It’s easy to feel frustrated by how much inequality exists in the world, and it can be overwhelming to think about how to fix it.
The McNulty Leadership Program and Wharton Social Impact Initiative (WSII) co-sponsored a panel to tackle this question, as part of WSII’s Turner Social Impact Executive Speaker Series. They invited three of the country’s top thought leaders to campus: Valerie Jarrett, who served as senior advisor to President Obama, Dalila Wilson-Scott, the senior vice president of community impact at Comcast, and Antony Bugg-Levine, the CEO of the Nonprofit Finance Fund.
During the discussion led by Prof. Katherine Klein, vice dean of WSII, the expert panel talked about how government, corporate philanthropy, and impact investing can begin to dismantle racial and socioeconomic inequity. They also offered advice for how to remain hopeful for the future.
Public Service: Transforming Communities from the Ground Up
When it comes to enacting change, Jarrett said the process begins with listening to community members. This was something she learned early in her career in public service when she served as deputy corporation counsel for finance and development under Harold Washington in the Mayor of Chicago’s office.
“It was really in those early days in city government where I had a mentor who just drilled into my head that public service is about listening,” Jarrett said. “In local government, (you are around constituents) 24-7 and I think that’s as it should be. It’s there that I learned that change happens on the ground.”
Jarrett said conversations in smaller communities can spark action on a wider scale.
“Ordinary people do extraordinary things because they love their community,” she said. “It builds momentum to have the kind of huge, transformational change that can sometimes happen at the national or international level.”
She stressed, though, sustainable change can be accomplished through collaboration with the private sector, and that “you can’t look to the government to solve problems alone, if you expect the change to be sustainable.” After transitioning into a position in Obama’s administration, Jarrett said she learned the importance of engaging the business community to leverage philanthropic funding. One way to do that, she suggested, is to make a business case for investing in impactful initiatives and organizations.
“If we were to simply look at it as an investment, as opposed to just philanthropy, you’re going to get a return on that investment. The data is now beginning to show, for impact investing, that companies that focus on sustainability and workplace policies — that are supportive of working families and good governance — are actually more profitable,” she said.
“When you change that paradigm and realize (working to improve equality is) a business imperative, and no longer a nice ‘to do,’ people don’t stop doing it when budgets get tight,” she said. “If it’s a business imperative, that stays a priority. We need citizens, which is the most important office of all, to hold their government accountable and encourage (officials) to think creatively.”
Corporate Philanthropy: Encouraging Accountability through Equitable Business Practices
Wilson-Scott also spoke about accountability. She said acknowledging her power to influence change has become both a personal and professional focus of hers because of the inequity present in the field of philanthropy.
“I think there’s more inequity in philanthropy than in a lot of other sectors and I think we have to own that,” she said.
When it comes to deciding which projects receive funding, Wilson-Scott said it’s important to be aware of an imbalance in power dynamics.
“There is a lot of decision-making power held in the side of the funder. We have to be cognizant that we’re not, through our actions or non-action, incentivizing people to do things that we wouldn’t otherwise want to happen,” she said. “(In a restaurant), the highest priced tables are at the front (which is to say that) the people who have the best information always get the best access. That’s the inequity I’m speaking of when I speak about equity in philanthropy.”
In her work at Comcast, she thinks a lot about how to incentivize results “when people aren’t starting from the same starting point,” and how to “reward the people who are innovative, solutions-focused, and have the best ideas.” Wilson-Scott tries to ensure that Comcast is thoughtful about their employment and management practices, falling in alignment with a growing push for the private sector to implement more equitable policies.
“As a private sector company, your ability to impact the world has much more to do with how you run your business and how purposeful you are in that process, from hiring to employment practices to how you’re managing your supply chain to how you’re thinking about everyday decisions,” Wilson-Scott said. “In a large company, every single person has some accountability in that.”
Impact Investing: Giving Hope to Society’s Most Marginalized Populations
In the past few years, impact investing has gained popularity in discussions about effective ways to address inequity. But Bugg-Levine has been involved in this work for much of his career. He even worked for the Rockefeller Foundation that coined the term “impact investing” in the early 2000s. Bugg-Levine defined it like this: “Impact investing is this really simple idea that a for-profit investment can be a morally legitimate and economically effective way to address social issues.”
He said he’s been heartened by the growing recognition among business leaders that impact investing can be profitable.
“(There’s been a) shift in the last 18 months where impact investing is now increasingly recognized by the finance industry as the smart thing to do, not just the right thing to do. There’s a lot of understanding with inequality that if you are not addressing it with your investments, you simply won’t be making as much money for your company.”
He cited one of his partners, a nonprofit staffing agency called First Step Staffing, as an example.
“First Step works with nonprofit organizations around the city to identify workers who are in homeless shelters or in rehab centers — many of whom are returning citizens coming back from incarceration — who are ready and able to work,” he said.
Using a loan from Bugg-Levine’s organization, as well as other local impact investors, First Step contracts with employers around town who need employees and figures out how to support those companies in filling jobs. First Step receives a staffing fee, which allows them to pay back the loan.
“We’ve built this magical connection between deposits in a bank account and someone who has experienced homelessness being able to go home today with the dignity that comes from having a job,” Bugg-Levine said. “That whole engine is being built with impact investing playing a central part.”
“You might look at it as a minimum wage job, but for these people, many of whom have recently been homeless or are veterans, they will come home from work today,” he said. “It’s a simple thing, but it’s a deeply profound beginning point for hope.”
— Emily O’Donnell
Posted: March 9, 2020