think4change.org

In the first part of a two-part investigative story in the LA Times, Dark cloud over good works of Gates Foundation, focusing on the investment strategies of the Gates Foundation raises some thorny issues about means and ends.

By comparing [Gates Foundation] investments with information from for-profit services that analyze corporate behavior for mutual funds, pension managers, government agencies and other foundations, The Times found that the Gates Foundation has holdings in many companies that have failed tests of social responsibility because of environmental lapses, employment discrimination, disregard for worker rights, or unethical practices.

Using the most recent data available, a Times tally showed that hundreds of Gates Foundation investments — totaling at least $8.7 billion, or 41% of its assets, not including U.S. and foreign government securities — have been in companies that countered the foundation's charitable goals or socially concerned philosophy.

For instance some of their investments in oil companies, especially in some European firms whose polluting facilities are exacerbating the very same health issues that the foundation is working so hard to alleviate.

The report also describes some similar tensions between the foundation’s mission to treat HIV and their decision to invest in drug companies that seem to make it more difficult for some infected individuals to get needed medication

This is "the dirty secret" of much large philanthropy, said Paul Hawken, an expert on socially beneficial investing who directs the Natural Capital Institute, an investment research group. "Foundations donate to groups trying to heal the future," Hawken said in an interview, "but with their investments, they steal from the future."

This is an important issue for philanthropy. It is much too simple just to throw stones at the 500-pound gorilla. There are systemic tensions and possible contradictions here that many foundations have already addressed, and many more need to.