Diversity vs. Philanthropic Freedom?
June 25, 2010
(Bradford Smith is president of the Foundation Center. In his last post, he argued that it's time for philanthropy to move beyond the "infrastructure debate.")
I'm not buying. The Florida legislature passes AB 998 to prohibit state and local government agencies from requiring foundations to disclose information about the "special characteristics" of their board, staff, or the organizations they support. Emmett Carson fires back in the Chronicle of Philanthropy, blogger Rosetta Thurman joins the fray, and the Alliance for Charitable Reform claims a victory for philanthropic freedom. So where do those of us who care about philanthropic freedom and diversity fit in an increasingly polarized debate that tries to impose a false choice between the two?
Let's start with philanthropic freedom. Philanthropy is the use of private wealth to serve the public good. No one forces the wealthy to use their money in this fashion; they do so primarily out of a sense of moral obligation, indignation, compassion, or charity. Government provides incentives for them to do so in the form of tax exemptions, but the overriding impulse is voluntary. The private and voluntary nature of philanthropy is the wellspring of its independence and, in principle, its innovation and ability to take risks.
Because philanthropy is supposed to serve the public good does not mean, as is sometimes argued, that its resources are public. Anyone working in a foundation has experienced the shock of trying to leverage government funds for a pet program strategy only to have civil servants turn around and request a grant. Public funds are immersed in a web of accountability, oversight, and bureaucracy that are essential to functioning democracies but tend to stifle agility, creativity, and innovation. Philanthropic dollars, though far more scarce, are valued precisely because their private nature makes them so flexible. For foundations and lawmakers, striking exactly the right balance between enough regulation to guard against fraud and abuse without stifling flexibility and innovation is the perpetual challenge.
What about diversity? America is becoming more diverse by the day and a trip to the shopping mall, visiting a corporate headquarters, or simply channel surfing will drive home the point. For those who require hard evidence, just wait until the 2010 census results come in. The armed forces and the private sector long ago embraced diversity because they saw it as both inevitable and strategic. Many foundations, especially those whose values lead them to work predominately with the poor and disenfranchised, already see diversity -- both internal and external -- as an asset if not a precondition for their work. And their ranks will continue to grow, largely because serving the public good in an increasingly diverse nation (and world) will demand it.
The Foundation Center does not take stands on policy matters regarding the operation of foundations. But as a knowledge resource for the field, we believe that more information is better than less, and that greater transparency is the best defense of philanthropic freedom. We provided data to the National Committee for Responsive Philanthropy, which concluded that one-third of all grant dollars benefit "marginalized populations," as well as to the Philanthropic Collaborative, which found that two-thirds of all grant dollars for health go to "underserved populations." This kind of research highlights the need for better data, and the open debate it provokes can only help philanthropy fulfill its promise.
In creating Glasspockets, a portal devoted to transparency in philanthropy, the Foundation Center noticed the growing number of foundations voluntarily posting diversity policies on their Web sites. Some, like the Packard and Kellogg foundations, choose to go further and openly communicate the diversity profile of their staff and boards. These examples inspired us to develop a diversity policy as well and post the Foundation Center's diversity profile on our own Web site. Frankly, it didn't look all that great at first, but it is slowly changing and more than one job candidate has told me how seeing that kind of information online made them want to work at the Foundation Center.
With the movement of money, people, and ideas that globalization brings, the world is growing more diverse before our eyes. But it is also a world in which there is too much poverty, violence, and pollution and not enough justice, beauty, and opportunity. Philanthropy, with its freedom to innovate, must strive to change that. So when it comes to diversity vs. philanthropic freedom, I'm not buying. We've got too much work to do.
-- Brad Smith