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Last week, an advocacy organization called the National Institute for Workers Rights (NIWR) urged the Security and Exchange Commission (SEC) to investigate possible U.S. security law violations by the financial juggernaut Goldman Sachs. The issue the NIWR raised relates to a charitable fund the company has established called the Goldman Sachs Charitable Gift Fund (Goldman Sachs Gives). The fund is one of a growing number of so-called “donor-advised funds” that now hold more than $200 billion in assets in the U.S. and give away more than $50 billion annually. One advantage of donor-advised funds is that donors can get tax deductions up front, even though the funds are given away over years.

First established nearly a century ago, donor-advised funds take different forms. They can be affiliated with religious institutions, hospitals, universities, and other non-profit entities. They can also be created by individuals or families to manage their personal giving. Companies also can establish them as a part of workplace giving programs, as Goldman Sachs has done for its current and retired senior employees. It describes the fund as pursuing the firm’s commitment “to fostering innovative ideas, solving economic and social issues and enabling progress in underserved communities globally.”

In its letter to the SEC, the NIWR raised the question of whether there are limits on the charitable contributions made through the Goldman Sachs fund. At issue are several grants the Goldman Sachs fund has made to organizations with mandates to challenge diversity and inclusion programs—programs that in other contexts Goldman Sachs explicitly supports. Among these grantees are Edward Blum’s Students for Fair Admissions, which received a $100,000 grant. Blum, a former Wall Street trader, helped spearhead the successful effort to persuade the U.S. Supreme Court to invalidate affirmative action programs for student admissions at Harvard and the University of North Carolina. Former Trump White House senior advisor Stephen Miller’s American First Legal and two affiliated organizations—the Center for Renewing America and the American Accountability Foundation—also have been grant recipients. Between 2020 and 2022, the Goldman Sachs fund provided $155,000 to help launch America First Legal and these related entities – all dedicated to undermining diversity initiatives that Goldman Sachs itself claims to support and the stated purpose of the Goldman Sachs Fund itself.

Read the full Forbes article.
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Michael Posner is the Jerome Kohlberg Professor of Ethics and Finance, Professor of Business and Society and Director of the NYU Stern Center for Business and Human Rights.