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Posts from the ‘Family philanthropy’ Category

Announcing the Wise Philanthropy YouTube Channel [A request for you to subscribe]

November 19th, 2020

Richard Marker

A REQUEST: Please subscribe.

The Institute for Wise Philanthropy has launched the Wise Philanthropy channel on YouTube. It is now live albeit still in the construction phase. Over time, we will be posting opinion vlogs, abbreviated and selected educational offerings on best practices, and interviews/discussions with others in the philanthropy world.

As we begin to populate the content on the channel, we invite you to subscribe. There is no cost or obligation, and the process is very straightforward [Simply go to YouTube and search for Wise Philanthropy; press the subscribe button]. This will allow us to formulate the most appropriate content going forward, and be responsive to your needs and interests. [ALERT: Please be aware that there are some other sites with very similar names. Ours is simply the Wise Philanthropy channel; for now, you can identify it easily by seeing the videos featuring Richard Marker.]

Among the pieces already in the works are:

– Why Advocacy is a Mandate, Not an Option, for USA Philanthropy

– The Big Lie[s] – Philanthropy’s Opportunity and Dilemma in the Post Election Moment

– A Multi-part Series on Personnel Practices and Cautions

– Strategic Plans are Passé; Scenario Planning is Yesterday’s News; What now?

– We are pivoting so fast that we’re dizzy; will the changes we are now seeing in philanthropy practice survive the pandemic?

and more….

As always, thanks for being colleagues and friends. We look forward to hearing from you.

OPAL Panel on Philanthropy Responses to COVID 19 [video]

November 1st, 2020

Richard Marker

https://drive.google.com/file/d/1XyHI7UYp8VLqWnfSjveT8RcQ-L6HN7YC/view?usp=sharing

OPAL Panel on Successful Philanthropic Partnerships [video]

November 1st, 2020

Richard Marker

https://drive.google.com/file/d/1Yy_DAQA1tIFgrah-pPsNSLkFeBgA5mJm/view?usp=sharing

#395 The Myth of Perpetuity

October 23rd, 2020

Richard Marker

Please note that much of this article alludes to U.S. foundation law. Laws regarding charitable and non charitable foundations differ extensively around the world. Nevertheless, the question of perpetuity applies broadly even if some of the specifics of this article are more limited.

Some years ago, a very prominent Wall Street financier and his wife, herself a very prominent philanthropists, gave a headline grabbing gift to a world-famous museum. The most famous gallery in that museum would henceforth bear their names.

At the time, the story was making the rounds that the museum promised this couple that the gallery would bear their name in perpetuity. The financier asked, “how long is perpetuity?” The museum replied, “75 years.” The couple accepted those terms.

I am not sure if the story is apocryphal, but I was acquainted with the couple and it certainly could have been true. Whether or not, though, it gives an important message about “perpetuity”, one that is worth revisiting at a time when foundation “perpetuity” is on the tables of the philanthropy world.

Before proceeding, it is worth noting that US law does not guarantee perpetuity for foundations. In the US, the law requires a 5% payout plus excise tax regardless of earnings. If the foundation earnings don’t reach that level and beyond, the corpus will shrink; if there are several consecutive years of lower earnings, the corpus will continue to shrink exponentially. If the law wanted to guarantee perpetuity, the law would adjust the spending rate to reflect earnings or at least C.O.L. It doesn’t.

Perpetuity, therefore, is an intention. And indeed, perpetuity is a very, very long time. In my own professional experience, the oldest continuing foundation I have advised was about 500 years old and struggling how or if to continue since all of its legally mandated conditions had long since become irrelevant or expired. Most foundations, even those that aspire to “perpetuity” are much, much younger than that. I wonder how many of them really believe that they will be around in 500 years.

A more accurate description, then, of these foundations is “open-ended with no pre-determined time limit.” The hope of the founder is that successor trustees will align spending, investments, and governance policies sufficiently well to keep it going to make an impact generations hence but history has shown that true immortality requires something more than a large bank account.

This adjustment of the concept is consequential in terms of foundation decision-making. Most of us have been in rooms when one or more trustees makes clear what they believe their role is to be “stewards” of the foundation resources to last for generations. If perpetuity is the defining variable, stewardship is a credible approach to their role, and their approach to the foundation’s philanthropy.

The problem with “stewardship” as the primary motivator of philanthropic decision -making is that it focuses more on the finances and less on what the money can do. This is not to dismiss the authenticity of respecting donor intent, i.e., honoring the legacy of the family and foundation founders, but, functionally, it often means taking the most restrictive approach to the resources. True, if properly conceived, a “perpetual” foundation can serve to keep family connections alive, to remember the impact of the founder, to exert influence in a particular place over time. However, in too many cases, the idea of “stewardship” is so engrained that it instinctively negates public benefit investment strategies, and it serves to diminish the willingness to take even prudent risks with philanthropic dollars.

The flip side of “stewardship” is not “spend-out” – we’ll come to that later. It is, rather, to start from a different mentality that focuses on the philanthropy and not the money, i.e., the mentality of what good can our philanthropic investments and grantmaking make during the time it is under our auspices. The challenges at any given moment, and certainly of any given generation, can never be fully anticipated, no matter how prescient one may be. Therefore, current trustees can feel fully empowered to makes decisions that may respect their legacy while being thoughtfully creative. This approach refuses to kick the hard decisions down the generational road but accepts them now. And it recognizes that each successor generation should feel similarly empowered.

Not long ago, I had the privilege of working with a family foundation the size of which was about to grow well into the upper 9 figures. The family knew that not long from that time, the responsibilities of succession would fall upon them. Yet they were a bit stymied because they couldn’t get the founders’ generation to articulate what they wanted their foundation to do and be. Finally, the widow of the founder made it very clear that she wanted them to be free to decide. After all, she said [here slightly paraphrased], “I could never have imagined what the world was going to be during my lifetime. How can I know what my grandchildren’s and great grandchildren’s world will be like? They have to be free to make their own decisions.”

This decision liberated those generations at the table and those not yet born to be empowered and not simply stewards of inherited wealth. There was no implied message of perpetuity, but there was also no time limit on how long the foundation should continue. The presumption was that subsequent generations need to be empowered to decide that question as well.

Let’s now come to the question of “spend-out” or “time limited” mandates. This is, of course, not a new discussion – Andrew Carnegie and Julius Rosenwald were two extraordinary and influential philanthropists who made quite different decisions. Various Carnegie endowments continue to this day; Rosenwald specified a terminus ad quem for his foundation Most of those who have established endowed foundation assumed that they were to last indefinitely. It is certainly true that most wealth advisors would recommend investment strategies consistent with those assumptions.

There are, though, two significant challenges to the idea of open-ended foundations. One is efficacy, the other ideology.

The efficacy argument is an easy one: if one wants to address a problem – whatever that may be – a dollar spent today is better than 5 cents. Why not throw as much as possible on an identifiable and presenting scientific or social or educational issue on the certainty that it will surely make more of a difference now and may even solve a problem. [e.g., the Diamond Foundation’s successful “all-in” on HIV-AIDS.] And, while no one can anticipate new challenges in the future, the more one can solve today, the more likely those unanticipated ones can be addressed effectively in their time.

The ideological one is quite different. It challenges the very nature of [mostly] tax free accumulation of wealth controlled by those who had nothing to do with the creation of that wealth. [For this article, I will table the much-needed conversation about the shocking transfer of wealth from the middle class to the very wealthy we now have in America. And I will also defer comments on “The Giving Pledge” to another time] A foundation that lasts for generations essentially transfers power from generation to generation, perpetuating a class and economic divide. Those who control perpetual/time-unlimited foundations can exercise that power without accountability for their decisions [other than that required by law]. Indeed, there is no requirement that the intended beneficiaries have any say in the decisions even though they are the ones most impacted. This conceptual challenge is not new but has become vivid and vital during the recent months as the USA has been forced to acknowledge our stark racial and economic divides.

Readers of this piece are well aware of some very welcome initiatives in our field to redress this. In prior articles, we have discussed the work of Participatory Budgeting, Trust Based Philanthropy, CEP, NCRP, and others and many other funders are struggling mightily with what all of this means for them. These initiatives try to readjust the power base, the decision making, and the accountability loop. But, with very few exceptions, these initiatives are agnostic about perpetuity.

A number of prominent foundations have made clear that they fully intend to spend-out their resources within a specified time. But it is not yet clear if those foundations are outliers or part of a new normal. [For the last few years, that is one of the most frequently asked questions when I give presentations on philanthropy trends to funders in the United States and around the world.] Some have already closed and much has been written about their decisions and their exit strategies. As one reads the motivations for doing so, there seem to be two motivations – the efficacy argument presented above, and the ability to make the decisions while still alive to do so.

I am happy to be proven wrong, but I have not seen any of the foundations choose to spend-out for the ideological reasons. One wonders, though, if that will change as an ever larger percentage of funders and philanthropists become self-reflective in the face of the challenges to inherited power, the recognition of endemic racism, and the moral repugnance to the unconscionable economic divide.

There surely is no one right answer to how long our funds should last, but I would urge all of us to drop the concept of “perpetuity” and replace it with “open-ended.” None of us lives forever – and until proven otherwise, neither does a foundation. What matters, in the end, and what makes a difference in how worthy our legacies, is not how long a foundation lives but how thoughtfully its resources are used.


The Institute for Wise Philanthropy has been educating and advising funders, philanthropists, families, and philanthropy associations around the world since 2002.

#394 Must Scale Be a Precondition for Sustainability? [Corrected]

October 13th, 2020

Richard Marker

This is a hardly a new question. [Long time readers may recall several previous articles raising similar questions: “Right Sizing…” Dec 2016; “Winning Small….” July 2018; et al.]

Most for-profit businesses rely on scale. Nonprofit business models struggle to achieve scale. Funders, deciding on the viability of their non-profit grantees, should ask the question. Is scale a precondition for long term sustainability? Should it be?

The issue is more poignant and pressing today than ever. The viability of many in the non-profit sector, the conceptual and capacity challenges to funders everywhere, the recognition that philanthropy can never be separated from public policy all converge to raise questions about whether the operative business models for non-profits of the last period of time can still be valid.

For the last couple of decades, the assumptions about non-profit viability has been heavily informed by b-school thinking. Funders of established organizations have pushed organizations to be less dependent on philanthropic giving and more on earned income as a measure of long-term viability. Start-ups are often rated by their likelihood of achieving disruptive scale.

Scale does matter: one needs look no further than the US embarrassment regarding COVID-19 testing. Literally millions of people have found it difficult to get tested – and when tested to get timely results. [Even though this is the political season, for this piece, I will exercise restraint in my opinions about why that is. I am sure any regular reader knows my feelings.] The inability to provide testing at scale has limited the ability of many in the USA to make safe and reasonable plans for their own behavior, and businesses, schools and communities have been handcuffed in knowing how or if to develop a new normal.

The same will be true when a genuine scientifically reliable vaccine or treatment becomes available. We will return to normal, whatever that will mean, only when they are available at scale.

Another example, about which the literature is overwhelming, is about food insecurity/hunger. In the USA, There is simply no functional alternative to SNAP funding to reach scale. [Perhaps a guaranteed income on which a family can really live would be an alternative but that requires major systemic re-thinking.] Food pantries, soup kitchens, and other local efforts are still indispensable, sadly, but none can systematically assure that the millions of families, children, undercompensated receive essential and basic sustenance.

We see this assumption in funders’ responses to innovation in both for-profit and not-for- profit sectors. On the for-profit side, a new idea doesn’t have to be as disruptive as an Uber or Lyft or Airbnb or any of the other disrupters to warrant initial or mezzanine funding; but to receive funding, it would have to have a credible business model which would bring it to self-sustainable scale in a reasonable time frame. There are capital markets at every stage of the process that make those risks viable, and there are even tax incentives to give those risks even a little extra push.

This is true on the social impact side of this as well. It is certainly acceptable and reasonable to achieve social good through for-profit investments. To take but one example: Once upon a time, support for solar energy fit neatly into the grantmaking side of a foundation’s portfolio, especially for a funder with a commitment to environmental sustainability. Today, such funding fits comfortably on the investment side since its financial viability and its positive impact are so clear to all but some recalcitrant deniers. [Full disclosure: we are personal investors in solar energy development projects both in the United States and Africa.]

It is far less easy on the not-for-profit side. Very, very few not-for-profits ever reach the stage where they can generate sufficient fees for service or endowment income to be fully self-sustaining without dependence on grants and charitable gifts. It is somewhat easy to get limited start up funds for an innovative project but the larger a new organization gets, the greater the dependence on more and larger gifts. There is a very limited identifiable capital market for mezzanine and second stage not-for-profit organizations. The problem is that all too often funders have drunk the venture capital or impact investing Kool-Aid. “Will you be the disrupter that addresses hunger or poverty or homelessness or illiteracy? [you know, the little things.] And if not those, will your new project be sufficiently compelling that it will reach the scale, scope, and sustainability justifying the aspirations of both funders and creators? It is a rare not-for-profit that can credibly claim that business model.

The last 6 months have challenged those assumptions of what success should mean. Organizations that had built their business model around fees-for -service or government reimbursables have suffered greatly. The higher the percentage of reliance on those income sources, the harder it has hit. Organizations that relied more heavily on traditional grants and contributions had more reliable income, even if more variable than in “typical” years.

Moreover, as funders have become more committed to responding to a radically changed reality, many of us have frontloaded our giving, reduced our reporting requirements, and eliminated our restrictions. [How permanent those changes remains an open question – but for another time.] Locally/placed based grantmaking has resurfaced as a high priority for many, especially to direct service organizations.

What is evident in these changes is that scale can no longer be the primary driver. Of course, there may well be organizations that can deliver more, better, faster, and more efficiently even on the local level, but that doesn’t guarantee that they can do so everywhere and to everyone. If there are racial inequities, food deserts, uneven economic prices to pay for the pandemic, efficiency only takes you so far. Community based organizations may know the needs of their communities, and especially of micro-communities, that larger, more efficient organizations don’t.

I would hope that this corrective represents a welcome rethinking regarding sustainability. There are circumstances when sustainability cannot ever be based on program generated or endowment income.

There are even circumstances when scale becomes a counterproductive criterion. Permit one very real example to suffice: When I was CEO of a foundation 20+ years ago, we were involved in numerous funding collaboratives. One was in support of a very wonderful innovative program for and by young adults. Its ambitions were aligned with its capacities; its commitment to quality a reflection of the thoughtfulness of the founders; and its success commensurate with both. One of the funding partners believed that this was such a wonderful model that it should be scaled up. They persuaded the rest of us to hire a consultant who specialized in this kind of non-profit scaling. Sure enough, you are not surprised to read that at the end of the consultant’s extensive analysis, they came back with a series of recommendations about how to bring this boutique organization to national scale. [I was on record as disagreeing, but was outvoted, and if one is in a collaborative funding arrangement, there are ground rules.] Shortly thereafter, a development staff was hired, a new executive was selected, and a national roll-out was initiated. A year later the organization went out of business.

What happened? When the organization was small, local, and controlled by those who were peers of the target market, it worked great. When those folks were essentially relegated to program staff but no longer making the big decisions, it didn’t. Why? Because once it attempted to reach scale, it became a competitor to much larger, much better capitalized organizations. The agility and responsiveness that made it successful on the local level became impossible to achieve on the national level. While I know that I am not giving readers too many details here, suffice it to say that it was a classic case of funder overreach and the idealization of scale as a goal. We were simply wrong, and a jewel of a program became worthless.

Let me return to where I began. Scale does matter in addressing systemic issues; in fact, it is a sine qua non. There are times when anything less is not enough. But implementation is almost always local. And how to implement often requires local knowledge that a big picture funder may not have. We don’t always solve our most pressing problems if we only look at financial sustainability, equate capacity with scale, or dismiss the value of local innovation. Our funding commitments must include the vulnerable, smaller, and local if we truly want to bring impact to all.


The Institute for Wise Philanthropy has been teaching and advising foundations, philanthropists, families, and philanthropy organizations around the United States and the world since 2002.

Partnerships and Collaborations

October 7th, 2020

Richard Marker

The annual update of the Institute for Wise Philanthropy‘s check list for effective funder partnerships and collaborations is now available by request. This has been our most requested practical “how to” for over 10 years. Contact us if you would like your copy.

This is a link to a presentation on collaborations at a recent OPAL conference:

https://drive.google.com/file/d/1Yy_DAQA1tIFgrah-pPsNSLkFeBgA5mJm/view?usp=sharing


The Institute for Wise Philanthropy has been teaching and advising philanthropists, foundations, families, and philanthropy associations around the United States and elsewhere in the world since 2002.

#391 The Elusiveness of Excellence – We Funders are not Exempt

August 10th, 2020

Richard Marker

A couple of years ago, my accumulated professional careers crossed the half-century mark. Knowing of my untypical journey, a number of people asked if I was planning to write an autobiography. While I don’t believe a full autobiography is warranted, I have written a pamphlet-size retrospective built around lessons learned. It will be published sometime this Autumn.

While writing, I was reminded of a number of influential episodes, some of which are applicable to current developments in the philanthropy world. This is the second such article; you may find it helpful to read #390 prior to this. Others will be posted periodically.

In this article, the applicability to those of us in the philanthropy world comes toward the end.

It was not that many years ago when Jim Collins “Good to Great” and its follow up “Good to Great in the Social Sector” were on everyone’s canon of required reading. It may still be but if so, I am not hearing it spoken about. Primarily built on retrospective examinations of what seemed to characterize those companies [and, subsequently, nonprofits] that have excelled over time, Collins challenged some B-school orthodoxies, and reminded everyone that it takes disciplined work over time to achieve that greatness.

I suspect that the book is less celebrated today because the dozen or more years since its publication have not been particularly kind to all the winners of which he wrote. Now, it is quite true that it was published before the recession of 2008-2010, and certainly before the current upheavals in the economic and social sectors, but many of his lessons are still valid, and worth the read.

When I look at his books from the retrospective of my own career, I see a divergence between what I accomplished as an executive, and how those related to my own personal accomplishments. They are overlapping, but not the same.

Before proceeding with the extrapolations to our philanthropy world, let me share a very significant personal story that made a difference to my own career and to my understanding of what “Good to Great” can really mean.

Many of you know that over the last couple of decades, my skills as a speaker and educator have been celebrated and nicely compensated. Verbally communicating to audiences small or large in 40 countries around the world became a key source of my compensation. I am a proud Legacy member of the National Speakers Association/Global Speakers Federation – membership in which is only open to those who can demonstrate that we are actually paid to speak.

Those who have known me only for the past 23 years may not know that I wasn’t always so excellent at this. My professional life had always required me to speak in public. I was always comfortable doing so, and always thought that I was good at it. Indeed, I had overflowing files of letters thanking me, and I had my share of standing ovations and plaudits. If you had asked me before 1997, I would have said I did it well.

Yet, I often wondered why I wasn’t being invited to give certain speeches that I felt I was as least as appropriate to give as those who were chosen. It was Mirele, to whom I have been joyfully married since 1995 and who knew me in professional contexts even before we became a couple, who set me straight. After we were married, she began to see that I was more frustrated by this than she had realized. Finally, she told me the truth: “If you really want to know, you are not consistently so good. You have great mastery of the content, and wonderful rapport with audiences, but your talks are, well, not consistently great.” [Admittedly this is a paraphrase, but a fair one.]

She said that if I was serious, I should work on my speaking skills. Now this may seem strange, but until that time, I had never had a course in public speaking, and, more important, no one had ever given me negative feedback.

And now we are getting to the crux of the message:

It appears that I was never so bad that it was worth it to anyone to tell me how I could have been better. I was sometimes only “fair”, maybe sometimes “excellent” but mostly “good.” No one had anything at stake in telling me that I could or should have done better. Until Mirele did.

I signed up for a mentoring program at the National Speakers Association and discovered something very quickly – I was undisciplined. I had all of the skills and knowledge and presence and I thought that was enough. But then I learned the discipline of how one organizes a presentation. I discovered that I still talked like an academic even though I had mostly left academia over a decade earlier. People did not want to know how many syllables I could have in every word; they did want to hear stories that illustrated what I was talking about. They didn’t want to be impressed with how much I knew; they did want to know how that knowledge could make a difference to them. [You know the old mantra: “nobody cares what you know until they know that you care.”]

Within 6 months I began to have evidence of the transformation. I started getting invited to more places, but more to the point, invited back! The character of the thank you’ s was markedly different.

I look back on so many squandered opportunities over the years and wince. I asked myself “why didn’t anyone tell me?” If I could go from just “good” to “excellent” in only 6 months, think about what I might have been able to do had someone held a mirror to me, or had the courage to tell me.

And now the message: the only person [other than a loving spouse] who really cares if you go from “good to great” is yourself. If you want to excel, you have to make it clear to others – and safe for others – to tell you! For most others, “good” is good enough. As I said above, what stake do they have in pushing you to excellence? Most of the time, your personal aspiration is at best only incidental to them or their work.

It also made me rethink prior parts of my career: I am pretty confident that I pushed organizations that I headed or was a trustee of to become high quality performers; I am less confident that I helped colleagues and supervisees reach that level in all they ways they could. Or maybe should have.

Having learned that skills and knowledge are insufficient without the discipline to apply them means that one has to work hard to not become complacent. One of my favorite, if embarrassing, cases about my own complacency goes back to a time when we were invited to Buenos Aires to give some lectures. One of the talks was to university students at 10 pm on a Saturday night. Shockingly, it drew a very large crowd – I learned that I was the entertainment before a night of dinner and dancing. Before speaking, I did my homework, and learned the names of all the hot spots that young adults frequented. I peppered my talk with those references, and I was a star! Two years later, we were invited back, but I was complacent and didn’t bother to update those references. They were all passé. And, while the talk was more or less well received, my star quality was seriously diminished. I have been back since for other audiences but not for the young adult crowd. Serves me right.

At the present time, the foundation and philanthropy sector are doing a lot of soul searching about our decision making, about our governance, about our priorities, and about our role in society. Groups such as CEP, NCRP and others are pushing us to go beyond our long-term self-satisfied [and often self-congratulatory] complacency to respond to systemic issues of racism and economic inequity. Impressively, many in our sector are taking these challenges seriously. Good enough is simply not good enough anymore.

The challenge, though, is if we can sustain this attention, momentum, and operational change over time. In the midst of a pandemic of public and of persuasive challenges to the social weal, it is evident that we must respond. But when there is a vaccine or a change in administration or a recognizable sense of normalcy, will we as funders find it all too easy to become complacent? Or will our commitment to endemic and systemic change propel us to internalize the discipline to sustain excellence?

That discipline will prove the harder challenge – one from which we must not back down.

#390 Listening vs. Hearing: The View from the Other Side

August 5th, 2020

Richard Marker

A couple of years ago, my accumulated professional careers crossed the half-century mark. Knowing that it has been an untypical journey, a number of people asked if I was planning to write an autobiography. While I don’t believe a full autobiography is warranted, I have written a pamphlet size retrospective built around lessons learned. It will be published sometime this Autumn.

While writing, I was reminded of a number of influential episodes, some of which are applicable to current developments in the philanthropy world. This piece emerges from one of them. Watch for additional posts that will address others.

…..
“Strategy” is the constant among my five careers. Whether in the non-profit or for-profit sectors, or, in the last quarter century in the philanthropy arena, being a strategist has been the core competence that ties it all together. I learned very early on that the elegance of a strategy, the completeness of the data, and the rigor of the process are often for naught if there is not attention to implementation. There is much to say about this, and I have written and taught about this extensively. But a current discussion in our field has underscored, once again, how crucial the implementation stage is in achieving any effective strategy. In this case – the difference between listening and hearing.

The anecdote: I recently had occasion to be reminded of a project I did fairly early in my career. In my first full-time post-graduate school position, I was a young associate chaplain/faculty at Brown University. Toward the end of my first year [’71-72], a graduating senior came to meet with me. He told me he had a beef: He said that there were matters of identity that he and his friends had never discussed and, now, on the eve of graduation, realized that he wishes they had. He told me that he thought that the only person he knew who could have facilitated that much needed conversation was me.

Now, to be fair, while it was a nice compliment, there were undoubtedly lots of folks who could have facilitated that conversation; his was probably more a comment on the still existing divide between faculty folks and students even in the early 70’s. It did challenge me, though, and I subsequently began a practice that I continued for my remaining years there. [I left in 1982.]

At the beginning of every Spring semester, I would invite graduating seniors to my home for small group teas. Over the years, I learned a lot. The most sustaining lesson was this: whatever perceptions I may have had about students’ commitments and involvements based on what I observed proved to be only coincidentally aligned with what students said about themselves. I might see a student doing some particular program or activity almost every day, yet those very students would describe themselves as only very marginally connected; other students might talk about how important a project was to their undergraduate life, even though he or she might be totally invisible to others involved.

In other words, self-perception is not always aligned with how others see us. The data alone was misleading – or at least insufficient. It was a lesson that has served me well in every subsequent career, but none more so than in my journey in the philanthropy sector over the last quarter century.

Our field is fraught with opportunities for misperception. It historically has been built on a power imbalance – one side wants, the other side has. Those who want financial resources need to convince those who give that they should give to them. Built in is a challenge of perceptions. Organizations that want resources from funders try to determine what the funder really wants to hear, what will give them a tactical advantage, what is legitimate hyperbole vs dubious exaggeration, and what will give a funder the confidence that their articulated missions will best be fulfilled in supporting your organizations. Funders have our own set of desiderata: yes we want to assess all of the items presented by those seeking our funds, but we also have our own independent considerations: where does this request fit within our own priority system, how does supporting this organization or project align with our own risk tolerance, how does this request compare to other similar requests on our docket, what is the internal push and pull among family or trustees or staff, and more.

Those requesting funds rarely know all of these internal considerations – meaning that there is an endemic disconnect. They are limited by their perceptions – extrapolating from the knowable [grantmaking history, articulated missions] to the “best guess.” Proposals, whether written or oral, all reflect a best guess of what the funder really wants, but since there are so many subjective factors, there is always, by definition, the unknowable.

Some funders have made our own mistakes – that of assuming that we can take the guess work out of our decision making. It is a little less true today than it was a few years ago, but for a while, funders thought that we could apply a rigorous due diligence and metric system to make the “right” decisions. That too is wrong – and also for an important endemic reality: we fund the future, and the future is never guaranteed. We may choose to reduce the risk by supporting only well-established organizations, or well-developed programs, or sector leading executives, but…. COVID-19 only proves that nothing is assured. Moreover, the lower the risk, the lower the likelihood that creative change can occur. If, as many funders claim, we want our money “to make a difference”, it is important to remember that “difference” has to mean something will be different.

If that is true, we too have an obligation to learn how to extrapolate beyond that which is presented. But how?

This is where our field is moving in a healthy direction. There have always been some in our sector who have made it safe for potential or existing grantees to tell the whole story in honest ways, but not most of us. There have always been some in our field who know that those on the ground are more likely to understand real needs, especially in the realm of direct service/at risk populations than we. There have always been funders who have an understanding that funding the future means that some things we fund will [and should] fail, but too many still don’t have the tolerance for failure or the importance to endorse its legitimacy.

Many of the most welcome changes in the current climate in our field are attempts to address exactly these things. Initiatives such as “Trust Based Philanthropy” or “Listen4Good” or “Nothing about us without us” or the ongoing work of CEP are all very welcome attempts to rebalance. How do we as funders make it safe for grantees to tell us honestly what they need? How do we make sure that the direct stakeholders are the real beneficiaries of our intended largesse? How do we allow grantees to take enough risks toward much needed change that some will assuredly fail? These, and numerous other initiatives are pushing us as funders toward redressing gaps in our own practice and affect. The primary responsibility in making these adjustments is ours.

It is also true that not every nonprofit is guiltless. All of us on the funder side have seen organizations that have chosen to hide essential information, to reject thoughtful support as inappropriate intrusion, to be blind to their own failures, and to view us funders as inscrutably “different than us.” We as funders may have the primary responsibility to readjust our behaviors but we are not alone in this. Non-profits too need to learn how to listen – to words that may appear patronizing or distanced or judgmental or overly jargon-y, often presented in settings that are intimidating but are usually well-meaning and more often than not intended to be constructive.

All of us, yes every single one of us, has filters that align what we are told with “our own” reality. The real challenge, then, is not only listening but also knowing how to hear. Since affect and tone and setting and implicit biases [on both sides] can so easily distort, knowing how and what to absorb from feedback and shared information is a constant challenge.

As we know from so many other contexts, collecting data may be hard; interpreting that data is much harder. Creating strategies may be daunting; implementing them is much more so. And, listening may be hard; hearing is much harder. For all of our benefit, it is a skill worth learning.

#386 Black Lives Certainly Matter: Why, then, did these 2 people give me pause?

June 16th, 2020

Richard Marker

A few years ago, when the Black Lives Matter movement first arose, it was not uncommon to hear a rebuttal – “but don’t all lives matter?”

Most of those who responded that way were simply being dismissive [that is the most generous way to put it.]. However, some folks I respected really needed an explanation. They had been on the right side of activism and associations, and the last thing they could imagine about themselves is that they were participating in or affirming racism. Their genuine views were built on the concept that a society needs to be built around a vision that all are equal, have equal access, and equal opportunity. Their well-meaning but naïve response was neither malicious nor mal-intended.

Most of these folks got it after it was explained to them why the phrase mattered and, regrettably, needed affirmation from all of us.

It is now several years later, and the BLM movement has expanded – for terrible reasons. There are lots of articles and analyses about why now but suffice it to say that it isn’t hard to understand why we who are White once again need to affirm the message. Nowadays, when we hear the same rebuttal about “all lives matter” it might mean that one is genuinely clueless and doesn’t accept the truth of endemic racism in America. Worse, some don’t really believe that all lives do matter – that only White ones should. I have very little patience for either of those perspectives.

I was, though, caught short in hearing two people comment about how it made them feel. One was a First Nation/Native American and one was the child of Holocaust survivors. In each case, they wondered why their historic anguish wasn’t being recognized or, they felt, was being implicitly dismissed. Neither in any way tried to belittle the legitimacy of the BLM Movement, nor deny that it was way overdue. Their point was that they looked at their own history of delegitimization, of legal and illegal discrimination, of the death sentence that too often accompanied their ancestors, even their own personal experiences, and how easy it still seems for much of the US to not take their histories as seriously as they now seem to be taking the travails of Blacks. Their concern, separately articulated, was that as America confronts its shocking and shameful history of anti-Black racism and racist behavior, that their own narratives will be lost, and America’s empathy quotient will be used up.

Now – so that no one, absolutely no one, misreads what I am writing here – let me be explicit: this is the time for the message of BLM – it should not be diluted, delayed, or discounted. American accountability is long overdue and practices and policies that have allowed racism should be changed – yesterday. No one needs to make excuses for the profoundly effective and moving protests seen around the world, and no one needs to apologize for saying that this is the time.

If one looks at history, though, the concerns of these two are not misplaced. America’s shameful past toward First Nation/Native Americans must never be allowed to be ignored. And the resurgence of anti-Semitic acts in the USA accompanied by a frightening skepticism that there were really 6 million Jewish victims of Nazism demonstrates that the work is far from done. How does one honor those very legitimate concerns – especially as we look to what we want in the future?

When I lived in Chicago in the 80’s and early 90’s, I had the honor of being involved in a Foundation funded by the Chicago Community Trust charged with addressing intergroup understanding. One of my volunteer/leadership roles was to co-facilitate these interactions among young adults from many different religious, ethnic, and racial backgrounds. The experiences were instructive: when groups first got together, their first instinct was to view their own group’s histories in competitive terms: How many were enslaved? How many were displaced? How many were massacred? How prevalent is bigotry toward…?

That approach proved untenable as a way forward. Is there really a hierarchy of bigotry and suffering? Is that a viable or even an ethical way to have an intergroup conversation?

After a while, we developed an alternative approach: what experiences made each group and each individual feel vulnerable, fearful, or misunderstood? No one was dismissive of those feelings since they were so clearly genuine. They weren’t quantifiable. Sharing why they felt those fears led to both empathy and understanding.

However, something happened during those conversations that anticipated today in remarkably and sadly prescient ways. In every conversation, by the end, the sense was that the most vulnerable group was young adult black men. In group after group, we heard black males tell of walking down the street and watching people quickly cross the street to avoid them; we heard of being stopped by police for no reason, or being tailed by clerks in stores, or seeing people clutch their purses or briefcases on busses – or choose less desirable seats to avoid sitting next to them. Every single person who was not a young black male nodded in recognition – in every single session.

I confess I have no recollection whatsoever if we then had the data to confirm what we all now know to be statistically true: the inordinate number of deaths and incarcerations among this population. The real-life experience of being a young black male, of any young black male, is only confirmed by that data, but it was evident even then.

Those sessions led to profoundly greater mutual understanding and empathy. Once we shifted the conversation from “my pain is greater than your pain” to “let’s acknowledge that we all have reason to feel vulnerable” both the character of the sessions changed, and the mutuality of respect grew palpably.

However, what didn’t change was the facts. All of those legitimate vulnerabilities continue today, and given the current ethos and political environment fostered by the Administration, other groups can easily be added to those who met in Chicago 30+ years ago, and make a case for their own victimization and vulnerability. But young black males are still being targeted, victimized, incarcerated, brutalized, and murdered.

We learned in those gathering that one can transfer fear of the other to empathy. As we [hopefully] construct a more just society going forward, that message must prevail. And of course, it must apply to all who feel vulnerable. But even then the message was loud, clear, and poignant even if we didn’t yet have these words to tell us: Black Lives Matter.

#385 – I’m Not Traveling; Why Should my Money? The Surprising COVID-19 and Racial Inequity Dilemmas for Funders

June 15th, 2020

Richard Marker

NB: This was written but not published prior to last week’s announcement by 5 major foundations of issuing debt as a way to get more money to the field. In many ways, that extraordinary development only underscores the dilemma discussed here.

As you may recall, when the COVID-19 quarantine began, I extended an offer to any funder anywhere to provide a pro-bono problem solving session. This post in an extrapolation of some underlying themes that I have gathered from those conversations and from the slew of many articles on funding choices at this time.

What has emerged for me is an interesting challenge from funders of less than mega-means. Choosing where to put funds comes down to hard choices, and those who fund on the local level/place based, are particularly sensitive to the implications of saying yes and no. Yet over the last few years, many of those funders became aware of the need to address systemic issues and were more open to funding national initiatives, sometimes at the expense of place-based funding. [Please see #293, 27 Dec 2017 and #337, 26 May 2019 regarding the significant continuing role for place-based funding, even when a funder is fully aware that the local organizations being funded can never aspire to the excellence of world-renowned organizations in the same fields.]

I cannot imagine that any funder or foundation is unaware of the financial challenges facing all non-profits, and the catastrophic challenges facing some. [I recommend the very recent survey published just this week by CEP on the unevenness of funding at this time.] Surely all funders know that their long-time grantees are in need. And, hopefully, every funder is aware of at least one local collaboration to address the massive local needs – even if that hasn’t previously been a core priority.

Moreover, it has been gratifying to see that hundreds upon hundreds of funders are learning that this is not a time for complex reviews, clever new initiatives, and burdensome reporting. It seems from the data that I have seen reported by others and anecdotal [no claim that it is scientific] evidence, most funders have either sent more money out the door, plan to spend more this year, or have committed themselves to funding new or ongoing needs in the next grant cycle.

Most of this is local.

At the same time, never has the need for systemic redress been more glaring. The funding community had been coming around to understand that band-aid type funding of societal needs of all sorts is far too short-term and nearsighted. Acknowledgement of the role of advocacy, providing support for national organizations addressing systemic issues, and seeing how existing funding aligns with underlying systemic needs has finally been high on the agenda. Both the pandemic and the BLM moment have starkly underscored the validity of those needs.

However, I am hearing, given how massive the local needs are, how can one justify diverting resources from “here” to “there”? Shouldn’t that be the job of the deepest pocketed funders whose focus is rarely place-based directed? Even if “woke” to the needs, perhaps this is the time to pull back from those national initiatives to focus on this place? After all, the putative systemic issues are visible right here – on our streets, in our schools, in our neighborhoods, in our policing, in our healthcare, in our workplaces.

I don’t disagree with the logic of this thinking, and for many it is a very valid way to go. But I also want to remind of the importance of not losing a connection with the groups with a larger and summative perspective, whose expertise allows alignment between current urgent need and optimal policy so that local funders don’t inadvertently reinforce counterproductive systemic causes, whose analyses of experiences elsewhere might provide a more laser focused use of local funds, and whose understanding of the political landscape might provide leadership in much needed policy reform.

Perhaps a single example will illustrate – and please excuse that this is a summary that elides some important local details: A couple of years ago, not long after we moved to the DC area, the government was shutdown for an extended period of time. The shutdown was felt throughout the country but, not surprisingly, hit the DC area hardest. Many in the local funding community stepped up with a variety of palliatives to alleviate very real hardships faced by many thousands of furloughed government employees and contractors. When the government re-opened, a meeting of many locally based funders was convened to address lessons learned. At the meeting, I [still a newcomer] asked if there had been any conversation with or utilization of material prepared by the Center for Disaster Philanthropy. To my surprise, no one in the room had heard of the CDP. As the local funders listed all the things they had learned and their commitment to document those learnings, it struck me that they had spent a long time largely reinventing the wheel – when, in fact, they could easily have adapted many of CDP learnings from many other natural and human-caused disruptions.

It is true, of course, that all politics is local – and most funding for many funders is and should be local. But just as local politics does not and cannot address systemic issues without national policy change, so too local place-based funding without a connection to the larger context in which we operate is insufficient.

Many of us would like to hope that the societal lacunae exposed by COVID-19 and by endemic racism will make this the time to finally address the systemic in real and transformative ways. So, while we absolutely must increase our support for and engagement with our local communities, we do need, as well, not to lose sight of the knowledge and wisdom that can come from continued engagement with organizations and affinity groups that extend beyond our own backyards. It need not be “either/or” but should be “both/and”.