In these perilous times, how can social justice philanthropy show up and be effective? Understandably, the focus tends to be on grantmaking. But philanthropy’s power isn’t limited to grantmaking. Its financial clout, especially its investment decisions, can shift political terrain—and history offers proof.

In the 1980s, divestment helped bring down South African apartheid. Students, activists, and local governments pressured institutions to withdraw investments from companies profiting from the regime. By 1988, over 150 US colleges had divested, as had at least 68 cities, 21 states, and more than 100 US companies. Divestment wasn’t the only factor that ended apartheid—the anti-apartheid movement within South Africa of course was the leading reason—but it did help isolate an unjust system and remove resources that sustained it.

Today, climate justice organizers are deploying the same strategy. In just a decade, over 1,600 institutions with $40 trillion in assets have committed to divesting from fossil fuels. Driven by grassroots campaigns, this movement has reframed coal, oil, and gas as not only environmentally destructive, but morally indefensible. Every divestment commitment sends a clear message: Profiting from climate destruction is unacceptable.

A similar story is playing out in the fight against mass incarceration and immigrant detention. Activists have successfully pressured major banks to stop financing private prison giants like GEO Group and CoreCivic. In 2019, under public pressure, banks like JP Morgan Chase and Wells Fargo began pulling billions from the industry.

These examples show how divestment works—not just by removing capital, but by changing public perception, pressuring institutions, and stigmatizing injustice. Philanthropy should see divestment and values-aligned investing not as radical, but as proven tactics to fight repression when policy fails. Moving money is a powerful act of resistance.

How Social Justice Philanthropy Can Align Endowments with Justice

Most philanthropic capital (about 95 percent) sits in endowments, invested for maximum return. Too often, these investments contradict foundations’ missions. A foundation may fund environmental justice groups while investing in oil and gas. It may support immigrant rights but profit from private detention centers. Such contradictions are untenable.

Read the full article about social justice philanthropy and divestment by Cristiana Baik at Nonprofit Quarterly.