In recent years, foundations have shown heightened interest in racial justice funding, prompted by the death of George Floyd and the uprising that followed — and the resulting conservative backlash. But barring a few exceptions, philanthropy as a whole hasn’t truly reckoned with the exploitative origins of its own wealth, particularly the role its donors played in the oppression of Black people throughout the nation’s history.
A new report from the National Committee for Responsive Philanthropy seeks to help funders engage in this work. The report, Cracks in the Foundation: Philanthropy's Role in Reparations for Black People in the DMV, looks at how the wealth behind several foundations in the Washington, D.C., southern Maryland and northern Virginia areas (the DMV) came at the expense of Black residents.
“The disparities that plague so many Black communities today are not a natural occurrence borne on an equal playing field,” the report states. “They are the result of a string of conscious choices by those in the public and private sectors that have repeatedly harmed these communities.”
In addition to providing case studies of these foundations, it also offers funders a five-step action plan, which it developed in partnership with the African American Redress Network and other movement partners, for funders looking to engage in this work. Although the report focuses on the nation's capital, its recommendations can be used as a model by funders throughout the country.
It stresses that while increasing funding for racial justice causes is an important step, it is not a replacement for acknowledging and repairing the damage the origins of its wealth caused for Black Americans.
“We can’t talk about wealth in this country without talking about racial injustice,” said the report’s author Katherine Ponce in a recent panel appearance. “If the history of foundations — all foundations — were widely known, it would completely change the demands that we have of them. It would change the relationship that we have of them being these powerful institutions with the money and giving nonprofits grants.”
Exploitative origins
The report looks at four sectors — media, housing, employment and health — that have driven historic harm to Black Washingtonians, harm that is still felt to this day. For each sector, the report names foundations in the DMV whose wealth was generated through exploitative means. The report notes that their inclusion is not meant to be punitive, but rather as educational guides to show the opportunities available for accountability and healing.
In the media sector, newspapers played a key role in perpetuating anti-Black stereotypes and propaganda, which contributed to the dehumanization of Black people. The Baltimore Sun's news coverage and editorial opinions, for example, supported racial segregation and the disenfranchisement of Black voters through the 1950s, and the Washington Post ran advertisements for skin lightening creams and for housing that explicitly excluded Black people.
Two of the foundations the report looks at generated their wealth from the media sector — the William S. Abell Foundation from the Baltimore Sun, which has since apologized for the harm it caused, and the Meyer Foundation, whose founder Eugene Meyer owned the Washington Post from 1933 to 2013.
On the housing side, Black Washingtonians have faced displacement, discrimination and segregation. Developers, for example, used their power and influence to prevent Black people from buying houses and to advocate for the clearance of Black communities in D.C. Numerous developers went on to establish their own foundations from the wealth generated through these practices.
The same can be said for employment practices, where Black workers faced discrimination and were prevented from benefiting from the value of their work. On the healthcare side, Black Washingtonians faced racist practices, lack of access, substandard care and underrepresentation in the field, all of which led to dangerous health standards, including a significant racial gap in life expectancy.
Many of the issues that were caused by the exploitative practices in these four sectors continue to this day. More than 20% of the city's Black residents live below the poverty line. And the once Black majority city has seen its Black population dwindle over the past two decades.
Recommendations for funders
While responsibility for structural racism clearly can’t be placed solely on the backs of funders, it is nevertheless important for foundations to make amends for harm caused by the origins of their wealth, the report argues, and authors offer a five-point plan for foundations to begin their reparations journeys.
The first step is to reckon with the origins of a foundation's wealth. Funders should invest in local historians to gather oral histories through nonextractive practices. This should not be a private endeavor. Instead, funders should make this information publicly available and the work should culminate with a formal public apology from the institution.
The second step is to connect with impacted communities to ask for ideas and solutions they may have. The report suggests making capacity-building grants to Black-community-led organizations so that they may have control over how to allocate and spend their funds. In addition to transferring decision-making power, funders should also center the voices, needs and perspectives of those who have been harmed.
The third step is to make reparations to the people and communities that have been directly harmed by how the foundation's wealth was created. The report recommends doing this through cash payments, infrastructure investments and vouchers with the goal of closing the wealth gap. Foundations should share decision-making power with community representatives, harmed individuals and their descendants to establish how and when money will be redistributed.
The fourth step is for foundations to decolonize their institutional structures, policies and practices. The report suggests making multi-year, general operating grants, sharing decision-making power with Black communities — and sometimes ceding it — and shifting endowment growth strategies.
“Since its inception, the original wealth used to fund philanthropy has been unjustly extracted and hoarded for perpetual existence and growth,” the report states, pointing out that the minimum 5% annual payout requirement is seen as the “de facto ceiling” for most funders. While perpetuity and repair don't have to be mutually exclusive, foundations should not allow it “to stand in the way of repairing past harm.”
The report cites Climate Justice Alliance, which found that in 2020, U.S. philanthropic institutions contributed $1.2 trillion to global stock markets and $88.6 billion to their grantmaking focus areas — that's a difference of 130%. “Simply put, endowment investments contribute more to corporate profits than to the communities receiving their grants,” the report states. Authors argue in favor of community-centered investments. Recently, for example, The California Endowment announced that it was shifting all of its assets toward impact investing.
The fifth and final step is for foundations to advocate publicly for reparations legislation at both the local and federal levels.
A growing movement
Despite political and legal pushback against racial equity work and DEI, the movement behind reparations is growing. At least 80 national funders, including powerhouses like the Ford, MacArthur, Hewlett and Robert Wood Johnson foundations, are providing support.
In addition to funding reparations efforts and using their power to advocate for the cause, both Robert Wood Johnson and MacArthur have turned inward to examine their own pasts. MacArthur has published insights from its internal reparation and healing process, acknowledging past harm and laying out the steps it has taken to begin the process to repair and heal. RWJF’s Truth, Repair and Transformation process, which will last three years, involves examining the foundation’s origins, doubling down on the positive steps it has taken to rectify past harms, and correcting course where it has fallen short.
For foundations that are already supporting reparation advocacy efforts, looking at their own histories is a natural next step. Philanthropy must also reckon with its past and the role that the exploitation of Black people played in its wealth generation, and take the necessary steps to address and repair the harm.
“The full impact of much of the harm done to Black people in this country over centuries of physical and emotional violence is hard to put into simply quantitative terms,” the report states. “Yet the enormity of what has transpired in the past is not an excuse for inaction… This is an opportunity not just to learn from the pain of the past, but to take real, practical steps to help communities heal.”
From Inside Philanthropy
