Charitable foundations: Beware the skeletons in your closets

When philanthropies or other charitable foundations are criticized in the news, it’s often due to a fault in their transparency or use of money. Watchdog organizations exist that follow foundations worldwide, as they should. These civil society institutions have asked for the public’s trust and garner an opportunity cost to society by being tax exempt. Sure enough, when foundations managed by those who have held public office are even suspected of illicit activities, as the Clinton Foundation was this week, public backlash erupts.

Before the allegations, the Clinton Foundation enjoyed a sense of social capital; society usually assumes an “innocent until proven guilty” mentality towards charitable organizations. But there are exceptions; society will shun money used for benevolent purposes if its source comes from an institution known to conduct illicit activities. The terms “drug and blood-money” immediately categorize funds as “tainted.” 

Yet, there are institutions with charitable causes that seem to have withstood the test of time while using immorally accrued funds. A recent New York Times piece on the Booker Award, one of the most prestigious cash prizes for the best novel in English, revealed a Booker family history of slave ownership and human-rights abuses. The prize is now simply known to be “the UK’s most prestigious literary prize”; the Booker family was successful in creating a brand of reputation and respect generations after the horrendous practices of those who accrued the capital that created it.

It’s important to make a distinction here between foundations stemming from companies known for notorious activities and charitable institutions successfully separated from their principal funds. For example, R.J. Reynolds, an American tobacco company based in North Carolina, operates a charitable foundation aimed towards improving public education, while its operating revenue comes from the sale of a product responsible for over 450,000 deaths each year. In this example and in the similar cases of  foundations run by McDonald’s and Coca-Cola, the stakeholders responsible for a social problem, be it cancer, obesity, or diabetes, aren’t separated from the company. Such isn’t the case for charitable causes more clandestinely financed, like contributions recently put under spotlight made by the Sackler family.

Google searches for “Sackler” between 2010 and 2015 present a family name “synonymous with philanthropy on a large scale.” The Sackler family is known for its museums, exhibits at the Met, and endowed professorships, and less known for their pharmaceutical company and most popular product, OxyContin. From the development of the drug responsible for over a 100,000 deaths from overdose each year in the mid 90s, Purdue Pharma, separated from the Sackler family only by name, adopted a marketing campaign that knowingly and willingly misled the public by funding research and paying physicians to doubt the addictive nature of the drug. The Sackler family not only took advantage of the public’s strong belief in the integrity of doctors, but also used a legal system of confidentiality in settlements to make sure Purdue Pharma executives—including the Sacklers—weren’t cast in the public judicial spotlight of trial. The Sackler practice of attaching itself to larger civil-society institutions with high social capital strengthens their own even more. Duke’s Nasher Museum elicits strong veneration for Raymond D. Nasher, its primary donor; the same parallel exists at Harvard’s art museum, the Sackler.

Such institutions have a duty to recognize the origins of their resources, and they’ve been notoriously bad at doing so. It took Yale 84 years to change the name of the Calhoun Residence hall after its slavery-defending alumnus. It took Georgetown over 200 to recognize and apologize for the sale of slaves in 1838 to help fund the university. But these faults—selling slaves and honoring defenders of slavery—were of the institutions and not of the donors. These institutions are seemingly only subscribing to sentiments in the lines of “in philanthropy, all that matters is the result and not the intentions.” Does that excuse Duke, who we found last week has invested in companies that work in resource extraction and are the cause of environmental hazards in South America?

In his Gospel of Wealth, the father of modern philanthropy Andrew Carnegie wrote, “the man who dies leaving behind many millions of available wealth, which was his to administer during life, will pass away, unwept, unhonored, and unsung." The Bookers, the Sacklers, and those whose philanthropy has been a means to an end only subscribe to the contrapositive: to pass away honored, one must give away wealth in life. Philanthropic organizations should indeed use these funds to ameliorate the human experience in any way they see fit, but they should do so recognizing and honoring the legacies of the untold whose contributions make their efforts even possible. 

Nima Mohammadi is a Trinity sophomore. His column, "on my mind," runs on alternate Thursdays.