A Bigger Tent: Where Climate Philanthropy Needs to Go Next

Last month, Matthew Nisbet, a communications professor at Northeastern University, published a study documenting just how narrowly major environmental philanthropies have targeted their efforts to address climate change. Nisbet’s research found that between 2011 and 2015, 19 of the largest environmental philanthropies spent over a half-billion dollars on climate and energy-focused activities. One in four of those dollars was spent to promote renewable energy and energy efficiency, and another 27 percent was spent on communication, media and mobilization, much of it through major environmental groups.

Nisbet’s study found that very little philanthropy was spent on climate adaptation, nothing went to promote nuclear energy (America’s largest source of zero-carbon power), and only a pittance was spent on natural gas, which has been the largest contributor to America’s falling emissions for over a decade. Less than $2 million over the five years surveyed was dedicated to carbon capture and storage or energy research and development, even as most serious assessments of pathways to meaningful climate mitigation conclude that long-term commitments to both will likely be necessary.

As the Hewlett Foundation Environment Program Director Jonathan Pershing pointed out to Inside Philanthropy in response to the study, climate philanthropy has nevertheless contributed to important progress. 178 nations signed on to the 2015 Paris accord, and most remain committed to it despite the U.S. pullout. Coal is on the decline domestically. And, thanks in part to federal and state policies long supported by U.S. philanthropy, the price of solar panels and wind turbines has dropped dramatically over the past decade, leading to growing deployment of these technologies. Philanthropy alone did not generate these outcomes, but it undoubtedly played an important role.

Yet it is hard to argue that we are winning the battle against climate change. Global carbon emissions, after a brief interregnum, resumed robust growth last year. Atmospheric concentrations of carbon exceeded 410 ppm. According to data in the BP Statistical Review of World Energy 2016, clean energy as a share of global electricity has actually declined over the past 20 years, and we have only begun seriously considering how to decarbonize the far more difficult transportation and industrial sectors. And in spite of enormous investments by philanthropy to raise awareness of the problem and build opposition to continuing dependence on fossil fuels, climate skeptics determined to expand U.S. fossil fuel production control all three branches of American government.

It would be easy to point fingers at major climate philanthropy for its shortcomings. And indeed, as two people who have long advocated greater philanthropic and political support for technologies like nuclear power, we share some of the criticisms. Major climate philanthropies have, without question, been too slow to question various environmental orthodoxies and too willing to follow the latest fads in environmental funding.

But it is easy, also, to overestimate the influence that even the largest environmental funders have. Yes, they give away extraordinary amounts of money every year, much of it to large environmental NGOs. But there are reasons that so much money has flowed to such a small number of organizations, and significant barriers remain to diversifying climate philanthropy at meaningful scale.

Size Matters

One of the ironies of philanthropy is that it is much easier to give away a little bit of money than a lot of money. Large philanthropies must, by law, move enormous amounts of money out the door—tens or even hundreds of millions of dollars every year. It is difficult to give that kind of money away in small chunks, which is the level that small or even medium-sized environmental NGOs can absorb. If you need to give away that sort of money, there are very few environmentally focused NGOs with sufficient scope to spend it. And so, year after year, the lion’s share of environmental philanthropy has gone to the same 20 or so institutions—the big national green NGOs with hundreds of staff, and dozens of field offices around the country and the world.

These organizations sit at the nexus of dense networks of policymakers, media outlets, donors and activists, and as such, provide a platform for sustained national and even global climate advocacy that no other set of institutions offer. They promote a range of climate solutions that are part of the answer, and they represent important constituencies that will be needed to sustain the social and policy consensus to address climate change over the long term. But they are also overwhelmingly left of center, coastal, and have neither the vision nor the social license necessary to produce that consensus on their own.

Nisbet criticizes climate philanthropy for driving such a narrow agenda, but it is important to understand that while big philanthropy may give big green a lot of funding, most of these organizations raise significantly more money from their membership lists and from large, ideologically motivated individual donors. For example, in FY2017, the Natural Resources Defense Council raised nearly 75 percent of its revenue from memberships, individual contributions and bequests, while just 16 percent came from foundation grants (almost all of which was restricted funding). Likewise, in FY2017, EDF brought in over 68 percent of its revenue from memberships, contributions and bequests, with 28 percent from foundations—again, nearly all restricted. For this reason, even the largest climate philanthropies have less leverage over the green agenda than many imagine.

The Tyranny of Metrics

The narrow focus of philanthropic funding has been further exacerbated by the emphasis within institutional philanthropy on measuring outcomes, which has driven funders toward investing heavily in a limited set of climate strategies in hopes of increasing the prospects of making measurable impact. Some foundations have gone so far as to require program staff to quantify avoided greenhouse gas emissions as a result of each grant.

While it is reasonable to want to know and track the outcomes of your grantmaking, the tyranny of metrics can create perverse incentives, leading funders to support what they see as “safe,” short-term opportunities. Focusing on metrics can also provide a false sense of clarity, while climate change is a wicked problem, plagued by uncertainty at every turn. No funder, or even group of funders, can know in advance how climate impacts will manifest, how policymakers and institutions will react to those impacts, or what set of policies or technologies are most likely to succeed.

Investing in a broad suite of strategies, technologies and institutions offers the best hedge against those uncertainties. But the demand for immediate and measurable impacts has disincentivized funders from investing in a truly diverse set of climate strategies. Combined with the lack of institutional capacity to spend philanthropic dollars outside of the mainstream environmental movement, the result has been that enormous sums of money have flowed to an extraordinarily limited set of institutions and climate approaches.

Where Now?

It is thus the large environmental NGOs and their individual supporters that primarily set the climate agenda, and institutional philanthropy that follows. The result has been that climate advocacy and philanthropy have emphasized renewable energy technologies to the exclusion of a broader suite of low-carbon technologies that will likely be necessary for deeply decarbonizing the global economy; it is overly focused on mitigation (i.e., reducing the magnitude of climate change) at the expense of adaptation (i.e., preparing communities to cope with the realities of a changing climate); and it ignores other mitigation pathways such as carbon removal and solar geoengineering.

The alternative approaches that we have called for, including greater focus on developing next-generation nuclear, renewable and energy storage technologies; policy support for nuclear power, carbon capture, climate adaptation, and carbon removal; and research into solar radiation management, are by no means guaranteed to work. But given the rapid advance of climate change and the narrow historical focus of climate philanthropy, a robust hedge strategy seems wise.

There are important signs that climate philanthropy is beginning to diversify along these lines. As Tate Williams has correctly noted, smaller funders were, by design, excluded from the Nisbet study and a number of them have quite different priorities than those of the major climate foundations. Additionally, since 2015, even some of the major philanthropies in the study have begun widening their focus—a point made by Jan Mazurek, ClimateWorks Foundation’s Clean Power Program Director.

To name but a few examples, the Hewlett Foundation has supported work on carbon capture and storage, and has provided general support to a number of organizations that promote clean energy innovation and nuclear power among their priorities; the Packard Foundation has provided support to Third Way to promote government support for energy innovation; and ClimateWorks has begun to explore carbon removal strategies.

However, climate philanthropy will not be able to execute this hedge simply by giving more to the handful of modestly sized institutions, such as ours, that currently work on alternative environmental approaches. Nor would doing so much change the funding mix that Nisbet’s analysis revealed.

If climate philanthropy is interested in hedging its bets by diversifying the political coalition for climate action and the political, institutional and technological capabilities of societies to mitigate and adapt to climate change, it will need to build a new field to work alongside the big green groups. That will require making sustained commitments to supporting new institutions that can speak to very different sorts of constituencies and bring very different policy priorities to the table. Ultimately, no set of interests or institutions has all the answers to climate change. Rather, supporting a diversity of civil society strategies to address the issue is likely to give philanthropy the best shot at winning the battle against global climate change.

Rachel Pritzker is president and founder of the Pritzker Innovation Fund. Ted Nordhaus is co-founder and executive director of the Breakthrough Institute.