David Rockefeller’s Death Means Windfall for Family Foundation

With the death this week of David Rockefeller, the fund he created with his siblings in 1940 will be catapulted into philanthropy’s exclusive billion-dollar club.

The Rockefeller Brothers Fund had $829 million in assets as of late January. It made grants totaling $28.9 million last year.

Mr. Rockefeller passed away March 20 at the age of 101. In 2006, the former head of Chase Manhattan Bank and grandson of oil baron John D. Rockefeller Sr. pledged to leave the foundation assets then valued at about $225 million.

While the current value of the bequest is unknown — Stephen Heintz, the president of the Rockefeller Brothers Fund, estimated it will take about two years to settle the estate — it means a major cash infusion for the organization. But it’s not clear how long the foundation will remain above the billion-dollar mark, as it is accelerating its grant making this year, a move that will likely cut into its endowment.

In response to Trump administration “America First” policies they view as an attack on causes close to David Rockefeller’s heart — multilateral trade, internationalism, and U.S. leadership in global affairs — the fund’s leaders plan to increase grant spending by 12 percent this year. It is also recasting itself as an active player for social change, putting more of its assets into investments geared toward improving the environment and creating a just, peaceful world.

The more aggressive spending is likely to last for some years and could shrink the foundation’s assets over the long term, said Mr. Heintz. The fund’s trustees decided to increase grants to counter what he called the “neo-authoritarian pushback” they see from the White House and the governments of other countries, including Russia, Hungary, and Turkey.

“This will likely be a multiyear effort,” Mr. Heintz said. “David was a devoted internationalist. He believed in free trade, he believed in the United Nations and the postwar liberal global order which seems to be challenged by the new administration and others around the world.”

Large Gifts

The exact value of Mr. Rockefeller’s gift to the foundation is unclear. In 2006, he made plans for large bequests to many of his favorite institutions, including the Museum of Modern Art, Rockefeller University, and the Council on Foreign Relations. Much of his residual wealth would then be channeled to the Rockefeller Brothers Fund.

Given Wall Street returns since 2006, which include a doubling of the stock market since the Great Recession, the estate has likely grown in value. In addition to selling off conventional assets like securities, the estate will have to liquidate property to make the gift. Some of Mr. Rockefeller’s extensive art collection, which includes paintings by Impressionist and modern masters like Pablo Picasso, Roy Lichtenstein, Édouard Manet, and Diego Rivera, will be donated to museums, but many pieces will be put up for auction.

The foundation bequest has long been in the works, according to Mr. Heintz. Most recently, in 2013, he and Mr. Rockefeller revised the memorandum of understanding that spelled out the philanthropist’s wishes for spending the gift.

“There was some fine tuning,” said Mr. Heintz. “He was very interested in making sure that the bequest was going to be used for things that reflected his own life’s work … but also that it would be relevant to changing conditions in the world.”

For example, he said, there’s no doubt that the memorandum gives the fund’s board a green light to pursue grants addressing the growing threats posed by climate change.

Mr. Heintz said the grant maker is still committed to having a long life. The new spending surge, he notes, will be considerably less “radical” than the Rockefeller brothers’ mid-1970s move to nearly halve the fund’s endowment by making large gifts to Memorial Sloan Kettering Cancer Center, the Metropolitan Museum of Art, and Colonial Williamsburg, and other institutions. Even after that sell-off, the foundation still positioned itself to last for generations, albeit without making an absolute decision on whether it would be a perpetual organization.

“There’s a big space between saying you want to exist in perpetuity on the one end and on the other end saying you want to spend down,” Mr. Heintz said. “You can agree that you want to exist in perpetuity, but it can be a smaller fund.”

Family Affair

In addition to co-founding the Rockefeller Brothers Fund, Mr. Rockefeller created the David Rockefeller Fund with his late wife, Peggy, in 1989. The two foundations are part of a larger philanthropic network that includes the Rockefeller Foundation and the Rockefeller Family Fund and has involved five generations of the clan.

Lukas Haynes, executive director of the David Rockefeller Fund, said he expects it will receive bequests in the future from its founder’s estate. He did not know how long it would take to sort through Mr. Rockefeller’s assets in the probate process.

The fund supports arts and criminal-justice and environmental programs. Any future bequests, Mr. Haynes said, would help younger Rockefellers carry out philanthropic projects as they see fit.

“The trustees of each generation are given latitude to respond to the needs of the world in their time,” he said.

In the meantime, the death of one of the country’s most recognizable philanthropists has triggered plenty of conjecture about how his money will be used.

Robin Rogers, a sociologist at Queens College who is writing a book on billionaires and their giving, surmised that Rockefeller Brothers might play a role foundations have historically played by propping up cash-starved social institutions that fear losing federal support.

“We just had a radical political shift, and all of this money available to programs is now in jeopardy,” she said. “That may be a place where more traditional foundations step in with an old-style philanthropy and keep things going.”

In 2014 the Rockefeller Brothers Fund divested its fossil-fuel holdings, The sell-off was a huge shift for the foundation, the existence of which is due in large part to the inheritance of John D. Rockefeller’s Standard Oil wealth, said Emma Saunders-Hastings, a social-sciences professor at the University of Chicago.

While she has not studied the foundation specifically, Ms. Saunders-Hastings said the divestiture and the spending increase are signs that Rockefeller Brothers is charting a new course.

“Foundations used to be very cagey about having a political role,” she said. “That’s changing.”

Mr. Heintz is direct on that score, asserting that philanthropies are not “frozen in time.”

Rockefeller Brothers’ evolution has been generational, as successive groups of family members took charge and began to emphasize social change. That outlook was reflected in the fossil-fuel divestiture and spending boost.

It also drove a decision in November to increase investments that are in line with the foundation’s goals to 10 percent, and eventually 20 percent, of its endowment — and, Mr. Heintz, said a move to become active as a voting shareholder in publicly traded companies, a strategy aimed at pushing corporations to make decisions that are good for the environment and society at large.

“That’s not old-style philanthropy,” he said. “That’s contemporary.”

Correction: A previous version of this article referred to Lukas Haynes as president of the David Rockefeller Fund instead of the executive director.