Gates Foundation Investments Often Don’t Jibe With Philanthropic Priorities

The Bill & Melinda Gates Foundation has invested at least $8.7-billion in companies that undercut the organization’s philanthropic efforts or that engage in socially irresponsible activities, reports the Los Angeles Times, in a two-part article on the grant maker and its investments.

In the first article, the newspaper notes that the Gates Foundation has invested in companies like Chevron Corporation, Eni, Exxon Mobil Corporation, Royal Dutch Shell, and Total—all responsible for gas flares that pollute the Niger Delta, shooting out chemicals and soot that may be causing the region’s alarmingly high rates of respiratory diseases, cancer, and blurred vision and also lowering immunity—while the foundation is making grants to fight disease in Africa.

In the second article, the newspaper notes that Gates is heavily invested in companies that have ties to tobacco, alcohol, and gambling.

The foundation has also invested in companies—including Ameriquest, Fannie Mae, Freddie Mac, Nestle, and Tenet Healthcare Corporation—that have been sued for or are suspected of profiting from illegal practices, such as predatory lending, forced child labor, and medical lapses.

The foundation’s endowment is managed by Bill Gates Investments, which maintains a strict separation from the grant-making side of the organization and invests solely for profit. The Gates Foundation told the Times that its investment managers do vote proxies to influence company policy.

But the disconnect between the foundation’s grant making and its investment decisions worries some experts in philanthropy.

“Trustees should say to themselves: ‘As we think about the work that we are trying to do with this foundation, which ultimately should contribute to the public good, we should be making sure that everything we do is aligned to the mission, including the investments we make,’” said Douglas Bauer, senior vice president of the Rockefeller Philanthropy Advisors.

The newspaper’s investigation of the Gates investment policies comes after a Chronicle of Philanthropy survey” of the nation’s 50 wealthiest private foundations found that 30 of them delegate to their money managers all decisions about proxy voting.

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