Climate crisis and philanthropic action
According to the United Nations, climate change is the most defining crisis of our time, and it is unfolding far faster than we anticipated. Climate change is wreaking havoc on people and ecosystems all around the world. Dr. Una Osili posited that as we deal with the repercussions of climate change, we are also dealing with a cascade of economic effects that leave individuals and communities scrambling to figure out how to deal with the situation. The United Nations reported that, environmental degradation, natural catastrophes, weather extremes, food and water insecurity, economic instability, and war are all being exacerbated by the climate crisis. Climate change poses a significant danger to global peace and security. In fact, climate change has increased competition for resources such as land, food, and water, causing social conflicts and, increasingly, mass displacements. Climate change is a risk multiplier, exacerbating existing crises. But, in the face of this global menace, we are far from powerless. Now is the time for strong global action as the endless cost of climate change approaches irreversible highs.
As we battle with this climate crisis, we are presented with a terrific opportunity for philanthropic foundations to illustrate how they are making a difference in the communities where they operate. A new report published by ClimateWorks Foundation stressed that philanthropists are committing more money than ever to combating the adverse effects of climate change, but the current rate of giving is still far short of what is required to confront the enormous difficulties this climate crisis is posing to the world’s population. The report compared data from 2019 and 2020 and concluded that while new donors and commitments increased global philanthropic giving towards mitigating climate change by 14 percent in 2019, it still accounted for less than 2 percent of overall philanthropic giving in 2020.
Environment Funders Canada (EFC) said in 2008 that philanthropic organizations in Canada were increasingly engaging to support climate mitigation and adaptation, the consensus today however is that neither the adaptation nor mitigation intervention of climate philanthropies are enough on their own. Both are needed today, and together they may significantly reduce the risks of climate change. While this sounds like a good plan, Morena thinks that such a consensus downplays the errors and responsibilities of philanthropic foundations. More emphatically, Morena stated that if philanthropy is to be judged by its outcomes, climate philanthropy has failed.
To further deepen the debate, Grubb et al. noted that philanthropists who are concerned about climate change are overwhelmed with a wide array of often contradictory options and opinions. The question therefore remains as to whether the influential role being played by philanthropic foundations have in any way contributed to curbing the climate crisis. Given the global scale of the predicament, where in the world should they allocate their precious resources? Is Morena right in asserting that philanthropy has failed in the fight against the climate crisis? Which philanthropic investments will best mitigate climate change? The overarching aim of this article is to delve deeper into these questions.
Philanthropy’s role in curbing climate crisis
Parmar noted that philanthropy has a long history of involvement in the climate debate. In the 1980s, well-known liberal foundations such as the Ford, Rockefeller and Alton Jones Foundations funded scientific research on “global environmental change” which helped to launch the global processes and multilateral institutions that continue to buttress the international climate regime made up of the Intergovernmental Panel on Climate Change and the United Nations Framework Convention on Climate Change (UNFCCC).
Philanthropy’s efforts in curbing climate change cannot be overlooked. For instance, Kraeussl argued that the role philanthropy has played in mitigation and adaptation, and the development and promotion of voluntary, market-based, and bottom-up approaches continues to dominate the international climate agenda. Though climate philanthropy represents less than 0.1 percent of the total climate finance, climate philanthropy’s combined effort over the past 30 years have had significant impact on the international climate debate even with their comparatively limited resources.
In their 2008 report, Calling all funders: The role of philanthropy in climate change, Environment Funders Canada noted that many prominent climate NGOs and networks relied entirely on philanthropic foundations and philanthropic money to function. Currently, Philanthropic Foundations Canada (PFC) thinks that the limited available resources and particular nature of the climate philanthropy landscape—made up of a handful of well-endowed and closely aligned foundations—means that climate funders have a strong influence in the civil society space and are partnering with various governmental and non-governmental organizations to create a climate resilient society and economy.
Furthermore, as we saw during the COVID-19 pandemic, disasters and crises wreak great havoc on the most vulnerable, both at first impact and throughout the recovery process. Philanthropic resources are assisting vulnerable communities and families to prepare and enhance resilience, and crisis response funding can support community-led initiatives to help the most devastated people and areas. In their recent report Building Canada’s low carbon future: Opportunities for the philanthropic Sector, Environment Funders Canada mentioned that strategies that are being employed by climate philanthropic foundations to address climate change focus mainly on mitigation (reducing GHG emissions) or adaptation (adjusting to the negative impacts of climate change and taking advantage of the positive impacts). Morena postulates that in the face of today’s worsening climate crisis, philanthropic foundations are increasingly called on and celebrated as “climate champions.”
To answer the question of which philanthropic investments will mitigate the climate crisis, Grubb et al. pointed out that in order to reduce industrial emissions and its effect on climate change, philanthropy is promoting new standards and utility reforms that are motivating firms to design long-lived assets with energy efficiency in mind. Hence innovative financing mechanisms, such as “efficiency grants”, are bolstering efforts to reduce industrial emissions and promoting greener homes. Philanthropy is therefore focusing on campaigning for better policies, which in turn are driving capital toward cleaner technologies.
Aykut et al. contended that while politicians are focused on winning the next election and CEOs are focused on the next quarter’s financial results, philanthropists, on the other hand, have longer time horizons and are willing to take greater risks. Philanthropists, in addition to being more patient investors, have a long history of filling gaps, driving technological breakthroughs, and pursuing programming that crosses national borders and economic sectors. These capabilities are precisely what are required to combat crises, including the climate crisis. Hence, to answer the question of whether philanthropies have failed in curbing the climate change, Environment Funders Canada is of the view that when crises arise, the philanthropic sector is able to react faster and more flexibly than other sectors, hence philanthropy has played and will continue to play an essential role in helping countries like Canada to move forward in addressing the climate crisis.
Needs and opportunities for philanthropy
Grantmakers understand the impact of crises and know that something has to be done quickly in time of crisis. The reality however is that climate crisis receives a very small proportion of environmental philanthropic funding in Canada, and environmental philanthropy is itself a very small fraction of the philanthropic total as posited by Aykut et al. Grubb et al., estimated that in order to implement better Design and Win strategies to respond to a major crisis such as the one we are facing with the climate, additional funding of about $600 billion globally is needed.
Environment Funders Canada also recommended in their 2008 report that philanthropy must support existing NGOs with deep knowledge of local conditions and required strategies. In several sectors and nations today, philanthropic organizations are already developing solutions based on a solid understanding of Indigenous politics, policies, and public opinions. Community-based philanthropy can work with such organizations to develop new, innovative approaches to responding to every crisis, not just the one we face with the climate.
While the role of philanthropy is not to replace government foundations, philanthropic foundations, such as community or place-based foundations, have positioned themselves to strengthen their localities. Minnes & Vodden therefore suggested that there is the need for new development approaches that can build on and further enhance resilience in communities while recognizing their place in wider, interconnected regional contexts that include both rural and small-town and urban settlements. Vodden et al. further proposed that even though philanthropic organizations have begun collaborating more with one another; there is an opportunity for greater levels of collaboration with local and regional governments to plan for high levels of complexities and to mobilize the considerable resources and capacities needed to respond to crisis.
In the view of Environment Funders Canada, grantmakers have many options for engagement: revising ongoing funding strategies in response to the implications of crises in general, and climate crisis in particular, for existing funding areas; prioritizing support to organizations that focus on the much-needed climate change policies and strategies; supporting “breakthrough” efforts at universities; or considering the potential role of philanthropists as change agents in the policy arena. Therefore, engagements such as the meeting PhiLab convened with several foundations that were interested in exploring a research agenda and initiatives that can advance the role of philanthropic donors in supporting climate change and climate action is indispensable. As organizations such as PhiLab continue to partner with foundations through different phases of research and knowledge mobilization, foundations’ options for climate action and crisis response will be made more explicit and awareness will be increased to contribute to a common understanding about the role of philanthropy in climate action and crisis response.
Environment Funders Canada noted that taking action to address the implications of the climate change crisis within individual funding areas is helpful, but it will not be enough. Grubb et al. added that most grantmakers and analysts who are already active in the climate change and crisis response areas agree that focus on policy reform is essential for real progress on climate change and disaster response, hence a broader strategic grantmaker engagement is necessary to move the climate and crises issues forward at the public policy level, especially in Canada. Furthermore, Grubb et al. agree with Environment Funders Canada that in order to ensure that climate policies in particular are adopted and are as effective as possible, philanthropists can pursue a variety of tactics. For instance, educating voters and consumers through the media can build political support for reforms. Supporting technical analyses and translating the findings for opinion leaders and decision-makers can improve the caliber of the resulting policies.
Most grantmakers agree that the climate crisis is among the most severe challenges the world faces. Part of the difficulty for many funders is that climate change falls outside of the perceived boundaries of their traditional funding areas and guidelines. Lately, however, grantmakers have been exploring how they can engage on climate change in recognition of the pervasive impacts that global warming is having on the environment and human lives. Despite this increasing interest, climate change is such a large and complex issue that it can be hard for philanthropists and foundations to know exactly how to respond. Yet through their efforts, philanthropic foundations are creating an environment conducive to a societal shift towards mitigating the effects of climate change. It is therefore safe to conclude that philanthropic foundations have in fact contributed towards the fight against the climate crisis and indeed have played an influential role.
This article is part of the special edition of November 2021 – Philanthropy’s role in a crisis. You can find more information here