Transformative Philanthropy in Action: 2022 Impact Report
Our world economy is juxtaposed by extremes stemming from persistent disparities in wealth. Moreover, the lingering effects of the pandemic and global inflation — along with the ongoing challenges of climate change — continue to make clear the need for proactive, bold solutions to deep-seated inequalities in economic opportunity.
The Ares Charitable Foundation (the “Ares Foundation”) is a 501(c)(3) qualifying organization sponsored by Ares Management Corporation (“Ares” or the “firm”). We strive to accelerate equality of economic opportunity through grants to nonprofit organizations whose programs provide career preparation and reskilling, encourage entrepreneurship and deepen individuals’ understanding of personal finance.
We envision a world in which equitable access to knowledge, resources and opportunities enables people to achieve their full potential. We seek to be leaders in strategic grantmaking that addresses critical societal issues and makes a measurable, meaningful and sustained difference.
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A culture of learning, responsibility and collaboration that fosters ingenuity, bold solutions and empathy is central to the Ares Foundation and personifies who we are and what we do.
Michael Arougheti, Director, Co-Founder, Chief Executive Officer and President of Ares Management Corporation and Chair of the Ares Foundation Board of Directors
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The world more often than not views ‘rich’ and ‘poor’ as acceptable dichotomies, but we endeavor to counter that thinking in concerted effort with our grantees.
Michelle Armstrong, Managing Director, Head of Philanthropy at Ares and Executive Director of the Ares Foundation
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The Scope of Global Financial Inequality1
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We partner with some of the world’s leading nonprofits to help close the widening wealth gap — a disparity that often threatens basic human dignity and survival. Our mission to accelerate equality of economic opportunity is as vital as it is aspirational.
Since our launch in June 2021, we have focused our efforts on building greater resilience among populations at risk of being left behind, and this anchor has led us to provide support to organizations that, like us, possess an enduring commitment to helping solve economic inequity through imaginative approaches. The initiatives that our grants fund help:
- build people’s capacity to either enter the workforce or pursue new fields of employment so that they remain successfully employed over the long term
- provide people with the knowledge they need to develop and launch businesses, empowering them to add economic and societal value
- strengthen people’s ability to make responsible, informed financial decisions that move them toward long-term stability
We award two types of grants to effect change on both global and regional levels.
Our Board of Directors determines our Signature Initiatives, which aim to address society’s toughest challenges through large-scale funding commitments. These grants reflect our desire to make life better for current and future generations in partnership with visionary organizations that embrace what it means to lead by example. The scale and scope of the problems that we take on through this funding are significant. As such, they require innovative and ambitious approaches coupled with the time and patience needed to achieve transformative philanthropy.
Our employee-directed grants rely on shared decision-making to meet regional needs in the communities where Ares operates. Grant Review & Diligence Committees (“GRDCs”) in the U.S., Europe and Asia help identify and vet nonprofits for grant consideration, carefully review their proposed work and determine funding decisions. A global Grant Approval Committee (“GAC”) supports regional committees in these efforts. These committees, along with our Board of Directors, work together to act as strategy overseers, monitoring grant-funded activities to help ensure our grants achieve our desired impact. We believe that engaging Ares team members in this way not only helps build their personal capacity to make a difference, but also continuously inspires them knowing that their hard work for the firm’s investment activities translates into the good that they can do for communities globally.
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The launch of the Ares Foundation coincided with a watershed moment as the world began to emerge from the vise of the pandemic with a renewed sense of altruism and humanitarianism. Our early momentum reflects our desire to address imperative societal challenges. While we are beginning to recognize and celebrate early wins, we are careful not to rest on our laurels. Rather, we view them as lessons that foster learning and motivate us to think more creatively about how we can help reimagine the future. Our current roster of grants totals nearly $60 million since June 2021 and supports initiatives with global reach and impact.
I am most proud to be a part of this foundation because Ares has embraced all the principles of a well-run foundation.
Caroline Blakely, President and CEO of Rebuilding Together and Ares Foundation Board Director
When we established the Ares Foundation, we challenged both ourselves and our stakeholders to execute initiatives with the same rigor, discipline and entrepreneurial spirit that Ares brings to its investment activities and business operations. We are privileged to partner with highly respected nonprofits to identify creative solutions to challenges that impede people’s quality of life, and we work to ensure that our grants help make those solutions possible.
At the end of the day, we need to be really good stewards of the communities that we serve and make the world a better place.
Jim Hirshorn, Partner in the Ares Private Equity Group and GAC Member
Ares generously supports the Ares Foundation, including a commitment to donate up to 5% of its annualized, realized net performance income from select Ares funds to support grantmaking and operations. Ares team members find it inspiring to know that good investment performance leads to much-needed funding for our Foundation’s work and the nonprofits that we support. Many of the firm’s employees also donate cash, equity and/or a portion of their realized proceeds from carried interest in certain funds.
We put a lot of time and effort into seeking to deliver returns for our investors, and to be able to see some amount of that effort translate into capital that gets invested back into the communities that we are a part of is incredibly gratifying.
Jana Markowicz, Chief Operating Officer and Head of Product Management & Investor Relations for U.S. Direct Lending at Ares as well as Co-Chair of the U.S. East Coast & Midwest GRDC
We set specific goals and define key indicators for every grant that we award, and we make certain to fund specific, project-based initiatives with clearly anticipated outputs and outcomes that we can track over time. To better ensure our desired outcomes, we work closely with grantees as they execute their funded activities. Doing so also allows us to modify our strategy and approach as needed. Our commitment to this level of close collaboration means that our grantor-grantee partnerships are highly relational and interdependent.
This symbiotic approach — as well as engaging team members with diverse backgrounds and perspectives as grant decision-makers — is both inspiring and effective.
We want to know what success will look like and how we can monitor our progress.
Sharad Bajpai, Head of Asset Management for Ares SSG and Co-Chair of the Asia GRDC
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Having an active, engaged team who are quite thoughtful and inclusive of each other has led to tremendous success.
Blair Jacobson, Co-Head of European Credit at Ares and Co-Chair of the Europe GRDC
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How We Achieve Distinctiveness Through Grantmaking
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Our Board of Directors and employee-directed grantmaking committees determine what we fund and act as strategy overseers.
We award grants for initiatives that provide career preparation and reskilling, encourage entreneurship and deepen individuals’ understanding of personal finances.
We provide our grantees technical assistance that further engages Ares team members through volunteerism, mentorship and board participation.
We share the results of our grants through diverse media and multiple communications channels to raise awareness for our partner organizations’ important work.
We learn with — and from — our grantees and we strive to be the caliber of thought leader and partner that they need and deserve.
We collect, analyze and report data on grant outputs and outcomes to help inform our practice, the philanthropic and nonprofit sectors, and our industry peers.
Signature Initiatives
We have committed $56 million to support highly intentional solutions to extraordinary challenges.
We must heed the clarion call to support exceptional initiatives that spur systemic change and inspire new ways of thinking on how best to help bring about a more equitable world.
Our Board of Directors awarded $56 million for Signature Initiatives designed as highly intentional solutions to extraordinary challenges.
The joy of doing this type of work is that it is infinite in terms of its possibility and the communities that we can serve.
Michael Arougheti
Employee-Directed Grants
Our GRDCs and GAC awarded $3.4 million in employee-directed grants, which helped encourage committee members’ buy-in and support for our work, and provided full transparency for how we execute it.
The Journey Ahead
The world requires bold solutions to address growing economic inequity and each of us shares the responsibility to take decisive action.
We are driven by this truth. Working in concert with our Board of Directors and employee-directed committees, we will continue to identify, vet and fund organizations that appreciate our purpose and wish to work alongside us to fulfill it.
While we believe that a better future is within reach, we know that we must continue to offer innovative yet practical solutions and rely on collective action with those who share our vision in order to harness it. Above all, we must allow empathy and integrity to guide us.
We also recognize that this work will be daunting and tireless, but we remain determined. There is much more that we can — and will — do. This is only the beginning of our journey, our story and our impact.
- Projections may not be reliable indicators of future events and are based on sourced material.
- Half of the global population lives on less than US$6.85 per person per day, World Bank, December 8, 2022.
- World Inequality Report 2022, World Inequality Lab.
- Lost & Damaged: A study of the economic impact of climate change on vulnerable countries, Christian Aid, November 8, 2021.