Posts from the ‘Trends’ Category
August 14th, 2019
In reviewing posts from the earliest days of this blog, I came upon this piece from January 2008. I invite readers to decide how accurate I was – or wasn’t – 11 1/2 years ago.
This entry is in response to a request from Trista Harris of “new voices in philanthropy” to address this issue. It is also cross referenced on their blog.
In addressing the future of “philanthropic foundations” one is tempted to recall the most quoted generalization about foundations: “you’ve met one foundation, you’ve met one foundation.” While still true for some, it is frankly not as true as foundation folks used to believe. Fads in philanthropy and herd mentality are as evident in our world as in any other. Therefore a few generalizations:
August 8th, 2019
If one reads some mailings from our field, from some of our grantees, and from all too many wealth advisors, one might think that philanthropy was and is a byproduct of the US tax system. It wasn’t and isn’t.
It is not even an American invention, as any scholar of religion or ancient history or anthropology can attest. There is no known society that hasn’t had some form of philanthropy or charity or voluntarism, and, for hundreds of years, much of this has been done in structured ways.
But it is true that in America there has been a long-time fascination with the giving history, practices, ethics, and lifestyles of the very wealthy. Their names and the recipients of their largesse with which their names are associated are the stories of legend and fascination. The quirks and foibles and philanthropic aspirations of the Astors or Carnegies or Rockefellers or Fricks or Rosenwalds – or more recently of the Gates or Buffets or Helmsleys or Adelsons or Kochs or Schwartzman or Bloomberg or the Chen Zuckerbergs captivate the attention of many of the remaining 99.5% of society. Their large gifts inspire admiration or anger or jealousy or awe – sometimes all at once.
If one isn’t careful, one may think that these stories are the story of philanthropy in America. But they aren’t. Or to put it more accurately, they are not the most important stories in American philanthropy.
After all, there have always been superrich – royalty, aristocracy, nobility, landed gentry – who controlled resources and people’s lives. One can cross the ponds on either of our shores to see that. [Let me be clear that I am not a fan of the unconscionable divide between the ultra-high net worth beneficiaries of an unjust system that we have in the USA, only that such wealthy people have existed in many places for a long time.] Indeed, what distinguishes American philanthropy is the willingness of the average person to give of his or her own means. The institutions of philanthropy, on the whole, are reflections of that willingness.
If one looks at the American system, voluntarism was the way in which fire departments were developed. Libraries were early attempts to democratize literacy – funded by voluntary contributions. Hospitals, certainly those that existed before the last century, were almost universally begun and supported by faith based or ethnic defined populations, not by taxes or insurance. Even education in general is still not perceived by many as essentially an obligation of the society [read “government”] – leading to massive personal debts for higher education and the controversial charter school movement for the El-Hi levels. But the policy implications of those realities were not typically front-page stories but relegated to academia or field of interest groups.
Therefore, while philanthropy infuses everyday life, for most people it has meant voyeuristic sightseeing of the lifestyles and largesse of the very rich and powerful. They distinguished it from their charitable giving at Church or rent parties or little tin charity boxes at the corner store.
Something has changed and it is important, I think, to talk about those changes and their implications.
1. Unintentional to intentional. As a rule, it is fair to state that philanthropic behavior, until this century, was the unintended consequence of public policy. To take only one example, the safety net of social security permitted funders to, implicitly, feel that there is no requirement that personal giving is the only place at-risk populations can turn. It meant that a funder might well choose to redirect his or her giving to other causes of more personal interest. Another example is the almost universal dependence of public schools on private funding for their arts or cultural activities or class trips. In other words, municipalities no longer feel the need to build in funding for these activities. It doesn’t take much imagination to see that those municipalities with wealthier parents and alumni are likely to provide more co-curricular opportunities than those in poorer areas.
That began to change incrementally during the time when taxes became a dirty word, but the intentionality became very overt during the Bush-Cheney presidency. For one example, after the disastrous and deadly Hurricane Katrina, the first response was not government mobilization but rather the mobilization of Bush Sr. and Bill Clinton to go raise private funds. The tragedy of that approach has been well documented, but for our purposes, it was an important statement about that administration’s view about which sector had what responsibility.
Since then, the role of philanthropy has been a part of every policy and budget decision on the federal, state, regional and local level. It serves to give philanthropy too much power, and, ironically ,far too much responsibility.
2. The democratization or, perhaps more accurately, the anarchization of philanthropy. One can be stopped on the street, sitting at dinner, opening the mail, watching late-night tv and sure enough we’ll be solicited. And because of how easy it is to start fundraising campaigns or to quickly put up websites, many people find it desirable to give directly, and seemingly, without overhead.
Some of this is very welcome. Giving Tuesday has institutionalized on-line giving and has had a huge impact around the world. A thoughtful individual funder can utilize readily available info from Guidestar [now Candid] or many other accessible and free sites. Doing so may or may not lead to wise giving but is likely to reduce the chance of being scammed. And for those with shallow pockets, it can be very gratifying to support a classroom outing in the US or a village seamstress in Africa rather than have those limited funds go through the purported bureaucracies of intermediaries. Of course, there are scams, there are scandals, and there are predators so the disadvantages of anarchized philanthropy is that it may be hard to be sure that one’s money is going where it is promised especially for those who haven’t yet been taught about how to do it best.
Nevertheless, we are still at the early stages of this technology and the systems to support it and it isn’t going away. It is a game changer, empowering all to make the kinds of direct decisions previously reserved for the few.
3. The concentration of wealth, the sheer size of some gifts, the growth of private/public funds under DAFs all have forced the issue of equitability and equity onto the table. Aside from the tax issues referred to above in 1, there are issues of altruistic folks of privilege determining what is best or irrelevant for those who have less and also of the legitimacy of wealthy folks using their foundations and private giving to distort public policy. There has been a slew of recent book-length commentaries on this issue. Their attitudes range from the essential fallacy of a system that depends on voluntary giving to an attempt to rebalance what philanthropy can, legitimately, be expected to do. What is relevant to us at this time in history is not that there are authors exploring and challenging philanthropic behavior – rather that those authors and those books are getting attention beyond our highly gilded sector and getting read widely. [In this piece, I am not addressing some of my own opinions on this since I have done so in numerous other opinion pieces and in public talks elsewhere.]
4. The emergence of “philanthropy adjacent” approaches available to many. This emerges out of a convergence of some interrelated but separate trends. Here too, I am not necessarily endorsing the underlying thinking behind some of these trends, only articulating them:
a. One emerges from an underlying skepticism toward the NFP sector model’s ability to succeed. This approach argues that without a motivation for personal gain, the creativity and long-term commitment to make real change can never be sustained. Therefore, the real solution to long term societal challenges is to develop alternative models where the owner or investor can “do well by doing good.”
b. A corollary of that is the recognition that most ngo/nfp organizations can never have access to the capital necessary to reach the scale to have the impact an “investor” would demand – that traditional “donors” might not. For-profit business, even when B-corps or ESG approved, have access to capital markets that the nfp/ngo sector doesn’t.
c. Foundation and other funders come at this from a somewhat different direction. Why, they ask, should only our philanthropic giving reflect our values? If we care about smoking or societal equity or the environment or food insecurity, we should find ways of aligning what we do with our investment money with the same underlying values that we apply to our giving. Impact investing and values screens are increasingly viewed as mainstream.
d. As many of the major investment firms offer some “values based” funds available through their retirement menu, the average investor now has options previously available only to those with deep bench investment advisors.
5. Systemic thinking has forced funders and policy makers to recognize the interconnectedness of so many elements of what must be fixed. A program grant to a local organization may be very useful but it is highly unlikely to get to the source of the problem. Government SNAP programming is by far the most efficient way to address food insecurity in the USA, but it cannot, alone, eliminate the continuing need. Voluntary clean up of a river will be satisfying but unless there are enforced policies about what is dumped into that river, edible fish are unlikely to return.
Understanding of systemic issues requires an ideological and political commitment to some forms of “intersectionality”. Opinions diverge about what that should mean. For some, the word implies a mandate to think broadly about how all decisions are interconnected. For some others, it means “with us or agin’ us.”
Globalism is another component of the systemic. Despite some misguided political voices these days, there is no such thing as a fully independent national economy or polity, and certainly no border protections from environmental degradation. Those in the philanthropy world who are committed to addressing the “systemic” need inevitably to address the “global.”
6. If philanthropy has moved into society’s zeitgeist, there is a danger that there will be two very problematic long-term responses:
a. That the visibility of foundations and other large giving will mislead people to think that private philanthropy can ever adequately replace public responsibility. As many $Bs are given buy very generous citizens, those dollars are a mere percentage of what an adequate tax/public system should and can provide. In an anti-government era, this would be disastrous since having human services depend fully on voluntarism would condemn millions to hunger and illiteracy and more.
b. That the attention to private philanthropy will lead to severe restrictions on it. The “closing of civil society” seen in so many places around the world, including the USA, might limit all citizens from exercising advocacy and free speech rights we should still cherish. Philanthropy should indeed be subject to a certain public interest transparency, but we should work very had to make sure that independent decision making is not restricted along the way.
Some have argued that we are living in the second Golden Age of Philanthropy. If one argues only from the perspective of UHNW giving, that is true. But in many ways, as the focus of philanthropy moves from aspirational voyeurism to more normal behavior and attention of the many, I would argue that such a characterization misses the point of how radically these changes are . I use the word Zeitgeist to suggest that philanthropy is one of the defining topics of our era in ways never imagined before.
June 20th, 2019
The Giving USA report confirms what everyone thought it would – giving is down, about 1.7% That is indeed real money and affirms what the non-profit advocates and philanthropy sector warned would happen with the tax changes that went into effect last year.
There are plenty of articles analyzing those numbers, and they are real. And the dollars are real. And they matter a lot to many non-profit organizations, especially smaller ones that are typically undercapitalized from the get-go. They truly need every penny.
Why, then, is the reduction in charitable giving not my [major] concern?
There have been blips in charitable giving every single time there has been any change in the tax code or tax rates. Sometimes those changes have boosted charitable giving and sometimes they have depressed it. But, over time, charitable giving seems to revert to a mean. In other words, tax changes have served to influence when something is given more than if. If one looks at a long-term giving pattern, it is far too early to know how significant the non- itemization will be for givers of modest amounts. My own prediction is that there will be a gradual return to the mean since Americans seem to have internalized giving as a normal thing to do.
But, that doesn’t mean that there are no red flags, and I believe that those red flags are far more significant than the short-term drop in giving:
1. Despite the claim of a healthy economy, middle and lower middle-class incomes have not yet come close to replacing the buying power those earners had a generation ago. Fewer have reliable health insurance, employer sponsored retirement plans, job security, and can afford college tuitions. Even incremental and long overdue wage increases don’t come close to closing that gap. The amazing thing is that voluntary charitable giving is keeping pace at all [other than by the very wealthy whose proportional wealth has skyrocketed and should be ashamed of themselves if they haven’t increased their giving as disproportionately.]
2. The deep-seated distrust of institutions is cataclysmic. Nonprofits may fare better than some other institutions, but they are not exempt from this distrust. One still hears too many people believing that non-profit people are either lazy and inefficient or that they are secretly making a profit off others’ largesse – or both. All of this distrust has profound and frightening implications for civil society as a whole. Of course, it impacts charitable giving but more so, it erodes the fragile network that allows civic engagement and community organizations to provide such an important role.
3. Even if charitable giving were to rise, it may lead us to a false sense that all would be well. It wouldn’t be. The charitable sector cannot be expected to replace public funding for health care, education, retirement, food safety, children’s nutrition – and so much more. Under the horrendous rhetoric that taxes are bad so cutting them is good, we are paying the price of taxpayers no longer paying for what we should be paying for. Until we reverse that terrible governing [or, more accurately, anti-governing] principle, and develop a more rational, fair, and responsible system of taxes that people feel are appropriate, reliance on the voluntary sector will be a fool’s mission. That is not to suggest that there will not always be a role for the voluntary sector but that this increasing reliance on voluntarism to do what an underfunded government doesn’t won’t get us out of this mess.
Taxes are a reflection of where we think public funding should be. Most of us care about more than roads and bridges [would that they were properly maintained]. And we care about more than police and fire and EMT folks [even when they sometimes need some serious equity training]. I believe that the vast majority of us care about the health of our food and our children and our air and our water and our old age…..
When we recognize that being a responsible member of any society requires that we pay our fair share for those things, and we pay for those through a fair and reasonable tax system, we can begin to return to our question of charitable deductibility and voluntary contributions. When that happens, I will be first in line.
Until then, count me among those who are advocating, as loudly and persuasively as I know how, to build a society and government that honors the needs of all with integrity and dignity.
I will continue to be an active volunteer and to put my charitable money there as well, but the shortfall in that as reported by Giving USA isn’t the grievance that anguishes me. Irresponsible, shortsighted, dystopian public policy is.
June 19th, 2019
As with so many of my colleagues in the philanthropy world, I have been involved in the “complete count” effort regarding next year’s USA national census. This involvement was a national attempt for our sector to help correct for historic under-counts of lower income and other marginal populations. Since those numbers have a 10-year implication for allocation of federal funding, representative apportionment, and more, this has been seen as a commitment by the philanthropy world and the organizations we support to equity and equitability. Our involvement was never understood as a partisan or political involvement, but rather a sector-wide role to do something that should have been politically neutral to support a constitutionally mandated action.
Why then did a foundation program officer demur about taking a public position on the census after a profoundly moving day bringing hundreds of local stakeholders together. Her argument: her board won’t take “partisan” positions.
The 10-year census is constitutionally mandated. It was never intended to be “political” but rather an objective tool for democracy to function at the most equitable level. And while certain populations have notoriously been undercounted, that has never been because of purposeful interventions by politicians. [I acknowledge that those undercounts may have been unintended consequences of inequitable public policy but not purposeful.] Yet in this go-round, we now know unequivocally, there has been a systematic attempt to co-opt the census process for overtly partisan purposes. As of this writing, there is still the faint hope that the Supreme Court will honor the intent and history surrounding the census and disallow the last-minute citizenship question imposed by the current administration. But the damage is done and far too many fear the government and don’t trust the data gathering. And the fact that this foundation staff person felt an implicit restriction is only one of the signs. It wasn’t supposed to be that way.
Some months ago, a parent of one of the victims of one of the all too many school shootings [for which the USA should be ashamed and angry] bemoaned that talking about rational gun policy has become “partisan”. He himself was a lifelong Republican, but the very fact that he tried to discuss his concerns with Republican politicians about this branded him as not one of them. He thought he was discussing policy but the party with which he had always identified has defined the very discussion as a partisan issue, and he was on the wrong side. He was furious and frustrated.
Since their inception, there has been a debate about how porous our social safety net of Social Security and Medicare should be. But let’s be clear: Social security and Medicare are mandated contracts with all American workers. Everyone has money withheld and contributed throughout their working career with the assumption that the government will honor its contract and provide what they [we] have every right to expect. Yet many in a single party now try to argue that it is not a contractual obligation at all but simply an annual gift that can be discontinued or privatized or reduced at their will. These politicians have made this a partisan matter and not a discussion of genuine ethical public policy.
Any reader, I am sure, can add to this list during this dismal era in American politics.
What are we as funders to do? Most foundations have a history of choosing to be overtly and explicitly non-partisan, often restraining from legal and legitimate advocacy since they don’t want to appear “partisan.” The danger, of course, is that as certain political forces try to make every matter of the social weal and public policy to be no more than a partisan divide, it can serve to intimidate and limit much needed public discourse on policy and civil behavior, and to silence some of the most educated and thoughtful independent voices [including but not limited to us].
Those of us in the philanthropy sphere must resist this willful usurpation strenuously. All of our work is in dialectic with public policy, and we have an obligation to help formulate public policy with a vision of an engaged and enfranchised populace. Just because one party chooses to make policy discussions “partisan” does not mean that we must yield to that. It is demagogic and violates the intent of the Constitutional system under which we operate. Sadly, it incurs a like reaction by the other major political party. When every issue is “us vs. them”, with only political winners or losers, public policy, civil society, and the very nature of what America stands for is radically harmed. The American ethos is the inevitable loser – even if a few, a very few, will win.
To be sure, there are legal limits to our role in the political process – certain lobbying is not permitted for private foundations, but much more is permitted for public charities. As a rule, though, advocacy for policy that is not related to a candidate or pending legislation is not lobbying and is permitted by all. It is not partisan to have an opinion and point of view, and the philanthropy world should be a clarion and courageous voice in the face of the purposeful “partisan” divide in this country. We must never allow our voices or those of our colleagues to be stifled. Those of us who have important leadership roles in public discourse must never feel intimidated by others’ partisanship for us to exercise our forceful, thoughtful role in the public sphere.
It is not only our right; in this misanthropic era, it is the only right thing to do.
May 26th, 2019
I wouldn’t be writing this if I hadn’t observed it on a number of recent occasions in philanthropy settings. [As readers know, I try to write these pieces so that individual funders or foundations are not easily identified, so the examples below will be, purposely, devoid of identifiable specifics. But they are real.]
In our field there has been a very healthy discussion about the best ways to use our voluntary resources, including our philanthropic dollars and leadership roles. That is always appropriate, never more so than in this misanthropic political era. None of us want those precious resources to be wasted, and most of us recognize that there are persistent systemic issues that beg our attention.
Many funders, either for reasons of habit or because they have carefully determined that it is the best for them, focus all or most of their resources locally. Place-based philanthropy is surely as old as any philanthropy, and most of us can see needs right in front of us if we choose to look. However, rarely does that local funding rise to the level of systemic solutions.
If one reads much of the current literature, one may feel that such local funding is inadequate or ill spent or simply irrelevant. It isn’t. For even if we were to determine that we know exactly how to solve huge systemic issues such as education, health care, poverty, climate change, etc., the only way that happens is if there is an on-the-ground component. People need to be healthy, not just the health care system. Children need to learn, not just school systems. People need to practice good environmental practices, not just through the EPA [when it is allowed to do its job!] That all happens to real people in real places, all of whom are, by definition, somewhere- that is local.
Let me be clear and reiterate what most of you know: I am a big believer that social and systemic change requires advocacy, big picture thinking, and a commitment to equity. Classic philanthropic giving alone won’t cut it. But I also know that it can only work through implementation, on the ground, locally.
However, what I recently discovered, to my surprise, is that many funders, yes, even some well-staffed foundations, still don’t see the relationship of their local funding to a bigger picture. They have decided to fund locally and act as if that place is a closed, self-contained system.
For one example, I recently was present when a group of funders were reviewing their reaction to a very genuine local disaster/crisis. Their compassion and generosity were beyond reproach. They did good things, their thinking was right on, and they developed some short-term very effective responses. What surprised me, though, was that they had gone through the entire process, and were about to extrapolate long term implications, without anyone in the room having heard of an organization that has already developed best practices through many disasters and has examples directly applicable to the community in question. It wasn’t my imagination, because when I mentioned that organization, everyone in the room confirmed that they hadn’t heard of it.
It was a classic example where localism had, unnecessarily, led to isolationism. It might be disappointing if a single funder had acted and thought that way, under the assumption that no one knows and understands their “place” as well as they do. But when a group of funders and foundations, some of whom were quite sizeable and staffed, acted that way, it troubled me.
Another example of this is the tendency of some affinity-defined groups to see themselves as unique. “Our… [choose one: religion, ethnicity, political history, race, gender, …] is not like others and, just as others cannot understand us, so too we need not learn from others.” I have previously written about the “with us or agin’ us” tendency of intersectionality, but here I am speaking about the tendency of some funders within these groups to mirror an isolationist tendency in their funding decisions. Why learn from or collaborate with others if we don’t feel that they can understand our uniqueness.
Lest anyone misconstrue what I am trying to say, I want to categorically affirm that there are distinct challenges to every affinity-defined group and there are indeed legitimate special interests and concerns that should be factored into all sorts of areas, including funding. At the same time, there are generic issues of decision-making and ethics and equity and systems- change that transcend those distinctions. It is not, and should not be, one or the other; understanding both the distinctive and universal at the same time is absolutely crucial.
One of the reasons I began to be an educator of funders in 2000 was my impatience with the field’s mantra at the time: “You’ve met one foundation, you’ve met one foundation” – usually stated with a self-satisfied chuckle. One doesn’t hear that very often anymore because the world has changed: There are more affinity groups. There are more on-line resources. There have been more articles in the mainstream media about our field. And there are more educational opportunities. Even those who may choose to fund locally or idiosyncratically are fully aware that there is a field, there are substantive things to know. [I am not so naïve to think that everyone joins those groups or takes those courses, only that working in isolation is now a choice, not a default.]
There is, as well, an implicit and important mandate for local or place-based or affinity-defined funders to take the larger picture seriously. Just as it is impossible to actualize systemic change in the abstract, so too it is impossible for those funders committed to systemic change to make good funding decisions if they don’t fully see how those decisions work- or don’t. Place based funders hold vital insights and actionable data that needs to feed into the policy and systems conversations. Some few situations may very well prove to be too idiosyncratic to be useful, but most local funding situations are reflective of larger challenges. How local funders answer those questions of learnings, provide information on what worked and didn’t, and participate in a dynamic dialectic on those issues can make the difference between moving toward real change vs another “big bet” gone sour.
In other words, funder isolation is counterproductive in both directions; place-based and affinity-defined funders can – and many do – learn from emerging practices and systems thinking; and big picture funders can – and many do – learn from those on the ground.
Place-based and affinity-defined funding will always have a place. Systems funders do as well. Neither should work in isolation even if they choose to fund only within their sphere of commitment.
Good philanthropy requires no less.
April 1st, 2019
This was first posted on 21 March. Apparently a tech error prevented it from being disseminated to all subscribers.
I was a third generation “legacy” attendee of an Ivy League school. Growing up, I don’t recall too much uncertainty about whether I could go there – only if. We attended football games, my family made annual gifts [although, admittedly, there are no buildings or chairs bearing the family name], and I knew all of the school songs [do they still do that?]
My subsequent career has, I am proud to say, justified their acceptance, but I daresay, looking back, I would have been a marginal applicant today. It is my suspicion that the admissions committee did not have a heart to heart about my capabilities; rather, I was a “legacy; next application…”
In those days, that kind of legacy was sort of assumed. It rarely required an affirmative or expensive buy-in. It was the privilege that accompanied privilege.
We didn’t think about that too much in those by-gone days. I became more aware of it during the 11 years I subsequently spent teaching/working at a different Ivy League school as the world began to change and last names more readily attracted attention. But so did proactive “diversity”. There was the sense that whatever favors names or money or national origin or color brought, they were capable students who just happened to have a leg up in the ever more perverse and competitive admission process. [Along the way, I learned that there was a lot more inscrutability to the process than how much money someone had.] [My son and my nephew chose not to attend the family legacy school, so it is left to our 3-year-old grandson and his cousins to, perhaps, resurrect the chain. But that is a long way off – a good thing given the current financial realities. And only incidental to the remainder of this post.]
In any case, over the past days, there have been millions of words written about the admissions scandals – legal and illegal – in American higher education. What concerns me in reading them is that too many of the op-eds and government responses focus on too narrow a question. Here are some of my responses:
• Let’s be cautious about passing new laws regarding endowments and tax deductability. Bad cases make bad law and too quick a “fix” may saddle us with even bigger problems for both philanthropy and education. Both need fixes – but not headline-driven patches.
• I am struggling with the all too thin line between illegal bribery and legal influence buying. Of course, there is a difference, but they reflect deeper systemic issues that encompass both.
• Underlying the bribery is the reality that that not all favored admission is to the wealthy; it is, though, to the wealth of the school Athletes bring a different financial value to a school. All one has to do is look at how much a university nets from a bowl game or a March Madness slot.
• There is a real issue of what the true meaning of education has become. Here is a case where a very dated marketing device to encourage higher education has come back to bite us: Starting in the 50’s, students were encouraged to attend higher education to enhance their earning ability; true and fair enough. But when earning ability supersedes critical thinking and education as a deep-seated societal value, it loses something. [I needn’t belabor this point: We are paying the price today in the character of public discourse, the absence of critical thinking, and the horrendous lacunae of basic knowledge by too many in the USA.]
• This leads us to the challenge to and of education. We have an ethically abysmal system. Even moderately upper middle-class families cannot afford most elite higher education, and lower middle class are even priced out of State schools. And if one takes a look at the shocking attempts to defund and privatize El-Hi education as well, we have a profoundly cynical approach to the concept of civic obligation toward an educated and literate populace. [I am reminded that Thomas Jefferson and Benjamin Franklin created the first free library out of a belief that a democracy can only function if the demos is literate! How far have we fallen from those ideals?!]]
There are few public policies more transcendent than that of education. With the erosion of the commitment to a thoughtful and thinking population, combined with the sense that, at least at the higher education level, it must be bought, we have a much greater problem than a few wealthy people securing their place in a social caste system.
Philanthropy does not have clean hands in this. After all, the largest gifts typically go to the already wealthy institutions. And while a few outliers like Michael Bloomberg may have committed a 10-figure gift toward scholarships at his own elite alma mater, one has to look very long and hard to find equivalent 7, 8, or 9 figure gifts to the institutions a bit lower on the class scale, but perhaps no lower on the teaching one. Our field talks a lot about equity, power, and the challenge of privilege, but it is rare indeed that our largest investments go to the kinds of investments and grantmaking that redress those societal needs.
More than anything, education needs a major adjustment in public policy – more resources, more affordability, and more genuine commitment to critical thinking. No question that philanthropy can never and should never be expected to do that alone. What we do have is an obligation to make sure that we are using our position of suasion and our resources in ways that narrow the caste, wealth, and learning gap.
If not, we may be sure that Varsity Blues type scandals will continue to cast a harsh light on our privilege.
March 4th, 2019
Tsk, tsk. No, not that kind of confession. And even if it were, none of those youthful indiscretions would rise to the level of what in normal times should be the basis for appropriate exclusion from the Presidency or Supreme Court. Read on anyway.
In the close to 20 years I have been teaching philanthropists and foundation professionals, it has been rare indeed to find any session with more than a handful of men – of any age, race, ethnic background. And when one removes the principals, I.e., those who made or control the money, from the statistics, the numbers of older white men can probably be counted on one hand.
Over that time, it was never surprising to find a seminar populated only by women, and that is also true when I speak to or attend regional associations and other affinity groups in our field.
There has, though, been a noticeable change over those years: more people of color, or of differing national origins, etc. are visible, so from an optics perspective [both meanings of the term], the philanthropy field seems to reflect diversity – albeit a clear gender majority. It is no exaggeration when I report that I am often the oldest, and often the only, white male in a philanthropy room.[Admittedly, when I have had occasion to work with foundation boards, the mix of trustees does not typically reflect that diversity, although gender balance does seem to be well on the way to parity.]
I write this as our field attempts to deal with an interlocking and complex reality – both internally and as to our larger societal role. By definition, those of us who are in a position to give money away are privileged. For those who have or control the money, that privilege extends far beyond the foundation or grantmaking space; but even for those whose background and resources may be less advantaged, the very roles we all play put all of us squarely in the privilege space. The challenge is how to properly, ethically, and effectively account for that privilege in our decision making, our empowerment of others, and in our relationship to the larger world, some of whom are grantees. If one reads the emerging literature from many others in the field, it will never be simple as long as one accepts that there is legitimacy to having independent funder entities. [Even if one advocates the elimination of those entities, as some do, it is not automatically obvious how one decentralizes and empowers decision making and resource control.]
A bit of autobiographical context. [if that is not interesting to you, please skip the next part.]
I am old enough that I grew up at a time when everyone was either a WASP or a WASP wannabe. There were Catholic WASPS, Jewish WASPS, Black WASPS, what used to be referred to in those days as “Oriental” WASPS. We all dressed, and often spoke, as if we were prepared to take our place in the Manor, or its representative law firms, clubs, and white shoe investment firms. And even if one didn’t quite make it into those circles, every one of the other firms and clubs acted as if they were of that class.
This was a reflection of a time when America was viewed as a melting pot leading to a desired homogeneity – the unstated ideal of which was upper class-ish, Anglophilic, sameness.
I graduated college in December 65, so my undergraduate experience fit that mold. But the culture changes of the mid-60’s challenged all of those assumptions about how we acted, dressed, and affiliated. Suddenly it was cool to be African American – so much so that lots of white males sported Aftros and spoke in Afro-slang. Liberation movements of all sorts – religious, ethnic, gender, national origin, led to changes of attire and décor. Alternative careers were celebrated, along with alternative life styles. Bras were burned, and jeans replaced 3-piece suits. Suddenly everyone was something other than that dreaded milquetoast WASP.
The halcyon days of everyone being an establishment alternative didn’t last long. Soon there was a palpable competition for whose group had the greatest historic grievance. “My group’s suffering was greater than your group’s suffering….” Anti-establishment morphed into siloed diversities.
It is no exaggeration to say that the USA was never the same. Mostly for the better – ]although some of the reactionary responses at this moment in history, emboldened by unconscionable words and behaviors of this administration, should make us all shudder!]
Laws have changed, Hiring has changed. Our vocabulary has changed. Our social realities have changed. And any further discussion needs to, at minimum, acknowledge those changes – even if nowhere near adequate or complete. Nevertheless, how to actually account for that diversity in the centers of power has been elusive. Tokenism, on the whole, has been the response of choice, and, even today, still is in too many settings.
Many well-meaning folks of privilege tried to compensate for that by developing approaches that, in retrospect, can only be called patronizing. To take but one personal example: When I was working/teaching at Brown University in the 70’s, the school had adopted – for want of a better term – Tougaloo College in Mississippi. Brown is as New England establishment Ivy as there is; Tougaloo is an “historically Black Southern College.” Many faculty, myself included, made symbolic visits to teach short term courses. All of us meant well, but were our efforts little more than patronizing exercises in privileged white folks modeling another life style? 40 years later one looks at things quite differently. [For the record, the Senior Chaplain at Brown, Charles Baldwin, did much more and deserves posthumous credit for it. He helped fundraise, coached top administrators, participated with their board, and exhibited a long-term commitment that rose above the self-critique I am applying to most of the rest of us.]
In any case, these times don’t allow that kind of tokenism or patronizing – certainly not in our world of philanthropy. Many [most?] of our field have progressed from know-it-all exhibition of power to an acknowledgement that we haven’t been as smart as we thought. After all, if we had been, illiteracy, homelessness, hunger, poverty, xenophobia and so much more would have become relics of a long-gone era. We have learned that there are lots of folks who know at least as much as we do, or more, about how to implement the kinds of changes we want to enable with our funding.
Over the years, our field has been trying to figure out the best ways of getting that knowledge into the decision-making rooms early enough to make a difference. Hire field of service expertise? Create slots on grants committees for representatives of the served population? Enable safe spaces for grantees to share feedback and assessment with and about funders?
Should that extend to governance as well? Can any funding entity credibly fund in a community or field of service or an at-risk population if none of those folks are in the rooms of decision-making power?
Notwithstanding the serious and cutting-edge work by several prominent organizations in our field, which I applaud, this is never easy. Empowerment of others is hard enough when there aren’t class or racial or ethnic or gender divides. [Ask almost any businessperson.] It is especially hard when our funding catchment includes many of these populations and there may only be space in the boardroom for a very few. The challenge is: can “privilege” be extended with surrendering it? It is not simply an organizational question: it involves social, economic, and many other divides and for all the “metrics” that we can develop, it will always be challenging.
Which brings me to my “confession.”
I have learned that age-ism is real.
I first experienced it when I was 57 years old and was being aggressively recruited by a search firm to be the next CEO of an organization. I was never interested in the position; it would never have been right for me. But I did know someone who was absolutely perfect for the job and told the head hunter of him. His response: “we know of him, but we are looking for someone younger”. That is an exact quote!!!
I told him that the person I recommended, and I were the same age; why was he pursuing me? His response: “Oh. We thought you were younger.”
While flattering, it was a surprising and pretty direct truth that slipped out. As I have become older, I see that the issue is real. There have been speaking gigs and advisory contracts where the choice went to someone much younger, and of a different gender – and have been told directly that age and gender were the reason. When that starts happening more than a couple of times one sees a pattern. If I once had the privilege of an elite education and background and a record of prestige positions, I was suddenly in a less desirable class.
But, before resenting those experiences, I do have to catch myself. Once upon a time I was the wunderkind and was the “youngest” or “first” to do lots of things and I was able to do so because of the advantages I started with. It would be wrong to resent someone else having that turn.
What I and we must never forget is that far too many have never had access to those positions to lose. My own experiences may enhance my empathy but must never be allowed to blind me to those who look at power, privilege, and position from the outside looking in and can only imagine what it is like. As philanthropists, we need to find ever more ways to open the doors and not just the drapes.
#335- The Challenge of Professional Collaborations in the Philanthropy World: A Contemporaneous Example
March 1st, 2019
Next week, I will be privileged to co-present a webinar for The Chronicle of Philanthropy on the topic “How to Craft Gift Agreements.}
The webinar was organized by the Chronicle and will include a senior development officer representing the view of non-profits, and me – representing the view of funders. In preparation, we have considered many areas that our respective positions and perspectives bring to the table.
The underlying assumption of the webinar is what happens after a funder decides to give – not where the money comes from, not [necessarily] what led to the decision, but what happens now. how does that agreement get articulated, who has what responsibilities, and what will happen in the future?
Underlying my part of the presentation is the concept of “exit strategies” – when funders decide to give a grant or gift to any organization, part of their decision making should include what will make them feel that this was a successful grant, and the grant/gift agreement should reflect those conditions. Clearly, there must be mutual consensus that these expectations are do-able, and consistent with the scope of funding and organizational capacity. [Tune in for more details.]
My co-presenter, Felicia Murphy-Phillips, is a very seasoned and senior development expert who has tremendous experience in this area – with a scope of knowledge that should prove very helpful to her fellow development professionals who may fall into the trap that getting the funds is the end of the process. My part will share insights into the thought processes of funders, and, for funders who may be attending, how to fine-tune their own thinking.
I write this now, not as a publicity for the webinar since, without question, the reach of The Chronicle is far beyond my own, but to comment on an unanticipated on-line conversation related to this webinar.
Some wealth managers, looking only at the title, viewed this webinar from a very different vantage point. From their perspective, they presume that it is to be about the funding vehicles that accompany or enable a “gift”, such as different kinds of trusts, or the tax savings that may accrue. In other words, their professional perspective on philanthropy is not related to the perspective either of us presenters will bring to the table.
Now, admittedly, where the money comes from and how the financial component is structured matters, especially to the recipient organization. [and it will be alluded to in passing by Ms. Murphy-Phillips]. Rarely, though, is that an issue for a funder related to the topic I have been asked to address. Once a funder has decided to give for any charitable purpose, his or her primary concern is what will happen to that money once it is given. That is when the expectations and exit strategy concerns come into play. The financial vehicles, at this stage of the conversation, are, at most, incidental.
These comments are in no way intended to suggest that the wealth managers are not doing something important to advance philanthropy – only that it is not directly related to philanthropic decision making,, only its financial enabling. The title of the webinar, I now see, suggests very different content depending on what hat one is wearing.
As one who has attended and spoken at many wealth conferences, this disconnect does not surprise me at all. Indeed, many long-time readers will recognize that this is not a new issue at all. It is worth reiterating that, when T & E attorneys and wealth advisors talk about the value of professional collaborations, they rarely if ever, include a philanthropy professional on their list of colleagues with whom they aspire to collaborate. Is it because their view of philanthropy is limited by their own professional perspectives or that they simply don’t know that there are folks like us who bring a very different level of expertise about philanthropy to the table?
So, by all means, it will be great to have colleagues from those disciplines as participants in next week’s webinar. But please don’t be surprised when the content has everything to do with the respective and interlocking interests of the non-profit and the funder, and not about the financial vehicles that got them there.
February 20th, 2019
“It is hard to say ‘no’ graciously; it is even harder to say ‘yes’ wisely.” [from “Four Laws of Philanthropy: Hubris vs. Humility”]
It seems that the philanthropy sector is awash in a re-branding frenzy. Just this week, as this was being written, 2 prominent organizations in our field, Guidestar and the Foundation Center announced that they will henceforth be Candid. Not very long ago, 2 organizations of which we are members changed their brand names: The Association of Small Foundations became Exponent Philanthropy. Grants Managers Network became Peak Grantmaking. I am told that another organization of which we are members, WINGS, is considering a name change as well. The Forum of Regional Associations of Grantmakers has become the United Philanthropy Forum. If one adds local organizations, the list could go on and on.
In the scheme of all of this, our re-brand is quite modest. It is not intended to signify any change in what we do, only how to make it more clear to colleagues and others in the philanthropy sector around the USA and around the world.
The name of our firm derives from the quote with which this post opens. It is from one of the first published articles I wrote on philanthropy practice and affect, about 2 decades ago. I was far from the first to make the various observations in that article, but it got a lot of attention – and helped launch my career as a speaker, educator, and advisor that began a couple of years later, after the foundation I was heading closed. In 2002, I joined my wife, Mirele Goldsmith, PhD, an independent program evaluator, and we launched “Wise Philanthropy.” We have also had the pleasure of periodically joining other outstanding colleagues who have been partners in particular projects.
We chose the brand “Wise Philanthropy” to convey the message embedded in the quote. We wanted to help people learn how to make decisions that were correct for them, informed by the highest ethics, the best practices, and the goals that they wanted to achieve. Wisdom is more than knowledge, but it does require knowledge; it is more than experience, but it benefits from experience; it goes beyond intelligence, but it is hard to have smarts without some smart. It is taking all of that and applying it to the often hard but extraordinarily meaningful decisions that every thoughtful funder must make.
Subsequently, since much of our work is as philanthropy support educators to the funder field, we started referring to our educational portfolio as the Wise Philanthropy Institute.
Why a name change?
As said above, in the scheme of these things, our brand name adjustment is exceedingly modest. But over time we have learned that “Wise Philanthropy” defined our aspirations, but not adequately what we do, and we spend a lot of time explaining what that is, and, as important, what we don’t do.
Why did we decide to re-brand? Well, if one is asked the same questions over and over, it is clear that our title isn’t exactly right. Too often we have to explain at least some of these seven areas.
1. Our business model is a boutique/niche approach so even in the field of philanthropy advisors and evaluators and educators, what we do isn’t typical.
2. We don’t work for or have the family name “Wise”. Many people ask who the Wises are. Hopefully, the change will make it clear that “Wise” is an adjective, not a noun.
3. We don’t manage anyone’s investments – although we are sometimes asked to help think through investment policy concepts that help align with values. And since we often present at investment conferences, it is an easy but mistaken assumption.
4. We don’t manage anyone’s giving or even propose grantees. Since most philanthropy advisors and advisory groups do help manage at least some part of the grantmaking process, it is another easy misperception. If a potential client is looking for those services, we are more than happy to refer them to other first-rate groups.
5. We don’t accept retainer contracts since we want any recommendations to be fully independent and never appear to be self-serving. To be clear, retainer arrangements are responsible and widespread; our model is not a judgement about those who do so. We recognize that our business model is very untypical and often surprises funders and foundations who have worked with other firms or advisors.
6. We don’t do any fundraising nor accept any development related contracts. Some professional advisors are comfortable working on both sides of the table; we have chosen to restrict our work to those who give, not those who raise.
7. We are not connected to a firm with a similar name based in Switzerland. They approached us when they first started to see if there was an IP concern, but since they have a broader organizational consulting practice than we aspire to, we felt that we were not really competitors. [This issue arises in Europe but not in the USA.]
The re-branded Institute for Wise Philanthropy allows us to emphasize our commitment to help people learn how to make appropriate decisions independent of us. At the end of the day, we realized, we are educators and trustees, teaching HOW to make decisions, not primarily to recommend decisions; HOW to improve practice or programs, not primarily to prove their worth; HOW to set policies for grantmaking or practice or investments, not primarily to be the ones who set those policies. We choose to emphasize the learning in our model, whether in our directly contracted advisory work or in our educational work or in our writing, since it suggests a more iterative role and constantly evolving knowledge. We are successful when our clients or “students” or fellow trustees can implement what we have taught or advised independent of us.
What is it, then, that we do?
We are committed to improving the quality of the field both as educators and as advisors. For over two decades we have devoted ourselves to addressing
• funder culture,
• funder alignment,
• improving organizational learning,
• funder and organizational ethics,
• strategy development, especially in the intergeneration and succession spaces,
• “equity” screens for funder behavior,
• utilization based program evaluations.
Much of this has now become mainstream in our sector – first rate and well-known organizations such as GEO, CEP, NCRP and others have made that so and deserve a huge amount of credit. We are quite proud that we have been addressing these issues for many years. Hopefully, with our new focus, we will give more visibility to our thinking to engage with our field more collaboratively, and at a more formative stage.
We do our work in a variety of contexts:
a. We work directly with funders as advisors or trustees to help them learn about and how to implement funding and policy decisions within their own context, and how, when, or if to use appropriate evaluation methods with their grantees.
b. We educate funders from around the world at both NYU and at the University of Pennsylvania’s Center for High impact Philanthropy and, over the years, have done so at numerous other universities and organizational settings.
c. We educate funders and foundations’ trustees and staff within their own foundations.
d. We speak extensively to affinity groups, philanthropy associations, and at conferences in the United States and elsewhere in the world.
e. We write about philanthropy, its challenges, its changes, its opportunities, and, yes, its foibles.
f. We are sources of informed opinion by journalists and have been quoted in many periodicals both within and outside of the USA.
g. We produce proprietary educational “cases”, “how-to” workbooks, and other material of use to funders.
Shortly, we will be rolling out a new website, be making 20 years of articles and our workbooks more widely accessible, and re-positioning our blog so that we can implement our expanded commitments to the field. As always, we welcome your feedback and inquiries, and look forward to long-time mutual collaborations in pursuit of what philanthropy stands for and should help enable: a more just and equitable world.
It may indeed still “be hard to say ‘yes’ wisely” – but with this re-branding, we are renewing our commitment to help our colleagues and our field do exactly that.
November 23rd, 2018
I guess it was inevitable. We were attending a wonderful and illuminating dinner learning about a cutting edge and courageous program in one of the world’s most famous trouble spots. It was a low-keyed fundraiser, but more so, an opportunity for opinion makers to learn that positive developments are possible even amidst wrenching political settings.
The event was held in the palatial home of someone who had originally come from that part of the world and has become quite successful in the USA. Those of us who attended were moved and motivated by the presentations, and that is saying something since this was not a group comprised of naifs.
As the MC was bringing the evening to a close, one of the attendees shouted from her seat that she had a very important question and insisted that she have an opportunity to ask it.
“What is your overhead?” she shouted.
As it happens, the answer was very reassuring to this obvious skeptic, but it was such an unfortunate way to end the evening.
So, at the risk of revisiting a topic that those of us in the philanthropy world have addressed for years, a few observations:
• “Overhead” is a very problematic and misleading term. It implies that there are costs totally unrelated to the project. I prefer the term “infrastructure”. The term makes it clear that no project or program exists independent of the organizational context in which it sits. Someone has to turn on the lights, clean the floors, hire and supervise the staff, account for the finances, and so much more. Most [but not all] of us on the funder side know this and fully recognize that it is counterproductive to fund a program without assuring its likelihood of success. That requires support for the infrastructure. [In another place we can have a discussion about how to determine what that amount might be.]
• If we already know this, why did this potential contributor feel that her question was so important that the evening could not conclude without her asking about “overhead.” [It was noteworthy that the presenters barely alluded to the financing of this project; there could have been so many more relevant financial questions.]
We in our field deserve some of the blame. A few years ago, as information about non-profits became democratized, the rating organizations tried to develop tools for decision-making. Percentage of “overhead” seemed an easy one. After all, it was a seemingly objective number and would raise red flags to phony or exorbitant fundraisers. The problem of course, is that not every project is equal and not every organization is at the same stage of development. Most important, though, it implicitly reinforced a concept that those who were not delivering direct service are simply superfluous flab.
Those of us in the field know that, a few years ago, the primary rating organizations issued their own mea culpa on this. They realized that they had done an inadequate job of conveying what questions should be addressed before looking at fundraising ratios and, to their credit, and to our field’s benefit, they have worked hard since to make sure that the now readily available financial data is only one important indicator of the value and worth of a project or organization.
• The force of the question that evening demonstrated that we still have a long way to go. Philanthropic giving has not only become democratized through on-line fundraising and access to organizational tax returns and financial information. It has also become unmediated. The average donor or funder has the option to make direct contributions, a mostly healthy development, but most haven’t taken the kinds of seminars or courses that we and many others offer to learn how to make decisions. That evening reinforced for me that our role as philanthropoids and philanthropy educators must not be restricted to the cognoscenti. We need to be better about showing how good decisions can be informed and responsible. And we need to do so in accessible ways: the appeal of the “overhead” percentage metric is that it is quick and supposedly “objective”. If we are going to provide more useful decision-making tools, we need to do so in ways that are also accessible without forcing a level of due diligence that might paralyze a well-meaning and caring donor.
All of this is particularly important as we approach “Giving Tuesday” and end of the year solicitations. There are many wonderful and deserving causes out there, and, sad to say, some who are, to put it kindly, phonies. One should ask questions before writing that check or using that credit card. Make sure the organization you want to fund is legitimate and is not one that just sounds like one that is. For most, that means making sure that it has legal 501(c)3 status. Make sure that it is an organization whose mission and program is one that aligns with your own priorities. All of us can get caught up in emotional giving, but we don’t want to look back and say, “why did I do that?” And it is certainly relevant to look to see what criteria an organization chooses to demonstrate its success [Hint: how much you can give each day isn’t a very good criterion; what actual changes they are bringing about is.]
At this time of year, unless you are prepared to spend time doing real significant research, stick with proven non-profits. They may or may not be the most efficient, or the most cutting edge, but there is a pretty strong likelihood that your money will go to what you want it to go for.
For those who want to learn how to dig deeper, January or February is a much better time to learn how. And will lead make next year’s giving season that much more gratifying.