Over the past few weeks, I’ve heard the following sentiment expressed so many times I am convinced it has become a campus catechism—to go into finance or consulting is to “sell out,” to smother the soul of the budding scientist or diplomat we believe dwells in each of our deepest heart of hearts. To be noble at Harvard is to go to med school, join the Peace Corps, or sign up for a two-year stint at Teach For America. My aim in this editorial is to convince you that this narrow conception of a “good” career and the dichotomies we construct between noble and ignoble paths are not only unfounded but opposed to the trajectory of social progress.
Let’s first take a look at where the dominant attitude on campus comes from. The answer is obvious: 2008. The financial crisis took place during what was for most of us at Harvard College now our “formative years.” Consequently, we are disposed to think of bankers and hedge fund managers as the primary villains in the cosmic struggle of Wall Street versus Main Street.
This attitude is not entirely off the mark. Especially during the last decade, unprincipled bad actors have had an outsized impact on the livelihoods of “innocent bystanders” who had no interest in playing the dangerous game of financial roulette.
But there is another side to the story as well. Without efficient systems of creating and allocating debt, the technological innovations that lead to human progress could never be financed. But this is old news. Luckily, there is some new news you may not have heard about yet, and it is very exciting.
For the past few decades, the driving trend has been towards a new model of “philanthrocapitalism,” at the heart of which is a vision of cross-sector collaboration. The social sector is no longer like water to the oil of the private sector, but rather a highly efficient, constantly improving hybrid. Gone are the days of the uninspired, pedantic social worker who is basically a missionary in his ideological rigidity. Enter the philanthrocapitalists: business leaders like Mark Zuckerberg, Bill Gates, and Warren Buffet who take their private sector expertise in managing organizations, developing technologies, and delivering outcomes to the realm of social good.
Over the course of the next quarter of a century, we will see business do for philanthropy what science has done for medicine. Just as modern scientific methods allowed for the measurement of health outcomes and rapid improvement of treatment processes, so will private sector expertise empower social good-motivated organizations to generate outsized impact with their finite resources.
Take the example of The Nature Conservancy, America’s largest environmental conservation organization with $6.7 billion in assets as of 2015. A few decades ago, TNC started out with a very simple business model, using their cash to direct purchase large tracts of land to dedicate to conservation, a solid strategy we might characterize as “get-what-you-pay-for.” But even billions of dollars can only buy so much land, and TNC’s goal is to create enduring, system-level change.
Two years ago, The Nature Conservancy created an impact investing division called NatureVest. The group of merely 20 financial professionals has processed $200 million in deals over the past 2 years for projects like creating flood insurance programs for at-risk communities in the United States and restructuring the national debt of Seychelles to protect vulnerable marine and coastal ecosystems. Perhaps surprising to you may be that JP Morgan contributed a significant part of their seed capital.
Another example of a philanthrocapitalism best practice is aligning private and public interests. Over the past decade, macroeconomic trends have compressed yields and interest rates close to or, in some cases, even below zero. The sudden evaporation of “easy money” puts many of the world’s largest pension and sovereign wealth funds at risk of insolubility in the near future. An initiative called Bretton Woods II sees opportunity in this turbulence. By using financial analysis and tools to advocate for redistribution of capital to social impact investments that address the fundamental drivers of volatility, they deliver superior risk-adjusted returns over time. Their board of directors includes a former managing director at Citigroup and a consultant at McKinsey. But it also includes an ex-Senate Foreign Relations Committee staffer and a nonprofit CEO.
The lesson here is clear. Progress on solving the world’s most difficult problems not only allows for but utterly depends on the collaboration of the best and the brightest across all sectors. The social sector needs the private sector like the human body needs the nervous system: to allocate resources, to coordinate, to learn and improve.
What this means for students at Harvard College is a growing abundance of opportunities to do good and do business at the same time. This year, my initiative at the Social Innovation Collaborative, called Impact Fellows, created 15 internships to place Harvard students at innovative companies like The Nature Conservancy, NatureVest, and the Gates Foundation that are applying private sector methods to social sector problems. The vision is that by creating opportunities to gain exposure to the cutting edge of the social sector, we will prepare our generation for the mode of cross-sector leadership that society needs. And so I ask you not to sell out, but to buy in.
Hansen Shi, ’18 is an English concentrator living in Kirkland House. His column appears on alternate Fridays.