pledge, there were no foreign non-American donors and there were some
notable wealthy individuals like Carlos Slim for example
who was interviewed and said, you know, why don’t you
give away more into charity? He said, “I don’t wanna
give any money to charity, “my greatest impact is
gonna be creating jobs.” Five years later, after
the Buffett Gates pledge was started, he joined it. It also has produced
the billionaire members. I mean, imagine the
first notable giver ever from Scotland joined. The Scots are not as as miserly
as they are thought to be, I mean, obviously but now
you look around the world, you see members of the Giving
Pledge from China, from India, from other countries in Latin America, from other countries in Europe. So the point is, I felt
from the beginning, the Giving Pledge would have
much greater effect abroad than it did than it would
in the United States and I think that’s still the case. I think there were not many
new donors who are attracted to it because of the fact that
it was there but for other for as and Brad Smith, the
head of the Foundation Council and now the chairman and
CEO of this new organization called Candid, which is a combination of the Foundation Center and a website. He said the idea of creating
a club that rich people all over the world would like
to join because of the people in the United States
who are involved in it as leaders there, it spread and the growth in the non-US members has been
larger in the last five years than the growth among
the US members in it. So (talks), I didn’t wanna interrupt you but it was related
(talks) – [Joel] To what you were saying. – Absolutely. So the other thing I got involved in was the single The Social
Progress Imperative which again, came out of a conversation
with a lot of philanthropists and social entrepreneurs in
about 2011 and we were trying to come up, it became very
clear that there was a, it was an international
group and that people were really frustrated that
no one could really compare from one country to another what worked and what didn’t work and we
just had this GDP obsession (talks) countries with
bigger GDP were better than those that had lower GDP and so a number of philanthropies, the Skoll Foundation for the Rockefeller, Larry Page, various other,
Nick Hanauer over the years have funded, creating an index,
we work with Michael Porter at Harvard Business School
to do this, to actually try and create a proper map
of how societies are doing in terms of actually
delivering social progress to their people because it seemed like one of the big problems of philanthropists
(talks) governments have is that they didn’t have
good data on what was working and what wasn’t and certainly,
as they were looking around the world, it was
very hard for them to see where the examples of real success were. In contrast, the business
world where it was very, there was a lot of data
and a lot of evidence on what was going well and what wasn’t. And so the social progress index has been really funded
entirely by philanthropy and now, what we’re
discovering is that the US is actually going
backwards on the measures that we have and that’s
particularly driven by some of the violence and
the intolerance and rights areas of how you define it. But also, we’ve now just broken it down into a state level measure
and you can see where the in terms of the measured out of a hundred, this is how the different
states are and you know, I show this partly ’cause
it’s philanthropists doing what I think one of the things that I’ve been most disappointed
about in the 10 years since the book came out is
how little philanthropists in general have been willing
to invest in the ecosystem of measurement and impact
that would allow you to really raise your
game as a philanthropist and as a society in terms of
delivering good to your people. So this was one attempt
that we have going on to try and provide some of
that data but it’s really, I mean what we’ve discovered
is it’s really, really hard to raise money for this kind
of work ’cause philanthropists (talks), there still seems
to be a bias towards things that you can be photographed
funding like babies and schools and things like that. – [Woman] May I ask,
what are the measures, just wanna make sure I’m
understanding what (talks). – Okay.
(talks) – On this, so what we
have basically traced, it’s three pillars that have
four components in each pillar, basic needs, what we call
foundations of wellbeing and then rights and opportunities
in the three columns. I mean, there’s a website, but it’s a mixture of very
fundamental things like housing and shelter and health,
basic healthcare through to be able to marry who you want or not being attacked for political views and that kind of thing. Anyway, (talks) this broad point that and it’s one of the points Joel made to me before we come back onto Soros. When we were first talking
about philanthropy, was there’s this thing called
the philanthropist curse which is that you, when you
become a philanthropist, you never eat a bad meal or
tell a bad joke ever again because you’re surrounded
by people that give you positive feedback
– Right. – About however bad you
are as a philanthropist, you will never hear it
from the people around you because they will want to
apply to you for money. And so, I think one of the
things that and it’s why Phil back in the day, Phil
Buchanan was able to make this Lehman Brothers to
the rescue jibe (talks) about the book was that we have
this chapter called virtues intermediaries and the
basic notion was that one of the things that makes
capitalism work as well as it does which is
obviously not perfectly and what’s particularly bad, the week before our book came out is that (talks) a whole
series of professionals in the middle whose job
is to actually figure out what is working well and what
isn’t and to get the money away from what isn’t working well and put it where it’s gonna
succeed and it seemed to me that was the thing that was
missing from philanthropy, that everybody was basically defining their own yardstick of
success and there was no one in the system willing
to give honest feedback or very rare people in the system willing to give honest feedback and
if you ask me to say one thing that really hasn’t happened
which I thought would happen over this 10 year period, it is that we just haven’t
seen really the maturing of a intermediary sector in the way that I would have liked to see it. We see consultants like
Bridgespan and we’ve, what’s the new, there’s (talks) emerging as seriously large players who do provide very strong professional
consulting support to philanthropies but we haven’t seen that some real public debate
about buy and sell essentially that you get in the financial
markets around performance of philanthropists and
performance of the organizations that they are giving money to
and it’s very hard therefore to have real confidence that
the money is being deployed as well as it should be
and very hard even for, I mean you have to be
incredibly self disciplined and self scrutinizing as a philanthropist to really hold yourself to
account on doing a good job as a philanthropy because
the whole system around you is almost designed to stop you doing that because anyone will throw
you a black tie dinner, they’ll give you an
award, they will tell you you’re doing a great job and
here’s two or three other ideas that you might want to fund as well sir. So it’s a problem and I
think if we can’t solve that problem, it’s gonna be
very hard for philanthropists to argue back in many cases, particularly when they move into more nuanced areas like fighting inequality and
building social capital up that they’re really doing a good job when the critics say they aren’t. So I still think that is a huge challenge. We’re starting to see some
progress on the other area that I hoped would be a lot
more advanced than it is which is a collaboration
between philanthropists. And so one of the things that
Rockefeller is partly involved in funding is something called Co-Impact where a bunch of the very
wealthy philanthropists have said they will form a kind
of a collective vehicle that will scale up proven nonprofit models to reach much greater numbers of people. And then there’s Blue
Meridian here in the States which is another very
– Right. – Interesting example of
that and there are a few of these vehicles that are emerging. Rockefellers also started (talks) fund jointly with MacArthur Foundation. Well MacArthur has put 30 million
into this Rockefeller fund to help develop some impact
investing catalytic finance to help encourage the
mainstream capitalist the financial markets to move into areas that they would be
normally staying out of. So there are a few examples
there but again I think it’s the not invented here syndrome is terrible in philanthropy still and the lack of care I
think about exit strategies which is another thing that
people in the financial world think about all the time is
not very well thought about in philanthropy so lots of
organizations get given money that gets them started,
they’re just about to enter into their fast growth phase and they hit what they call the valley of death where suddenly the original
funders have decided that they’ve proved their
point and they’re gonna move on and do something else and no
one else wants to take over that role because they
didn’t invent it themselves. (Joel mumbles) So those issues are still we
write about them in the book, they’re still problematic
about philanthropy and (talks), you know, we need to
figure out how do we create an environment which really
rewards philanthropists for doing those things collaboratively and less about the size of the check and the size of the foundation
and more about the outcome. And so my hope is that
what will come out of some of these critiques
that’s going on at the moment is that we will have
the philanthropic sector raise its game on these points. The trouble is the nature of the, certainly the Anand critique is so hostile to the very act of
philanthropy that it’s hard for there to be a
constructive response to it which is actually what you
really want is a book that says, okay, how do you raise your game as a group of philanthropists
rather than just you are all bad for even
doing it in the first place. Now two, I will make
(talks) two more points to the finishing with George Soros I think is one of the most
remarkable philanthropists. Whether you love him or hate him, he’s made a huge difference
but it’s very interesting to me what’s happened to him and
most notably in Hungary where he was born, where he founded the Central European
University has had to move out of the country. I mean, there are issues
around anti-Semitism clearly but I think there’s also, he
is emblematic of a huge trend that is going on around
the world at the moment of the deliberate trying to shut down the global philanthropists and
to close the space available to civil society that I think we are all kind of sleepwalking
into allowing to happen. It’s a part of the
general populace hard-man leadership fashion that’s
going on at the moment but the first thing that Putin does is he starts getting foreign charities and foreign philanthropists
to have to register as foreign agents in Russia.
– Right. – And so forth. This is now happening in
lots of places and I think it’s something we all need to be thinking about a lot harder. And then we have the issue of Jeffrey Epstein and the Sacklers. Again, in the book, this
is rather a dense slide but we have this the
statement near the end, where we’re calling for,
recognizing that the wealth was gonna be a growing
political issue in society, saying there ought to
be a new social contract between the rich and
everyone else and we set out this thing called the
Good Billionaires Guide which had three components. One was that you should make your money in an ethical fashion. The second was that you should
pay a higher rate of taxes than everybody else that
wasn’t earning as much and the third was that you
should give away effectively a good part of your wealth. What’s happening at the
moment is quite interesting in that respect if we go
back to Sackler and Epstein and the, I mean I think
that Sacklers are probably classic examples of they would fail the Good Billionaires Guide because they were obviously
making their money in a unethical fashion
– Unethical. – By pushing these opioids
out in a way that they knew was gonna be deeply harmful. Epstein is more complicated
because he appears not to have made his money but we don’t know how he
made his money actually but the reason he is
unethical, he is a prior is obviously that he’s
a convicted sex offender and alleged sex trafficker
who was clearly right at the heart of philanthropy,
major philanthropic circles right up until maybe a few months ago. – [Joel] Including the
British royal family. – British royal family yeah, I’m not sure they’re
philanthropic particularly but certainly I mean
met with Gates in 2013. I think that a lot of, I mean
it makes you quite I mean, it makes you question the
judgment of the philanthropist when they seem to be making, allowing those sort of
personal relationships to go on and I think that now every,
feel that every organization that receives money from philanthropists and every philanthropist that is working with other philanthropists really needs to be much more skeptical about you know and much more scrutinizing of the people they are dealing with
because you are gonna see every institution’s endowment looked at and the donor base looked
at and if you have people who’ve been giving you money that are not, that don’t meet maybe the
Caesar’s wife test or whatever, you’re gonna find yourself in a mess, you’re gonna be a newspaper story, you’re gonna have to give money back. Now what effect this has on philanthropy is sort of gonna be interesting
to see because I mean, in some ways, it could
be a spur to see everyone raise their game, be much
more focused on people who are good people working together. On the other hand, I
generally believe it’s better to be working with people
that you share values with and so forth, you’re more
likely to be successful in doing what you’re trying to do. On the other hand, I
think one of the roles that philanthropy has
played throughout the ages has been a way for society
to kind of get some payback from its worst members and
get some of the money back in a way that gives, when
there’s been a big disruption, someone makes a lot of money
maybe there’s a lot of things going on that you don’t
quite like the look of and the smell of but you can
kind of normalize people again back into society through them
giving away a lot of money. That has been a historic
role of philanthropy, maybe that moment is passed
or we’ll have to create new entities that you
know, or new ways of taking of getting that money
back into circulation and being put to good use. (audience applauds) – And when you do the sequel
to philanthrocapitalism, we’ll have you come back again. – Thank you.
– And talk about – Some of the things (talks). – (talks) here again, you know. – That’s a good idea too, let
me know when you’re ready. Let me just mention other
forthcoming seminars. On the 25th of September, Rip
Rapson who’s been here before the president of the Kresge
Foundation will be coming back to give us a report on
what’s happened in Detroit since the big bargain, the grand bargain. On October the 30th, Rebecca Rimel, president of the Pew Charitable
Trust will be coming. She’s just announced
that she is stepping down from the running of the foundation. So this will be her last
visit here as president, (talks) she will come back
again afterward I hope. And on November 13th, Michael
Marsicano who is the president of the Foundation For The
Carolinas in Charlotte which is the largest community foundation in North or South
Carolina will be speaking. And on (talks) December the
six, sorry December the fourth, Mario Morino, the chairman
of the Morino Institute and co-founder of venture capital, Venture Philanthropy
Partners is gonna come. So they’re all, you’ll get
notices about all of them and if you’re not on our mailing list, you need to let us know and we’ll put you on the mailing list. So I thank you all for coming
and I thank Matthew especially for flying down here and
spending a day with us and we hope you’ll come back. – [Matthew] Thank you. (talks) (people clap)

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