The Rockefeller Foundation announced in July that it was “reimagining its philanthropy” so the existential threat of climate change would be at the heart of all its giving.
It was an extraordinary decision for a more than $5 billion traditional philanthropic institution, particularly one founded by
John D. Rockefeller,
whose fortune was made from “the world’s first and most notable fossil-fuel industry business—Standard Oil,” as
the foundation’s president, says.
But confronting climate change is essential if the foundation is to continue its mission of advancing well-being throughout the world. A warming planet can undo all the organization has done for more than 100 years to aid vulnerable communities in the realms of health, energy, food, and equity.
“We have committed ourselves to tackling the biggest and most existential threats to humanity in our time,” Shah says in an interview reflecting on the foundation’s decision. These perils include pandemics, climate change, and wide-scale instability from multiple related crises in food, fuel, energy, and debt emerging throughout the world. “When we look across everything, the thing that threatens all of humanity in a highly complex but incredibly urgent manner is the climate threat.”
For a foundation focused on global well-being, using climate as an organizing principle makes sense to Valerie Rockefeller, a fifth-generation member of the family who chairs Rockefeller Philanthropy Advisors and is co-chair of BankFWD, a nonprofit pushing for responsible climate finance.
“Climate means democracy, peace, justice, human rights, and economic development in an equitable way,” Rockefeller says. Given the source of the foundation’s money, she also believes, “We do have a special moral obligation to stay focused on this issue.”
The resolve to put climate change at the center of all its work culminated a shift begun by Shah in the depth of the Covid-19 crisis. In September 2020, RF Catalytic Capital, or RFCC, was launched as a public charity, an innovative approach that allows the organization to amplify its efforts by pooling capital with corporations, governments, and other philanthropists.
Then in October 2020 the foundation sold $700 million in taxable 30-year bonds largely to fund RFCC, and then soon after announced its $1 billion, three-year, Global Green Recovery, a two-pronged effort to first, stimulate a recovery from the pandemic, and second, to invest in distributed renewable energy technologies in emerging nations to end “energy poverty” without exacerbating climate change.
In December 2020, the foundation announced it would divest itself of its endowment of fossil-fuel assets. While the decision only affected about 2% of its portfolio (down from 4% in 2014), it was full of symbolism for a foundation founded on fossil-fuel dollars. By the fall of 2021, the Ford Foundation, the MacArthur Foundation, and the McKnight Foundation also announced plans to divest themselves of fossil fuels.
In September 2021, Shah, who had served as the administrator of the U.S. Agency for International Development from 2010-15, wrote an article in Foreign Affairs magazine calling for a “Covid Charter” to match the scale and ambition of the Atlantic Charter, signed by U.S. President
and British Prime Minister Winston Churchill on Aug. 14, 1941. The Atlantic Charter sought to avoid the kind of catastrophe that led to war by promoting a global economic recovery that would “unleash a slow, steady convergence between wealthy and poor nations.”
Shah argued that the pandemic had exacerbated a trend in the opposite direction by creating a growing divide between wealthy and developing countries. That called for a charter that would offer a “new paradigm” for global development, he said.
“We’re entering a period of divergence,” Shah explains, “when the most vulnerable people in the most vulnerable countries will actually get more vulnerable from climate change, will get poorer and more vulnerable from food insecurity, and will live in countries like Sri Lanka, Ghana, and Haiti that are experiencing acute debt crises that are creating all kinds of political instability.”
Through RFCC, the foundation’s leading response to this challenge has been to create the Global Energy Alliance for People and Planet. Seeded with $500 million in funds raised from its bond proceeds alongside $500 million each from the IKEA Foundation and the Bezos Earth Fund, the alliance intends to spur $100 billion in public-private dollars to reach one billion people with renewable power.
To achieve this goal means working with the private sector and governments, from both developing and developed economies, a formula Shah sees as essential to real change. So far the alliance has mobilized over $9 billion in commitments from multilateral and development financial institutions and governments, including the African Development Bank, the Asian Development Bank, the United Kingdom’s CDC Group, and the World Bank.
Rockefeller’s commitment to tackling climate change sets a crucial example for other philanthropies, says Surabi Menon, vice president of global intelligence at ClimateWorks Foundation, a donor collaborative. Funding to address climate change has been notoriously small, and while more groups are recognizing the urgency, the overall percentage “is still less than 2%,” Menon says. “It’s not enough.”
But she’s encouraged by the Rockefeller Foundation’s approach for leveraging dollars, and notes ClimateWorks is seeing “a lot of interest from philanthropic actors who aren’t active in the climate space, but who realize the progress they’ve made on other causes will be derailed because of climate change.”
Rockefeller is going big on climate change because “we have a very limited time—a few years, or maybe to the end of this decade, to put in place the policies, the programs, the technologies, and the innovations around the world that will help prevent the most catastrophic consequences of climate change,” Shah says.
“Acting now, at scale, is so much better for the world and for our mission of lifting up the condition of humanity,” he says.
This article appears in the December 2022 issue of Penta magazine.