Inside Philanthropy

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

June 30, 2008

Information essential to build community

A new initiative by the John S. and James L. Knight Foundation aims to fill a gaping hole in the civic marketplace.

The foundation is investing $24 million over five years to help community foundations make better use of media and technology to keep communities informed and citizens involved.

The effort should serve as an important example for all nonprofits and foundations, which need to do a better job telling their story and that of their communities.

In an increasingly complex and confusing global marketplace, people and organizations need news and information they can use to make smart decisions geared to making their communities better places to live and work.

The mainstream news media once filled the critical job of delivering that news and information, which are the lifeblood of a free society.

But in the face of brutal competition in a marketplace dominated and saturated by corporate media, traditional news organizations have worked themselves into a frenzied identity crisis.

Their near-sighted solution has been to abandon their role as social watchdog and resource, preferring to pursue the safer goal of simply surviving by pandering to the fears and consumption preferences of readers, viewers and listeners.

Yet while it no longer seems to matter to the news media, social change remains the core business of nonprofits and foundations.

And social change depends on civic engagement and informed communities.

With the mainstream news media failing to keep communities informed, that essential job falls to nonprofits and foundations.

It is no small irony that the frantic drive for revenue and profits has blinded the media to the market value of news and information that address the core concerns of the communities they claim to serve.

With the Knight initiative piloting the way, nonprofits and foundations can work to meet the demand of the civic marketplace for news and information that citizens can use to heal, repair and grow our communities.

June 23, 2008

Change is a continuous job

Nonprofits and givers are in the change business, and the business of change continually requires changing the way we do business.

Too often consumed with the day-to-day grind of delivering services, meeting the payroll and raising money, nonprofit managers and leaders too rarely take the time to think about changing the way they work so their organizations can work better and smarter.

Yet the demands of a global marketplace transformed by technology and the seamless flow of people, jobs, capital and information has made it more urgent than ever that nonprofits adapt to the new economy and way of doing business.

Nonprofits and their leaders must learn to be social entrepreneurs, gearing their organizations not only to deliver services more effectively and efficiently but also to make change happen.

That means adapting to their organizations the enterprising, networked, collaborative and outsourced culture of the global economy.

Change as a vision must become part of the way nonprofits think and work, and the leaders of nonprofits must make entrepreneurial leadership a value and a lesson they look for and cultivate in their boards and staffs.

“Everyone a changemaker” is the mission of Ashoka, the international social-change organization that supports the development of social entrepreneurs.

And making everyone a changemaker requires inspiration and giving every problem “as much innovation as it can humanly get,” says Sushmita Goosh, Ashoka’s president emeritus.

Nonprofits are indeed in the change business, and making change happen requires that nonprofits and their supporters invest in finding and developing individuals dedicated to changing their organizations so they can work on making our communities better places to live and work.

June 16, 2008

Politicking soils Golden Leaf search

Ham-fisted politics have hijacked the effort to pick a new president for one of North Carolina’s biggest foundations.

The board of the Golden Leaf Foundation, created to dole out half of North Carolina’s share of 46 states’ massive settlement with Big Tobacco, was set in early June to name a new chief to succeed Valeria Lee, who is retiring.

But the board, made up of political appointees, yielded to last-minute requests by Gov. Mike Easley and state Senate leader Marc Basnight to delay the decision so it could consider Easley’s top budget adviser for the job.

Dan Gerlach, the budget adviser, is busy with the state legislative session and would not be able to begin the new job until the session ends, Easley reasons.

The move by Easley and Basnight reeks of back-room politics.

If Gerlach wants the Golden Leaf job, he should have applied for it months ago like the hundreds of other candidates who met the application deadline.

But after a careful search by a consultant, screening of candidates by the board’s search committee, and interviews by the full board with four finalists, Easley’s intervention seems like the clumsy move of a lame-duck governor to find an exit strategy for a top aide.

And Basnight’s intervention, in the face of bills pending before state lawmakers that would choke off funding for the foundation, looks like a barely veiled threat: Give Gerlach the job, or kiss the foundation, its assets and its promise goodbye.

Created by state lawmakers to invest in efforts to heal and repair North Carolina communities hurt by tobacco’s decline, the Golden Leaf Foundation is by definition and nature a political creature subject to the whims and agendas of politicians.

And despite the innovative grants and investments it has made, and the effort of its board and staff to maintain the organization’s integrity, the political make-up of the board has saddled the foundation with the perception that it is a political tool.

By mucking up the search for a new president and interfering with the board’s exercise of the judgment delegated to it, Easley and Basnight have further undermined the foundation’s reputation.

June 9, 2008

Arts play critical community role

A study a year ago by Americans for the Arts found nonprofit arts and culture in 2005 generated $166.2 billion in spending in the U.S., up from $134 billion in national economic activity in 2000.

The study also found the nonprofit arts industry generates $26.9 billion in annual federal, state and local tax revenue throughout the U.S. and accounts for 5.7 million jobs.

Beyond the economic impact those numbers reflect, the nonprofit arts industry is critical to our communities’ quality of life and their prospect for economic growth.

To better tell the arts’ story, and to gear the arts to play a more active role in shaping public policies that affect our communities’ future, arts councils are retooling themselves.

In North Carolina, for example, the United Arts Council of Greater Greensboro is working to help the arts play a more strategic role in strengthening the local economy, improving education and attracting visitors.

The council also is working to generate the investment, participation and attention the arts need to play that strategic role.

The neighboring Arts Council of Winston-Salem and Forsyth County is spearheading efforts to better promote the arts, raise money for arts groups and facilities, and boost the arts as a force in downtown growth and economic development.

And in Charlotte, The Greater Charlotte Cultural Trust, housed at Foundation for the Carolinas, advises partner groups of the Arts & Science Council on setting up planned-giving programs, and also handles the management of gift pledges, as well as investment services for endowments that arts groups create at the trust.

To compete effectively in a global marketplace, particularly in the face of a looming recession, the arts need to tell their story better, and communities need to embrace the nonprofit arts and culture industry as an important partner in building a promising future.

June 2, 2008

Foundations need to tell their story better

Foundations need to tell their story better

A critical engine of social change, giving reflects the heart and character of America.

Yet active civic leaders actually know little about the work of the charitable foundations that can be key players in addressing both the symptoms and causes of the social problems our communities face.

A new survey finds that foundations “are isolated from many citizens on the front lines of local, regional and national efforts to improve American society.”

The survey, which was commissioned by the David and Lucille Packard Foundation for the Philanthropy Awareness Initiative, and was conducted by Harris Interactive, asked questions about foundations to individuals serving in a leadership, committee or board role in an organization working on community or social issues.
All told, the survey says, the findings “paint a picture of foundations as little known among key players in the efforts they seek to support.”

Fifty-six percent of those surveyed, for example, could not name a foundation on their first try, 60 percent considered themselves somewhat or not at all informed about foundations, only 15 percent could cite examples of a foundation’s impact on their community, and only 11 percent could give an example of a foundation’s impact on an issue they care about.

While foundation grants in 2006 represented only 12.4 percent of all charitable giving in the U.S., the impact of foundations and the role they can play is far greater than their share of overall giving suggests.

Foundation grants, whether to address immediate social problems or needs, or to fix the underlying causes of those problems or needs, can provide critical investment in improving our communities.

Funds from foundations also can help nonprofits secure investment from other funders.

And foundations can serve as brokers for social change, convening individuals and organizations that can work as partners in addressing community problems.

What’s more, foundations can do even more than they do now.

Instead of paying out only the 5 percent of their assets in grants and overhead that the law requires they pay, foundations can pay even bigger share.

Moving beyond their preference for funding programs, foundations can invest more in helping nonprofits strengthen their internal operations.

And rather than simply looking to their endowments for investment returns, foundations can be more active shareholders, making investments that are in line with their philanthropic mission, and working with the companies in which they invest to make change happen.

Ultimately, foundations can be powerful agents for social change.

First, though, foundations must do a better job telling their story, and helping the groups they support tell their own story.