The gifted city: Setting a research agenda for philanthropy and urban governance

Philanthropy and the city

On 1 April 2019, the Rockefeller Foundation announced it would be winding down its 100 Resilient Cities (100RC) programme after six years in operation and a US$185 million investment. The news came somewhat unexpectedly to many and cast doubts as to the continuity of such visible ‘urban’ engagements by philanthropies (Nielsen and Papin, 2020). While the Rockefeller move might simplistically be interpreted as a retreat of major foundations’ giving to cities, its story is perhaps more accurately one pointing at the sizeable impact of philanthropy in urban governance – an influence that all but whittled away as COVID-19 struck. In fact, philanthropy’s involvement in cities has become more present than ever. For instance, shortly after the pandemic began spreading, Bloomberg Philanthropies announced a US$78 million Rapid Response Initiative to support US-based and low- to middle-income country mayors. Many other donors followed suit.

To be certain, there is a long history of philanthropic involvement in cities. Yet the past couple of decades might have witnessed a heyday of these practices. This momentum is not just about the ‘urban’ location of gifts and grants. Rather, it is also characterised by philanthropic institutions and individuals intervening explicitly in urban governance, shaping for instance urban agendas and local decision-making (Montero, 2020; Parnell, 2016). The Ford Foundation, for example, played a critical role in supporting the United Nations’ 2016 New Urban Agenda. Realdania was key in influencing how cities lobbied for the 2015 Paris Agreement on climate change. The Open Society Foundations (OSF) has had a big impact in pushing for a place at the table for mayors in the 2018 Global Compacts on Migration and on Refugees. This philanthropic focus on urban issues has translated into sizeable investments across the planet, championed both by large philanthropic institutions and by High Net Worth Individuals (HNWIs). ¹ Explicitly ‘urban’ initiatives by the likes of Bloomberg, Ford, Realdania, OSF and Rockefeller are but some of many such examples. It would be now hard to deny that, at the turn of the 2020s, philanthropy hasn’t played a key role in shaping much of the so-called ‘urban age’. In fact, one of the major drivers of this very rhetoric, this is, LSE’s Urban Age Programme, was kickstarted by a sizeable investment by the German Deutsche Bank’s philanthropic arm of the Alfred Herrhausen Gesellschaft in 2005 (Gesellschaft, n.d.). However, the implications of this philanthropic influence on urban governance are rarely debated. Here is where our commentary comes in.

If an increasingly explicit urban dimension is present in much of today’s philanthropic giving, discussions of philanthropy have neither had much of an urban focus in the wider industry parlance nor have made their way to the top of the urban studies debate agenda. Of course, the global growth of philanthropy has not been immune from broader, and indeed critical, scholarly assessment. Mitchell and Sparke (2016) have for instance argued that a ‘new Washington consensus has come to characterise the rise of a ‘millennial’ philanthropy pushing for specific agendas while seeking to maximise results through market oriented solutions (see also McGoey 2012). This stance has been particularly clear in the criticism of the growing popularity of ‘philanthrocapitalism’– a philanthropic ethos centred on ‘social entrepreneurs’ and ‘impact investments’ (Bishop and Green, 2010). Central for our commentary, the scholarly doubts cast on what these new forms of philanthropy may stand for are centred on key questions as to the power and influence that philanthropy can exert in policymaking and resource allocation in cities. Unfortunately, these broader discussions have not taken cities as a realm of debate. A much more explicit scholarly engagement is needed in urban studies. In calling for this focus, we take our cue from Montero (2020: 2266), who has already noted in this journal that little has been written thus far on the move by major philanthropic institutions to ‘“leveraging cities” as a proliferating global development practice’. As he argues, cities have become increasingly important for international philanthropic institutions, and in turn philanthropies have taken up a greater role in urban issues – a call for attention we want to amplify and systematise in our commentary.

Ours is an empirical agenda too. We would argue that the relationship between cities and philanthropy plays out at two main scales. On an institutional level, major urban initiatives in the spotlight for tackling the likes of climate change, resilience, culture or migration have been tightly intertwined with the support of sizeable philanthropic entities for urban governance institutions like local governments and urban development programmes. In many instances, major foundations have become a stable presence as partners, if not initiators, of well-known stakeholders that shape urban governance internationally. This was for instance the case for the Clinton Foundation’s 2005 investment to support the set-up of the renowned C40 Cities Climate Leadership Group (Acuto, 2013). On the other hand, on an individual scale, urban governance has also been influenced by the intervention of HNWIs, who have become a driving force behind a new wave of so-called ‘super-philanthropy’ and a presumed new ‘golden age’ of philanthropy (Hay and Muller, 2014), not least within urban agendas and urban policy circles.

We want to bring this two-part agenda focused on the institutions and individuals to the fore with a particular emphasis on how philanthropic institutions and individuals intersect with urban governance. We do so to put the emphasis on the underlying (urban) politics of these interventions. We call on urban researchers to become more explicitly conversant in the dynamics of philanthropic investment in the governance of cities. To position this agenda beyond Euro-American practices, we underscore how this needs to be done through a diverse ‘global urbanist’ (Lancione and McFarlane, 2021) prism. We suggest that we need to acknowledge that philanthropy is a global phenomenon emerging from Global North and South, even if of course Euro-American institutions still dominate much of media headlines and public discourse. Critical reflexivity about the relation between urban scholarship and philanthropic giving, we stress in our conclusion, is also a precondition for this approach. Urban studies is not independent of philanthropic giving. Overall, our commentary aims to underscore the intersection of philanthropy and the politics of cities, and the way urban studies could address this nexus.

Philanthropic institutions and urban governance

The philanthropic sector is progressively keen on relating to cities as a key area of investment and giving. Philanthropy is intervening within the edifice of urban governance at local, national and international scales with important effects. It wields sizeable capacity to bring issues to the fore, reform local decision-making and coalesce attention and efforts around specific policy agendas (Rogers, 2011). This means understanding what kind of ‘urban’ agendas are being promoted by philanthropy in the governance of cities the world over. These are, at a minimum, important items for the empirics of urban researchers globally. A recent OECD (2018a) review of private philanthropic engagement in development has for instance highlighted how 91% of giving to NGOs and other private organisations, and 62% of giving to multilateral institutions, has been explicitly earmarked with agendas, conditions and bespoke projects, rather than more flexibly to support said organisations (see also OECD, 2018b).

The issue of philanthropic influence is even more central in those contexts where urban governance has witnessed either a withdrawal or a substantial reduction in the capacity of national and local governments. As research into the impact of philanthropy in European cities has underscored (Ravazzi, 2016), philanthropy ‘in and for cities’ has progressively taken up a role as public policy supporter and even as a policymaker of its own. This has manifested either via funded decision-making proxies (e.g. local authorities) or by holding consultative roles in municipal government.

So, where to start? In our view, a closer look at how philanthropic institutions are intersecting with how urban governance works, rather than a wider focus on ‘cities’ more generally, or ‘local government’ more reductively, offers great potential to unpack specific dynamics that are at play when philanthropy meets the politics of urban development. We highlight here two examples of productive institutional entry points for this application: the overlap between philanthropic and urban entrepreneurialism, and the issue of city-oriented giving in global urban agendas.

First, a productive example of how this urban governance agenda could be operationalised might be that of entrepreneurialism, where local government and philanthropic trends seem to converge. While there has been plenty of debate on whether the self-defined entrepreneurial approach hailed by philanthrocapitalism is anything but new (McGoey, 2015), this business rhetoric has been widely embraced by institutions, funds and venture philanthropists (McGoey and Thiel, 2018). Urban studies could do much in engaging with this entrepreneurial evolution. It could help with understanding how giving is shaping cities and what charitable institutions are intersecting with the governance of urban development. Much of the critique on the foundations of social entrepreneurship in philanthropy finds closely aligned debates in the current resurgence of attention to the question of ‘urban entrepreneurialism’ (Phelps and Miao, 2020) in urban studies. As this latter work has noted, drawing on earlier 1990s conversations around the ‘entrepreneurial city’ (Hall and Hubbard, 1996), new managerialist and speculative practices have progressively become central to the modes of ‘statecraft’ that municipal actors have taken up over the last few decades (Lauermann, 2018). This is a productive overlap ripe for empirical investigation. For instance, recent work on the role of foundations in housing policymaking has underscored how philanthropy has gained prominence at the local governance scale due to a declining presence of corporate actors involved in the urban governance of housing, often encouraging ‘asset-based rationales’ (Davies and Pill, 2012). This productive overlap of philanthropic and urban studies approaches can shed light on how giving has shaped the expansion of this governance tactic, how it is being embodied by local government and other urban governance actors, as well as how philanthropic institutions might be driving its underlying motives (Acuto, 2020). Of course, this is but one of several examples of how overlaps between philanthropic and urbanist literatures could yield critical results through an agenda that looks specifically at the impact of giving on urban governance.

Similarly, our suggested focus might allow us to ground investigation of the impact of philanthropy in cities by highlighting this industry’s influence in agenda-setting policies and processes. As Montero (2020) noted already, philanthropic engagements with urban agendas have had a fundamental role in the dynamics, and directions, of policy mobility in both the Global North and South. This consideration would reconnect the investigation of giving to mounting attention in urban studies to the emergence among international institutions and donors on the potential of cities as key drivers of sustainable urban development and of global agendas. It is within this logic that institutional actors (including philanthropies) have played a key role not only in providing funding but also in facilitating the export and circulation of certain urban models, ideas and frameworks. This is what Montero (2020: 2277) has labelled as ‘urban solutionism’: a key mechanism used by international institutions to select those ‘best practices’ that ‘can be quickly spread as a framework for development action’ and where cities are set to play a key role (see also Bok, 2020). As Montero (2020: 2269) aptly points out, ‘models and “best practices” travel not because they are best but rather because they have been constructed as “best” at a particular moment of time’. This is a narrative that is closely intertwined, in our view, with recent debates about the rhetoric that cities ‘can save the planet’ and the change in discourse from ‘the city as a sustainability problem to the city as a sustainability solution’ in global urban policy (Angelo and Wachsmuth, 2020). Yet we would caution against an all-out critique against all kinds of giving. We should perhaps reject altogether the idea of mobilising practices and cosmopolitan comparisons (Robinson, 2011) to inspire change in cities. Rather, as Montero (2020: 2278) puts it, we should call out philanthropy when it has pushed a ‘prescriptive and acritical adoption of urban policy solutions from elsewhere’, or has turned a blind eye to the fundamental unevenness of cities. In a nuanced fashion, we should not simplify all philanthropy as a single uniform entity or perhaps even as a coherent ‘industry’, and that remember Euro-American models and viewpoints might not so easily apply to other realities – an issue we return to in the fourth section of this commentary. Yet to do so we need to not downplay the continuing influence of wealthy individuals in this story.

HNWIs and place-based giving

Whose wealth philanthropy is built on matters substantially for the way giving intersects with cities. To understand that, we need to couple the institutionalist view above with a continued appreciation of individuals. One of the more complex realities to be unpacked in the contemporary world of philanthropy lies in the relationship between HNWIs and philanthropic institutions. ² Again, this is a productive but unexplored area for investigation. Although urban scholars have increasingly been paying attention to the presence and influence of the ‘super-rich’ in cities (Butler and Lees, 2006; Hay and Muller, 2012; Pow, 2011), their role in city-based philanthropy is generally absent from these analyses. Little attention has been devoted so far to the complex intertwining between either more generally HNWIs and the world of philanthropy (Hay and Muller, 2014) or more specifically how they are shaping the engagement between philanthropy and cities. This is a pressing issue. If the act of giving has certainly deep historical roots in the shape and governance of cities, the past two decades have seen the super-rich spending more and more on charitable causes and philanthropy in a close correlation to unprecedented amounts of wealth accumulated (Levenson Keohane, 2008). Recent reporting on ‘mega-gifting’ ³ revealed how the combined wealth of the 62 Americans billionaires who originally signed The Giving Pledge, an initiative pledging to give away at least half of their fortunes, has now increased by 95% from US$376 to US$734 billion in 2020 dollars (Collins and Flannery, 2020: 7). Many of these billionaires have close interests and charitable investments in cities. Similar stories can now be found the world over, from East Asian billionaires to European and Latin American millionaires (Forrest et al., 2017; Freeland, 2012).

To understand such discrepancies, we of course have to attend to the political economies underlying HNWIs. The tax breaks and giving incentives that philanthropic institutions and HNWIs benefit from have brought a myriad of fiscal advantages to those who have the most (Cassidy, 2015). The way that tax systems are set up in many countries means that, de facto, those on the top are the ones who benefit the most from the state through generous tax deductions (Collins and Flannery, 2020). This is not purely a question about philanthropy becoming a form of subsidised spending for the super-rich but also about the creation of a ‘system [that] allows higher-bracket taxpayers greater influence over public policy by controlling more subsidy dollars’ (Hay and Muller, 2014: 644). This ushers in questions not only about the elite power and influence in cities but also about the more complicated dynamics at play in the restructuring of what counts as ‘philanthropy’ today. Europe and North America have seen the emergence of new philanthropic instruments shaking much of the bases of giving from major donors. For instance, this has been the case in the United States where Donor-Advised Funds (DAFs) and Limited Liability Companies (LLCs) have gained increasing popularity due both to their flexibility but also lax reporting criteria and lack of transparency, in turn raising concerns about the accountability these instruments are subject to (Olen, 2017). To complicate matters further, this does not only apply to wealthy individuals but also to corporations that have equally been able to benefit from new taxation regimes brought forward by such instruments (Piper, 2019).

Overall, as Hay and Muller (2014) have already noted, the accumulation of wealth by those at the very top has led to a ‘super-philanthropy’ practised by a select minority for whom lavish gifts and donations have in many cases become the means to gain access to certain privileges and define policy-making agendas. This is what Rogers (2011) has referred to as ‘philanthro-policymaking’, whereby philanthropic institutions and individuals get to use their wealth and connections to leverage and implement agendas favourable to their own interests (see also Eikenberry and Mirabella, 2018; Newland et al., 2010). Although the idea of a ‘corporate elite’ heavily involved in philanthropy is well established in the philanthropic literature (e.g. Useem, 1980), their increasing influence has raised some concerns amongst urban scholars too. For example, Storper (2016: 252), in his analysis of the critical neoliberalist literature and the misconceptions and misuse behind the idea of the ‘neoliberal city’, argues how in the US, ‘the “donor class” [has been] using the wealth they concentrate from the new inequality, [to] shape elections, academic research, and community action (through the shadow state of its foundations), [and] art museums and concert halls (with their donor plaques)’.

The increasing presence of a donor class, in turn, stresses again the growingly popular self-defined ‘new entrepreneurial’ mindset displayed by philanthropists, often under the banner of ‘philanthrocapitalism’ seeking to ‘maximize the “social return”’ through targeted investments (Economist, 2006). Unsurprisingly, a number of authors have reacted to the contradictions surrounding this concept. As McGoey (2012) has repeatedly argued, the entrepreneurial approach invoked by this is anything but new, rather echoing prominent philanthropists like Carnegie or Rockefeller from the late 19th and early 20th centuries. Yet, one of the defining features of today’s philanthrocapitalism (aside from the sheer amount of spending) is the explicit ways in which self-interest, private gains and personal agendas have been brought forward through philanthropic endeavours (McGoey, 2012; see also Mitchell and Sparke, 2016). It is precisely the way that all these ‘entrepreneurial projects’ (McGoey, 2012: 194) are put into practice, and their impact on the city as a place but also in promoting entrepreneurial styles of urban governance, that could be tackled more explicitly by urban scholars in current debates (Acuto, 2020). In turn, this underscores the need to attend to processes of ‘placing’ of philanthropy in urban contexts. This is especially important as much philanthropy is, in fact, distinctly place-based (Wolpert and Reiner, 1984). For example, in their study of the relationship between foundations and private wealth in Heidelberg, Glückler and Ries (2012) highlighted the key role of geographic proximity in philanthropic engagement. As they argued, it was precisely the place-based ‘contextual understanding’ of the city and the local connections between donors and recipients that allowed for a myriad of philanthropic networks to flourish in the city, shaping its governance. Similarly, in the case of Los Angeles, Eli Broad’s involvement in the cultural and arts scene of the city over the past four decades – ranging from his founding role in the Museum of Contemporary Art (MOCA) to the recently built The Broad museum in downtown LA – would be hard to understand without his personal attachment to the city and his vision of Los Angeles as the ‘contemporary art capital of the world’ (Nagourney and Popescu, 2017). This applies not only to well-known Euro-American examples, but to a much wider geography of urban development that we stress below. For instance, South Korean entrepreneur Kim Byung-Yeol donated in 2018 his own personal forests and buildings for the exclusive use of the city of Cheonan – to name but one of many similar occurrences worldwide. And yet it is important to note that the philanthropic attachment of HNWIs to specific places can often lead to urban contradictions. As an increasing body of literature suggests, the super-rich might be contributing to more urban inequalities by targeting already privileged areas rather than ‘levelling the field’, as has been the case with school districts in the US (Cassidy, 2015; Reich, 2005). From this perspective, one important theme that can chart part of our research agenda on philanthropy and urban governance should be that of the ways in which philanthropic investments and gifts are ‘placed’ and in which they shape places. We should better attend to the politics of place inherent in the dynamics of philanthropic investment, by institutions or individuals, in cities. Yet to do so we might also need to de-centre the current worldview of philanthropy.

De-centring the narrative

The wider narrative on the intersection between philanthropy and cities has often been intertwined with major North American institutions as commonplace reference points. However, the business of giving to cities has much further ramifications that so far have received little attention from Euro-American viewpoints. Shifts in the positioning of the philanthropic discourse presented above are needed, in order to go beyond a Euro-American view of this ‘industry’. Whilst of course some of the largest global funders remain based in the United States and the Old Continent, non-Euro-American realities are not only present but influential and, to a degree, different in their modes of engagement. Asian philanthropy is a case in point here. Less regularly chronicled in urban research than the large North American and European donors, and in fact often side-lined in discussions about the state of the industry too, the so-called ‘Asian way’ (John, 2014) of philanthropy has not followed the trajectory and practices of Euro-American philanthropies. As Shapiro (2018) noted, it embodies ‘pragmatic’ elements that are distinctive from much US and European entrepreneurialism and is predominantly centred on highlighting the ‘role of relationships’ whilst also more explicitly working with government and the challenging and often well-established ‘trust deficit’ in donors from much of the public.

This is a key metrocentric bias that we should strive to correct as we embark on a more explicit conversation about philanthropy in urban studies. In doing so, we must recognise that this is not uncharted territory in Global Southern scholarly traditions. For instance, when it comes to Asian philanthropy, many ‘Eastern’ academic institutions have been leading the way, with for example the National University of Singapore (NUS) and Singapore Management University (SMU) creating dedicated research programmes in 2011 and 2006, Hong Kong University in 2014 and Tsinghua University in Beijing in 2015. Philanthropies themselves, as with the Hong Kong-based Li Ka Shing Foundation and Singapore-based Lien Foundation, have also been promoting greater appreciation and proliferation of forms of giving beyond Europe and North America, seeking to ‘nurture a new philanthropic attitude in Asia’ (Li Ka Shing Foundation, n.d.), as per Li Ka Shing’s mission.

Essential in our proposed research agenda is then the need to de-centre our view from restrictive Euro-American-centric perspectives on philanthropy and urban governance, towards a more Southern-engaged and rebalanced ‘global urbanism’ (Parnell and Robinson, 2012). In line with the approach suggested by Montero (2020), we do not want to disregard the fundamental imprint that giving from Euro-American philanthropic institutions and HNWIs has had in cities beyond their countries of origin. Yet, we would call for more evidence, debate and worldviews emerging from Asian, African or Latin American experiences which clearly have much to bring to the table to de-centre our current (and currently still very limited) narratives of the influence of philanthropy in urban governance. In turn, this approach would strengthen emerging efforts towards making sense of that ‘foundational relationship’ between the ‘global’ and the ‘urban’ (Lancione and McFarlane, 2021), and the dynamics of urban governance the world over, which international philanthropic forces now have a key stake in. To embrace this rebalanced research agenda, and to delve critically into the dynamics that philanthropy ensues for urban governance, we would argue that reflexivity about the relation between philanthropy and academia is also essential.

Conclusions

Engaging with the imprint of philanthropy on the ways in which cities are governed, and doing so from a de-centred standpoint, presents in our view a critical juncture capable of inspiring a truly transformative urban action research. To put this into practice, we have suggested a two-fold empirical path, attending to both philanthropic institutions and individuals, and suggested to pay particular attention to the implications of all of this giving in the unfolding of urban governance, whilst looking beyond Euro-American worldviews.

This is no at-a-distance agenda. Rather, it is one that calls for self-examination for urban studies too. Philanthropy hits very close to home for the vast majority of urban scholars, be they in long-standing Euro-American institutions or indeed scattered across the vast ‘global’ geography we are encouraging researchers to cast their gaze upon. Universities and other research institutions continue to benefit from the patronage and generosity of private foundations and individuals. Yet little debate has taken place in urban studies specifically on our role and position as individuals working in an institution privileged by such gifts. It is clear that the trend of universities routinely turning to philanthropy to support all types of educational activities and research, critical and fundamentally theoretical ones included, is here to stay. Importantly, this has already had a strong bearing on major centres for urban research the world over. Perhaps unsurprisingly, for instance, at the time of writing this commentary, Bloomberg Philanthropies has invested US$150 million in a gift to Harvard University to create a new ‘Bloomberg Centre for Cities’– a sizeable but not unprecedented example of direct influence between philanthropy and urban academia. As such, some degree of assessment of our positionality as urban academics in respect of this theme is therefore urgently required. This, in turn, requires us at a minimum to highlight this complicity in philanthropic giving but also more importantly to recognise the diversity of what can rarely be referred to as an economic sector, with vastly different institutional, normative and practical differences across such a large landscape. In a time when the role of researchers and academia, if not expertise in general, is more and more put into question, we consider it necessary to acknowledge our responsibility as scholars benefiting from such donations and what this entails from an ethical standpoint. Hence, from our point of view, the empirical research agenda sketched above needs to go hand-in-hand with a proactive reflection about our own positionality. From this perspective, we would encourage a number of tangible scholarly moves for urban studies. On the one hand, embrace the two-fold point of view below not just as an isolated realm of empirical inquiry but as part of wider urban research debates. Put simply, we call upon urban researchers to account for the impact of philanthropy in their depictions of cities. This can be done by focusing specifically on the political issues that underpin urban governance, where in turn many useful entry points could allow an even greater connection with existing debates about and within this ‘industry’. Above, we sketched briefly a few of these, ranging from urban entrepreneurialism, urban agendas and the role of the super-rich in cities, to the relative ease of identifying such productive spaces for engagement between this issue and commonplace urban studies debates. Accordingly, such research moves need to not be blind to the wider geographies of philanthropies that emerge from experiences beyond Euro-American viewpoints, whilst also being conscious of our own positionality as academics – a reality that in our view further strengthens the possibility for action research.

This is an increasingly important agenda. While COVID-19 has brought to the forefront the ability of HNWIs and philanthropic institutions to react to the crisis, it has also proven to be a period of unprecedented growth for the personal wealth of billionaires, including tech and e-commerce tycoons alike, and giving thrives across the planet. While the urban dimension of the pandemic challenge is now well acknowledged, we need to have a clear conversation among scholars and practitioners about how we want to engage with and around philanthropy, and the implications of doing so, both from a personal but also an academic and practical perspective.