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#379 – Post COVID-19: The Future of Funder Education

May 20th, 2020

Richard Marker

Full disclosure: As discussed below, we have been educating philanthropists, families, and other funders in many settings and under many different sponsorships since 2000. Until now we have resisted suggestions to offer funder education courses or seminars directly through our Institute for Wise Philanthropy. For the first time, we are seriously contemplating offering limited-attendance on-line workshops. This post shares some of our thinking as we move ahead with our planning. To be clear: these webinar/workshops are not intended to supplant the superb funder education program at the University of Pennsylvania Center for High Impact Philanthropy with which we are delighted to be connected. However, that program is restricted to principals, trustees, or chief professional decision makers of grantmakng institutions. For all other funders, please keep in touch and watch for our offerings.

Between zooming and cooking, there is still a lot of time to write and think these days. Thank you to so many of you who have commented both publicly and privately on my numerous posts on various media regarding funders’ roles now and in the “next normal” period. There are many more pressing issues at this moment in time than how one educates those who give money, but it is how I have spent a good chunk of my professional life over the last 20 years so it shouldn’t be too surprising that it has been on my mind during the last couple of months.

To remind readers who may not be familiar: Since the foundation I was heading closed in 2002, I have chosen to spend a good deal of time responding to requests to offer workshops and courses for families, philanthropists, and foundations in many places around the world. Some of those have been at NYU and UPenn, some for associations and what are now called Philanthropy Support Organizations, and some for individual funders and foundations.

When I first started doing this in a formal way, not wanting to develop a top down curriculum, I consulted with the organizations most prevalent in our field at the time: the Council on Foundations, the Association of Small Foundations [now Exponent Philanthropy], the National Center for Family Philanthropy, and the Forum on Regional Grantmakers [now the United Philanthropy Forum.] The courses were then jointly conceptualized by what was then known as the New York Regional Association of Grantmakers [now PhilanthropyNY.]. I asked them all one simple question: “What should a funder know?”

There was so much alignment in their answers that it was relatively easy to create a curriculum based on consensus “core competencies” of grantmaking. As the world and our field have evolved over the years, the curriculum has been updated regularly, but the basic concepts and structure have remained viable and vital. I am proud to say that several thousand funders around the world have been direct beneficiaries of that model. Further, it significantly informed my own boutique “philanthropy advisory” model, and it is the underpinning of my quite extensive international speaking.

Until now.

1. Curriculum.
So much has been called into question over the last couple of months, it is forcing me to think about what philanthropy education for funders should look like in the “next normal.” Has this fine-tuned and well-tested curriculum become too dated for funders who have been rethinking strategies, changing ways of relating to their communities and grantees, accepting the overwhelming reality of the systemic disconnects and need for public advocacy, and even what it means for us to have independent and autonomous decision making about where our public benefit resources should be spent? Or, conversely, has all of this reinforced the value of such a structured, sequential, and carefully considered curriculum as a basis for knowing how to make the hard decisions with which we are all faced?

2. Medium:
A lesser but no less challenging question is what the optimal viable medium for this kind of education should now be. 100% of what I have done until now has been predicated on “in-person.” The occasional webinars I have presented have all been for groups where everyone knew each other and had prior in-person experiences. Group learning among funders with an educator in the room, is very different than a group of pictures on a screen with an active chat button. Philanthropy education for funders, built around the core competencies mentioned above, has been most credible when a funder hears the questions other funders are asking, what challenges they face, how they respond to the same sets of questions. And what about confidentiality? Funders want to talk in safe, discreet, and confidential spaces. [see #3b below]. Have we developed sufficient confidence in newer media that this discretion can comfortably migrate – or would it, ipso facto, be one of the inevitable losses that would accrue to accepting fully on-line courses?

3. Educators and Students:
Moreover, given emerging issues identified by such initiatives as “Participatory Budgeting”, “Trust Based Philanthropy”, DEI practices, etc., not only must we examine the content of the curriculum but also both who should be imparting knowledge and who should be in the room.

a. Who should teach:
On the whole, our field has relied on funders to teach funders. To be sure, not every funder is a good educator – something that anyone who has attended sessions at philanthropy conferences can attest. However, a good educator who is a funder with multiple experiences has a much deeper internal data base to respond to the realities of other funders. As our field has become more diverse and the relevant experiences and values are expanded, it raises the expectations of what the content should be and the challenges of determining who should provide it. This issue is probably the easier of the two challenges to address. After all, over the years, we have readily added issues of equity in both our philanthro-ethics and in our strategy units. And there is a long history of inviting co-presenters with a variety of backgrounds and expertise to be co-educators, many of whom reflected much of the now-current diversity lens.

b. Who should be in the room:
The question of whom we should invite/permit into the funder education room is far more complicated. All of us on the funder side are well aware of being “walking dollar signs.” There are few places we can enter without being solicited. Over the years of teaching funders, I am consistently asked to guarantee that no one hoping to raise or manage funds will be there, and every philanthropy conference requires a similar commitment from all attendees and speakers. Sadly, that concern is not ill-founded; I have seen it abused when the participation rules have been loosened or when someone simply cannot resist the temptation to sell to wealthy funders. Yet if we are now talking about developing a new relationship between funders and nonprofits, if we take seriously the “nothing about us without us” mantra, if we believe that our advocacy requires a full mutuality, is the implication that we need to develop a new model that removes the divide and invites funders and the npo/ngo side of the sector together? Or would the funder community consider that a step too far? Is there a way to have separate education for funders precede subsequent joint learning?

4. Systemic Change.

The final question has to do with the centrality of systemic change as a new primary essential core competence. We have always underscored that understanding the interconnection between public policy and private philanthropy is a sine qua non for contextualizing where our field is and where it has come from. Once aware, we have felt, it would be hard to make a grant, any grant, without thinking about what its relationship to existing or preferred public policy. Is it better to support that local food pantry or support advocacy for increased SNAP funding? Or both? Is it better to fund that in-school arts project or to advocate for the restoration of those funds? Or both? You understand.

But COVID-19 has laid bare the scope of systemic dysfunction that leads to food insecurity, fiscal uncertainty, health-care vulnerability, the fragility of our cultural institutions, and yes, instability of our civil liberties and civil society. It is one thing to make sure that funders know of the legitimacy of advocacy funding; that is something we have taught all along. Perhaps, though, we must now say that any philanthropy education that doesn’t start with the centrality of our role in addressing systemic questions is insufficient and doesn’t fully acknowledge our unique role.
….
There are a lot of changes that await us as we delicately and thoughtfully move into a “next normal.” Those changes do and will touch every part of our lives. If there has ever been a time when our philanthropy work matters, it is now. It matters best when that work is informed by a deep and profound understanding of what our roles should be and how we can best play those roles. We have endorsed that mandate for a long time. Looking at the “next normal,” it would be irresponsible for those of us who are philanthropy educators to avoid the serious discussion about what a funder should know now.

Especially now.

Dear reader: Your thoughts and reactions will certainly inform both our continuing work and our new offerings going forward. I urge you to share them with us and your colleagues.

#378 Whatever Happened to Noblesse Oblige? Have We Gone too Far? – A COVID-19 Takeaway

May 15th, 2020

Richard Marker

This is our 12th article for funders, philanthropists, and foundations regarding COVID-19. As always, we welcome your thoughts and reactions to any and all.

Two decades ago, noblesse oblige was still the standard rationale for funders to be charitable and philanthropic. If asked why one gives, the answer was likely to be “to give back.” With riches come responsibilities.
The underpinning of that thinking is that there are those less fortunate who need something that a generous gift might provide. While most funders had opinions about which organizations or causes they cared most about, on the whole giving had a social context, in every sense of the word. Some of that social had to do with communal leadership responsibilities; some had to do with responding to peers’ requests. Most funders didn’t assume that they knew better than those who worked in the fields they funded about how best to use the money, only that the recipients certainly needed it.

Approximately two decades ago, a mostly healthy corrective began to supersede that rationale. For all sorts of reasons, the subjects of all too many books and articles that one can read on this subject, loyalty was summarily discounted as an imperative for supporting organizations, and measuring impact became the new value-added. After all, why continue to support a literacy initiative year after year if people still cannot read? Why do organizations dealing with homelessness warrant support if there are still so many homeless? The motivation for giving thus morphed from altruism to efficacy.

At first, there was denial from legacy institutions. Despite the growing anecdotal and statistical evidence to the contrary, those 20th century institutions convinced themselves that this was simply a temporary or transient aberration. When people got older, got married, got jobs, had kids, their giving patterns would revert to the past practices of their parents and grandparents. As time went on, as the change became more pervasive, it also became more persuasive, and many of those organizations had to pivot to find ways to catch up to the zeitgeist. Some did and some never did.

In the meantime, newer funding models emerged, all of which were based on some sort of measure of impact. There are a variety of models of those systems, often differing on what the true bottom line of effectiveness is, how far out a longitudinal perspective must look, which stakeholders or sectors have the greatest claim, how subjective the giving might allow or how comparatively demanding the objective claim, how “profit sector” they behaved, and more. Not only did funders not feel any assumed loyalty to organizations, but their giving was increasingly conditional. “We will fund this – IF you do that” or “We will fund that as long as you can demonstrate that our metrics are being met.” Not only did it reflect the changed motivation for giving, but it changed the way organizations had to deal with funders.

Implicit in all of these changes was a set of assumptions that have proven all too specious. It assumed that funders knew better than the experts what would work, how to do the work, and what constituencies deserved service. After all, funders made their money in the for-profit world; that alone, they believed, demonstrated that they must know more than those who are stuck in the non-profit world. [Need I say more?]

Over time this led to the institutionalization of attempts to develop standard ratios – such as “overhead” to program, or appropriate balance of sources of income, or cash reserves. Using these new metrics, some organizations began to rate nonprofits, and woe to one whose rating slipped. Eventually, though, most of the raters saw that they were imposing a very limited and limiting set of metrics to a very complex field. Did it really make sense to use the same rating system for a local food pantry as for a university? And if that food pantry were to have a mediocre rating but was the only one in a food desert neighborhood, would that be sufficient reason to discontinue funding it?

Thus, over the last few years, more sophisticated means of determining impact have been developed. [including, inter alia, the cutting-edge methodology developed by the UPenn Center for High Impact Philanthropy with which I have a part time connection.] These looked more deeply beyond simple-to-measure efficiency and to longer terms effectiveness as a means to decide where to put substantial funding. There is no doubt that our funding world was developing ever more useful way of making sure that our resources were used to bring about the changes we hoped for and in the ways that made the best use of our money.

Then COVID-19 hit.

And, suddenly we recognized that, for all of our sophistication, for all of our rigor, those non-profits on the ground doing the daily hard work were certainly better equipped to know where the immediate needs are, where the preferred interventions should be, how to spend precious dollars, and which skills are most applicable. Our field – or at least 700+ foundations and philanthropy support organizations – avowed [or perhaps acknowledged] that our reporting systems, our proposal systems, our laser focused funding approaches [and perhaps even our investment policies] were no match for the needs of the moment.

Maybe, we had strayed too far from the long standing, seemingly dated noblesse oblige rationale for giving. Maybe our demand for metrics, too often based on our categories, contingent on our priorities, reflecting our own systems overwhelmed the reason for philanthropy in the first place. Maybe, we are being reminded, that altruism is a social value, and that our own demands for systematic analysis everywhere along the line may be handcuffing those whose real job is to provide services to those in need.

Over 20 years ago, my first published article on philanthropy was entitled: “Hubris vs. Humility”. At that time I was the CEO of a major foundation, and I learned how easy it is for us to think we know everything, how fortunate we are to have the resources to try to make a difference, how seductive the power imbalance – and how arrogant so many of my colleagues appeared. [Of course, I never was. 😊] But I also recognized that, not only was that ethically problematic, but it was also pragmatically wrong. After all, it meant that grantees were less likely to be fully honest, that it allowed us to pretend that we are never wrong, and it allowed us to function in a self-referential bubble.

Over the last couple of decades, our field became so committed to the efficacy of impact and results that we often forgot about the nobility of “giving back.” COVID-19 seems to have forced a rebalancing. Perhaps a bit overdue.

Endnotes: I know my colleagues in the field quite well and can anticipate some rebuttals, so permit some addenda:

• Yes, funders sometimes do have perspectives or expertise their grantees lack. But even when a funder is more “right”, implementation should rarely be top down and requires a relationship that allows the “right” and the “real” to become aligned.

• Yes, of course there were always funders who wanted results – even in the days of noblesse oblige. But before the days of impact and metrics, the norm was more typically that funders gave, nfp/npo’s spent.

Yes, due diligence and program evaluation is indispensable. But too often due diligence and the post program evaluations go way beyond gathering information that will truly inform our decisions. If we as funders don’t need the info, why impose extra work on grantees?

Yes, there is great value in research as a basis for sophisticated decision making – but… One admittedly extreme contrary example: in an Advanced Grantmakers course I taught a few years ago, I invited a guest speaker who was considered the national expert on a particular then- hot initiative in the field. It turned out that the expert whose work was widely published, had never met with any foundation, never worked in a foundation, never spoke with any practitioners. I am sure that no one knew more about the research or the laws related to that initiative than the guest speaker. However, the “expert” was fully unable to answer a single question on its functional application from the room full of very experienced funders. Surely this is indeed an extreme example; it does, though, remind us that research that isn’t rooted in real experience is simply a contribution to general academic knowledge, but of questionable value to those who must make decisions on its basis.

Yes, I agree that there are certain times when a restricted gift serves the grantee organization. 2 examples: when a non-profit wants to explore an initiative beyond its core budget; or, perhaps, when it is for a capital project. But in general the tendency of some funders to give only restricted gifts, to be unwilling to fund infrastructure of that same organization, to give for a year at a time, to give less than the amount necessary for the project to succeed, etc. typically handcuffs the recipient organization and limits the ability of that organization to bring the impact the funder claims to want. Our funding should enable the greatest likelihood of the success of a project. That doesn’t mean there should be no limits; it does mean that a funder must make sure the relationship with grantees is open, honest, and trusting. Given the power imbalance, that relationship only works if we as funders enable it to.

Final point: Yes, it is true that I have been teaching and advising funders on how to make good decisions for a long time and hope to continue to do so. So, I don’t want to appear disingenuous in my statements about overreach in due diligence. My hope is that we as funders “right size” our processes and decision making – to make our own lives and the lives of those whom we empower with delivering services easier.

Today is 9 November 2019; please see post #324

November 9th, 2019

Richard Marker

#305 – Lessons from the March – This Time We Must Not Rest Until…

April 2nd, 2018

Richard Marker

While this post is a personal reflection, it is implicitly a call to action by those of us in the philanthropy world as well. It joins the growing chorus of those who argue that our sector no longer has the luxury of reticence in the face of the most profound challenges to the institutions of democratic stability since the McCarthy era.

The year was 1967. A friend and I were sitting on a Broadway bus in New York City. Sitting in front of us, apparently each minding his own business, were a hirsute college student and an older man. [Now that a lot of years have gone by, I realize that I have no idea how “old” that older man was at the time.]

The bus came to a stop, the older person stood up to leave, but before doing so struck the younger one in his face with a fist. He then got off the bus and ran away. The young man was not seriously hurt, but he was shocked and surprised. All the rest of us on the bus could only surmise that the older gentleman was so threatened by this long-haired college student that he literally lashed out. [Thank goodness the destructive belief in the unrestrained and extreme interpretation of the 2nd amendment was still in the future. I shudder to think if this blind rage had been accompanied by a gun. A point to remember toward the end of this essay.]

By 1967, most of us who had not rushed off to careers on Wall Street looked very much as this young man did. Indeed, between 1965 and 1968, the preferred attire for most had switched from buttoned down to denim-ed up. On university campuses, and in most of the trans-Atlantic big cities, the confluence of the counter culture and political activism [two very different motivating dynamics that converged in time] meant that what was normal then was profoundly different than it had been a scant 5 years earlier.

This is not the place to rehearse all of the changes, some fleeting, others more lasting, of those years, but one thing is certain. By 1968, it didn’t take much courage to protest. I don’t want to diminish the killings at Jackson State and Kent State, nor the “occupying” police presence on many university campuses and at the Democratic National Convention in Chicago. But they were, it appeared to many, the last gasps of a political enterprise that resisted the changing rules, the challenge to the mandatory draft, the protests against a despised war, the legal and moral insistence of racial and gender equity, and the transforming personal mores.

It was a movement, or in retrospect, several interlocking movements, that were young-person led. Some in the political power structures tried to ignore or squelch things at the time, but changes prevailed, even if radical Change may not have.

Over the next decades, many of us rested on our activist laurels. I know I did. We assumed, wrongly it now appears, that while there were still significant skirmishes to be fought in the areas of women’s rights over their own bodies, or fairness in hiring and education of minorities, or the degradation of the environment – to take but three, the big battles of a society that could hold its elected officials and big business accountable for misconduct were won. And there were governmental entities in place that would enforce these principles.

I cannot speak for everyone else, but I know that I never changed my political leanings even as my attire became more bespoke, and my hair – well, let’s just say that is long gone. However, what I discovered on numerous occasions over the years was that very few knew that I had those views. There were even occasions when I would speak up or write something or attend an event that incurred surprised reactions by other attendees or readers. But on the whole, I let others, too few others, take the lead in these and other important battles.

I don’t want to impugn others, although I don’t think these behaviors were mine alone. Activism, even when safe, is never easy and requires great tolerance for failure and disappointment. And it requires a lot of time, and even more social risk. How ironic, I now realize, that my passivity was during the very time when I, in fact, did have leadership positions -some ascribed, others earned. I had the opportunities to influence others, to articulate larger visions, to be more politically active, but didn’t.

Activism became less and less appealing as the political ethos deteriorated into money and partisanship and ugly personal nastiness. In 1967, the risk was a fist in the face; in 2018, there are opponents trolling our sites and toting guns. Even when it is socially safe, it is not without real risk.

Voting or sending an occasional letter or making an even more occasional phone call to an elected official is not that hard or risky. But getting in the trenches requires a different level of commitment, and that wasn’t what I did.

And if it is true that I am not alone, we are all a bit guilty of negligence. We have tolerated, mostly by our silence, this abysmal state of affairs, the erosion of confidence in our democracy, and the willful self-indulgent atomized existence of far too many.

The Parkland kids shook me out of my facile passivity. Yes, I did participate in recent marches – to respond to climate change, for women, for immigrants, and more – but there was something different this time. It resonated with the dormant part of my activist soul. And challenged me and hopefully us.

It may well be that my own personal opportunities to influence others are largely over, but that doesn’t exempt me from raising my voice, being a visible advocate, and choosing involvements that demand a restoration of a commitment to ethics and justice as bedrock principles of empowerment.

We didn’t quite accomplish what we hoped to in our last youth-led movement, when I was still young-ish. Now that I am 2 generations older, it is time to follow the young once again. And this time, we cannot leave it to them alone to finish the hard part of the work.

They and we and the nation as a whole deserve no less.

#393 The Fall of the Berlin Wall: An anniversary a year too early; not a minute too soon

March 5th, 2018

Richard Marker

Recently the NY Times published an extended piece on what has happened in the years since November 1989 when the Berlin Wall fell. The Wall has now been gone for longer than it stood. It has been gone long enough for decidedly revisionist theoreticians to bemoan its loss, xenophobes to blame its loss for precipitating an influx of “foreigners”, for Europe to have gone through celebratory post-nationalism and reactionary tribalism. It was a metaphor for a world with clear binary choices made more complicated without it.

On a personal level, its fall marked a life-changing experience for me, one that shaped a good deal of my professional involvements and interests since. As some of you know, I was in Berlin that day. For a short while after that, I would, in an attempt at humor, take credit, but after it became clear that re-unification was more complex and nuanced than originally imagined, that made little sense and wasn’t very funny. [I had been a guest of the West German government for several weeks prior to that famous day and stayed on briefly afterwards. My presence was pure coincidence.]

The Fall of the Wall is remembered as a peaceful symbol of the end of the Cold War. Only days before, if one stood at the Reichstag and looked into the space between the walls, one saw a killing field. Few recall that tensions were very high in the days leading up to 9 November. All of the armies occupying Berlin were on full alert, we were warned to stay away from Checkpoint Charlie, and there was on overriding sense that something could happen any second. The history that must be told is the miracle that no solider on either side, in a moment of panic, lost his [yes, his] cool and started shooting. It could easily have happened.

The result, ultimately, would have been the same but it would have been remembered very differently. The Cold War didn’t end with a whimper exactly, but it certainly was not the Bang it might have been. Thankfully.

As I said, it changed me. It wasn’t that I had been parochial exactly, but I had never been very focused on international issues, the dynamics of the many diasporas of many peoples, and the implications of an implicit post-nationalism that characterized that era.

After that experience I invested heavily in recrafting my own career, developing programs with several governments, speaking in many other countries, and cultivating some modest expertise as a frequent observer of a rapidly changing world. [Initially, most of this focused on Europe but subsequently I have had the privilege of speaking and meeting on 5 Continents – Australia being the only remaining outlier.]

There are many things I learned during those years – most notably a very profound respect for how history shapes one’s worldview. Watching the Republikaner march in Munich, or observing how Jews in the evolving Europe would lie low even 2 full generations after the Holocaust – then celebrate that they are more than survivors only to witness a resurgence of vitriolic anti-Semitism, or how Germany’s view of a post-nationalist Europe resonated with so few outside of Germany, or how the Czech and Slovak republics could become Czechoslovakia for only one year, only to divide again, or Brexit, or how long submerged ethnic identities exploded – in both wonderful and terrible ways, or how difficult it has been, even to this day, for some countries to come to grips with their own uncomfortable pasts, and more, has been extraordinary… and instructive by providing perspectives on today.

Given the frightening challenges to democratic ideals in the USA, and also in many other countries, it is clear that too many forget or deny that history is filled with destructive mis-steps. The USA is not the first nation or people that celebrated its exceptionalism, only to become an also-ran in subsequent centuries. Unconscionable divides between the haves and the have-nots have led to outright revolutions and decades of instability. Pluralistic societies cannot take for granted that tolerance and integration will be foregone conclusions in the future. Isolationism, in the form of national “superiority”, becomes a cancer on the body politic.

The Berlin Wall, with all of its metaphor and symbol, represented a binary understanding of the world. When that facile and simplistic overlay was removed, we learned that the world had not anticipated how complicated it would be nor was it adequately equipped to deal with the tribulations and challenges that have followed. My hope is that history will look back at our currently tumultuous time and see it as the last gasps of failed visions of totalitarian and xenophobic aspirations. If there are any abiding lessons to be learned, it is that we cannot rely on “history” to make sure that we survive these times intact, and we certainly cannot count on the self-discipline of trigger happy leaders.

#301 Necessary But Insufficient: the Response of the Philanthropy World

February 20th, 2018

Richard Marker

In the almost 16 years since I have become self-employed, I have learned that there are both professional advantages and disadvantages. One of the double-edged swords is the ability to say or write whatever one wishes without clearing it with anyone. Of course, that doesn’t mean that there aren’t consequences to that freedom. For example, not everything I say in my public presentations or in my writings endears me to all of my fellow philanthropoids, and I am aware that such outspokenness has cost me some contracts. I sometimes say things that challenge common orthodoxies in the field. This post is another example of that.

Before my Jeremiad, let me be very clear: I am a big believer in the indispensability of voluntarism in giving of time, money, and leadership. This is true everywhere in the world and has been for as long as there have been structured societies. I also believe that it is advantageous [but not mandatory] that there be some incentives to do so, such as tax deductions, although this is far less universal. In a very high percentage of the nations and peoples of the world, education, healthcare, social welfare, and much more would simply not exist if it were not for that voluntarism, whether organized by faith based or secular institutions’.

Moreover, full disclosure, for a good part, but not all, of my career, I was a beneficiary of that voluntarism. I was employed by universities, non-profits, and foundations all of which exist because of voluntary giving. [I have also been employed by for-profit companies and am now mostly an independent contractor – a profit making venture most of the time.]

Having stated my bona fides, and affirming the necessity of our sector, what is my beef?

It is that our sector continues to advocate for the wrong things, or more correctly, inadequately advocates for what will truly make a difference.

The recent tax law, which I consider to be an embarrassment and an abomination for its shameless pandering to the super-wealthy and its concomitant disregard for those in need, has probable real implications for charitable giving. I say probable because it is by no means certain that the tax changes will in fact yield lower giving.

I agree with the pundits that it will probably depress giving by mid-level donors in the short run, but history doesn’t support that that depression will continue over time. In fact, if one looks at the implications of tax changes on charitable giving over the long run, one sees short term gains and short-term losses concomitant with tax changes, but that over time giving reverts to a mean and has remained there for a very long time. [There have been many pleas and attempts to increase that percentage, but with only marginal success.]

Moreover, most studies show that charitability is only marginally influenced by taxes, and when it is, it mostly has to do with how – not whether – one gives.

Having said that, it is true that this is a time when we need every incentive possible because of the vastness of the needs, and the tax sham certainly doesn’t do that.

But even were charitable giving to double, it would only make an incremental difference in the moral hole the USA has dug for itself in its recent policies. Maybe the tax scam will save the average person in the USA a few hundred dollars as they promise, but it comes at the same time when congress is radically reducing support for health care, education, food insecurity, and – if they have their way, social security and Medicare! The probable financial net loss to most people far exceeds the incremental tax savings.

And this is all accompanied by a reduction in consumer protection and in abetting climate degradation.

[If I wanted to get “political”, I would add to this shameful litany the incessant attacks on the judiciary, the press, science, and the truth, but let’s leave that discussion to another time.]

Not only do these changes portend economic hardships for many, but underneath, a veritable meanness of spirit, a culture of misanthropy, the very opposite of what our field is supposed to stand for.

To be fair, many in our field have been actively and assertively leading the good fight. But for too many institutions in the fields of philanthropy, the advocacy begins and ends with charitable deductibility and similar self-authenticating issues. Yes, it is worthy to encourage charitable giving, but hardly sufficient to redress these wrongs. As a field committed to improving our world, making it more sustainable and equitable for all, our voices should not be heard as defending our own needs, but rather demanding that what we stand for matters. These are public policy matters; they are a reflection of our tax priorities; they are statements about our national character, our ethics, and our values. Optics matter.

Most of us are in the field of philanthropy because of our visions for what our limited [even if generous] resources can help bring about. Let’s not let those visions be reduced to transactions on a tax return.

What then is the proper role of philanthropy in these times? There are numerous approaches.

a. Risk Capital: A recently widely disseminated piece out of the venerable Ford Foundation reaffirmed philanthropy’s role as society’s risk capital. Most of us in this field come to that same conclusion at an early point of our ventures in this field, and it is always worth re-discovering and re-affirming our uniqueness. After all, who besides our field is exempt from plebiscites, or is accountable to stakeholders beyond our own boards. We can, should, and must take risks that other sectors might legitimately shy away from. [That doesn’t exempt us from appropriate humility that our guesses or investments may be wrong, but when we are right, our investments can be transformative.]

In normal times, I would applaud this recent reaffirmation of our unique role, but these are not ordinary times. Our risks work best in times of stability and a common commitment to basic societal institutions. Our risks are more suspect if the education, social service, health care, and even cultural institutions are not adequately supported. Are we supporting risks to get us back to an authentic baseline – or avoiding our responsibility?

b. Funding what government won’t. Some segments of our sector celebrate examples where voluntarism of money and time have successfully replaced programs that taxpayer supported institutions no longer can afford. Those successes or noble experiments most typically are present in the education sphere, but not restricted to them.

However, leaving aside the moral challenge of having human needs dependent on the good will of voluntarism, or whether this reflects public policies that are sustainable over time, on a practical level it is simply impossible to privatize all of the basic needs of an industrialized, or post-industrial society. The scale, the alignment of need with available resources, and the accountability to the public make it all but impossible.

c. Continuing to support what we always have This approach has served society well in the past. The need for cultural or local institutions will always be there even after a particular disaster or financial crisis passes. Many argue that those continuing investments save many millions of dollars over time and give a much-needed social stability especially in times of turmoil.

The logic of such support is unassailable, but today there are radical changes in the funding landscape. When Ultra High Net Worth funders can give 9 and 10 figure gifts to museums and orchestras and universities, what real difference does the average person’s – even the average wealthy person’s – annual gift make? At this time when our disruption is not primarily financial but ethical and existential, does keeping to the well-trodden best express our best philanthropic interests?

d. Becoming real change agents. Over the years, I would often challenge funders [clients and students] when they would say that they want their funding to “make a difference.” I point out that “making a difference” means that something is different than it would be without your funding, and that often means taking chances. [see a. above]. Some would acknowledge that they mean something much more modest than being a change agent, rather that they want to focus on institutions that will be sustained or enhanced by their gift. Others took the message to heart and thought long and hard about what difference they really did want to make and if they were prepared to be disrupters.

At this time in history, the disruptions are being caused by public policy challenges that go deep and wide. To be change agents requires going beyond an “industry” or “priority interest” in our funding. To be change agents even requires going beyond our own sector. It means leveraging our resources, all of our resources – financial, influential, and knowledge – to address potential cataclysmic disruptions. [In the case of the environment, these are clearly not exaggerations; in the case of the character of our nation, they are also existential.]

I think you can gather where I stand. That doesn’t’ mean that funders who choose a, b, or c. are bad funders, but they should be conscious of where those decisions sit in the context of current needs. For those who share my alarm at the fragile state of our union and planet, it is hard to shy away from a commitment to d.

Advocacy matters more than ever before. As funders, let’s make sure we are advocating for that which can indeed make the difference.

#292 Naming Names: A Philanthro-ethics Decision

August 22nd, 2017

Richard Marker

Two recent WisePhilanthropy.com posts have led a number of readers to raise a question about the examples I gave. These readers are quite sure they know exactly to whom I am referring in each of them. [When you read B below you will see that they might be partially correct, but, even then, only partially.]

Why don’t I publicly identify my clients or the foundations and philanthropists to whom I refer? After all, it is quite customary for many bloggers and philanthropy advisory firms to name their clients, sometimes in a descriptive way and sometimes in a self-congratulatory way but always proudly. And some business advisors tell me that I am leaving money on the table by not showing that the foundation and philanthropy field takes us seriously and uses our advising, speaking, and teaching expertise.

Why am I so strict about this?

There is a simple answer, a more nuanced one, and a very practical one:

A. The simple answer is that I want to respect the confidentiality of all of my clients and students. Many of the matters discussed during my advisory work, or even in classes for philanthropists, are deeply personal, reflect very sensitive family or foundation issues, and are confided to me on the assumption that it goes no further. And that can apply both to those well-known and those not so well known.

If I were to publicly identify those clients who would have no problem being identified, it might make future clients or students reluctant to share, fearing that I would identify them as well. By being so absolute about it, it obviates the possibility of their wondering. [Obviously, if a potential client needs a reference, we are happy to connect them privately.]

B. The more nuanced answer is that I try hard not to give any clearly identifying information in any example I use or any case that I teach. In fact, almost every example I give is an amalgam of real people and real cases but rarely is so unique to a particular individual that there is only one possible reference. If one names names, it is far too easy for cases to be dismissed as listeners or readers try to unpack distinctive personality characteristics. I want the underlying philanthropy message to come across, not the quirks or voyeuristic enticements of bold face names. [This actually works: I once had to take a deep breath when I saw that a family I was largely using as an unnamed example in my presentation was sitting in the audience. Afterwards they approached me to tell me that they could really relate to that example and had a lot to learn from it. Go figure.]

C. The final reason I am so restrictive in naming names is a very practical one. In my line of work, almost everyone I meet assumes that I can help them get funding for a favorite project, or at least introduce them to “my clients” who would be thrilled to learn of their causes. Most of them are very valid and worthy, no doubt, but that isn’t my role and it isn’t why we are hired. Were we to become random advocates, we would lose our ability to advise and the confidence that we function fully independently. Just imagine how many more requests would be coming our way if we listed the funders and foundations around the world with which we have had a connection.

[Full disclosure, there are a very, very limited number of times I make direct reference to individuals or foundations in my teaching. When that happens, it is because the philanthropist or foundation has already gone public with that case and my role in it. Even then, that name will never appear in our website or anything I write.]

As stated above, many if not most of my colleagues in the field are less absolutist in the way they apply discretion and confidentiality. My view of the demands of philanthro-ethics is that I don’t name names. However, I do not want any reader to assume that I am suggesting that anyone who has a different standard is unethical, indiscreet, unprofessional, or otherwise compromising their roles with clients. They simply have a different “best practice” understanding.

For those of you who asked directly, and those who may have been wondering, I hope this clarification helps.

Transparency and Self-Dealing

December 7th, 2016

Richard Marker

Transparency and Self-Dealing Matter

[Caveat Reader #2: This post is another with both a philanthropy and political point of view.]

Being a funder is a power position. The more money one gives or can give, the more power. Whether that is the way it should be is beside the point.

The ngo/nfp sector is existentially dependent on the largesse and beneficence of those with money. The challenge of how to accept, mitigate, reject the power of those funders is real and all non-profits understand that. Hopefully, all funders understand that with power comes responsibility.

This power dynamic is the reason that foundations, and the principals and trustees, have certain legal obligations that attempt to bring some equilibrium and an element of fairness to this imbalance. For example, there are limitations on certain related parties in doing personal business with a foundation with which we are involved. Our insider status gives us an advantage. The law is concerned that we insiders might benefit from money we control but isn’t ours. And with more specificity than applies to any pubic charity, the law is adamant about real estate transactions, compensation, purchases, professional services, etc. After all, a foundation may have a funder’s name on the door, but the money is no longer the funder’s- it has been given for the public good and not for private benefit.

To control for that, there is a required transparency regarding where the money is spent: every single grant, no matter how large or small, must be listed on the publicly available tax return; each board member and key staff members must be listed on that same return with information about compensation; there are certain reporting requirements, investment guidelines, limits of control of for-profit businesses, and much more that apply only to private foundations. And, while it is called an excise tax, private foundations even pay a tax on earnings, unlike public charities.

The penalties for violating these rules can be severe, even draconian.

All of this is a way that the law attempts to control for the power of money and the unusual control that a funder has in using money that is no longer his or hers. To repeat, the law reminds us, over and over again, that the public good must trump private inurement. [hmmm, pun intended.]

It seems that no less should apply to a president and any other elected official. They have chosen to run to do public service. The public, therefore, should have access to transparent evidence that this so-called public service is not a way to enable private inurement. Public tax returns are one way to assure that. Surrendering control of private businesses to disinterested parties is another. Recognizing that relatives are interested parties with built in conflicts of interest is a third.

We, through the law, believe that there should be limitations on the exercise of power for every single private foundation. It seems to me that, at the very least, the same should apply to our elected officials, all elected officials, whose power far exceeds even the very largest private foundations, and the potential for abuse far exceeds that of those very same foundations.

Transparency and self-dealing matters. We should insist.

A Contract is a Contract

December 5th, 2016

Richard Marker

[ Caveat reader: This post is the first of several addressing politics as well as philanthropy.]

When I teach philanthro-ethics to philanthropists and foundation professionals, one of the “best practices” I emphasize is the need to pay grants in a timely fashion, and no later than the dates specified in the grant agreement.

Funders need to understand that grantees rely on the good faith of their funders to do their business – they hire staff, publicize programs, plan their facilities, and much more based on the valid expectation that money granted to them will be there when promised and in the amount promised.

This may seem obvious and straightforward but, alas, one would be amazed how often this is observed in the breach. While I consider that commitment to be a contractual obligation, and therefore binding on the funder, many funders seem to think that this “commitment” is no more than an “intention.” If they get to it, of course they’ll send the check promptly, but perhaps it is not convenient, or maybe they didn’t plan their foundation’s cash flow carefully, or any of all sorts of reasons- so the money isn’t transferred. They forget that, once promised, they aren’t simply doing their grantee a favor but have made a contract with them.

The non-profit is now in an awkward position. They are relying on those funds but they are also respectful of [or perhaps frightened of] their funders and reluctant to bug them. They shouldn’t have to. A contract is a contract and funders have an obligation to fulfill their part.

[There are indeed some few circumstances that legitimate a reconsideration, but that isn’t the topic of this post.]

Why is this political? It appears that some congressional leadership has announced their intention to change Medicare and Social Security. They don’t like “entitlements” as a burden on the federal budget. Why not simply privatize the system and let citizens take responsibility for their own retirement and health-care?

The problem here is one of contracts. An entitlement means that there is a contractual obligation. Millions of us have paid into a system throughout our careers with the guarantee of a benefit at the other end. This is not simply a favor a benevolent group of government officials do for us, but their lifetime contractual obligation. It cannot be unilaterally broken just because a current group of elected leaders wish that contract didn’t exist. To break a contract is, as we know, illegal, immoral, unethical…. And given the destructive impact on millions relying on that contract, unconscionable.

Just as there are funders who must be reminded that paying their grant commitment is not a choice but a contractual obligation, so too our current national political leadership must be held to that standard. Medicare and Social Security are not favors to be bestowed if they happen to feel like it but a binding obligation, not negotiable at the whim of political winds.

Perhaps the details of how to assure this obligation may not be simple, but the principle certainly is.

Civil Discourse…Did I Go Too Far?

December 10th, 2015

Richard Marker

This post is not about Donald Trump, but please bear with me for a few sentences so I can get to what it is about.

Much of the oxygen in America this week was been absorbed responding to Mr. Trump’s demand to ban all Muslims from the United States. – or as the week progressed, some variations on that theme. I have not been above the fray and posted a number of tweets on the topic. One of my tweets, then auto-copied to Facebook, said this:

“Let us not ignore that the demagogue Trump has followers who agree with his hate speech. The danger is not out there but right here.”

Not surprisingly, if you know my friends and the world in which I live, most of the comments were supportive. But one, by a colleague whom I respect, challenged this post, saying that people are entitled to different opinions, and name-calling rarely persuades your opponent of the rightness of your position.

I don’t think I was indulging in name-calling. By any definition, Mr. Trump is the very definition of demagoguery, and many, perhaps most, would concur that his statements during his campaign have been textbook examples of hate speech. Public personae deserve the same respect we should extend to everyone, but they are not exempt from being called out when what they say is, or should be, beyond the legitimacy of public discourse. Readers can weigh in on this if you wish, but, as I said above, this post is not about that.

It is about the remainder of the post. I find myself frightened by the popularity of the statements when they malign whole groups – Muslims, Mexicans… It seems that the more hate filled the oratory, the higher the poll.

Now, I recognize that those polls may or may not tell us anything about who will be the Republican nominee or how people will actually vole when they get into the booth. And I recognize that, even with poll numbers that lead the field, they don’t approach an absolute majority of even the GOP. Lots of people are publicly repudiating the most outrageous statements [although, sadly, some are only condemning the most outrageous – as if the others are more or less legitimate public discourse.]

More frightening than the hate speech has been the outright dismissal of the legitimacy or authority of the Constitution, or that we should no longer be a country of law and civility for all citizens, or that due process counts less than a wild-west gunslinger ethos. Playing into mob mentality is not simply irresponsible on the part of any leaders, it is unconscionable and destructive.

How did we get here?

It shouldn’t surprise. After more than a generation when many elected officials preach anti-government policies and don’t believe in governing, after years of an education system that doesn’t teach that the bill of rights is American law and an expression of our values, after 7 years when the most fictitious and racist canards about the current President still are espoused in public – no evidence is sufficient to quell the nonsense, at a time when some politicians advocate that private religious belief should have an equal claim to scientific consensus in setting public policy toward the environment or in our educational system, at a time when civic behavior is understood as a resume filler more than a character builder, at a time when it takes only one or two exchanges on social networking sites before deteriorating into defamation and extremist position, at a time when conspiracy, racist, Islamophobic, anti-Semitic and xenophobic theories once relegated to embarrassed whispers are now considered part of legitimate public discourse …. Does it surprise?

The response of my friend above shows how complicated it has become. Her position implies that ”tolerance” demands that we should tolerate diverse positions no matter how extreme. After all, she said, everyone should be entitled to his or her own position. That sounds reasonable, and civility demands that her position should be the norm. But sometimes positions are not worthy of tolerance. One can privately indulge in any nonsense thinking one may wish, but stating it publicly doesn’t make it legitimate. The 20th Century has taught us all too well how easy words become actions, how opinions become policy, how wholesale labeling can become genocide. Silence may be read as assent. Sometimes repudiation is the only credible and justifiable response.

As I see it, the challenge is not only to rebut or condemn hate speech from putative political leaders, but to change deep underlying attitudes toward what counts as civic virtue, public discourse, apt public policy, and national identity. What is at stake is not simply who will be elected as leaders, but what we are becoming as an American nation.

We have less than a year to get this right.