The prudent directors of most private foundations and public charities invested the funds entrusted to them conservatively in the early twentieth century. But there were some directors who asked why their investment policies shouldn’t be aligned with the mission and program of the organization. In 1919, for example, when steel workers struck to reduce their work day from twelve to eight hours, John D. Rockefeller Jr. supported the workers. When steel company executives refused to give in, the Rockefeller Foundation sold its shares in Otis Steel and cashed out a $1 million note from Bethlehem Steel. ““I am now, and have long been, a believer in the moral responsibility of stockholders,” Rockefeller wrote to a church official.
The NonProfit Times recently highlighted this discussion of “social investing” in Eric John Abrahamson’s book for the Rockefeller Foundation entitled Beyond Charity: A Century of Philanthropic Innovation. The book is available for free download from the Foundation.