Feeds:
Posts
Comments

Posts Tagged ‘Center for Effective Philanthropy’

Much as Haiti can serve as a test case for philanthropic efforts to rebuild a country destroyed by natural disaster, Detroit is emerging as a model for renewal domestically.

Carol Goss of the Skillman Foundation pointed out the promise in Motor City in a March 26 article in the Detroit News: “We can be a model of how to turn around a city and a region.” Skillman is just one of several foundations collaborating to rebuild and rethink all aspects of the city, from its residents’ educational needs to city planning to the arts.

Philanthropic efforts to revive the city’s arts—particularly in establishing a “creative corridor” downtown—are drawing extra attention. “If we could ever try out all these ideas we’ve been cooking up about the arts as an engine of urban renewal—and really do it—this is the place to do it,” said Andras Szanto of AEA Consulting in a March 29 airing of WNYC Radio’s Soundcheck. The show’s host, John Schaefer, compared Detroit to  New York some three and four decades ago, when first punk music and then hip hop culture emerged as vibrant art forms and breathed new life into the city before becoming global cultural forces

Detroit does indeed offer a promising case for foundations: The city was struggling more than most American urban centers before the recession. And its nonprofits have long been too dependent on the severely depressed automotive industry.

But the clock is ticking: The Kresge Foundation’s Rip Rapson told the News that the philanthropic effort has about 18 months to achieve its goals. And alarm bells are already sounding. The News quoted several community leaders skeptical of the efforts, seeing the work as a “takeover” from what appears to be an emerging, unaccountable “fourth branch of government.”

The ever-astute Bruce Trachtenberg wrote in a March 26 post to the Communications Network’s blog that such concerns testify to the still large gap between the public’s understanding of what foundations do and what motivates them—something the Philanthropy Awareness Initiative documents. Independent foundation consultant Bob Hughes wrote in an April 6 post to the Center for Effective Philanthropy’s blog that it’s not just that foundations need to be more open about their activities. A sustained conversation is also required so that the public and organized philanthropy can be aligned.

It will take the whole village of Detroit—as elsewhere—to bring about true social change.

—Jane Wales

Read Full Post »

If Congress were to double or triple the private foundation excise tax, asks Joel Orosz of Grand Valley State University, “does anyone truly think that there will be a groundswell of support for foundations” that resist? In a March 10 guest post to the Center for Effective Philanthropy blog headlined “Déjà vu (or 1969) All over Again?”, Orosz suggests it’s too late for foundations to react effectively to stem a possible backlash against the sector. Still, the philanthropy professor counsels foundations to take steps on their own to improve practices, including training employees to be more professional and more accountable to nonprofits.

Orosz is just one of several commentators recently suggesting that a growing populist fervor in society isn’t just anti-government, but anti-institution—and a threat to philanthropy, one that can’t be summarily dismissed and should propel changes. For example, in Small Change: Why Business Won’t Save The World, Michael Edwards wrote that foundation leaders will vociferously resist and complain about the many suggestions he makes in the book calling on Congress to require more transparency and accountability from foundations. But Edwards, a senior fellow at the think tank Demos and the leading skeptic of philanthro-capitalism, says that public and political pressure will eventually build and force changes in the sector. Similarly, in a February 25 Chronicle of Philanthropy opinion piece, the Hudson Institute’s William Schambra argued that philanthropy’s increasingly business-minded approach is at odds with the populist mood of the American public on both ends of the political spectrum. He thinks the tide is turning against foundations.

To help improve the situation, Thomas David of the Community Clinics Initiative argues that foundations should show they’re making sacrifices in this economy along with everyone else. It should not be a time of hunkering down, cutting grantmaking, trimming staff and expenses or focusing on re-growing endowments. Instead, David writes in an essay published by Grantmakers in Health (GIH) that foundations should make some big bets, ease up on control of grantees and practice mission-related investing. In other words, take risks that put them on the line in ways that might tangibly, not just symbolically, benefit nonprofits in a time of need. More specifically, David advises foundations to increase their grantmaking this year—even if they’re one of those already exceeding 6 percent payout. He complains that over the past couple of decades, foundations have evolved to become more risk averse than ever; they’re so focused on assets that growth is their priority, not giving.

David’s hard-charging essay is just one of several included in Taking Risks at a Critical Time, released in March in tandem with GIH’s 2010 annual meeting. Foundations hesitate, according to this publication, in part because of an over-reliance on proven practices, unwarranted anxiety about engaging in public policy and avoidance of failure of any kind, despite the fact that a healthy proportion of failures in a grant portfolio is a sign that a foundation is successfully venturing in new territory. The lead essay includes examples of “risk taking in action,” efforts to improve health.

Tom David is not optimistic, however. He essentially calls foundations fair-weather friends to nonprofits: “It is at times like this that nonprofits, who like to think of foundations as allies in their struggles, have learned not to count on their friends when they need them most.” I wonder. It is not the role of foundations to support nonprofits based on need, but rather based on merit, because doing so fits a larger strategy—one that produces a social benefit. I have a good deal of faith that foundations will do their best to achieve that end. But the way in which they do it must take into account the public mood, and even distrust that these observers so powerfully describe. No institution is being given a pass, particularly one that is seen as opaque while claiming to advance the public good. “Trust us” has never been an adequate response to doubters.

—Jane Wales

Read Full Post »