Distinguished Speaker Series with Darren Walker, President of the Ford Foundation

Julia Stasch:
Welcome to the University of Chicago Booth School of Business, Distinguished Speaker Series. I'm Julia Stasch, Philanthropy Executive in Residence in the Rustandy Center for Social Sector Innovation at Booth. In a minute I'll be pleased to introduce my friend and colleague Darren Walker, president of the Ford Foundation.

Before I do that, just a few housekeeping items. The session participants, Dean Madhav Rajan, Darren Walker and Caroline Grossman, Executive Director of the Rustandy Center will be visible on screen. All the rest of us will be muted. We hope you'll ask questions. To do that type one anytime into the Q&A box. If you have issues with audio, consider shutting down programs running in the background or dial in from your telephone. Our total time today is 60 minutes, including 20 to 25 minutes for questions from you.

Now, of course, Darren Walker is the president of the Ford Foundation, a $13 billion international social justice philanthropy, but that doesn't really tell you who Darren is and how he got there. Now, no little boy says, "I wanna grow up and lead a foundation." and Darren is no exception. He was born in a charity hospital in Louisiana, raised by a single mother, and was one of the first children to benefit from the Head Start Program. Then supported by a Pell Grant, he started his education which resulted in degrees in Government and Communication followed by a Law degree. Now, he honed his sense of legal systems in how capital works, first with an international law firm, and then with the global investment bank, UBS.

Now turning his back on Wall Street, he dove deep into the revitalization of Harlem as COO of the Abyssinian Development Corporation. In 2002, he moved to the Rockefeller Foundation where I met him. This positioned him to move to the Ford Foundation in 2010. In 2013, Darren was appointed president.

Now this is my personal kudos to Darren. He's used that role with courage and empathy, and he's demonstrated he's an original thinker, a provocateur, a consummate organizer, and a collaborator. Now, well, I would not become president of the MacArthur Foundation until the following year. One of my favorite memories is a Sunday call to Darren to congratulate him on his new role. I said, "Don't forget that I knew you when," and then I said, "Let's do some damage together." Now by damage I didn't mean harm, I meant the kind of good trouble that Congressman John Lewis urged and Darren has made a hallmark of his leadership. I have to say a call from Darren was often an invitation to think big, be radical, and with him to lead.

Although there are many examples, here are just two of them: The $330 million philanthropic contribution to the grand bargain that saved Detroit. And just yesterday virtually, the $156 million America's Cultural Treasures to help arts organizations run by people of color recover from the pandemic's economic devastation. It's now my pleasure to introduce Darren Walker to you in conversation with Chicago Booth Dean Madhav Rajan. Thank you very much.

Madhav Rajan:
Thank you, Julia, and Darren thank you so much for taking the time to be here today.

Darren Walker:
Dean Rajan, I'm grateful for this invitation. I've been looking forward to this and so grateful to my friend, Julie Stasch for arranging it.

Madhav Rajan:
So maybe I'll start with the details of your journey, which is very compelling. And today you head this incredibly powerful influential organization that has changed a lot. It's become much more activist, more consistently committed to racial and social equity. Could you speak a bit about your experiences and how they brought you today and how do you bring your experiences into the role? How do you think about the leadership responsibility that you have as head of the Ford Foundation?

Darren Walker:
Well, we all bring both our training and our lived experience. The training includes the credentials that we achieve, the learning and knowledge, the scholarship that informs our thinking and our worldview, and then we bring our lived experience. In my case, my lived experience was one of growing up in a low income household, understanding what it is like to live without privilege, and coming to New York and being able to get on that great American mobility escalator and do well, which has allowed me to today live with a lot of privilege.

And I think often about how my two worlds have converged my lived experience, which keeps me grounded, keeps me, I think, rooted in an experience in a community that in many ways is far away from where I sit speaking to you today in Manhattan, but of course the Ford Foundation, which itself is an institution committed to social justice and to reducing inequality in the world in all of its forms. This is a great mission, a bold and ambitious aspiration, and one that I feel enormously grateful to lead.

Madhav Rajan:
So Julia mentioned a little bit about some of the big moves that you have done through COVID. So maybe we can just start with, how has the foundation responded to COVID and how has that tied into your longstanding work towards justice?

Darren Walker:
Well, as Julie knows, one of the real challenges for legacy foundations like MacArthur, or Ford, or Rockefeller, is that we live off of the income of our endowments just as you do at Booth. And when the markets go down, we actually have less to give away, but there is an asymmetry there because when the market goes down, need goes up.

So one of the realities is that in a case like 2008, when we lost over $2 billion of our endowment, we actually gave away less at a time when there were more demands, more requests. And we found ourselves back in March in that same situation, once again, in a matter of weeks we lost about $3 billion. I and the team at Ford were really besieged, overwhelmed with requests because people were immediately in a crisis.

You may remember fundraisers were being canceled, if you were an arts organization your theaters were dark. There were so many sort of dystopian scenarios playing out very quickly. As I thought about how we could respond, the first thing I thought about was, "How do we spend more money? How do we give away more money to respond?" And of course our investment professionals said, "You can't actually give away more, in a time like this we don't wanna liquidate the portfolio. We actually need stability, we need optionality, we need to be resilient in the face of a turbulent potentially volatile marketplace. So we need liquidity so we can't start selling off." And therefore I had to come up with another idea.

Fortunately, chairman Jerome Powell gave me the idea because when he put in place the policy of free money, I thought, "Well, my goodness. They have fed fund rate at zero, I'm sure a AAA rated credit like the Ford Foundation could figure out a way to eke out a bombed offering of some significant amount to help us deal with this. And I'm willing to bet on our investment office doing better than that rate over time and so let's see if we can borrow money." And in fact, while it was a somewhat unusual idea, not really conventional, it was very well received and my trustees got behind it and we were able in a matter of weeks to put together a billion dollar offering and literally a coupon of 2.8%, which when I was working on Wall Street, 2.8% was like a money market. A 90 day money market got you 2%.

So for us, it was a great opportunity to basically double our giving to over $1 billion a year for two years. And it's allowed us to do some of the really exciting, innovative things we've done this year, and respond in this moment, this unprecedented moment and step up because I think philanthropy has to do that. We can't use the old playbook. The old playbook is not sufficient for the moment we're living in.

Madhav Rajan:
So before we get into what you're using the funds for, lemme go back to the whole issue of raising this money in the first place. How has this made you rethink the whole 5% payout rule? And what are your thoughts about it? We've had people for example, say that, "I'm gonna spend all the money," that organizations like Booth, like others, should be spending more of the money faster than just putting it in endowment. You have done something very innovative in this space. Has this made you rethink the whole philosophy about the 5% payout rule?

Darren Walker:
Well, it hasn't made me rethink perpetuity. Henry Ford intended for the Ford Foundation that he created to exist in perpetuity, as did Andrew Carnegie and John D. Rockefeller. So I actually do not wish to go against the original intent of perpetuity. I think there are others who have different ideas about how they want to initiate, sustain, or spend down their philanthropy, and that's great. I think the wonderful thing about American philanthropy is its pluralistic nature. There isn't just one way to give away money in our country and do well. So what I don't subscribe to is the kind of narrow ideological, it's one way or the other, or those who say, "Well I wanna give it away now because I don't want to be something else." Well, if you wanna give it away now, you wanna give it away now because you believe that the urgency of this moment requires you to do that. But I believe that we need all kinds of philanthropy. We need legacy and perpetuity, and we need foundations that wanna spend it all down in five years and everything in between is fine with me.

Madhav Rajan:
So let's speak about what you were using these funds for. Could you just speak about that? What were the kinds of uses you put it to and why you felt those were the most important needs at this time?

Darren Walker:
Well, our largest commitment has been to racial justice. And we have funded racial justice for over two decades in very serious ways and that program has involved economic justice work, it's evolved reform of the criminal justice system, I think a review of how the arts and culture ecosystem in this country is organized, our work internationally around America and the world. And so we prioritize work to support black led organizations and the movement for black lives, and the various organizations that were both grassroots and grasstops, working on be it racial justice issues that emerged in the wake of the murder of George Floyd and Breonna Taylor and Ahmaud Arbery and the others who were murdered and look at how we could invest in those organizations working on the front lines to demand accountability and justice. And that involved organizations working on the courts and rule of law, organizations like the NAACP Legal Defense Fund, Equal Justice Initiative in Montgomery, Alabama, as well as organizations working at the grassroots like Color Of Change.

We also invested in a number of other initiatives to support black, indigenous, people of color led organizations and communities. As Julie mentioned, the most recent example was our work around America's Cultural Treasures, and effort to acknowledge that we have a rich and vibrant cultural history in America that has not fully been told. And there are organizations that represent that history, represent that facet of the American narrative, and those organizations are traditionally under resourced. Those organizations do not have boards who can do emergency fundraising campaigns or endowments, or two years of operating cash flow, all of this sort of criteria for resilience and durability.

So we made a series of large grants, the smallest grant being about $2 million and the largest being about $7 million general support unrestricted to a set of 20 organizations nationally. Organizations like the Studio Museum, the Mexican Museum of Art, the Apollo Theater, Dance Theater of Harlem. These are all national treasures and we want them to be elevated to the status of treasures.

And we're also in the regions, including in the Chicago region, working with foundations like MacArthur and the Joyce Foundation and others to support local treasures, those organizations right in your backyard, who also are underfunded, under-resourced in the arts ecosystem in your community. And so we've put a $5 million challenge grant into eight regions, and it's really exciting in every region that number has been doubled or tripled or quadrupled from local philanthropy. And that was our objective, to leverage, and then to let the local foundations design what is appropriate for their community, not have it imposed upon them by the Ford Foundation.

Madhav Rajan:
Could you speak just a bit more about the commitment to the arts Darren? I mean, this was a big push that you've made as you've said. At the time of COVID, why did you put the arts front and center as being something that was deserving of getting the grants from you?

Darren Walker:
I believe the arts are essential to having a just nation. And if justice is your focus, we will not have justice in America without the arts. We know this because we know from the research in the neuroscience, that teaching art, learning literature, understanding the visual arts, understanding and engaging in the creative process, developing an appreciation for the arts builds empathy. Any parent knows that. This is why parents work so hard so that their kids can be engaged and learn about the arts because they know that the arts will help them in being more empathetic and understanding other people and in being able to put themselves in the shoes of others. This is what empathy does and there's a direct correlation to the arts and learning of the arts, appreciating the arts and empathy.

And there is also a direct correlation between one's ability to empathize with one's ability to see dignity in others. And I believe that if we are to be a more a just nation, it will require us to see the dignity of every human being, even those who do not look like you or have your background. And what I notice in society is that people who talk about other people in inhumane, disrespectful ways that degrade them, that take away and ignore their humanity or seek to strip them of their humanity, those people have never experienced great literature, they've not visited museums, they've not read poetry. They've not really developed that part of their intellect, that part of their brain.

And so I believe that the arts, if you are a foundation committed to justice, you have to be committed to funding the arts and these organizations and the arts more generally bring beauty and every person deserves beauty. And I can tell you when I was a kid and we lived in a little shotgun shack in rural Texas, my grandmother was a maid for a family. And one of the reasons I used to love going with my grandmother to clean their house and do the yard work, was everything was so beautiful. And I got exposed to that beauty, I got exposed to magazines and books, to things that family discarded that I took in brown paper bags home with me, and I would just look through the pages of those books and see beauty. And even though my own physical circumstance was not one that would be called beautiful, I was able to see beauty. I was able to dream and be taken out of that place that wasn't so great. That's what the arts allows you to do.

Madhav Rajan:
That's a wonderful answer, thank you. If I may, I wanted to talk about a recent New York Times story where you were quoted, this was about the Baltimore Museum of Art, and they were deaccessioning some paintings in order to fund some initiatives in the racial justice space. And if you could just talk about... That seems like you have two contradictory things going on. You're sort of selling your art to get to an objective that is noble. What are your thoughts about?

Darren Walker:
Well, it's a very controversial initiative and I don't think it's for every museum, but I think the trustees of the Baltimore Museum clearly deliberated on this for some time. Again, the construct is that the accrediting association for the museum community sector has temporarily suspended its requirements that do not allow a museum to deaccession without being sanctioned. So they are for a period of time not doing that. This has allowed museums to consider the deaccessioning.

The purpose of deaccessioning in the case of Baltimore is to address historic inequities that they believe need to be addressed in a city that is primarily African American, who have a museum that has very little African American art, very little representation of the very people who live in the city. They, I believe, rightly have identified addressing this as a priority. Unfortunately, the Baltimore Museum does not have much of an endowment and while they have some prominent collectors and trustees, they're not MoMA, they're not the Chicago Art Institute. They're not that wealthy. And this has meant for them that they've had to think creatively.

So they're going to sell some very expensive and important work. A Warhol masterpiece, a Brice Marden masterpiece. These are two beloved artists and there are some who believe it's a mistake. On the other hand, they feel an urgency to address the fact that they need to build out their collection, that they need to be able to acquire. And so they need an acquisition fund that they do not have.

And so I actually don't see a problem with this. I don't think it's something that every museum should address, but I do think it requires a nuanced understanding. And Madhav, we do not have in this country today, unfortunately, a capacity for nuance, which is a tragedy, a great tragedy because the real problems, as you know as a Dean of a prestigious Business School, complexity is the future. And complexity cannot be embraced with binary thinking, with thumbs up or thumbs down. That's really not the way we are gonna solve problems. Problems are gonna be solved in the gray space, not black or white. And yet we find ourselves in this country where we have lost our capacity to engage in nuanced discourse, understanding that to problem solve we are gonna have to come together and not be so rigid in our thinking that we can't possibly find our way to some consensus, to some middle ground with others who may not agree with us.

Madhav Rajan:
Thank you. Maybe I'll switch topics a bit, ask you about something we chatted about at the beginning. This year was the 50th anniversary of the Milton Friedman Op-Ed in the New York Times that the social responsibility of businesses is just to increase profits. And then a year ago the business round table changed its statement on the purpose of the corporation saying we need to think about all the stakeholders. Could you talk about your thoughts on this topic? Where do you see the right purpose, if you will, of a corporation?

Darren Walker:
Well, I am very mindful that I'm speaking to the Dean of the Booth School at the University of Chicago, but I must be candid and frank. It's the only way I think I am (chuckles) on occasions like this. Milton Friedman was most certainly the most influential economists of the last half of the 20th Century without a doubt. He deserved his Nobel. He had an influence, not only in the United States, but globally.

I believe that Milton Friedman's "Theory of the Firm" did more damage to this country, to the idea of the firm than any other economists' ideas of his generation. And he was not intending, I don't believe, to have happened what happened because Friedman created the intellectual scaffolding for our understanding of the way a company could behave.

Now, I did not agree as he seemed to suggest that the corporation isn't a social actor. I believe companies are social actors. Companies are given a license by the public and therefore have to earn that license, the renewal of it, in my view, every year. And I worry that what happened with Friedman was that the intellectual scaffolding provided the architecture upon which so many bad ideas got attached to. And that is what happened and it wasn't Freedman's fault only.

Concurrent to Friedman was another influential, in this case philosopher, and her name was Ayn Rand. And at the same time, we saw the cult of Friedman in business, we saw the cult of Rand in philosophy, and we found the convergence of this idea of the corporation... the idea that corporate social responsibility as Friedman said, was a subversive idea. And this cult of the individual that Rand propagated, here's a woman who said that altruism was a disease, the notion of communal anything... And I understand given her history in Russia, but Russia was not America, Russia is a different context that she, in my view, never fully understood. Russia was a different place and the people who populated Russia were not the same people who populated–We had a different context in this country. We had indigenous people and a genocide. We had people enslaved and brought here. It was a different place, and I don't believe she fully understood that.

And so the convergence of these two ideologies I believe contributed to, and laid the enabling environment for the greed is good that we saw in the 80s. This idea of the individual triumphing over community, the assault on government, the assault on the idea of community that you would actually have someone, as we saw, (chuckles) attack the idea of community. And we saw all of this converge during this period and I believe that today we are living with the consequences of these two ideologies. The level of inequality we see, the policies that were propagated.

As you know, and I'll just give one example. And I say this as a capitalist, a believer that there is no better way to organize an economy. There is no better economic system in my view, than capitalism. So I offer my humble view here as someone committed to it and wanting to see it endure, but worried that it is at risk of asphyxiating itself because of greed, because of the level of inequality and how that inequality has taken hold.

And the inequality has been made possible by policies. Policies such as share repurchases. Before 1982, as you know, it was illegal for a company to attempt to buy back its shares. It was considered stock manipulation. The SEC made a change along with a number of other policies. Some of them well-intended created an environment where the number one priority of American corporations was to repurchase shares. And I believe this is one example of many policies that incented corporate behavior in ways that have resulted in inequality, have resulted in cynicism about rigged systems for the rich, and because workers have lost ground.

Workers as we know, as many economists at your school have demonstrated, workers' wages have been stagnant now for over two decades. And so the American worker has become more cynical about management, has become more cynical about the opportunity for their children.

That is in large part a result of inequality and what inequality does is it harms the very most important value, the most important feature of American society, our culture, and that is a sense of hope and optimism, which has always characterized this nation more than any other. That hope and optimism is itself being asphyxiated. Hope is the oxygen of democracy and when we become more hopeless we become more angry and we become more irrational. And our politics reflect that our lack of an ability to speak to each other, to engage with each other, our lack of commitment and willingness to solve common problems becomes the feature of our democracy which makes me very worried.

Madhav Rajan:
So if I may take off on that, one criticism that is being made of philanthropy now is that it is being driven increasingly by a few people who are able to essentially undermine democracy because of the power that they have. And you have people like on Anand Giridharadas in his book and others making this argument, and I'm wondering if you could comment on that, Mark Zuckerberg's undue influence because of the way that he can distribute his income through philanthropy, for example. What is your take on that?

Darren Walker:
Well, I regret that we have a situation where... you know, sort of beat up on rich people. I'm not interested in demonizing wealthy people. Personally, I am interested in excavating the systems and structures that concentrate wealth. I do believe we have a challenge when we have so many billionaires that we can't even name. I mean, to be in the Forbes 400 now, you need so many billions. I remember as a boy growing up in Texas, when Ross Perot became a billionaire. And the idea of Mr. Perot being a billionaire was something that even to successful people was so almost otherworldly because there wasn't that level of inequality. Today it's a real challenge and it contributes to people not believing that philanthropists have the best intent.

Now, this isn't new. In fairness, this is not new, in fact, John D. Rockefeller attempted to establish the Rockefeller Foundation in 1908 and he could not get a charter. And the congressional record reflects that on the floor of Congress, congressmen said, we cannot give him a charter to give away his fortune because nothing good could come of the man, this demon of a capitalist. Of course, obviously I don't have to tell you at the University of Chicago, that there are some good that came from John D. Rockefeller, but it took him a long time to get a charter to give his money away.

And I today fear that there are people who have taken this one step further, who do not believe that wealthy people are up to anything good other than lining their own pockets and compounding their own privilege. And this is a problem and I don't believe that it's unfair to criticize wealth. We're at a point in this country where I believe we have moved from this question of, "What can I give back?" to one of, "What can I give up?" Because I believe some of us have a level of privilege and advantage that is only compounded by the systems and structures. And if you look, even during this pandemic, if we're to be really honest with ourselves, as most Americans have lost ground, have lost income, have depleted their savings, are at risk of eviction. Many of us who have been lucky enough to have assets, to own real estate, to even just be in some index funds.

I mean, when you opened your statement, the August 31 statement, you had more wealth than you did on March 1 when this pandemic started. And there is something fundamentally problematic about that. That there can be such asymmetry in the experience of those of us who were lucky enough, and those who were not so lucky. I think we have to ask questions about fairness in society that are gonna be really tough but as essential if we're to realize the American dream for the future.

Madhav Rajan:
I'm gonna turn it over to Caroline now to take some of the audience questions. So Caroline go ahead.

Caroline Grossman:
Hi, thank you so much for joining us. There are some terrific questions coming in from our audience and I'll start with a few on philanthropy. So the Ford Foundation has provided some thought leadership in the realm of participatory grantmaking. Can you speak to the potential for shifting decision making power in philanthropy?

Darren Walker:
Thank you, Caroline. That's a great question. Participatory grantmaking. The idea of including the people in communities closest to the challenges in the strategy design and grant review and approval process is something we are piloting at the foundation and I believe it holds great potential. I think, for too long we have privileged credentialed knowledge over the lived experience. The wisdom and accreted knowledge of those with experience in the very communities, in the very impacted places and spaces. So I don't believe that it's going to be all of philanthropy, but I do believe that there is going to be an evolution as we think about ways to have impact, to try new models.

And, you know, Caroline, one of the real challenges is this is about power too, okay. Let's just be really clear here. One of the, I think less attractive features about philanthropy in my view, is the power dynamic, which is why I believe you shouldn't be in a position in a philanthropy, certainly in the same position for too long. I mean, even in my position, I just had a conversation with my board and said, "All right, in five years, I have to be up and out of here." I know there've been other presidents who have stayed longer. It is not a good thing. I mean, the power dynamic is such that you can actually begin to believe some of the things people tell you about yourself and some of the sycophantic things that people tell you about yourself.

And the dynamic– I have been on the grantee side, the applicant side, and now that I am on the grantor side, I see that power dynamic. And it's a real challenge to operate with some semblance of humility and curiosity, and to extend that agency and autonomy to the people who are often marginalized and who are seen often as just the recipients. This notion that, "Well, we're gonna help give them voice." Actually they have a voice, just listen to their voice. We don't need to give them a voice.

Caroline Grossman:
Well it's interesting along with humility from where you sit, also you need ambition, audaciousness and risk taking to create massive change and the change that you have the ambition to foster. So I'm wondering if you think that institutional philanthropy takes the risks that it should. Is it unwilling to take enough risks?

Darren Walker:
No, we don't fully take the level of risk that we should. No, absolutely not. Including my own institution by the way. And what I mean by that is we sit in a very privileged place in that, we have capital, we have autonomy, we are a sort of heavily regulated industry, we don't have customers. It's not like someone's gonna stop buying our products and choose our competitors if we don't change or if we don't deliver a service. And we have the opportunity to think expansively and to think radically. And yet we too often fall back on normative ideas and practices, the things that have worked maybe in the past.

And certainly I think in my institution that one of the things I think we legacy foundations, and I talked to my trustees about this, who are very open, and I am absolutely the luckiest foundation president in America because the board of the Ford Foundation is a remarkable group of people and they are open to a lot of radical thinking, thank goodness. But there are times when I say, one of the risks for legacies is that over time we lose the innovation, the ingenuity of our donor and move from innovation to concerns about preservation. And so you become more concerned about reputational risk. You become more concerned about capital preservation. And when you can push the envelope on reputational risk, you can invest when there aren't metrics readily available or achievable for five or 10 years. You can do things that others cannot, that government can't, that the private sector won't.

And so I just challenge my own institution. That's all I can do is say to the trustees of Ford and my colleagues, how can we think in a non-normative way? How do we suspend normative thinking? And it's why the first month when I, as Julia mentioned, was involved in Detroit, and I remember one of my trustees initially saying, "You want us to do what? I mean a bankruptcy? Foundations don't get involved in municipal bankruptcies." Well, we needed to get involved in that municipal bankruptcy and it's true foundations don't go around buying art museum collections and figuring out ways to ensure that retirees of a municipal government get paid. That's right, that's usually not what we do. But we had the ability in that example to provide the risk capital that gave the private sector and the Governor and the legislature the push to actually get it across the finish line. And there are countless other examples like that that I think we and other foundations have been involved in but I'd like to see more of it.

Caroline Grossman:
So here's another way of thinking about that challenge. A couple of our alumni have asked questions about how you manage your endowment and how that ties in to the Ford Foundation's mission. And one really articulates it well and says, "You've spoken inspirationally about how Ford is thinking outside the box with respect to making grants. Can you share some of the foundations thinking about how the endowment is being invested to support the foundation's goals?"

Darren Walker:
Sure. That's a great question. And this is something that I have been challenged to live up to my own rhetoric. Because as I said, I'm a capitalist, but if you're a capitalist leading a foundation that has a responsibility for perpetuity, you are indeed focused on returns, you are focused on alpha, you have an understanding of the long term view of not losing the purchasing power of the foundation's endowment today into the future. But that doesn't mean that you can't invest in a way that reflects your values.

And so at Ford what we've done are several things. One, the easy part, the easy part is screens is just saying, don't invest in prisons, don't invest in pollutants. There are certain sets of things you can say don't do to your asset managers. And we have absolutely done that. But then it gets harder because you then have to be able to say, "All right what will we invest in proactively to prioritize our values?" And so what that has meant for Ford is doing more impact investing. As I learned working with Julia and her colleagues at MacArthur, the impact investing space is one that when I came into philanthropy 20 years ago was nascent, barely existed, but today constitutes billions of dollars of investment. And so at Ford the trustees agreed three years into my presidency to allocate an initial $1 billion for impact investing to test this hypothesis of double bottom line. And so we are doing that.

We are also because of our commitment to racial justice, asking ourselves who manages our money? How many minority fund managers do we have in our portfolio? And what we learned was that we had a woefully small number. So we have a program that is seeking to invest in those fund managers from historically underrepresented communities in particularly African American, Latin X women. Because we know that there is a broad inequality in the marketplace, in the capital markets and certainly in the field of asset management. And so if you wanna address that you have to name it and do it and demonstrate that you can both do well, that you can achieve more justice, and you can also achieve yield.

Caroline Grossman:
Great, thank you. There are a couple of questions about sustainability, not in the environmental sense, but in the sense that the grants that you make lead to long term systemic change, not just short term fixes. And so one of those is around how do you ensure that the organizations to whom you grant funds have the capacity to exist either without your funds or to grow with them? And then in parallel, how do you think about relationships with other major institutions like government and integrating some of the work that you support with existing structures, for instance arts in the schools?

Darren Walker:
So I believe that philanthropy cannot achieve its mission without government. In spite of what some philanthropists seem to believe. If you are seeking change at scale, it is not possible to achieve that without government. And so philanthropy has a role to play in my life. Head Start was initially a Ford Foundation program, a pilot in New Haven with a group of child education specialist at Yale. But it was government that scaled Head Start. And so I believe if we are interested in moving from projects to scale, from token to transformation, government is a major, major lever for that.

Now that's not to say that government is the only lever for scale, the private sector has a role to play depending on the objective. When I look at some of the ways the private sector led. I mean, my old law firm, a progressive law firm in New York city in the 1980s, was among the first employers to extend partner benefits, to partners of gay associates and partners at the farm. Well that was before the New York city government actually did that. So in some ways it was a set of progressive employers who inspired government to actually take the action of implementing policy.

So I believe that government and a robust government is essential in a functioning democracy. And I do not believe that a government can be supplanted by private philanthropists. And that government should sort of take a back seat to the priorities of private philanthropy.

Your question about institutions enduring in sustainability is a really important one, Caroline, and one that is under-attended. And the reason it is under-attended is because to really invest in long term change and sustainability, you have to invest in institutions. Every social movement may have had a dynamic leader, and when I look back over the fourth foundation's history of funding mini... I call it the three Is, we invest in ideas, institutions and individuals.

And our history is full of these examples. Muhammad Yunus walking into our Bangladesh office with a paper on this idea of micro finance. So that was an idea. We invested in him, we invested in that idea, and then he had an idea, a big idea for something called Grameen Bank, the platform that would sustain his idea.

Gloria Steinem came to the Ford Foundation, she was a journalist, a feminist, but she wanted to build a movement and sustain that. We gave her a grant to start the Ms. Organization that's borned the Ms. Magazine, the Ms. Foundation, the Ms. Policy Institute. All of that was an institutional play. Yes, they were dynamic people we invested in.

When Martin Luther King was murdered, he was on a Ford Foundation scholarship in 1968, but that scholarship was through the Southern Christian Leadership Conference because that was the institutional home. So we believe that you must invest in institutions and that is not a sexy idea. That's an idea that often feels mushy and how you... What's the metrics? How do you know if you're making progress? And so a lot of new philanthropists do not like this idea of not only investing in institutions, but investing in them in the way in which venture capital invest in the ideas of entrepreneurs. Give them the money and get them the talent, get them the best operator, get them the best CFO and get out of the way and let them do their job and don't micromanage them. And this is the way many nonprofits feel. They feel like they are contractors for the foundations who gave them money rather than partners in an endeavor for social change.

Caroline Grossman:  
Well, I have one last question from the audience. There are many more, thank you so much for submitting these excellent questions but I will end with this question from Asha that says, "Thank you so much for sharing this evening. You started talking about your lived experience and your training. Do these lived experiences and your training ever come in conflict with one another? And if so, how do you reconcile?"

Darren Walker:
That's a great question too. Wow, the Booth community, you guys are on it. (laughs) Those are great questions. You're making me think here. Well I do think that the lived experience is really important and I find myself really challenged. I find myself challenged because my own life today has brought me to a place where I do feel the conflict of my training, the abstract way in which we sometimes achieve our credentials and the ways in which we talk about the poor or the incarcerated or single mothers, I mean, the way we talk about, we privileged people, we people who study these people and the communities they live in. And I find myself being challenged.

But I also am very lucky because most of my peers don't have the benefit of my lived experience. And so for me... and working with my colleagues at other foundations on mass incarceration, it is not an abstraction to me. I have relatives who are incarcerated, who have been incarcerated. And so I engage in a kind of reflection that is a little different, from my own lived experience.

Because when I look at the lives of some of these men, and they were all men, some were my cousins who I played in the yard with, or I babysat for. And yes they lived in rural poverty in Louisiana and I was fortunate that my mother took me and my sister away from that community where we had opportunity in Texas and she could find a livelihood. But I do reflect and ask myself, how is it that my cousin who is in Angola prison in Louisiana is in the Angola prison and I am sitting here on Park Avenue in Manhattan? How did that happen? I don't believe he was less ambitious or less intelligent or didn't dream and have aspiration to have a better life. I believe that his dreams were smothered by racism and by low expectations that people in the small racist rural community, where he grew up, had of him.

And so I do think about and reflect on my lived experience, my training and whether or not my training has really been the thing that is best and most prepared me to do the work that I do today at the Ford Foundation.

Caroline Grossman:
Thank you. Madhav, I think it is time for us to conclude. So, thank you so much for joining us Darren and, Madhav, I'll give you a moment to say a few last words. Thank you.

Darren Walker:
Thank you.

Madhav Rajan:
I just wanna say, Darren, you are incredibly thoughtful and inspiring. It was wonderful to have you. You're very candid. You see the big picture of everything that you're doing, and you're able to step back and look at it, as you said, to think through what you're doing, which is very, very rare. So this was a very huge opportunity for us to have you come and speak to our community, and we really appreciate your taking the time to do this. Thank you very much Darren.

Darren Walker:
Well, Dean Rajan, it was a huge honor for me and I have the utmost respect and admiration for you and your colleagues at Booth. And I'm just grateful that Julie arranged this and just I'm most thankful for this opportunity to be with you tonight.