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Money Can't Buy Justice
Koh Okuno
Usually showered with praise in mainstream media, what do well-funded charitable organizations do wrong? Turns out, quite a lot. So much so that it seems to nullify their "charity".
Growing up in the highly inequitable country of Thailand, my understanding of philanthropy was characterized by justice and virtue. My everyday scenes would be highly juxtapositional in terms of wealth, where I would see young children as small as seven selling orchid flowers at the traffic lights on the way to my international school. But as soon as I got to the pristine campus deep in the lush mountains of Northern Thailand, my wealthy friends would be showing off their newest iPhone. Seeing this inequality, it made sense to me that privileged people like myself and my wealthy friends should help less entitled people like the children I saw. Therefore, there seemed to be nothing to question about philanthropy.
Then in 2016, in my second to last year in high school, I happened to become the short-lived philanthropist that I admired. It all began when I lost to one of my best friends to become my high school’s student council president. It was a "defeat" that I took particularly seriously as it jeopardized the strategic resumé building plan that I had for my college applications as a student in the competitive educational sphere. Without showing respected leadership experiences, I knew I had no chance to get into Columbia University, my dream destination at that time. Therefore, the following month, I set up a youth charity organization with three other friends.
Within 5 months, we expanded our team of four into 18 and organized a music charity concert at our school to raise awareness about endangered Asian elephants in Thailand. In the end, the event was a great success as the school community came to support the initiative and we raised around €2000 in a single night that went to an elephant hospital in the Lampang district. That night, I remember feeling exhilarated by what I had accomplished; I not only "co-founded" a student-led group that organized this successful event but we raised a great deal of money, which was going towards saving elephants. It was a win for me and a win for the world.
But reflecting on that experience, I see my teenage self-indoctrinated by a disposition of self-interest and instrumental motivation that hid behind a seemingly altruistic act. While I was proud to have made some social impact, I believe I was more fulfilled by the sense of accomplishment anchored on the amount of funds we raised and obtaining a leadership experience that would look great on my resumé, which led to an increase in my chances to get into Columbia.
In a similar fashion but at the consequential scale of the world, I observe great parallels between my experience and today's most influential charitable organizations such as the Bill and Melinda Gates Foundation, Open Society Foundation, and Wellcome Trust that all hold assets in the multi-billion scale. Behind the altruistic curtain of "social justice" that they drape with their annual multi-million expenditures, these entities function in accordance with their private agendas with limited transparency and accountability that contradicts their purpose.
The Three Red Flags: Conflict of Interests, Financial Loopholes, and Neglected Contexts
Three red flags point towards a veil of charity that disguises a foundation's wrongdoings: conflicts of interests, financial loopholes, and offshore financial activity. A great and notorious example of a charitable organization that clearly has all three red flags is Wellcome Trust, a foundation with roughly €32 billion in assets and €1.2 billion in annual expenditure. They are one of the leading private organizations that fund biomedical and health-related research.
With this immense capital and focus on the health industry, it was no surprise that Wellcome Trust also contributed to the funding of the UK and WHO's Access to Covid-19 Tools Accelerator (ACT) program, a research program on Covid-19 therapeutics, but not purely for the reasons to help fight against the pandemic. According to the medical trade journal, BMJ, Wellcome Trust was found to have multi-million stakes in Novartis and Roche; companies that were in contact with the ACT program to produce and research the covid-19 therapeutics of interest. It also happens to be that the former CEO of Roche Holdings, Williams Burns, is one of the Board of Governors of Wellcome Trust along with the co-chair of the WHO/World Bank Global Pandemic Preparedness Monitoring Board, Elhadj As Sy. Finally, let's not forget that well-funded charitable organizations usually have a corporate background. Wellcome Trust, for one, is actually built from the pharmaceutical profits of GlaxoWellcome that merged with SmithKline Beecham to form GlaxoSmithKline, a pharmaceutical giant that rivals Novartis and Roche.
But the red flag doesn't stop there. While Wellcome has recently spent roughly €1.2 billion every year, they are making substantial returns to their assets. Last year, their assets increased in value by roughly €3 billion, even during the pandemic. Over a third of their €32 billion assets are in private equity funds and hedge funds, known to promote the pernicious business culture of cut-throat profit maximization. Despite this, Wellcome paid roughly €15 million in taxes in 2020 because of their status as a "charitable organization that exempts them from corporate taxes even when they behave like one. With all that said, the image of any charitable organization really falters when you inspect it within the context of the offshore financial market of the world, through which around half of the world's total €18 to €28 trillion in cross-border assets pass through. Wellcome Trust is no exception when it comes to participating in the offshore financial market.
In 2018, a Science Magazine report found that Wellcome had roughly €800 million of its assets in at least 57 tax haven funds. This is almost the entire value of their annual expenditure that directly contributes to the global issue of evaded government tax revenues, which puts their "charitable" activity in question. If Wellcome Trust was legally recognized as a corporation and was taxed at a reasonable rate, much of its annual expenditure amount would go to the government who can invest it in the same research programs and public infrastructure but with greater accountability and transparency as a public body.
It's important to emphasize that this is not a new revelation. From the Panama Papers, Paradise Papers, FinCEN Files, and most recently, the Pandora papers, more evidence points toward the scale of incongruous corporate behavior of profit and shareholder value maximization that is behind their philanthropic efforts. This implies that often when charitable activity is undertaken, it is not perceived with full information and accurate relativity of the donation amount to the wealth of the donor. Consequently, the donor is able to maximize on this leverage of positively skewed publicity because of the general public's oblivious perception that they are "generous" and "altruistic", but in reality, the activity is undertaken with more self-interest and greed.
It took me a lot of time to truly question philanthropy because on a fundamental level it is virtuous and moral to help a person in need. However, having slowly observed and come to realize that our global society currently runs itself based on norms of self-interest, instrumental motivation, and malicious tribalism, which are all anchored on the fictitious deity of money, I believe market-based solutions such as philanthropy to be more harmful to our society than it is beneficial. Especially, considering the multibillion-dollar assets of these charitable organizations and their institutional behavior that is synonymous with any irresponsible major conglomerate in regards to transparency, accountability, and democratic procedures.
As a young adult still figuring and learning about his life and the world he lives in, I have no concrete answer on how to bring about more socioeconomic equity, especially during this debilitating pandemic. But what I am confident about is that a systemic solution cannot be solely contingent on markets and money. Why? Because it is our unhealthy obsession with these concepts that bring out the self-interested and instrumental mindset within us. Therefore, if anything, I conceive a systemic solution to be spiritual, one that necessitates these implicitly encouraged behaviors to be substantially suppressed and instead, promotes a mindset that is more altruistic, communal, and substantial in nature.
We need to be more caring of others, introspective of ourselves, and attentive to the inherent value of everything instead of its manipulative capacity towards the goal of money. In other words, we need to transcend and transform the material norms on which our society runs because socioeconomic equity and justice cannot be bought.
Koh Okuno is an aspiring journalist from Japan but with an upbringing in Thailand. He is a recent graduate from Amsterdam University College, where he majored in Economics and Political Science. Currently, he is taking a gap year to work and explore his interests before making his eventual return to academia.
This article is featured in JUSTIN Development Review (JDR) Vol. 01 Issue 03 — December 2021