2000 ANNUAL REPORT ABOUT THE FOUNDATION The Rockefeller Foundation is a knowledge-based, global foundation with a commitment to enrich and sustain the lives and livelihoods of poor and excluded people throughout the world. In order to maximize its resources and leverage the Foundation's strengths, grantmaking is organized around four thematic lines of work: Creativity & Culture, Food Security, Health Equity and Working Communities. A cross- theme of Global Inclusion supports, promotes and supplements the work of these themes. In addition, the Foundation supports a number of programs that are developing or in transition, among them the Africa Regional Program, Communication for Social Change, Public/Private Partnerships and Global Philanthropy. One year into the execution of a new strategic direction that is more pointedly focused on the needs of the poor, we have reaffirmed some of our original assumptions about development, most notably that: For the Foundation's strategies to be most effective, the poor and excluded should have a voice in the process, that we should actively find ways to unleash those voices, and that such voices should be heeded; that The poor and excluded themselves should participate in researching, planning and doing the work, and that Neither this foundation, nor any other, can work alone. We must seek creative ways to leverage our limited dollars in order to attract new funding from the private sector, international aid organizations and national, state and provincial governments. Even though the Rockefeller Foundation's endowment still ranks in size among the top 20 U.S.-based foundations, we cannot begin to solve any single world problem alone. The problems are too complex. A $15 million grant, or even a $50 million grant, cannot begin to address a cure for AIDS or development of new tuberculosis drugs, for example. Consequently, the Foundation increasingly must build partnerships and encourage collaboration between the public and private sectors. Following are more specifics on the Foundation's themes, cross-theme and special programs, with summaries of progress to date. © 2003 The Rockefeller Foundation MISSION AND VISION Traditionally, annual reports are an opportunity to look back and describe our achievements over the 12 months. As I sit at the desk I've now occupied for almost three years, I'm struck once again at how daunting a task this is because of the very nature of how foundations work. We seek long-term, systemic, enduring change, and accomplishing that takes time--far longer than just one year. In the essay and photographs that follow, we take you to four countries, looking at common threads that stretch from continent to continent. You will see close up the effects of inequity on poor families and individuals, along with some explanation of the Rockefeller Foundation-supported programs that are working to alleviate those conditions, over time. Although the locales differ, the impact of inequity is strikingly similar as we travel from Irlanda's village in Mexico to Jackie's public-housing complex in the United States, then on to Margaret's farm in Kenya and Hian Som's plot in Cambodia. These are the real- life struggles of impoverished people whose lives are being bypassed--or even adversely affected--by the globalization that holds such great promise for those already better off. In addition, I'd like to tell you about some of the new work begun in the past two years that illustrates the Foundation's endeavors to find lasting solutions to some of the world's most pressing issues. The first is our Africa Regional Office's support of Makerere University in Uganda, where our goal is to contribute to Uganda's distinctive governmental reform process, while simultaneously enhancing the quality and relevance of higher education by reinforcing the university's own transformation. Secondly, we recently helped inaugurate the Global Alliance for TB Drug Development to find new drugs to treat one of the world's deadliest infectious diseases. Drawing on our deep roots in Africa, where the Foundation began making significant investments in 1958, we have joined with the Carnegie Corporation of New York, the Ford Foundation and the John D. and Catherine T. MacArthur Foundation in an initiative to support the improvement of higher-education institutions in a number of sub-Saharan countries. Africa's universities have a key role to play in helping to reduce poverty and in serving as catalysts for national economic development and social well-being, but they all have suffered in recent decades from lack of funds and the inability to compete for the best faculty. Yet, despite very difficult circumstances, many of them are responding in creative ways to the needs of their countries and to the various democratic and social reforms now under way. And, we believe, the ultimate success of those reforms depends substantially on the universities' ability to support them. We have elected to concentrate our efforts on Makerere, which, under visionary leadership, is undergoing dramatic changes and wishes to be more relevant to the needs of the Ugandan people. Once among the continent's premier universities, Makerere has embarked on an ambitious strategic plan that encompasses not only improvements to its own functions and finances, © 2003 The Rockefeller Foundation but also capacity building to aid the devolution of power from Uganda's central government to the districts. In the last six years, enrollment at Makerere has more than doubled and degree programs have expanded to include business administration, nursing, biomedical technology and tourism. By building the university's research capabilities and providing the resources to attract top scholars, both to study and to teach, we believe those individuals, in turn, can become resources for the Ugandan government as it moves forward with its national decentralization agenda. The university will then be able to train not only national leaders, but also district leaders, most of whom lack higher education and formal training for their positions, in the areas of health, agriculture, finance, education, planning and public administration. In this way, we work together, in a collaborative public/private philanthropic effort, to build a strong civil society that can move the country forward. The Rockefeller Foundation is also working to alleviate health inequities among poor people in developing countries. This is nothing new; we've pursued scientific approaches to world health throughout our history, with some well- known resulting accomplishments, including our support of research leading to the discovery of penicillin and development of the yellow fever vaccine, for which a Foundation staff member won a Nobel Prize. Today, we operate as a catalyst and partner among the myriad public, private and nongovernmental organizations engaged in health-equity work. We know, from experience, that some of the world's most significant health problems exist simply because people in developing nations lack access to the kinds of treatments available in developed countries. Tuberculosis, for example, though still around in the United States, is not considered a public health threat because people have access to drugs that will cure it. Such is not the case in the developing world, where TB is commonplace and kills more than two million people annually. One third of the world's population is currently infected with TB, and each year eight million people develop the disease in its active form. The standard treatment is a six to eight month regimen. However, when a patient must walk miles to the nearest public clinic, or the clinic is open only on Wednesdays, this effectively constitutes no treatment at all, because people simply cannot follow through for the required time. Meanwhile, the bacillus continues to build up resistance to existing medicines, and no new class of TB drugs has been developed in more than 30 years. We considered what would be the ideal situation: a new TB drug that didn't require a lengthy treatment plan. The primary obstacle to its development: money. It costs an estimated $300 million, on average, for a pharmaceutical company to develop and take a new drug to market--but when the only market for that drug is poor people who can't afford it, there is no financial incentive to induce that investment. To remove that obstacle, we brought together the Global Alliance for TB Drug Development. A public/private partnership, the Alliance operates independently and is modeled after a small, virtual R&D company. Using Foundation money for initial research costs, pharmaceutical companies have agreed to make the new drugs, once developed, available at cost to poor people in developing nations in return for guarantees from the ministries of health in those countries that they will purchase a certain number of doses. © 2003 The Rockefeller Foundation All of this came about in a record 14 months; perhaps equally remarkable, with our initial $15 million commitment, together with $25 million from the Gates Foundation, the Rockefeller Foundation leveraged commitments totaling $150 million. We were able to do that because, when a foundation comes into the game, we kindle interest, add credibility, eliminate initial risk and stick with it for the long haul. That is how we use our catalytic power to effect long-term, systemic change. That is how, over time, we will help to improve food production, access to jobs, education and health among the world's poor and excluded. That is how we will contribute to the development of effective civil societies in Africa, and how we will promote the development of the first new TB drug by 2010. We do not treat symptoms; rather, we go into things for the long haul, for that is the most effective, sustainable way to alter the root causes of the world's complex ills.