Philanthropy in 2021 – what can we expect to see change?

The Jean-Francois and Marie-Laure de Clermont Foundation was created on the shoulders of giants. Inspired by the Institute of Life formed in the early 1960s by great men, including my grandfather François de Clermont Tonnerre, we wanted our foundation to reflect the founding principles of uniting art, culture and science to invest in a better symbiotic future between man and this planet.

Through philanthropy, the Foundation supports projects that fall into these categories. But we are not restricted. If we find a project that fits with our views on life, the future and what really matters, then we get involved.

Changes within philanthropy in 2021

Our forays into science, biodiversity, art and culture, and much more reflect our personal values, but also those that we believe truly benefit our existence. As a whole, humanity must work together to identify the threats to our very species and find ways to safeguard the fragility of life.

These are huge and intangible aims. But through the Foundation’s work, whether it’s funding projects, conferences, seminars or artists, we are part of this bigger goal. For those of us with all of the luxuries of peace, time and money, this must be our raison d’etre.

Last year showed us all the fragility of our society and existence. While we’ve created the veneer of security, look how quickly it was threatened by this pandemic. COVID-19 is not the first pandemic, but it is the first to hit the world in this way for 100 years or more. It will not be the last.

And while many of us are happy to leave 2020 behind, the turning of the year hasn’t eradicated these existential challenges. However, during the darkest of times last year, there were some positive developments within impact investing and philanthropy that must give us hope. Attitudes are shifting in fundamental ways around the world. We are awake to injustice and the inequality that exists all around the globe, and philanthropic trends reflect this.

Philanthropic trends throughout 2021

As we go through 2021, we have the optimism of changes in world leaders, vaccination programmes and signs that we will endure as a species. Come what may. But we have bigger challenges ahead. COVID-19 has demonstrated in the starkest manner just how much we must change to be in a position to combat climate change and the very real threats of further pandemics.

There are also questions of gender equality, human rights and facing up to the systemic racism that is present everywhere. Here are some of the philanthropic moves I think we will see this year, developing all the time as crises evolve.

  1. A shift in focus from philanthropists and charities

The racial justice movement that exploded again in the US during 2020 forced the world to re-evaluate its awareness of racism and injustice. This has caused all kinds of philanthropic donors, from the largest to the smallest, to refocus their giving.

This shift is moving towards funding projects and solutions aimed at the very source of the problems that need solving. We’re becoming more and more aware that throwing money at the symptoms of these issues isn’t enough. More must be done to change the root cause.

Solutions therefore need analysis and consideration about the role that racism plays within other societal issues – racism in the context of homelessness, access to healthcare, education, gender equality and climate change. For example, the use of food banks has become ubiquitous through the pandemic. So, instead of only providing food for the banks, the philanthropic focus should move towards preventing food insecurity at its source.

  1. Challenging the traditional structure of elite philanthropy

There’s something very wrong with a system that allows unlimited privilege, power and tax breaks for already wealthy people. At the same time philanthropic funding chugs on with too little accountability.

We will see far more calls to change this, and to look at the whole system of charitable tax deductions, the charitable status of religious organisations, and property tax exemptions. All of these are part of the status quo in the US, for example. These are issues that affect every wealthy country’s philanthropic and charitable sector and it’s past time to confront these issues and make sweeping changes.

  1. An increase in funding solutions for climate change

The US is now once again part of the Paris Climate Accord under new President Joe Biden. We can expect the US to begin to reassert its leading authority in the fight against climate change, a position that was heavily adversely impacted by the previous administration.

And the role of philanthropy will be a major driver in this mission. The non-profits will increase work on local, global and national initiatives to combat climate change. While billions have been pledged by the biggest Foundations, so much more must be done.

This is the existential threat that hovers over us all, and it impacts everything we do in one way or another. Corporations, public bodies, Governments, Foundations, charities, funds and individuals must join together and address this crisis.

  1. An upsurge in sustainable investment through philanthropic capital

Sustainable investment includes environmental, social and governance (ESG) considerations into every investment decision, from portfolio selection to management. ESG funds captured $51.1 billion of net new money from investors in 2020. This will only grow around the world, as more clarity is offered regarding the viability of making returns.

Philanthropists will ask themselves about the potential impact of their funding choices before making the decision. They will be scrutinising where money is really going, as they seek out both a sustainable and financial return on their giving.

This year will be a year of change in so many ways, and within philanthropic donations I believe this change will be fundamental and wide-ranging. The world is changing fast, and if we want to contribute towards a future full of promise and hope, this is now what we must do.