Why philanthropic giving may not be humanity’s hope for solving the climate crisis 

Sandrine Jacquot, Staff Writer

October 1, 2021

With the lack of action against climate change from governments around the world, can society’s newly-found awareness regarding growing income inequality and louder calls for climate action put enough pressure on the ultra-rich to turn their philanthropic giving towards the climate crisis? And is this good enough to spur a sustainable and effective solution to the climate crisis?

On August 9th, the International Panel on Climate Change (IPCC) released a report which infamously signaled ‘a code-red for humanity,’ as stated by the United Nations Secretary-General, António Guterres. The report exposed the rapidly intensifying effects of climate change around the world and urged global leaders to “act decisively” against the closing 1.5 degree celsius gap. Since August, the hype surrounding the report has died down, and as is the trend nowadays, the world carried on with ‘business as usual.’ The report eventually became of little consequence to policymakers and leaders alike around the world. 

As many governments continue touting the importance of climate action while also setting far-off climate targets to burden future administrations with achieving, society has interestingly turned their attention to the ultra-rich. Society is aware, now more than ever, of the global growing gaps of income inequality- the uneven distribution of income, and wealth inequality- the uneven distribution of wealth. Between 1989 and 2016, the wealth gap between America’s richest and poorest families more than doubled. The richest families in America are getting richer faster, accumulating an increasing share of the country’s wealth. More recently, the COVID-19 pandemic has exacerbated pre-existing inequalities in the labour market, furthering the already growing income and wealth inequalities by pushing many further into poverty while alternatively increasing billionaires’ incomes. 

Philanthropy: A solution born out of the rise of billionaire wealth and mounting pressure for climate action. Philanthropy, in an altruistic sense, is the concern for human welfare and advancement, often noted through charitable giving in the form of money, or the creations of non-profit funds to help the needy. There is newfound pressure from philanthropy advocates to see donors focus their money on solving immediate, and pressing problems, such as climate change. Yet, philanthropists are only just starting to prioritize climate change, as less than 2% of the $730 billion in global philanthropic giving from 2019 went towards combating climate change. Recently, new initiatives from the famous and wealthy are popping up, such as Amazon CEO Jeff Bezos’ Bezos Earth Fund, which recently pledged another $204.7 million on top of the $10 billion it already allocated to funding groups fighting climate change. Earlier this January, even Elon Musk offered $100 million for the best carbon capture technology. 

It is widely recognized among the philanthropic world that donors need to prioritize the climate emergency and do their part to fund innovation, support advocacy movements, and influence markets and governments. Many proponents believe that philanthropy can shape the political debates around climate policy, create networks to structure and coordinate climate action, divest from fossil fuels, and invest in climate tech developments. Further, many in the community also view American-based philanthropists as potentially playing an instrumental role in shaping climate philanthropy initiatives because of their ideological, political, and financial influence. Although it is generally agreed upon among philanthropists that their actions will not solve the climate crisis alone, if the likes of Jeff Bezos or the notable Gates Foundation shift their focus towards funding climate initiatives, then that is a good step forward to taking climate action.

However, the reality is much more complex and less idealistic. The world should not look to the billionaires to start solving the problem by giving away their money, but rather we should look to hold large multinational corporations accountable that further the climate crisis in the first place and pressure governments to change the regulatory frameworks in which they operate. 

Big philanthropy has many contradictions. To start, there is no law to mandate how and if billionaires give away their money: philanthropic giving is all voluntary. When Jeff Bezos made his claim to pledge $10 billion towards climate action, it was simply a promise, with no repercussions to follow if he did not follow through. Additionally, accountability and transparency vary depending on the structure of the fund — how billionaires give away their money may be shrouded in mystery. Not only are there often questionable transparency issues, but inconsistencies with how these big philanthropists made the money they are giving away in the first place. Billionaire philanthropists attempting to use money they make unethically for the greater good is a cycle that will never enact concrete change. Using Jeff Bezos as an example, in 2018 his company Amazon paid no federal tax, while instead receiving $129 million in a tax refund. Amazon, the source of Bezos’s wealth, threatened to fire workers who campaigned for stronger climate action. In 2018, the company emitted 44 million metric tons of CO2 equivalent,  and its push for faster delivery times, in some instances reduced to 1-2 days, does little to help its massive carbon footprint. This irony is at the root of why philanthropy will never be a viable solution to the climate crisis. 

In the gap between slow government response and the growing crisis, we have turned to the billionaires. Canada is not on track to reach its new climate target of reducing greenhouse gas emissions by 40-45%, with some provinces not yet willing to agree to meeting them in the first place. However, we should instead be putting more pressure on governments to increase spending, to shift away from fossil fuels, new policies and taxes for the rich, change the regulatory framework for business operations, and divert subsidies to renewable energy. Billionaires cannot change the regulatory structure that governs the businesses and multinational corporations that created the climate crisis in the first place; only government and policy action can take concrete steps towards sustainable and structural solutions that are necessary to address this crisis. Sure, billionaires might be good for funding new climate technologies, but the private sector and its winnings converted into philanthropic giving will never be enough to solve the climate problem.