Calling on climate philanthropists to invest in people of color

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As two entrepreneurs of color, we know all too well the model of communities of color underinvestment in the venture capital-funded climate technology sector.

Against all odds, we raised over a combined $ 130 million in climate technology venture capital from our public benefit companies, Aclima and Blocpower. However, this private sector investment in our businesses represents a tiny fraction of the more than $ 16 billion in total climate technology venture capital funding raised in 2019. While overall climate technology venture capital funding has increase. 3,750% from 2013 to 2019, the overall percentage of venture capital invested in Color Founders is declining.

The percentage of US venture capital raised by founders of color is less than 5% and less than 1% for venture capital raised by women of color. This contrasts sharply with emerging data from the Federal Reserve Bank which indicates that the strong economic recovery from the 2009 financial crisis was more correlated with women in digital businesses led by color. Still, the U.S. counties with the highest percentage of digital businesses run by women of color were the most likely to experience disproportionate economic growth.

Innovative environmental justice organizations (JEs) and Black, Indigenous and Colored (BIPOC) leaders are similarly ignored by mainstream climate philanthropy. With philanthropic funding in the nonprofit climate sector, the stats for leaders of color are worse than those for climate venture capital. From 2015 to 2019, climate sponsorship almost doubled to $ 9 billion per year. However, a recent study by the New School found that only 1.3% of the $ 1 billion given by 12 of America’s largest environmental funders from 2016 to 2017 went to environmental justice organizations led by and serving people of color.

The billions of dollars spent in climate philanthropy to date have not resulted in the change we need. This summer’s climate disasters from coast to coast bear witness to a narrowing window of success. Climate philanthropy needs a new model.

Fortunately, Color Network donors Climate donor commitment to justice gives us a roadmap to succeed in advancing environmental and climate justice. It creates new momentum that will bring climate solutions in the public and private sectors.

We can simultaneously reinvigorate local economies, create jobs, alleviate the climate crisis and tackle the systemic inequalities that undermine the foundations of our society.

The Biden administration reported renewed commitments to environmental justice and economic development, but will need support on the ground. The pledge calls on top climate donors to spend at least 30 percent of their US climate dollars on justice-focused climate groups led by people of color and transparency in reporting on climate change. funding of organizations led by the POC. This transparency sets a new standard for climate finance, ensuring accountability and knowledge sharing in a sector in urgent need of transformation.

In private markets, investors such as Kapor Capital and the Schmidt Family Foundation (two leading investors in Aclima and BlocPower) are building investment portfolios of high-impact companies led by people of color.

Since the launch of the engagement in February, the 21 climate funders (including the top 40 climate funders, the Kresge Foundation, the Schmidt Family Foundation and the Pisces Foundation) have pledged to complete at least the transparency portion of the pledge – but most of the 40 major climate funders are still deciding whether to step up.

Climate action without equity, justice and the transformative contributions of communities of color will continue to waste money – and fail – as barriers to equity are also barriers to building political power and climate innovation. required. The Recent recommendations from the National Academy of Science to the Biden administration published in February clearly show this. There is no way to solve the climate crisis without increasing investments in talent, skills and genius widely distributed in underserved communities of color.

For years, environmental justice organizations working with their communities, such as the Deep South Center for Environmental Justice, the Harambee house, WE ACT for environmental justice and the West Oakland Environmental Indicators Project – have catalyzed climate action and environmental equity, with limited resources coming from the philanthropic sector.

For example, in California, strategizing and organizing environmental justice was key to saving the state’s historic climate law in the face of powerful opposition. Across the country, environmental justice organizations are influencing policy and teaching decision-makers, businesses and large non-governmental organizations how to effectively engage with communities.

In California, the West Oakland Environmental Indicators Project (WOEIP) spearheaded the creation of the “Own our air“Community action plan with community members and air regulators. The plan uses modernized air monitoring to develop data-driven plans to reduce emissions from transportation, industries and ports , and their negative impacts on health Systemic change is proven, there is no funding to help scale up and replicate its success in affected communities.

It’s a climate crisis. Now is the time for the biggest philanthropic organizations to step up and commit to advancing and accelerating climate action. Philanthropy is the highest form of venture capital, intended to invest both in the most difficult challenges facing society and in pioneers who will invent the solutions necessary to save the planet. To move forward equitably – and even have an outward chance of adapting to accelerating climate change – the best foundations must consciously and intentionally invest in climate action led by diverse communities.

We can simultaneously reinvigorate local economies, create jobs, alleviate the climate crisis and tackle the systemic inequalities that undermine the foundations of our society.

Committing to justice-focused climate finance and investments is not just the right thing to do. It is the only economically, socially and politically viable path to a livable planet.


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