Posts Tagged ‘funder-grantee relationship’

Does Anybody Really Know what Time it Is?

Thursday, April 11th, 2013

Which is the title of a classic song from the band Chicago. I’m just back from there, having spent several days at the Council on Foundations conference. I tweeted up a storm, met some great people, and wrote a couple of posts for the conference blog:

Welcome to the (Global) Accountability Class
About self-motivated accountability in philanthropy

Learning: The “Third Heat” of Impact Investing—and All Grantmaking?
About the idea of a “learning return” in impact investing, and how it may apply to all of grantmaking

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Upside Down

Thursday, January 3rd, 2013

Happy New Year! My two questions in this blog are about philanthropy and democracy: What does it mean to democratize philanthropy? Is philanthropy a democratizing force?*

Every once in a while, I come back to these and unpack them from a different angle. Today it’s about the nature of the power relationship in each. Democracy is about collective deliberation, creating a new mode of decision-making. Schattschneider said when you increase the number of people in an argument, you change the power dynamic. To democratize is to change the power dynamic by giving more people access to decision-making.

Democracy has a verb. Is there a verb for philanthropy? What does it mean to philanthropize? (Well, I talked about expressive and directional modes of philanthropy, so that’s one set of meanings.) It means to give money. I think we usually conceive of it as reinscribing (a college word I always liked the sound of, but don’t think I had the opportunity to use correctly until this sentence) an existing power relationship: the rich give to the poor. Or for their benefit. (Mostly “for their benefit” – not directly to them. If anything, we have elaborate social structures so that we can avoid having to make that transaction, that gift, directly.)

So maybe what it means to democratize philanthropy is to upend that traditional understanding and image in two ways: by making giving more an act of solidarity, rather than noblesse oblige, and by remembering and highlighting that giving has always been multidirectional. Mutual aid, tithing, zakat, alumni giving – there’s a lot of “horizontal” giving, among poor and rich.

But in addition to (I almost said “beyond,” but thought better of it) image and perception, there’s a power relationship at the heart of philanthropy. It creates a power dynamic where none existed before: one who gives voluntarily, one who receives…voluntarily? Gratefully? Grudgingly? While democratizing multiplies horizontal ties, “philanthropizing” – in some of its key forms – multiplies vertical ties. So in that sense, it’s NOT a democratizing force – just the opposite.

I’ll leave for another time whether that’s a good or a bad thing. But it’s a thing.

* After completing this post, I went back to embed the links, and saw that I originally framed the first of my two questions as, “what is the role of philanthropy in a democratic society?”, and not “is philanthropy a democratizing force?” After nearly three years, I’ll allow myself to expand a little!

Give a Little Bit

Thursday, December 20th, 2012

Looking for a last-minute stocking stuffer for that person in your life who asks you for advice about giving during the holidays, since you work in the nonprofit or foundation sector? Want to give a thank-you note to your foundation program officer for helping you keep the lights on? Hoping to fend off that cranky uncle who scoffs that you work in philanthropy because it’s not a real business, and giving money away is easy?

I’ve got a book for you. Giving with Confidence: A Guide to Savvy Philanthropy, by Colburn Wilbur with Fred Setterberg. (You can find it cheaper on Amazon, but come on, make an expressive choice and buy it from Powell’s, or better yet, ask your local bookstore to order it. I was given a free copy to review, and am honored to have been asked.) Cole is the former executive director of the David and Lucile Packard Foundation, and one of the grand wise men of philanthropy. (He’s been a senior fellow at the Council on Foundations and is quite active years after his putative retirement.) He was on the board of an organization I used to work for, Hispanics in Philanthropy, but I don’t believe we ever met other than in passing. But I remember hearing a story of how all the men on the HIP board wore Hawaiian shirts to a board meeting held in Hawaii when the Council on Foundations conference back in the day. The image of him – tall, thin, fair, soft-spoken – decked out in a bright shirt with everyone else warmed my heart.

And that unpretentiousness limns every page of this calmly voiced yet passionately argued book. There’s no grandstanding, no real name-dropping, just sage advice delivered in an even and friendly tone, even as he moves the reader gently, gradually, toward considering the advice of the National Committee for Responsive Philanthropy, which stakes out positions that make a lot of foundation folks uncomfortable (and good for them for doing so).

What’s great is that the book is pitched to a general audience, but it has nuggets of wisdom for those of us in the philanthropic sector, from someone who’s long labored in those air-conditioned trenches. Such common sense and plain talk.

To individual donors: “On a more mundane level, consult your checkbook and tax records to find out where your donations have actually gone in the past year or two. Fill a page with the amount of each gift and the name of the corresponding organization. Ask yourself: Given what I have, have I given enough? Do my donations jibe with my ambitions? Are there glaring holes in my giving patterns–or are there opportunities shining through?”

To individual donors: “Your contribution, however important, doesn’t make you a member of the starting team. You’re a fan and a booster. Your donation will require staff time to record and manage. Don’t add more than a couple of hours to the burden…. Instead of vocalizing about programs and policies, try asking the organization’s leaders what kind of assistance they need.”

To institutional donors: “Of course, ‘change’ is practically a sacred term in the parlance of grantmaking. (Who brags about their efforts to thwart it?) Yet, the inevitable handmaidens of change–controversy and opposition–are the last things most donors want to inspire.”

To all donors: “Sometimes addressing root causes is crucial. Other times, the symptoms prove so severe that they require immediate attention.”

Blessed common sense, and elegant, limpid prose. Wilbur and Setterberg have given us a gift, and one that’s especially useful this holiday season, when so many people (myself included) make an important number of our personal philanthropic choices. This year, I chose to allocate a significant portion of my giving budget to political giving (fully aware of the non-deductibility of those contributions). I tried to mix expressive and directional gifts. Time to take stock, write down that one page Wilbur and Setterberg recommend, and take stock. I hope you’ll do the same.

Warmest wishes for the holiday season. I’m grateful for another year of professional success and personal growth, and thankful to all who have followed along on this blog.

On My Own

Thursday, May 24th, 2012

Privacy

Autonomy

Perpetuity

As I started talking about last time, these are the tenets of the archetypal charitable foundation in the U.S.

Autonomy means that no one other than their own board of trustees tells them what to do. They’re not beholden to shareholders, the government, the public – they have the ability to make up their own minds.

At modest asset sizes, this doesn’t seem too problematic at first glance – you want to have your own idiosyncratic agenda, hey, more power to you.

But when we’re talking billions of dollars, that’s when people start getting suspicious. Arundhati Roy’s recent piece about the pernicious role of US foundations abroad (which, interestingly enough, is an argument being echoed, in a different key, at the Hudson Institute next week) targets certain large and familiar names like Ford, Rockefeller, and Gates. To a degree, these folks are setting themselves up for such scrutiny by promoting their own brands more aggressively (see Alison Bernstein’s reflections on how Ford’s branding has changed over the years). (H/T GiftHub for these three links.)

But let’s not forget, even with all their billions, these groups are a drop in the bucket of the economies of social problems. As Sandy Vargas of the Minneapolis Foundation pointed out at the EPIP conference last year, her budget when she ran a county administration in the Twin Cities metro area was $2 billion. One county, in one state! OK, a big county, but still – in government terms, foundations are a drop in the bucket. Always healthy to remember that.

But I think the real issue arises when autonomy is exercised by big fishes in small ponds. This goes back to the idea of funding ecosystems – funders need to be aware of how they’re situated in their individual fields, and what are the impacts of the choices they make on the health of the ecosystem. When everyone gets too focused and no one supports the broad-based, bread-and-butter groups…the ecosystem suffers.

Autonomy becomes a challenge when funders operate in fields with few other actors, where their decisions have outsize consequences. Even if in the aggregate, foundation dollars are a drop in the bucket, at the micro level, or even field level, they can have an outsize influence. All the more important then to adopt the Spider-man model as a default: “with great power comes great responsibility.”

When you combine this kind of autonomy with privacy, it can be difficult for actors in the field to figure out how to relate to “their” funders. If the default setting is for funders to keep things internally oriented, then information may not flow freely enough to enable the ongoing health of the ecosystem. If water plays a critical role in biological ecosystems, then information is the water of funding ecosystems. Privacy and autonomy throw up dams that need to be acknowledged, understood, and managed. And sometimes replaced….

Next, I’ll look at how the goal of perpetuity interacts with privacy and autonomy.

Save Me?

Thursday, March 29th, 2012

Teju Cole has a great piece on the Atlantic website about “The White Savior Industrial Complex,” inspired by KONY 2012 and other international do-gooder efforts. (He’s also in tomorrow’s final of the 2012 Tournament of Books.) It’s an evocative phrase, let’s break it down.

That the saviors are white matters because of the white man’s burden, the legacy of colonialism, and unexamined white privilege.

That they frame themselves as saviors (if that’s what they’re doing) matters because that denies agency to the people who are being nominally saved.

That it’s an industrial complex matters…why? Because do-gooding should be an artisanal craft? Because it should be a monastic calling? Because it should be divine inspiration? Because…. Hmm. The original term “military-industrial complex” pointed out that two apparently unrelated areas were related that shouldn’t be related, because they concentrated too much material and political power. What power do would-be white saviors wield? And why should their professionalization be worth calling out as a danger?

Could it be because the power to call attention to an issue or problem, particularly one as previously obscure as the Lord’s Resistance Army, turns out to matter after all? And that the innocence and disintermediation that were the public face of KONY 2012 supporters somehow confirm our prejudices about what do-gooding should look like – non-industrialized, organic, idealistic?

The truth is, white saviors have a pittance of the Pentagon’s budget. Not much of an industrial complex – more like a set of competing and fractious medieval guilds. So it shouldn’t be surprising that they try to leverage the hell out of soft power.

There are many kinds of complex that white saviors could be ascribed: superiority, inferiority, Cassandra – but industrial? Nah. They wish.

Don’t Want to Work on Maggie’s Farm No More

Thursday, October 13th, 2011

I’ve written previously on agriculture as a metaphor for social change, and the idea of funding ecosystems.

Lately I’ve been thinking in terms of ecosystems out of balance. What happens when too many funders are chasing too few opportunities for impact? Or when everyone tries to promote “innovation” and no one focuses on the meat-and-potatoes work that provides the basic infrastructure of social services?

Private foundations need to be particularly aware of this problem as individual donors become more persnickety and less willing to provide organizations with discretion in how to spend funds. Discretionary funds at community foundations have been on the wane for a while; everyone wants their direct say in how the money gets spent. Maybe some funding ecosystems need like an index fund – a standard “basket” of investments that you choose precisely because it’s safe and predictable.

I want to explore this further – what are different types of ecosystems, and what are different ways that they can go out of balance based on how the actors (foundations, nonprofits, individual donors) interact within them.

Stuck in the Middle with You

Thursday, January 6th, 2011

(With apologies to whatever band played that song in Reservoir Dogs for the title. There’s a TV show where all the episode titles are the titles of songs. I might try that for a while with blog post titles, this makes two in a row….)

Continuing this week’s theme on decision-making and transparency:

Congressional appropriations are a kind of grant. What if foundations had to go through a Congressional-style process while making grants? What kind of theater would ensue? Would you see foundation staff whispering in the ears of trustees, who would be seated behind nameplates and microphones, asking questions of the grant applicant, who’s shifting uncomfortably in the hotseat, reading prepared testimony?

The giving circle I’m involved with, the NYC Venture Philanthropy Fund, has a version of this, come to think of it. We do a “pitch night,” where our three finalists for one annual grant come to present to the membership, who afterwards get to deliberate together and vote online about which organization receives the grant that year. There’s definitely an element of theater there, of performance. And it’s interesting how it’s semi-public, for an audience that has ante’d up for the privilege of making that decision together. We have a lot of criteria we use to make the decision, and the deliberation is genuinely enjoyable. Feels like crowdsourcing at its best.

And see, there’s one of the challenges with transparency and decision-making. Whatever the experience of being in that deliberating group is like, I can’t think of a way to describe it without raising the potential, however remote, that someone might call into question the nature of the process. As much as I know internally that we do a careful job, from the outside looking in, it’s always going to have the potential to be mysterious or even suspicious. Even when there’s nothing going on. The very nature of the situation has the potential to breed mistrust. And that potential is amplified when you have – wait for it – more people involved in the conversation. Which is why observing Congress drives people crazy, because so many people are watching and the stakes are so high. (And, well, because there actually is a lot of venality going on.) So what would my giving circle’s pitch night look like with a lot more people watching?

I’m not sure where I’m going with this, I guess I’m trying to abide honestly in the place of ambivalence that drove me to this series of posts and to which I return in the end. I’m open to ways more transparency can improve decision-making, but I continue to have my doubts, or at least my questions….

The missing leg of the stool

Thursday, December 16th, 2010

Continuing from yesterday: “varieties of capitalism” teaches us that there are different ways to organize a modern economy. The German model, what Hall and Soskice call a “coordinated market economy,” feature a relatively high level of coordination between firms, capital, and labor. They’re able to develop high-quality, labor-intensive goods because each takes a risk knowing that the other is taking a complementary risk.

In the U.S., the high-quality good of strong nonprofit evaluation/learning practices is not frequently produced, and one reason may be that that three-way coordination doesn’t happen. Nonprofits, foundations, and clients/the public aren’t coordinated in the same way. Foundations are rarely patient enough to support high-quality evaluation, nonprofits can’t count on stable financing to do it, and most crucially, nonprofit clients (and workers) don’t have clear incentives to participate in high-quality evaluation.

(I know that just earlier this week I distinguished between monitoring and evaluation. I’m using “evaluation” here to mean those practices of continual learning that allow a nonprofit to understand its environment, its product quality relative to that environment, and make adjustments to its resource allocations.)

There are some different ways to address this. One would be to make it easier for clients and nonprofit workers to gather and analyze evaluation data. This is improving the tools (SurveyMonkey has done this). That mitigates a disincentive, but doesn’t necessarily provide an incentive. Another way is to make evaluation data available to those from whom it’s gathered. This is improving the feedback loop (again, web-enabled tools, including SurveyMonkey, make this more easier). This provides somewhat of an incentive, because you see that your contributions actually result in something. But to have a really positive incentive, there has to be a connection to the person’s life and own interests. And that comes from a clear articulation of the nonprofit’s mission and a strong communication of its value added to its clients and workers. People need to be able to see why having a nonprofit that’s better able to learn is better able to serve them.

And that’s where I feel the real challenge is. It’s a missing piece in what could be a greater form of coordination among nonprofits, foundations, and the public to produce the kind of evaluation data that would make it easier for all involved to know that the work being done was having real impact.

Mercedes-Benz and nonprofit evaluation

Wednesday, December 15th, 2010

Last week I talked about intentionality and coordination, and expressed my dissatisfaction at market-based metaphors that would make it difficult for philanthropy to proceed in terms of “coordinated voluntary participation.”

Well, it turns out I’ve written a fair amount about coordination in the context of “varieties of capitalism,” the idea that the U.S. mode of doing business is not the only effective one. In addition to the “liberal market economies” of the U.S. and England, there are “coordinated market economies,” like Germany and Japan, where there is more intentional coordination, and the pieces of the employment/jobs system fit together more: vocational training fits with trade unions that have strong, long-term relationships with employers, who are willing to take risks on high-quality, labor-intensive products (think Mercedes-Benz) because they’ll have a supply of high-quality workers and relative labor peace.

I’ve also said that philanthropy and the nonprofit sector in the U.S. have a weird hybrid model of LME labor relations and CME finance. What would a fully-CME enclave, perhaps at a state level, look like in the U.S. nonprofit/philanthropic sector?

It would have to involve institutions working together to enable mutual risk-taking, on a path toward higher-quality, more labor-intensive outputs. Like, say, more attention to measuring results. What the German economy has to teach us is that all the parts need to fit together and assume some of the risk. (That means you, philanthropy). Firms (nonprofits) will produce higher-quality goods (better evaluation) if they can be assured that capital and labor will play nice; that is, that capital will be patient, and that labor will be high-quality enough to make high-quality goods. Foundations need to be patient with capital for evaluation, and be willing to pay for it, AND there need to be incentives for labor (in this case, the clients or nonprofit workers who provide the data for evaluation) to participate in this. German unions go along to get along because they’re more or less guaranteed job security and a steady flow of trained young people from the vocational system. That’s what’s missing in the U.S., the equivalent of the German-labor side of the equation. Where’s the incentive for nonprofit staff or clients to collaborate in the gathering of high-quality evaluation data? We haven’t made that connection (or rather, most orgs haven’t), and so the coordination breaks down.

What might those incentives look like? To be continued….

Five zombie philanthropic ideas that won’t die?

Wednesday, October 20th, 2010

Foreign Policy has an interesting piece entitled “Five Zombie Economic Ideas That Won’t Die.” They’re bits of economic “wisdom” that the economic crisis is meant to have shown we ought to abandon, but for some reason people (and policymakers) stubbornly keep alive. The candidates are things like trickle-down theory and the idea that privatization is always good.

While I enjoy any chance to excoriate lock-step laissez-faire dogma, this piece has me thinking: there must be at least five zombie philanthropic ideas that won’t die. Here are a few candidates, which I’ll expand upon in future posts:

  • Foundations are legally prohibited from doing advocacy.
  • General-operating support doesn’t allow you to demonstrate impact.
  • If we accept unsolicited proposals, we’ll be drowned in inquiries.
  • Every grant should have rigorous evaluation.
  • It’s possible to ameliorate the power imbalance between grantmakers and grantseekers through open communication.

What are other zombie philanthropic ideas that won’t die?