February 27, 2012
February 20, 2012
Focus on donors can help build community
By Todd Cohen
Donors are changing, and community foundations are adapting their business model to try to keep up with donors’ needs.
What is emerging may be a greater focus on building a more engaged community of donors by providing strategic advice on giving, and on social and global needs, and by connecting donors with charities and other donors who care about the same causes.
That is the view of Ellen Remmer, president and CEO of The Philanthropic Initiative, a nonprofit consulting firm that advises donors and on Jan. 1 merged with The Boston Foundation.
The foundation, which was founded in 1915, has $850 million in assets and has made over $1 billion in grants, including nearly $78 million in 2011, when it also received $81 million in gifts, while The Philanthropic Initiative, which was formed in 1989, has advised corporate, foundation and individual clients on giving away roughly $1 billion.
The merger creates a new, hybrid model for community foundations that can help ease a natural tension The Philanthropic Initiative identified in the old model in a study 10 years ago, Remmer says.
That study, which focused on donor education and learning, recommended that community foundations be strengthened so they could serve as more effective educators of donors.
Because their traditional business model relies on fees from donor funds under management, Remmer says, community foundations tend to focus on generating new funds, leaving them less time to devote to donors.
“The tension is, they’re always trying to get money under management,” she says.
But with their needs changing and growing, she says, donors need a lot of hands-on attention, as well.
Donors, for example, have a growing number of choices, and thus a growing number of questions, about what to support and how to give and get involved.
Family giving increasingly needs to accommodate not only an older generation that traditionally has focused on institutions like hospitals or museums, but also a younger generation that tends to focus on specific issues like homelessness.
And while they all live in local communities, donors increasingly care about global issues as well.
So community foundations should be providing training and resources for donors, particularly families, as well as hands-on consulting that helps them clarify their values and interests, define their mission, and craft a vision about what they want to accomplish, Remmer says.
Some donors also may want to operate their own foundations or manage the investment of their philanthropic assets, she says.
So while they traditionally have played those roles, she says, community foundations should be thinking about ways to accommodate those donors while still providing the advice donors need about their giving, a role that consultants like The Philanthropic Initiative can play.
A growing number of donors also want to have a big impact with their giving, and recognize they may need to collaborate with other donors, so in addition to giving money away, they find themselves playing a fundraising role, Remmer says.
In the wake of the earthquake in Haiti in 2010, for example, a Boston couple created a $1 million challenge fund at The Boston Foundation that generated another $1.5 million from other local donors.
In addition to just raising money, the effort engaged Boston-area donors who are part of a Haitian diaspora, and helped the foundation connect with them.
Throughout the U.S., Remmer says, community foundations are looking for ways to bring donors together so they can learn from one another and work together.
So focusing on the needs of donors can help a community foundation play a leadership role in building community.
“To be a leader, you need others to be with you,” Remmer says. “It’s all about having the potential for more influence, and having those relationships.”
In the end, she says, “you’ve got to build community.
February 13, 2012
Komen stains its brand
By Todd Cohen
Komen for the Cure blew it.
Since it was formed in 1982, the charity has raised money through its Race for the Cure and invested over $1.9 billion to fight breast cancer, in the process building one of the most successful and trusted brands in the charitable marketplace.
But in just one week it now has managed to tarnish its well-deserved reputation and to script, unwittingly, two case studies for nonprofits about how not to behave.
Its bungling of the controversy over its funding of Planned Parenthood has shown nonprofits what not to do, both when faced with pressure from financial supporters and others to change their programs and policies, and when faced with a public-relations crisis.
Triggering an explosion of criticism was Komen’s decision to end much of its funding to Planned Parenthood, a decision that became public two weeks ago and that Komen reversed a few days later in the throes of continuing after-shocks of anger and criticism from donors.
Under a policy it set last year not to fund groups under investigation, Komen reportedly was cutting most of its funding of Planned Parenthood because that organization, which provides family-planning and abortion services, was under investigation by a member of Congress.
But Karen Handel, an abortion opponent who joined Komen last year and resigned Feb. 7 as senior vice president for policy after Komen had reversed its decision not to fund Planned Parenthood, said in her resignation letter that talks about changing the relationship with Planned Parenthood began before she joined Komen.
Prompting those internal discussions was pressure from abortion foes, said Handel, a former Republican candidate for governor of Georgia who during her 2010 campaign called for ending government funding for Planning Parenthood.
In her resignation statement, Handel was up front in acknowledging her own role in Komen’s initial decision to cut funding to Planned Parenthood, and said she still believed the initial decision was “the best one for Komen’s future and the women we serve.”
In their public statements about the controversy, however, other Komen officials have been less than candid or clear about the reasons for the organization’s initial decision on Planned Parenthood or for its quick about-face on the issue.
When the controversy began two weeks ago, Komen attributed its initial decision on Planned Parenthood to its new policy not to fund groups under investigation.
Then, before Komen reversed that decision, its president, Elizabeth Thompson, said the move was not related to the congressional probe, one focused on whether Planned Parenthood had illegally used federal funds to pay for abortions.
Nancy Brinker, Komen’s founder and CEO, said at the same time that the organization wanted to fund groups that provide direct services for breast health, such as mammograms.
Later, after Komen reversed its decision on Planned Parenthood, Brinker in a statement accepting Handel’s resignation characterized Komen as a nonpartisan group dedicated to finding a cure for and eradicating breast cancer.
All that dissembling sounded like the lawyerly and ludicrous parsing of words by then-President Bill Clinton in his response to investigators’ questions about whether he had had a sexual relationship with Monica Lewinksy: “It depends what the meaning of ‘is’ is.”
Komen board members and senior executives also reportedly did not expect the public firestorm ignited by their decision to cut funding for Planned Parenthood.
What was Komen thinking?
Komen has been a bright star in the charitable world: Brinker founded the organization 30 years ago after promising her sister, Susan G. Komen, who was dying from cancer, that she would do everything she could to fight the disease.
Komen’s races, held in cities and towns throughout the U.S. and abroad, are testaments to the power of a deeply human cause to mobilize and build a community of passionate and committed donors and advocates.
Komen’s signature pink ribbons have become a universally-recognized and beloved brand, and the organization has created a model in its effective and innovative use of social media and marketing.
Komen ought to have known what to expect when it plowed head-first into the toxic politics of abortion, and how to control the damage as soon as its ill-conceived political maneuver backfired.
Sadly, and possibly because of its success, Komen seems to have figured it could do no wrong.
But it messed up, badly, apparently falling prey to a common fear among nonprofits that they will lose their funding if they do not bow to funders and other groups that aggressively push their agendas – of whatever ideological or policy stripe.
Many nonprofits fail to see that changing their stripes to get a grant or curry favor with a funder or other powerful group betrays the trust and loyalty they have worked long and hard to build among their donors.
And despite the damaging fallout from the seemingly endless parade of crises that have tainted the nonprofit, political and business sectors in recent years, nonprofits like Komen still seem to believe they can hide their opportunistic pandering, and their mistakes, from their donors, the media and the public.
Was playing politics with abortion worth the anger and sense of betrayal Komen unleashed among its donors?
It certainly did not seem to hurt Planned Parenthood, which last year received less than $700,000 from Komen, a small fraction of the $93 million in grants Komen made.
Within days of the initial news that Komen was cutting its funding, Planned Parenthood more than made up the cuts through an outpouring of giving, including a pledge of $250,000 from Mayor Michael Bloomberg of New York City.
The controversy also has prompted questions from critics in the philanthropic and research communities over Komen’s scientific approach to some issues and how it spends the money it raises, according to Reuters.
Based on a Reuters analysis of Komen’s financial statements, while the total dollars of Komen’s research grants have grown steadily, they have not kept pace with the surge in donations it has received.
In recent years, Reuters reports, Komen has cut by nearly half the share of fundraising dollars it spends on grants to scientists studying the causes of breast cancer and trying to find effective new treatments.
In the face of the stink it has stirred up, it still is not clear why Komen tried to cut funding to Planned Parenthood.
The move may have reflected opposition to abortion on the part of Komen’s leaders, or it might have been an effort to appease abortion foes and protect its financial support.
Whatever its motivation, Komen has diverted attention from its mission, hurt its good name, and strained the trust of many of its donors.
Charities like Komen are only as successful as the confidence and good will they earn and keep with their donors and grantees.
Whether Komen can help remove the stain from its brand, and protect its fundraising from serious erosion, now lies in its own hands and those of its donors.
A first step Komen should take to help heal its wounded brand is to come clean on exactly what it did, and why, as well as where it is headed.
It needs to be clear and specific, not vague and evasive.
Komen needs to reassure its donors it is committed to its mission of fighting and eradicating breast cancer, a deeply personal issue that inspires people to work together.
And it needs to make sure, and make clear, that its mission and its focus do not involve the politics of abortion, also a deeply personal issue but one that divides people and drives those who disagree on the issue to demonize one another.
Playing abortion politics is a bad strategy for finding a cure for breast cancer.
February 6, 2012
Mary Semans, philanthropic role model
By Todd Cohen
Mary Duke Biddle Trent Semans, the North Carolina philanthropist who died Jan. 25, less than a month shy of her 92nd birthday, epitomized what is best about philanthropy.
Wealthy but modest, she was caring, thoughtful, considerate, curious, genuine, and graced with charm and wit.
And while true to the roots of the philanthropic wealth she helped oversee, and the values and vision of the family that created it, she also was open to change.
Her willingness to listen to and embrace new ideas about how philanthropy should operate and the way it should support causes it cares about represents a role model for organized philanthropy.
Born two years after the end of World War I, Mary Semans lived to see the blooming of the digital age.
She was born and raised in New York City, and arrived at Duke University at age 15, then spent most of her life in North Carolina.
She saw sweeping social, economic and demographic change, along with revolutionary advances in technology that have transformed the way we live, work and play, and that provide powerful tools for helping to address the urgent and escalating social and global problems we face.
As long-time board chair of The Duke Endowment in Charlotte, the largest charitable foundation in the Southeast, she oversaw distribution of the philanthropic wealth created by the family that built American Tobacco Co. and Duke Power Co., now Duke Energy, into industrial powers and engines for economic growth.
That same family used its wealth to build modest Trinity College in Durham, N.C., into Duke University, one of the great institutions of higher education in the U.S.
And Mary Semans’ great uncle, James B. Duke, created The Duke Endowment in 1924.
In the document he used to set up the foundation, Duke limited its grantmaking to four broad causes in the Carolinas.
Those included Duke and three other universities, as well as hospitals, orphans, and religion, specifically rural Methodist churches and retired Methodist ministers.
Over the years, however, after heavily investing in “bricks-and-mortar” projects for many of those institutions, Mary Semans “led the foundation into considering there are greater and higher needs than simply building buildings,” says Gene Cochrane, the foundation’s president.
So, under her steady hand, the foundation began to look for ways to adapt the particular focus of its grants while staying true to the broad intent of its founder.
Mary Semans approached those changes with “supportive caution,” Cochrane says.
And she adapted easily.
She “seemed to be perfectly comfortable in every decade,” Cochrane says. “She had a wonderful curiosity about what’s next.”
As a result of its flexibility, The Duke Endowment has been an effective, influential and highly-respected force for change.
Instead of just investing in hospital construction, for example, it has invested in a broad range of health-care programs associated with hospitals, such as obesity and patient safety.
And instead of treating its four funding priorities of education, health, children and religion as separate and distinct from one another, it has looked for ways to address needs that overlap two or more of those priority areas, such as nursing support for first-time, at-risk mothers.
It also has looked for ways to pool its funds with those of other foundations, such as the Kate B. Reynolds Charitable Trust in Winston-Salem, to better address urgent needs, such as child abuse and neglect.
The Duke Endowment is not alone in its willingness to change, although far too many foundations are stuck in the model for foundations that was developed roughly 100 years ago as the philanthropic vehicle for industrial giants like John D. Rockefeller, Andrew Carnegie and James B. Duke.
A new report by Grantmakers for Effective Organizations, a group that promotes improvements in the way foundations work, cites some progress but says broad-scale change has eluded foundations, a group that accounted for 14 percent of the nearly $291 billion in charitable giving in the U.S. in 2010.
Whether small, family foundations with little or no staff, or larger bureaucratic organizations, far too many foundations are resistant to changing the way they operate.
That is not true of The Duke Endowment or the Durham-based Mary Duke Biddle Foundation, a much smaller foundation created by Mary Semans’ mother that supports arts, educational and charitable causes in New York City and North Carolina.
Mary Semans made a big difference in the lives of North Carolinians and others by keeping faith with the vision of James B. Duke while recognizing that, by adapting to changing needs, the philanthropy she helped oversee would honor and help realize that vision.