The Rothschild family has a long and rich history of donating to Israel, with its patriarch Edmond James de Rothschild even earning the monicker “the Known Benefactor”. Long before the State of Israel was established, Rothschild funds were instrumental in buying up land and developing educational facilities for the budding nation, and it currently injects hundreds of millions of dollars into different projects and organizations throughout the country. But now all that could change.
Meeting with a group of young Israelis on the sidelines of the annual Herzliya Conference - held this year under the title of "The Edmond Benjamin de Rothschild 2014 Conference", in honor of the Rothschild Caesarea Foundation’s 50th year - Baroness Ariane de Rothschild told Ynetnews of the need to develop a new, more sustainable form of philanthropy.
“I think what is interesting in Israel is that it is a country which is, and will always, be strongly supported by the Jews’ Diaspora, but the grants given by the Diaspora are diminishing in a very quickly,” she said.
“As Jews abroad struggle with their questions: Are we Jews? Are we Zionists? Are we both? The eternal questions that we have had for so many years. So naturally (as a result) the Diaspora are questioning the way they want to support Israel through philanthropy.”
An impressive and articulate women, the baroness is avid to engage on the topic of both the changes in philanthropy and Diaspora relations. She maintains that the drastic drop in funding is not just the result of the internal Israel-Diaspora debate - which she deems “a worthwhile and rich debate which I personally encourage” - but also the result of a wider phenomena.
“Philanthropy worldwide has been changing. You will see, especially with the younger generation (of benefactors), they give less grants just for the sake of grant giving, and have a more active role in grant-making. Which is personally what I think is much more interesting.”
Former Teva CEO and current Rothschild Caesarea Foundation chairman Shlomo Yanai elaborates: “The new philanthropy is much more sophisticated and the new philanthropists are much more involved, they are willing to measure the results of their donations and they want to make sure they are more effective.”
De Rothschild and Yanai are talking about social investment or venture philanthropy, as the baroness calls it - in which grants are not treated as endowments, but as long-term investments expected to make returns, be they monetary or social, used in turn to maintain sustainable social initiatives.
Director of Philanthropy at the Rothschild-Caesarea Foundation Eli Buch explains: “When we go into a project we always ask how does it become sustainable; sometimes its the state, sometimes an organization, sometimes a specific model,” but there must be a viable plan.
The end goal, the baroness says, “is to give you the means to do, to be freer, and not to be dependent on us. My goal is to give you the means to stand on your own and create the circle by which you will then continue to give. “
And it is no coincidence she cites conversations she had with the man considered to be the father of the field - Egyptian-born British venture capitalist Ronald Cohen, who describes his mission as "to set out how entrepreneurial practices could be applied to obtain higher social and financial returns from social investment.”
According to the baroness, “it’s really about bringing the best tools from business and law to make philanthropy a professional process… It is very interesting to see how you work with different actors in the field taking pure market tools and employing them into philanthropy, how do you do good in a smarter way, in a business and proactive way.
“So necessarily you have frictions between institutions, which are used to having old style grants, and a new style of philanthropy.”
The shift is already being felt, but it is not necessarily negative. In recent years, the Rothschild Caesarea Foundation has been taking a more proactive role, not just funding but also pushing projects of its own, most prominently founding their own leadership program - the BR (Benjamin de Rothschild) Ambassadors (disclosure: the author is a graduate of the program).
Though this in itself is not new - Rothschild donations have consistently promoted developing long-term economic opportunities through education on the one hand, and donating in the more classical sense, on the other - the long-term implications of this shift are massive, with more and more beneficiaries being called upon to develop sustainable models that would eventually wean them off donated funds.
“This is a very interesting debate for Israel about what are going to be the future sustainable models for this country. So for me, philanthropy has a pivotal role in this process because Israel has been so grant-dependent, and what I am passionate about is how do we create a different Israel… which does not receive so many grants, which per se is not sustainable.”
In her opening remarks at the conference, the baroness spoke at lengths about the need to develop social resilience in Israel, and the role philanthropy can have in promoting such a long term goal.
“Sustainable means you can fend for yourself, so you can’t always be grant-dependent,” she explains, and “resilience means being open to change and tackling the challenges (that Israel) faces.”
The baroness spoke about the historic arrangement between Israel and the Rothschild foundation, in which a larger percentage of revenues earned by the lands of the wealthy Caesarea community are donated to promote education in Israel.
“This is being challenged today,” she said, now “we build partnerships and evaluate results...
“We need to be looking beyond the grant, how do you engage with lets say the Weizmann Institute … to make sure (the grant) goes back into the system in a productive way.
“The highest form of giving is giving others the means to give,” she concludes, and “the startup nation must become the leading social startup nation.”