Philanthrocapitalism & Consilience in Philanthropy

As a follow up to my post yesterday regarding the World Economic Forum and my personal views on “business thinking” in philanthropy, I’m reposting something I wrote for back in January:

Consilience in Philanthropy
Wednesday, January 16, 2008
By: Sean Stannard-Stockton

Have you ever heard someone say, “We need to get out of our silos and work together”? The silo effect is one of those over used metaphors of the business world, but the issue it raises is real. In short, silo thinking refers to a situation (common in most organizations) where people do not communicate across departments.

In large private foundations, there has long been a silo effect across program and investment staff. But recently, some foundations are trying to overcome this barrier and encourage the two departments to work together.

I believe the key to unlocking the potential of philanthropy is to break out of our silos and embrace consilience. Consilience means “unity of knowledge” (or more literally the “jumping together” of knowledge). The phrase was popularized by famed biologist Edward O. Wilson in his aptly named book Consilience: The Unity of Knowledge. What consilience recognizes is that every field of study captures only a snapshot of reality. While economists might believe that economics is the study of the production, distribution and consumption of goods and services, the fact is economic theory does not actually describe reality until you begin to take into account the biological, psychological, and sociological behaviors of humans. Even then, a broader systems approach is needed to understand how the market affects the environment and human culture, as well as the moral implications of market outcomes.

Today, philanthropy is faced with the coming together of traditional models of giving with market based social good production. While this systems based approach to philanthropy is promising, too often it seems that those schooled in for-profit business models assume that their knowledge can be directly applied to philanthropy. At the same time, many people who understand giving at a deep level fail to recognize the potential of market based approaches to social good creation. For philanthropy to realize the potential being presented in the 21st century, the trick will not just be to bring economists, sociologists, technologists, biologists, etc to the table, but to truly forge a consilience of knowledge across all domains. The whole is more than the sum of its parts. The first step to this goal must be simply to encourage people with varied knowledge to speak with one another. Not lecture at each other, but to truly create a conversation.

This idea of crafting a conversation across knowledge silos has been a core principle of my blog, Tactical Philanthropy. I myself straddle the for-profit and nonprofit sectors with my schooling in economics, training in the financial markets and application of this knowledge to help philanthropists through my firm, Ensemble Capital Management. In November of this year, I got a glimpse of what a consilience conversation might look like. Through a project called the One Post Challenge, readers of my blog were encouraged to submit their blog posts for publication with the goal of encouraging a cross-disciplinary conversation.

The conversation generated 36 reader essays and over 200 comments (excluding one post that generated 700 comments from around the world and inspired refugees to dance in Africa, but that’s another story). The authors included; foundation staff, nonprofit consultants, nonprofit employees, volunteers, social entrepreneurs, wealth advisors, web 2.0 gurus, authors, angel investors, tech entrepreneurs, magazine publishers, fundraisers, venture capitalists, activists, community foundation employees, academics, and public relations professionals. This was a group of people who would never find themselves in a room together. Yet to solve the complex problems facing humanity, all of their knowledge is needed. While each of them knows something important, it is not simply collecting this knowledge that is key, it is understanding how it all fits together. It is the “jumping together” of their wisdom that results in breakthroughs.

The One Post Challenge was an experiment in cross-disciplinary conversations. As wide as the group’s expertise was, it did not include experts in government, economics, sociology, or international relations.  The conversation must grow.

We often refer to our field as the Third Sector. But philanthropy and nonprofit activity do not exist apart from for-profit markets and government. We all operate within a single system. It is only in bringing together the many parts and encouraging them to interact that we will begin to understand the whole.