Philanthropy Needs New Paths to a Just Economy
By Jennifer Astone and Renata Minerbo
The question of how capital is stewarded is increasingly central to philanthropy’s relevance and legitimacy.
At a time of social-ecological collapse and declining trust in institutions, the sector can no longer afford to focus solely on how much it gives while remaining silent about how its endowment operates in the world.
Preserving wealth through investments that contribute to the harms philanthropy seeks to address is a clear contradiction, and as civil society and social movements demand greater accountability and coherence from funders – so scrutiny will persist.
To meet its gaze, some are searching for a one-size-fits-all framework or better business models. What we should really be doing is becoming uncomfortable with who, why, and how capital flows.
An outsider’s perspective
For context, we are regenerative economy practitioners. We both question the current extractive logic around capital and, coming from outside the world of finance, are free to ask questions like:
Why are grants and investments treated as if they belong to different worlds?
Why do philanthropic portfolios focus on financial return instead of recirculating capital for human and environmental wellbeing?
We ask these questions because we are more used to learning through integrated capital strategies. Renata is a trained architect and head of Be The Earth Foundation, a family foundation and investment vehicle. Meanwhile, Jen trained as an anthropologist and writes based on her experience with the Transformative 25 funds, an ecosystem of impact-first, community-rooted funds employing integrated capital.
For us, it is contradictory to see philanthropy and investments restrained at opposite ends of a spectrum when between the two is a messy and rich middle of recoverable grants, patient capital, low-interest debt, relational capital, knowledge, access, and community trust.
None of these fit properly into either ‘bucket’, but each offers great value in creating a healthy economy and ecosystem.
Can capital flow be fixed?
The holistic thinking that can allow these two sectors to flow together into coherent portfolio strategies barely exists at institutional scale, and this is one of the problems. Where it does exist, foundations’ lawyers and trustees often don’t know what to make of it, and when those in power are dealing with unfamiliar territory, it’s usually a no-go.
Foundations may tinker with 10 percent carve-outs, exceptions, one-off grants and experimental recoverable grants but then block investments that could improve the flow of capital to funds and businesses creating opportunities that grants alone could not. And here, ‘blended finance’ has become a frequent response. It’s often used to de-risk individual transactions for commercial capital but rarely asks what a community actually needs, or what mix of resources, over what time horizon, will help it thrive.
The route we prefer is ‘integrated capital’ – a model less focused on transactional strategy, and more on ecosystem orientation.
Integrated capital
In our perspective, philanthropic capital is not making a sacrifice when it accepts restorative returns – often described as below-market or concessionary yields. It’s choosing to invest in regenerative services, which doesn’t mean giving anything up, but restoring something that extractive finance has caused, and taking responsibility for the externalities it generates.
Integrated capital, as we use the term, encompasses grant capital alongside relational capital, know-how, cultural legitimacy, convening power, recoverable grants, loan loss reserves, patient capital, and low-interest debt. The first four of those are rarely discussed in blended finance conversations, which tend to focus on deal structuring rather than ecosystem health.
The people most harmed by this capital division are also those who need it bridged most: Indigenous-led land stewardship organisations, farmer cooperatives in the Global South, communities of colour rebuilding from decades of asset stripping. They need the full spectrum of finance, not the narrowest slice.
Wholesome capital
Reflecting on this challenge, at the beginning of Be The Earth in 2020, our family went through the Enough Project process, using their template to calculate how much wealth we would like to keep for ourselves and next generations. This got us to realise that almost half of our capital was surplus to what we needed to live our lives comfortably.
That gave us the freedom to experiment, and while we keep part of our impact portfolio for preservation, the other part operates on a spend-down mindset, investing in higher risk and impact businesses, and donating to philanthropic initiatives.
Searching for coherence between these practices eventually got us, in 2024, to what we call the Wholesome Capital approach: the use of different financial models toward the same vision.
For us, this means philanthropic capital can be in service of investments or vice versa, and philanthropic and investment ‘buckets’ are not just adjacent; they actively leverage one another.
One example was a donation of £30,000 made to The Nest, a non-profit creative agency for agroecological farmers and growers that committed to offer their branding and marketing services to a couple of our existing portfolio companies as part of their deliverables. Or Zune, which uses philanthropic resources as patient capital and technical training for entrepreneurs, while also taking investments from as low as US$10 that go straight to women- and people of colour-owned businesses in the north and northeast of Brazil.
Examples of integrated capital: Community-rooted funds
Similarly, Collective Action for Just Finance (CAJF) curates the Transformative 25 (T25) list of funds. These funds pair non-extractive investment capital with culturally informed technical assistance and relational support to finance community wealth-building where governments and commercial capital refuse to go. Here, the selection criteria are explicitly financial-return agnostic: a fund earns its place by demonstrating positive outcomes for communities and the environment, not the highest yield.
On the fund level, consider FINAPOP, Popular Funding for Healthy Food Production, a Brazilian cooperative fund of US$15 million offering over 130 agricultural cooperatives and associations low-interest loans of US$25,000–$250,000. Born of the agrarian reform movement in which landless peasants resettle degraded land and cultivate food using agroecological practices, FINAPOP supports communities to access affordable finance. Through business planning, technical support and a network of peers, farmers produce and market healthy food for local schools and markets.
Meanwhile, on the investor side, SK2 Fund runs a significant impact endowment portfolio, a majority of which is private fixed-income and private equity investments in funds and small businesses – 16 of its 34 holdings are CAJF Transformative 25 funds. Many of these investments are in funds that use integrated capital as part of their core theory of change, and similarly, DF Impact Capital invests in twenty-five T25 Funds through a livelihoods and social justice lens.
What these examples demonstrate goes beyond a particular instrument or a legal structure. They share a posture: a willingness to ask what the situation actually requires rather than what the bucket allows, and what kinds of capacity they can leverage beyond investment capital.
Learning through practice
The separation of philanthropic and investment capital is not a law of nature. It is a habit reinforced by professional silos, legal caution, institutional incentives, and a financial education system that trains two worlds to believe they have nothing to do with each other.
In our experience, the solution to this will not be found in a single new framework. Instead, it will be in more practitioners willing to be honest about what they are trying, what is working, and what is failing – and to share that learning across the walls that normally separate investors, philanthropists, movement builders, and communities.
Because these divisions are not protecting a functioning system. They are hiding a broken one.
Renata Minerbo is co-founder and head of philanthropy at Be The Earth Foundation, a living lab for eco-centric economies in the UK, Brazil, and South Africa.
Jennifer Astone is ecosystem director at Collective Action for Just Finance, a collective of financial activists sourcing, amplifying, and connecting impact-first, community-rooted funds.
