PRESIDENT'S ESSAY

MacArthur’s next chapter will be characterized by big bets that strive toward transformative change in areas of profound concern. This is not a search for quick fixes or easy wins, but an all-in, timely commitment—of talent, resources, time, and reputation—to real change that matters for many, many people.   

This means that, today, in pursuit of a world that is more just, verdant, and peaceful, we will invest deeply, with hope and optimism, and a commitment to creative partnership, in a small number of critical issues of planetary and human survival and human dignity:  global sustainability, global security, and the rule of law rationally and equitably applied.

Criminal Justice in the U.S.

The first of these new, big bets is the Safety and Justice Challenge. Its goal is to help reverse the practice of mass incarceration in the United States. The high rate of incarceration and the dysfunctional relationship between police and minority communities are symptoms of a deep pathology that takes a terrible toll on families, communities, and the legitimacy of government itself.

Criminal justice has received recent, widespread attention from the media, scholars, and advocates, and progress has been made at the state level in reducing prison populations through sentencing reform and other means. Much less attention has been paid to local justice systems, through which most people experience the administration of justice in this country, and where mass incarceration begins.

With an initial $75 million investment, we are supporting a national effort to spearhead broad reform in local jurisdictions, with a goal of changing how America thinks about and uses jails in a fairer, more effective justice system. The effort is off to a promising start. More than 190 jurisdictions competed for 20 grants to help create local reform plans; by the end of the year, ten will be selected for major implementation support. We will help the others pursue change on their own.

Global Climate Change

Building on a long history in global conservation and, more recently, energy efficiency in the U.S., a second big bet is an aggressive effort to support U.S. and global leadership to mitigate the effects of climate change. As a down payment this year, our new Climate Solutions program awarded $50 million in grants. The initial focus is to build and sustain sufficient U.S. leadership to ensure that this nation meets its responsibilities in addressing climate change.

This means supporting organizations that aim to continue and accelerate U.S. greenhouse gas reductions, to increase and sustain political consensus for climate action, and to provide incentives for transition to a low-carbon economy. Our goal is to add significant, distinctive value to the many important and substantial efforts already underway. All of this and more is urgently required if the world is to avoid the worst outcomes of global climate disruption.  

Going forward, Climate Solutions will consider areas of constructive partnership with international leaders whose actions are equally critical to long-term global sustainability, including India, China, and other countries.

Other Possibilities

We are exploring the elements and feasibility of a big bet based on a new approach to reducing the threat posed by nuclear weapons. We also think that a big bet could be a place, rather than an issue. Our candidate is Nigeria, where MacArthur has made grants since 1989 and has had an office since 1994. There may be national momentum in Nigeria around attacking corruption and reforming the criminal justice system that could be the basis for broader Foundation investment in helping that country succeed and lead in Africa and on the global stage.

More Resources for Social Change

Rapidly growing interest in impact investing presents an opportunity for a foundational big bet with the potential to fuel progress in our priority areas and across the social sector. This builds on MacArthur’s 30-year history innovating in the use of program-related investments for organizations whose missions, markets, or business models require capital that is very patient, risk-tolerant, and flexible.

With other pioneering impact investors, we have demonstrated the power of this unconventional capital, especially when it leverages investments from mainstream institutions. However, this useful capital is likely to remain scarce without a new generation of financial platforms and products. We are prototyping these new vehicles with the goal of bridging the gap between social sector organizations and the increasing number of investors looking for social and environmental impact.

We expect this new endeavor to use our capital and increased risk-taking, including market-making and syndication, to give investors greater transaction ease, liquidity, confidence, and choice. We will partner with others who share our ambitious goal: to expand the flow of impact-enabling capital worldwide.

A Special Bet

Even as we focus to drive toward large-scale, lasting solutions in a few key areas, the Foundation must remain open to other powerful ideas. We are devising a plan to reach out broadly for feasible, promising projects that need timely, substantial support. Every three years we will award $100 million to a single proposal to solve or significantly mitigate a major problem or seize a compelling opportunity.