Philanthropy In Focus, the blog of the Worldwide Initiatives For Grantmaking Support (WINGS), published in June an interview with EDGE Funders Alliance co-chair Nicolas Krausz. Check it out!

Nicolas Krausz is Program Officer at The Charles Léopold Mayer Foundation for the Progress of Humankind and Co-Chair of the Board of Directors at the EDGE Funders Alliance.

1- What are the motivations behind the work that EDGE Funders does?

We live in a time of mulitple crises: deep inequality, political polarization and ecological degradation, to name just a few. Our members understand that these crises are interconnected and that our work has to recognize the nature of these connections, even if individual foundations work primarily on one issue. I believe all EDGE members are in agreement on the urgent need to support a transition from economic, political, social, technological and cultural systems centered on extraction, exploitation, growth and profit for just a few, towards societies and economies grounded in solidarity, peace, the common good and, social, economic and ecological well-being of all. In this respect and, of course, through the huge diversity of our membership, we try to increase resources for communities, think tanks and movements creating systemic change alternatives for this Just Transition.

2- What do you consider the biggest challenges that you or your organization faces?

Basically, as a progressive funders network that is part of the philanthropy community, we face two main challenges: the status quo of the philanthropic sector, let’s call it the “charity complex”, and in some cases, the refusal to engage in a political discussion about funding choices. I think, since 2012, we managed to gather a significant number of progressive foundations within EDGE. In others words, we have built a “political home” to bring together like-minded peers who share a similar theory of change. But we also have a kind of advocacy perspective within philanthropy, as we wish to channel more human and financial resources to systemic changes. Therefore, we’d like to learn more about the diversity of philanthropy networks and approaches in order to understand how collectively we could take more risks and move out of our comfort zone. It’s not only about funding transformative change instead of business as usual solutions. It’s also changing ourselves as foundations: how we manage and invest capital, internal governance, the power dynamics with the grantees,etc.

Even as “progressives”, we are very far from living day-to-day what we are preaching. Finally, we’d like to understand the political vision and agenda that stand behind every funding strategy, as we’ve started to do with our members. Because we believe such a thing as “apolitical” grantmaking doesn’t exist. Making political assumptions explicit and transparent should be part of our global accountability efforts.

“It’s not only about funding transformative change instead of business as usual solutions. It’s also changing ourselves as foundations: how we manage and invest capital, internal governance, the power dynamics with the grantees,etc.”

3 – Why is interconnectedness such a strong focus of your work? Are there any lessons we can learn from the work in your network?

I hope so! We are not a single issue-oriented funders network such as the ones working only on environment, agriculture, security & peace, social change or Human Rights. We want to fund systemic change initiatives, which indeed means breaking the silos that usually lock us and our political aspirations into discrete boxes. For example, we believe that a major “ecological” issue such as climate change is caused by a specific economic system (extractivism, and a singular focus on growth, not to mention capitalism), which is itself embedded in and promoted by a certain culture (consumerism, patriarchy). We won’t solve or mitigate climate change with just a set of short-term ecological policies.We are looking at intersectionalities like more and more change agents and social movements.

Throughout history, the type of systemic change that we need has been accompanied by social movements, which are a core focus for our members’ philanthropic investments and stategies. This work is complex, and we don’t have all the answers. That’s the reason why we are launching the Just Transition Collaborative to bring EDGE members together to learn from and challenge each other so that our work is truly getting at the root causes of the multiple crises we are experiencing.

4 – What makes a social-change philanthropist different from a “regular” philanthropist? Can you explain the lens through which members of EDGE Funders approach their partnerships?

In the framework of the Just Transition Initiative, we have identified three main strategies within the large spectrum of civil society activism: fighting the bad (e.g., resisting a pipeline project), changing the rules (e.g., advocacy work on the European Common Agriculture Policy) and building the new (e.g., the Commons as an alternative to the Market-State duopoly). We need to work on and link these three strategies explicitly, especially “building the new,” in order to demonstrate that there are alternatives to the current system. This focus on real alternatives is what might differentiate social-change philanthropy.

Of course, foundations are strange and slow animals, like sea turtles that lay their eggs on the beaches year after year. It takes time to change a strategy or a theory of change. But sometimes when working together, we can act quickly to make a difference as we saw this year when ten EDGE members decided to support the Fearless Cities Summit in Barcelona. We helped bring hundreds of activists from all over the world to Barcelona where they kicked off this international municipalist movement that resists the conservative and Corporate capture of the State while building new social, progressive and citizen driven policies.

5 – A number of conversations and initiatives, such as the Divest/Invest movement, are emerging to address the question of the coherence between the financial assets management and the philanthropic mission of foundations. Do you think this is a growing global trend that will eventually become a mainstream approach?

I think it has already become mainstream in the philanthropy sector. Of course, between the pledge of divesting and the implementation of new investment strategies, lots of work has to be achieved and many difficulties and fears have to be addressed, especially by foundations’ Board Members and Trustees. EDGE is definitely part of this global movement, but we try to focus on the tools and mechanisms to invest into the “real” and non-extractive economy—to build the new—and not only to switch assets into tech solutions or green bonds, which are embedded in the current system. We need to think about real impact on real people.

Matthias Fiedler and the Bewegungsstiftung (Movement Foundation) in Germany are leading this thread of work within EDGE. According to Matthias, real impact is not achieved by buying a few more green bonds. We need to re-think the way we invest our capital and to put it to use to serve our goal of transforming society.

6 – How do you think these approaches could be broadly adopted and what are the low hanging fruits and what easy first steps you would advise foundations to take?

The most low-hanging fruit might just be around the corner of every foundation. The organic apple farm or the solidarity economy project on the next street over. Even though the needed shift is to change the investment policy, foundations can start with small things, a first investment in something they know. According to the EDGE ethical investment working group,the first step, however, is to convince your financial adviser, your bank or the person in the foundation that is charged with investment to be on board. Don’t let them deflect you by saying, there are no products. There are and they need to up their game if they don’t know them.

Start small with, a few investments, and then finish big by changing your investment policy so that it becomes a driver for the change you want. It is useful to establish explicit ethical-sustainable investment guidelines, like the ones done by Bewegungsstiftung. In order to embed the management of the capital in the ethics, values and mission of the foundation, it is advisable to have an in-house ethical investment manager, instead of handing this important work to an autonomous department, or even outsourcing it to financial service providers. Friends Provident Foundation or Bewegungsstiftung for example have such in house ethical investment people who work closely with the programs team. Talk to them, or other foundations engaged in the DivestInvest movement – your peers are the best advisors!

7- Do you see a specific role for support organizations in engaging foundations?

We’ve decided to join WINGS to go beyond preaching to the choir. In our opinion, WINGS is meant to be the global place for philanthropy to organize and facilitate respectful yet controversial debates. It also brings together funders networks that share the same analysis on the current context but might have different approaches in terms of solutions or don’t communicate with each other because of a focus on a single issue. We appreciate WINGS for its diversity and as a space where members should be able to share their own values and agenda but also have them challenged by the others.

8- Do you think for instance that philanthropy support organizations working at national or local level should play a similar role in promoting these debates? How can they engage a diverse membership on sensitive issues in a constructive way?

Why not? But as far as I know, their primary role is often to represent the institutional and legal interests of the sector which is of course needed and requires more unity and technical advocacy than debates and political controversies. Maybe the entry point for such debates could be the thematic working groups that some of these support organizations have set up for their members. Actually, as a constructive methodology, we already have examples of very interesting working processes where the foundations ask themselves for example how they envision the shift from best practices on the ground to best policies at the local, national or international levels. It’s a very strong way to acknowledge that behind every technical solution showcased or funded by a foundation, there is a political dimension and maybe the same kind of fights our grantees are supported to deliver…

“Permaculture principles (care for the earth, care for the people, return of surplus) should also guide us towards a new art and culture of funding.”

9- In the next five years, what do you feel is the biggest opportunity for foundations (or associations of foundations) looking to make a difference?

Unfortunately, the accelerating pace of climate change and rising inequality will make the world more unstable and people more stressed. Since Gramsci, we know it’s the perfect time for monsters[1]. But we also know that it’s the perfect time to seed and expand alternatives, as old social, political and economic systems fail to meet the needs of more and more people. Our role as EDGE funders can be seen as sowing the seeds right now, identifying the levers of change and scaling up the alternatives. Permaculture principles (care for the earth, care for the people, return of surplus) should also guide us towards a new art and culture of funding.

[1] “The old world is dying, and the new world struggles to be born: now is the time of monsters”  (Antonio Gramsci)