Inside Philanthropy

A blog on philanthropy and nonprofit news and issues. A publication of Philanthropy Journal.

February 28, 2007

NCGives gives new take on giving

America is changing, and so is the way we give.

As PJ reported recently, a new study says racial, ethnic and tribal communities in the U.S. are rooted in traditions of giving to support their communities, and now are looking for ways to strengthen and organize their philanthropy.

And as PJ reports today, a new initiative known as NCGives wants to change the way we give and think about giving.

NCGives is working to strengthen giving by African Americans, Hispanics and Latinos, Native Americans, women and young people, and to build bridges to mainstream philanthropies and help them better understand the needs of the populations it serves.

A growing number of nonprofits, working to address social problems that have become more critical and interconnected, want to tap the resources of our increasingly diverse society.

And a growing number of donors want to pitch in not only with their money, but also with their time and know-how.

As Donna Chavis, executive director of NCGives, told PJ, “There’s never going to be enough money.”

The challenge, she says, to make giving more “inclusionary” and leverage the resources, including those of traditional philanthropies, needed to address our most urgent problems.

Equally critical is the need for charitable organizations to redefine the development of the resources they need, a function traditionally known as “fundraising.”

Rather than treating donors and funding organizations as automatic teller machines, charities should be looking for ways to connect personally with donors and other partners, better understand their interests and values, and involve them and their resources in helping to shape collaborative strategies and solutions to the critical social problems we face in common.

What do you think? Submit a comment.

February 27, 2007

Green is good

The $45 billion deal to acquire Texas utility TXU should be a wakeup call for nonprofits and charitable foundations that claim they cannot play an effective role in shaping corporate policy.

Based on input from environmental groups they had enlisted in their talks with the utility, the buyers agreed to a 10-point plan that included reducing carbon-dioxide emissions and support a $400 million energy efficiency program.

While critics might see it, at least in part, as a tactic to lend credibility to the buyers and boost TXU’s bottom line, the plan also shows that the bottom line can be measured in more than dollars.

Research continues to show that companies that do good are more attractive to investors, customers, employees and prospective employees.

By stepping up their advocacy work, particularly with companies in which they already own stock, foundations and nonprofits can be more effective in persuading corporations to change policies that affect a broad range of environmental and social issues.

Sadly, many charitable organizations do not believe or realize they can or should use their role as shareholders to advance the causes they care about.

But until charities start facing and embracing the realities of the marketplace, their efforts to make change happen will be only half measures.

What do you think?

February 26, 2007

Smart giving is hard work

While many foundations are much too comfortable, others see that effective philanthropy requires moving beyond the comfort zone.

That insight was clear last week at the annual meeting of the North Carolina Network of Grantmakers.

The meeting, which attracted 130 people, looked at huge challenges like improving high schools, improving delivery of mental-health services and strengthening nonprofit “capacity.”

Reflecting on lessons the Bill & Melinda Gates Foundation has learned from its massive investment in U.S. high schools, including many in North Carolina, Steve Seleznow, the foundation’s program director, said foundations must understand that change takes time and they “can’t do it alone.”

Making a dent in problems that are big and complicated, he said, requires taking on systemic change; engaging communities that are involved; forming strategic partnerships; supporting those who might be hurt by the changes; working to fix policies that underlie the targeted problems; establishing clear outcomes and metrics to measure progress; and shifting gears when needed.

Many foundations are fat and lazy, and need to shake old habits and focus more on their impact and less on themselves and their power.But the grantmakers network reflects a genuine effort by foundations to work more effectively and collaboratively.

February 21, 2007

Where there’s a will…

The highly publicized fight over the will of celebrity Anna Nicole Smith underscores the need for charities to do a better job reminding donors to remember the charities in their wills.

You don’t have to be a celebrity to be able to provide for a charity in your will, but many charities fail to invest the time and effort to continually communicate to donors that a bequest to a charity is a great way for donors to make a big impact on causes they care about.

What do you think? Submit a comment.

Challenges afoot for families

A new study says several trends underway in American society, including technological advance and rising joblessness among single mothers, pose threats to the well-being of the nation’s children and families, PJ reports today.

February 20, 2007

Growing pains

Nonprofits in the U.S. are big business, and the finances of charitable nonprofits in particular are growing much faster than the national economy, PJ reports today.

PJ also reports this week that as the nonprofit sector matures and expands, a new breed of leader will be important to its success.

The growth of the sector and the leadership challenges it faces are particularly critical in the face of a growing crisis in executive burnout and turnout, tracked in recent study.

Nonprofit boards and their funders need to move fast to address this critical challenge.

Bush at war against nonprofits?

A professor of service learning at Goucher Colleges says in an opinion column in The Baltimore Sun that the Bush administration's proposed 2008 is the newest ammo in a conservative war against nonprofits.

What is needed, he says, is for Congress to set a new progressive agenda to strengthen civic life and commit the government to solving problems the private sector cannot handle.

February 19, 2007

Engaging ‘lone rangers’

Whether they deliver charitable services or work for social change, nonprofits face the never-ending job of raising money.

Yet the traditional fundraising model, created by white men when donors generally were white men, has become obsolete in the face of sweeping changes in who controls wealth and how they give.

That was the message consultant Karla Williams delivered to over 135 people at PJ’s Feb. 13 Lunch ‘n’ Learn in Raleigh.

Women and Baby Boomers soon will dominate giving for the foreseeable future, Williams says, and nonprofits need to understand those prospective donors, and how they deal with their wealth, know-how, time and giving.

And while women and Boomers are alike in many ways, she says, each group differs, and can be subdivided, based on age, with older women and Boomers approaching their wealth and philanthropy differently than do women and Boomers who are younger.

Williams characterized Boomers in particular as “lone rangers” who will not fit neatly into traditional donor categories and fundraising strategies.

So to tap the donors they will need to help fix what is wrong in our communities, at home and abroad, nonprofits must move quickly to understand and engage the donors who are redefining philanthropy.

February 15, 2007

What’s up at Kintera?

Kintera, a firm that provides software and services for nonprofits and has never has reported a profit, has reported a shakeup in its leadership.

Co-founder Harry Gruber, who remains as CEO, has been replaced as president and board chair, while his brother, co-founder Allen Gruber, who remains as executive vice president, has resigned from the board.

See PJ story.

February 14, 2007

Duke Endowment aims to share knowledge

PJ reports today that the Duke Endowment, moving beyond support that responds to funding requests from individual organizations, wants to make grants to groups of organizations that can test promising approaches to widespread problems.

Microsoft boosts tech for nonprofits

PJ also reports that, with $5 million from Microsoft, NPower plans to diversify its funding sources, and broaden and strengthen its efforts to help nonprofits maximize their use of technology.

February 13, 2007

Duke embraces civic engagement

PJ reports that Duke University will launch a major program in the summer of 2008 to move its undergraduate students beyond the classroom and engage them in giving back to the community by taking on social issues at home and abroad and learning from those real-life experiences.

Family foundations growing

PJ also reports that the number of family foundation in the U.S. has grown over the last four years by almost a quarter, to 34,000 funders that gave over $14 billion in 2005, according to a new study by the Foundation Center in New York City.

February 12, 2007

Who’s responsible for corporate social responsibility?

Proxy season is here, and time is ripe for foundations to be more active shareholders.

In recent years, a small but growing number of foundations have joined the ranks of activist shareholders to push companies to adopt more socially responsible corporate policies.

That activism has produced results: Wal-Mart Stores, for example, has agreed to report on its social-responsibility practices.

And as the Wall Street Journal reported Jan. 31, citing proxy advisory firm Institutional Shareholder Services, activists are pushing for similar disclosure from 37 firms, up from 20 last year.

Yet most foundations seem content to hang back as passive investors.

In response to the recent Los Angeles Times report that its investments conflict with causes it supports, for example, the $30 billion-asset Bill & Melinda Gates Foundation issued a statement saying it could best advance those causes through its grantmaking, not its investments.

But foundations, with over half a trillion dollars in combined assets, have a lot of clout, and can use it to work with companies to adopt policies that advance critical causes like protecting human rights and reducing global warming.

To truly make a difference, foundations must take responsibility for the policies of the companies in which they invest.

February 9, 2007

New, traditional donors can learn from one another

PJ reports today on a talk by Susan Berresford, president of the Ford Foundation, who says new philanthropists are generating excitement in the charitable world but also creating risks for it.

Mega-donors’ business-oriented approach to giving could hurt philanthropy by prompting other donors to abandon traditional strategies for those favored by the new generation, Berresford told a Duke University seminar.

Kids materialistic, altruistic

PJ also reports on a new study that says appreciation for family and belongings is driving the giving spirit among American teens and “tweens.” While they may be materialistic on the whole, the study says, that doesn’t mean they aren’t generous.

Disclosing grassroots lobbying

OMB Watch is conducting a survey on federal grassroots lobbying disclosure. Current law requires disclosure of direct lobbying but not grassroots lobbying, which was included in a provision that was passed by the Senate last year but struck in January during Senate debate of lobby reform. OMB Watch says grassroots activities and the financial interests behind those activities should be disclosed.

Anti-terrorism screen

A new survey has found support for a centralized repository of data on prospective grantees outside the U.S. that grantmakers could use in assessing grant requests. Conducting the survey were the Council on Foundations, Independent Sector, the Foundation Center and GuideStar.

Bush budget

The Council on Foundations is touting proposals in the Bush administration budget for fiscal 2008 to boost charitable giving by taxpayers, including permanent extension of the charitable IRA rollover provision enacted last year.

Postage rate delay

The Direct Marketing Association Nonprofit Federation wants the U.S. Postal Service to delay a move to more than double the postage for many nonprofit mail pieces.

February 7, 2007

Foundation giving surges in North Carolina

PJ reports today on a new study that says charitable foundations in North Carolina have multiplied, and increased their assets and giving, but those assets are concentrated among the state’s urban areas and largest foundations, and the focus of foundation giving overall has shifted.

Higher education pays off

PJ also reports today on a new study that shows endowments at U.S. colleges and universities earned 10.7 percent on their investments last year.

And PJ reported recently that a separate study found earnings for higher-education endowments in the U.S. grew 10.6 percent last year.

One key, the studies show, has been the trend toward alternative investments.

February 6, 2007

Blackbaud reports growth

Blackbaud, a provider of software and services for nonprofits, says its net income grew for the fourth quarter but fell for the year, while its revenue grew for the quarter and year, compared to the same periods a year earlier, PJ reports today.

Blackbaud also announced an increase in its annual dividend to 34 cents a share from 28 cents, and declared a first-quarter dividend of 8.5 cents a share.

Its acquisition of Target Software and Target Analysis Group, announced in January, has made Blackbaud “an undisputed market leader in director response market for the nonprofit sector, a significant new market opportunity for us,” says CEO Marc Chardon.

February 2, 2007

Change requires taking a stand

Despite their lofty talk about social change, foundations rarely put their money where their mouth is.

Foundations fund causes they care about, but grants and overhead at few foundations exceed the 5 percent of assets the law requires they pay out each year.

And precious few foundations treat their endowment -- funds they invest in capital markets – as assets to advance their mission.

Jonathan Fanton, president of the John D. and Catherine T. MacArthur Foundation, told a Duke University seminar last month it would be a mistake to tie the foundation’s investments to its grants portfolio.

He also dismissed the idea that foundations should be active shareholders, saying he was skeptical of the impact foundations could expect to have on corporate policies.

Yet Fanton also said that MacArthur, known for “genius” grants it makes to individuals, takes very seriously its commitment to human rights and biodiversity.

It does not take a genius to view as near-sighted, if not wrong-headed and even hypocritical, a foundation that touts its commitment to critical causes, yet knowingly will not try to enlist in those causes the corporations in which it owns stock, and that may be part of the problem and can help shape the solution.

In a series of articles, the Philanthropy Journal looked at the more active stockholder role some foundations are taking to better advance their mission. To read the series, click here.