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9 posts from October 2018

Philanthropy's Under-Investment in Holding High Finance Accountable: A Gamble We Can’t Afford

October 17, 2018

Monopoly_top_hatTen years ago, President George W. Bush signed into law the Troubled Asset Relief Program, or TARP, authorizing $700 billion in federal funding to buy troubled assets from banks deemed to be in danger of failing as a result of the subprime foreclosure crisis.

A lot has changed since then, but one thing has remained the same: progressive philanthropy continues to under-prioritize efforts to hold the financial industry accountable.

It's a choice that risks undermining the headway progressive foundations are making on issues of inequality and wealth building. Placing big bets on policies designed to lift up low- and moderate-income communities while failing to address the accountability of financial institutions is a gamble we cannot afford to take — not least because it puts at risk the very people we are trying to serve.

American households lost $16 trillion in wealth in the years after the 2007-08 financial crisis. And while some experts estimate that Americans have regained $14.6 trillion, or 91 percent, of those losses in the decade since, the collapse affected different segments of society unequally, with the gains just as unequally distributed. In other words, both the crash and the recovery increased inequality in America.

The impact on African Americans was especially profound. Nearly 8 percent of African-American homeowners lost their homes to foreclosure in the years after the crisis, compared with only 4.5 percent of white homeowners, and between 2007 and 2010 African Americans saw their retirement accounts lose 35 percent of their value. Indeed, according to the National Association of Realtors, African Americans lost fully half their wealth as a result of the financial crisis.

It's not just the likelihood of future financial crises that should give philanthropic leaders pause; it's also the fact that an under-regulated and unaccountable financial industry will continue to target communities of color and low-income communities with sketchy products and put vulnerable households at risk.

The payday lending industry is one example: the average payday loan, $300, costs the borrower $450 in fines and fees. And if it's not the payday industry preying on low-income individuals, it's car title loan companies, usurious overdraft fees, or predatory mortgage lending.

Philanthropic funding in support of efforts to hold the financial sector accountable is most helpful in advance of a crisis, not in the midst of or after one. Progressive grantmakers and grantees should be working to prevent the next crisis and gaming out what they can do when and if it happens. We need to move faster and more effectively to mitigate the effects of the next crisis, and acknowledge that it could happen sooner than we expect.

With adequate philanthropic investment, we could shape a financial sector that works to help low- and moderate-income households build and protect their wealth. That we have not isn't for lack of ideas: there are efforts already underway to create affordable small dollar loan programs, new and smart affordable mortgage models, and state banks like the one currently being debated in New Jersey.

When the last financial crisis hit, there wasn't a lot of nonprofit infrastructure in place focused on mortgage and financial sector issues. People's Action, the nonprofit I direct, organized the largest street mobilizations during the crisis with the aim of demanding accountability, from the financial sector and its regulators, and some measure of restitution for homeowners, workers, and retirees. Initially, we subsidized this work through general operating funds. Similarly, the campaign to win the Wall Street Reform and Consumer Protection Act of 2010 (more commonly known as Dodd-Frank), which was led by Americans for Financial Reform, had a budget of $1.3 million. That's the same amount the financial sector was spending every day to defeat the bill.

A handful of philanthropic organizations answered the call, including the Arca Foundation, the Panta Rhea Foundation, and Atlantic Philanthropies. But once the worst of the crisis had passed (and the financial reform bill had been signed), consistent funding in support of stricter regulation of the financial industry largely dried up (with the important exception of the Arca Foundation).

Unfortunately, the work we need has barely begun. Experts have predicted that housing bubbles in many U.S. cities will cause mass displacement as the wage-to-housing cost gap reaches unsustainable levels. New lending schemes that sound eerily similar to many of the subprime lending scams are being widely advertised. Non-bank lenders, who now comprise the bulk of the mortgage market, are not subject to the same oversight as traditional banks and are growing like kudzu.

Now is the time for progressive philanthropy to engage in a serious conversation about how it can support efforts to strengthen financial regulation. With all three branches of government controlled by the GOP, Wall Street and Republicans are free to mischaracterize and roll back the protections that are keeping the titans of Wall Street from crashing the economy again, including an attempt to exempt 80 percent of banks from the Home Mortgage Disclosure Act (which requires banks to disclose who they are making and denying loans to) and to erase common-sense tax rules for corporations and billionaires.

Because we in the nonprofit sector don't have their resources, we must combat the regulatory rollbacks and irresponsible policy making with good organizing and strategic communications. With the ten-year anniversary of the big bank bailout upon us, it's a good time to question why this work continues to be under-supported, and what we can do to change that.

George_goehl_for_PhilanTopic George Goehl is a community organizer and executive director of People's Action, whose work in the lead-up to the Occupy Wall Street movement played a critical role in the passage of the Dodd-Frank financial reform package and a $26 billion mortgage relief settlement for communities and homeowners.

Weekend Link Roundup (October 13-14, 2018)

October 14, 2018

105499618-4ED5-BL-HurricaneMichaelV2-101018.600x337A weekly roundup of noteworthy items from and about the social sector. For more links to great content, follow us on Twitter at @pndblog....

Climate Change

As the global climate continues to warm, there's a "material difference" between 1.5 degrees C of warming and 2 C degrees. Kelly Levin, a senior associate with the World Resources Institute's global climate program, looks at some of them. And Adele Peters, a staff writer at Fast Company, suggests that holding warming to the former, while difficult, might not be impossible.

According to a poll conducted by researchers from Yale, George Mason University, and Climate Nexus, a majority of voters in North Carolina post-Hurricane Florence are worried about climate change (60 percent) and think it's appropriate to talk about the issue when disaster strikes (55 percent). HuffPost's Jeremy Deaton reports.  

Disaster Relief

Hurricane Michael, one of the most powerful storms ever to strike the continental U.S., hammered the Florida Panhandle before carving a path of destruction across Georgia and North Carolina. We're tracking institutional pledges and commitments to relief and recovery efforts here. And Fast Company has put together a list of fifteen things you can do to help the storm's victims.

Education

On her Answer Sheet blog, Kevin Welner, a co-director of the Schools of Opportunity project and director of the National Education Policy Center at the University of Colorado, and Linda Molner Kelley, a co-director of Schools of Opportunity and director for outreach and engagement at the University of Colorado, look at how William C. Hinckley High School in Aurora, Colorado, used a restorative justice approach to change its culture.

Giving

As we head into the holiday season, families and friends should think about allocating some of the money they planned to spend on gifts to a commonly determined cause, writes philanthropy consultant Bill DeBoskey. "Imagine the result," adds DeBoskey, "if each of us pledged to donate to a worthy cause just 10 percent of what we would otherwise spend on holiday gifts, food and candy."

Impact Investing

Forbes contributor Aislinn Murphy has a good Q&A witf LinkedIn co-founder Reid Hoffman, who reveals that he has put $1.5 billion of his considerable fortune into impact investments.

Nonprofits

Nonprofit AF's Vu Le is another leader in the social sector for whom the confirmation of Brett Kavanaugh to the Supreme Court was a kind of come-to-Jesus moment.

Over at Forbes, the site's panel of nonprofit experts weighs in on the things that the best nonprofit blogs have in common. 

Is your organization one of the best nonprofits to work for. If the answer is yes, the NonProfit Times would like to hear from you.

Giving Tuesday is just around the corner, and Beth Kanter and Allison Fine have collected fifteen #GivingTuesday myths nonprofits should be aware of.

Philanthropy

On the Center for Effective Philanthropy blog, CEP president Phil Buchanan applauds the announcement of Kathleen Enright, longtime CEO of Grantmakers for Effective Organizations, as the new president and CEO of the Council on Foundations. But in a philanthropic infrastructure landscape that has "changed dramatically" since the early days of GEO and CEP, what role should the council play? asks Buchanan. Check out his post to learn what he thinks that role should be.

And in the Stanford Social Innovation Review, Alison Corwin, senior program officer for sustainable environments at the Surdna Foundation, argues that when it  comes to building the capacity of frontline and grassroots leaders, funders first need to "build [their] own individual and institutional skills to receive and incorporate the insight these leaders and communities provide."

That's it for this week. Got something you'd like to share? Drop us a note at mfn@foundationcenter.org.

Tracking Hurricane Michael Disaster Relief

October 12, 2018

Updated: October 17, 2018 - 4:45 PM ET

Hurricane Michael first showed up in early October as a low-pressure area in the western Caribbean. After meandering for a few days, it began to organize itself and then intensified rapidly as it moved past Cuba into the Gulf of Mexico, becoming a tropical depression on October 7 and a Category 1 hurricane just twenty-four hours later. By Tuesday, October 9, it had strengthened into a Cat 3 with winds of more than 120 mph, and by the time it smashed into the Florida Panhandle near Mexico Beach on Wednesday, October 10, it was a Cat 4 with sustained winds of 155 mph.

For many, the unprecedented nature of the storm — the most intense tropical cyclone to strike the U.S. since Andrew in 1992, the third most intense storm in terms of barometric pressure ever to make landfall in the U.S., and the strongest hurricane to strike the Florida Panhandle on record — was disturbing, its rapid intensification and the path of destruction it carved across four states cause for alarm, coming as it did just days after the UN's Intergovernmental Panel on Climate Change released a report warning of dire consequences if greenhouse gas emissions are not cut dramatically over the next decade. As of Wednesday afternoon, a week after the storm made landfall, the death toll had risen to thirty-two, including fifteen in Florida, and estimates of the damage were holding steady at between $8 billion and $30 billion.

As we did with Florence, Foundation Center will be tracking institutional pledges and commitments for relief and recovery efforts here on PhilanTopic. To make sure your company or organization's pledge have been included in the total, or for questions about methodology or sources, please contact Andrew Grabois, manager of corporate philanthropy at Foundation Center.

Mexico Beach destruction

(Photo credit: Reuters)

TOTAL: $20,910,000

Organization Type (pledges and commitments)

Corporate Direct Giving/
Company-Sponsored Foundations
$17,710,000 29 orgs.
Private Foundations $0 0 orgs.
Public Charities $3,200,000 5 orgs.

Top Recipients (Total Received to Date)

1. Unknown Recipient(s) $12,550,000
2. American Red Cross
(national)
$4,755,000
3. Florida Disaster Fund $1,600,000
4. Multiple Recipients $1,100,000
5. United Way Worldwide $375,000
6. Samaritan's Purse $250,000
7. Volunteer Florida $250,000
8. American Red Cross, North Florida Region $50,000

Source: Foundation Center & Center for Disaster Philanthropy

Download the Data

For the latest coverage of the philanthropic sector's response to
Hurricane Florence, check out Philanthropy News Digest.

Nonprofit Boards and Risk

October 11, 2018

RiskWhile most nonprofits know they need to be forward thinking in order to create change, many are (understandably) focused on the day-to-day delivery of programs and services and don't know how to proceed. It's a challenge to strategize about future plans or consider taking on new activities and programs with broader impact when resources are limited and the organization's staff and leadership already have their hands full. Which is why it is especially important for nonprofit boards to weigh and be willing to recommend taking calculated risks. Is yours?

What follows are some commonsense tips for nonprofit board members who are ready to help take their nonprofits to the next level.

Think data. A good strategic planning process should focus resources on the programs likely to have the greatest impact on the groups served by an organization, and data needs to be at the heart of that process. Every program (as well as every internal department) generates data. Making time to identify trends and patterns in that data in order to be more strategic and identify risk is the first step on the road to creating impact.

Assess current risks. In Green Hasson Janks' most recent nonprofit report, Board Governance: The Path to Nonprofit Success, one of the firm's principals, Mark Kawauchi, notes that "a significant percentage of nonprofits are not incorporating and addressing risks in their strategic plans." Mark goes on to suggest that nonprofits with sufficient resources should conduct a comprehensive risk management assessment that incorporates both the organization's operations and its programs.

Collect best practices. The last thing a nonprofit organization should do is reinvent the wheel. Nonprofits of every size and stripe have published their success stories and shared lessons they learned along the way, so surfacing useful strategies for an organization to consider should be no more complicated than conducting an online search. Even better is talking directly with leaders and board members at other organizations engaged in similar work. What practices have they adopted, and how might your organization leverage those ideas to strengthen its performance? Don't be afraid to reach out to competitors: you'll be surprised how many people in the nonprofit world are happy to share what they've learned.

Align plans with resources. It may sound obvious, but given the limited resources available to most nonprofits, an important element of any planning process is understanding what an organization should stop doing in order to free up resources for a promising new program or activity. Similarly, launching a new program without fully understanding the demands it will make on existing resources can lead to disastrous consequences. Take the time to figure out which of the organization's programs are having an impact and which are underperforming. It's not always easy — or fun — but it's imperative that, on a periodic basis, boards, working with leadership, do so.

As a member of the board of the Downtown Women's Center, an organization focused exclusively on serving and empowering women experiencing homelessness, I've learned that our interim CEO, Lisa Watson, has a set of questions she uses when considering whether to develop a new program:

  • Does it align with our mission?
  • Does it align with our current priorities?
  • Are there other agencies engaged in this work? If so, who? If yes, are we duplicating services or can we collaborate with them?
  • How long will the project last?
  • If we make this decision, how will it look six months from now? A year? Five years?
  • What is the budget for this project and what impact will it have on our budget?
  • Is it financially sustainable?
  • Are there any legal, permitting or zoning issues that need to be considered?
  • Is there a better decision that would be more aligned with our mission moving forward?

In fact, the center's board recently used Lisa's framework to help her make an important programmatic decision. The center has long believed that permanent supportive housing is the solution to ending homelessness, and it has focused its resources on providing trauma-informed services to homeless women and on keeping them housed. In response to the high demand for short-term shelters, however, the board recently decided to recommend that the organization expand its work to include the provision of shelter services in its building after business hours. We used Lisa's questions as a guide to help us think through all the implications of that decision, and we ultimately agreed it was an important step to take in response to the needs of the community we serve.

Diversity, diversity, diversity. Embedding a tolerance for risk into an organization's culture is not easy for any organization, let alone a nonprofit. In the current environment, however, it's not enough for boards to sit back and govern passively; they need to be fully engaged. They should also be diverse in terms of age, race, religion, gender, expertise, and experience. If an organization expects its risk-taking to pay dividends, its needs to consider a wide variety of perspectives 

Measure success. Another important, if often overlooked, part of strategic planning is defining what success looks like and how it will be measured. Measuring outcomes against goals and evaluating programs as they are being delivered will go a long way to keeping things on track and will allow an organization to make course corrections in a timely fashion if needed.  

Final thoughts. When considering a new program or initiative, evaluate the opportunity at the executive committee level first before bringing it to the entire board. Another best practice is using board subcommittees to take a deeper dive with individual board members on key issues.  Lastly, emphasizing clear and transparent communications between the board and leadership and across the organization is critical. After all, any calculated risks an organization takes are likely to be more successful when everyone is on the same page, right?

Headshot_donella_wilsonDonella Wilson is a partner at Green Hasson Janks, where she leads the Green Hasson Janks Nonprofit Practice. She also is immediate past president of the board of directors of the Downtown Women’s Center and a member of Southern California Grantmakers.

 

The Importance of Listening for and Sharing Stories

October 10, 2018

Share_your_story­When leaders of today's most vibrant social movements gather in a ballroom for a day to share advice and lessons learned, we ought to listen — and not just because as leaders of nonprofits competing for people's attention, dollars, and time, we should welcome opportunities to learn as much as we can about how best to apply our efforts to bring about change.

In September, leaders from the Ad Council, the Born This Way Foundation, Young Invincibles, the Transgender Law Center, the MBK Alliance, the National Geographic Society, and other organizations and causes gathered in Washington, D.C., at the Influence Nation Summit to talk about the tactics they've used in the past to move large numbers of people to take action.

Running through their remarks were two critical points that many nonprofits struggle to operationalize: 1) Listening is more important than talking; and 2) Sharing authentic stories with a compelling message is at the heart of every successful movement.

Listening is more important than talking

If you're a professional fundraiser, you've heard the admonition to focus on your donors and establish them as the "hero" of the narratives you share with supporters and stakeholders. You've been told to use "you" in your messaging instead of "we," to evoke donors' empathy by appealing to their emotions, and to assure them that whatever your organization has accomplished is due to their generosity and passion for the cause.

Imogen Napper, one of the speakers at the Influence Nation Summit, is a marine biologist and a National Geographic Sky Ocean Rescue Scholar who is focused on ridding the oceans of plastic, including plastic fibers found in clothing. Without listening to the online conversation around the topic, however, you might think Napper supports a ban on synthetic fibers in apparel. Not so. As she told attendees at the summit, "Plastic is a fantastic material as it is so versatile....Seventy percent of clothes are made of plastic. Therefore, it would be difficult and often expensive to completely avoid it." What people want instead, she said, is access to information that allows them to make informed decisions about the clothing they buy.

In other words, before you go out to recruit new donors to your cause, it's imperative that someone on your staff spends some time finding and listening in on the conversations that are already happening around your issue.

Telling authentic stories with a compelling message

The second component of a successful movement naturally follows the first. Careful listening should give you a good idea of the language, concerns, and passion points surrounding your issue so you can then use that information to create stories that don't overpower the conversation but instead dramatize the issue in an unforgettable way.

Conservation International's Anastasia Khoo, another summit speaker, said those of us who work for causes have to make sure we are inspired by the messages we create. "We have to be bold and fearless," she added. Michael Skolnik of the Soze Agency agrees, stressing the need for authenticity and passion. "I have to believe that you believe it," says Skolnik. "Tell a story from your heart."

So while you're recruiting new donors and working to retain the ones you already have, try to gather information you can use to create compelling stories for and with your supporters. How? Here are a few things to keep in mind:

Look for ways to create common ground. How is your issue personally relevant to the lives of those you want to engage? How can you make that connection? Your goal is to help potential supporters "see" themselves in your organization or cause, which will make them much more willing to give their time, money, and attention.

Invite people to share. Most people won't talk about themselves unless they're asked. So ask — on social media, on your website, in your email communications, and at your events. Charge your staff with collecting stories that might be good for sharing. (And if someone asks that their name or story not be used, be sure to honor their request.)

Learn how to tell stories via Facebook Ads. Facebook may not be the best place to make a cold pitch, but it's an excellent platform for telling stories. Pay attention to organizations, causes, and campaigns on the platform that seem to work and try to emulate them. Using Facebook Ads, you can post a video, tell a story in a single ad or sequence of ads, or start a story in a post and the provide a link to the rest of it. Facebook has kept the cost of the service low, so it's easy to test to see what is and isn't working. And remember: the key to a story well told is eye-catching imagery.

Social movements that achieve success often seem to have done so spontaneously, but that's rarely the case. Behind every successful movement are people and organizations that have taken the time to listen first and then find and craft stories that pack an emotional punch. It isn't a new idea: nonprofits have been telling stories and talking about their causes for decades. What's changed is the environment in which stories are told and shared, including the speed and reach of digital communication, the greater awareness of social issues across a wider swath of the population, and the way young adults view their personal capital (dollars, time, attention). We live in an increasingly "noisy" world and breaking through the noise with a well-crafted message isn't getting any easier. But if you listen first and then dig in and create stories that appeal to others with a passion for your cause, your chances of success will improve dramatically. 

Headshot_derrick_feldmann_2015Derrick Feldmann (@derrickfeldmann) is the author of Social Movements for Good: How Companies and Causes Create Viral Change and the founder and lead researcher for the Millennial Impact Project.

Philanthropy Delivers an Outcome — and Its Name Is Brett Kavanaugh

October 07, 2018

Kavanaugh_swearing_inWhen the U.S. Senate voted 50-48 on Saturday to confirm Brett Kavanaugh to the Supreme Court, it was a significant victory for the Federalist Society, and for the foundations that support the organization. It also represented something — an outcome and real impact — that philanthropists of all persuasions crave, and it was achieved through, that’s right, general support grants.

Widely credited for writing the playbook that has guided the Trump administration's judicial nominations strategy, the Federalist Society, by any measure, has been wildly successful. Since Donald Trump's inauguration in January 2017, the U.S. Senate has approved two of his picks for the Supreme Court and some fifty lower court judges. With an additional hundred and fifty appellate and district court seats to be filled, the administration, with the help of the Federalist Society, is on track to have put in place nearly a quarter of all active judges by the end of 2019.

The organization describes itself as a

group of conservatives and libertarians interested in the current state of the legal order. [The Society] is founded on the principles that the state exists to preserve freedom, that the separation of governmental powers is central to our Constitution, and that it is emphatically the province and duty of the judiciary to say what the law is, not what it should be….This entails reordering priorities within the legal system to place a premium on individual liberty, traditional values, and the rule of law. In working to achieve these goals, the Society has created a conservative and libertarian intellectual network that extends to all levels of the legal community....

As a 501(c)(3) organization, the society receives tax-deductible donations from individuals, but foundations contribute roughly one-quarter of its annual funding. Since 2006, 127 foundations have made $39 million in grants to the organization, 53 percent of which has come from five foundations: the Lynde and Harry Bradley, Templeton, Mercer Family, and Sarah Scaife foundations, in addition to the Searle Freedom Trust. Nearly half of those grants have provided general operating support to the organization, giving it the freedom to use those resources to further its goals without donor-imposed restrictions.

As social investing and effective altruism — with their focus on outcomes, impact, and results — increasingly challenge so-called traditional philanthropy, general operating support has become somewhat passé among those who see themselves leading the charge. Unlike the Federalist Society, most nonprofit organizations receive little, if any, general support. Overall, 80 percent of the resources granted by U.S.-based foundations are restricted, requiring grantee organizations to spend valuable time on creating theories of change, strategic plans, and elaborate output and outcomes measurement systems in order to prove their impact to funders.

But who would disagree that shaping the philosophical orientation of the highest court in the land, not to mention the rest of the federal judiciary, is anything but hugely impactful. Scale? Check. Significance? Check. Sustainability? Check. From where I sit, the foundation supporters of the Federalist Society seem to have achieved something monumental by going back to basics: find an effective organization that shares your goals and provide it with steady, unrestricted, long-term support so it can do its work.

How I feel about the Kavanaugh confirmation, the polarization it represents, and what it means for the country is beside the point, and not something Foundation Center has a position on. For our information to be trusted, we believe we need to avoid taking positions on matters of public policy. But we are fascinated by the what data, research, and analysis can tell us about what works, and does not, in philanthropy. Today, it’s telling me that traditional philanthropy is alive and well and changing the world.

(Photo credit: AP)

Bradford K. Smith is president of Foundation Center. In his previous post, he looked at philanthropy in the war zone.

Weekend Link Roundup (October 6-7, 2018)

0930-bks-kabaservice-superJumboA weekly roundup of noteworthy items from and about the social sector. For more links to great content, follow us on Twitter at @pndblog....

Advocacy

"[W]e are in a season when the electorate has the obligation to choose our future," writes Richard Marker on his Wise Philanthropy blog. "And the philanthropy world has an obligation to weigh in on many of these matters. We have everything at stake in re-asserting a stable and civil society, eliminating poverty, rejecting racism and xenophobia, and urging systemic equity. The challenge for us is to not be intimidated by those who would limit our outspokenness under the guise of accusing us of partisanship. Of course, there are legal limitations to what we can lobby for and what lobbying we can support. But our rights, I would say even our obligations as funders, to advocate for constitutional rights, civil society, and equity for all are virtually unlimited."

Children/Youth

On the Robert Wood Johnson Foundation's Culture of Health blog, Martha Davis, a senior program officer at the foundation, shares six recommendations for communities that are developing collaborative, place-based approaches aimed at ensuring that all children have a solid foundation of safety.

In a Q&A on the Case Foundation blog, Justin Cunningham, the millennial co-founder of Social Works, discusses what he and his colleagues are doing to empower youth in Chicago.

Giving

The team at GiveWell has made a number of changes to the organization's cost-effectiveness model.

Grantmaking

In a post on the GrantCraft blog, Jen Bokoff, director of stakeholder engagement, announces the release of the latest GrantCraft guide, Deciding Together: Shifting Power and Resources through Participatory Grantmaking, which was created in partnership with researcher/writer extraordinaire Cynthia Gibson.

Nonprofits

On the GuideStar blog, Lisa Keitges and Ryan Grosso of Orr Associates, Inc. share some good advice with respect to board transitions.

In his latest, Vu Le has some advice for nonprofit professionals who have become jaded and cynical about "the Nonprofit Industrial Complex."

Philanthropy

The Stanford Social Innovation Review, in partnership with the National Committee for Responsive Philanthropy, has launched a new series focused on "power in philanthropy" with posts by Kathleen Enright, president and CEO of Grantmakers for Effective Organizations ("Power, Privilege, and Effectiveness: Are Funders Connecting the Dots?"), and Luz Vega-Marquis, president and CEO of the Marguerite Casey Foundation ("The Power of Family: From Poverty to Agency to Unity").

On the Center for Effective Philanthropy blog, Jennifer Wei, organizational effectiveness officer at the William and Flora Hewlett Foundation, argues that a "handful of foundations offering general operating support to nonprofits is not even close to being enough" and that the field needs "many more funders — a critical mass — to provide general operating support grants and recognize the full cost of running an organization. Only then," she adds, "[will] nonprofits have enough unrestricted dollars to truly use those funds flexibly, prioritize organizational capacity needs, and strengthen organizational health."

Here on PhilanTopic, Foundation Center president Brad Smith argues that general operating support provided to the Federalist Society over the years by conservative-leaning foundations played was a significant factor in the elevation of Brett Kavanaugh to the Supreme Court.

The team at HistPhil winds down its forum on Paul Brest and Hal Harvey's Money Well Spent with a post by Erica Kohl-Arenas (The Self-Help Myth: How Philanthropy Fails to Alleviate Poverty) that offers a brief history of strategic donor behavior. And in the forum's final post, Brest and Harvey respond to the comments of forum contribtutors.

And after two years of work, the renovation of the Ford Foundation's landmarked building on Manhattan's East Side is almost complete. Darren Walker, the foundation's president, explains how the building, newly renamed the Ford Foundation Center for Social Justice, "will be a unique asset for champions of social justice across sectors and geographies...in the U.S. and globally."

That's it for this week. Got something you'd like to share? Drop us a note at mfn@foundationcenter.org.

How to Recruit, Engage, and Retain Millennial Board Members

October 03, 2018

Millenials_on_boardHere's a well-documented fact: in the nonprofit sector, most boards are lacking in diversity, especially when it comes to people of color and women. (We wrote about the former, and how to change it, a couple of months ago.) We also know that more diversity on a board tends to bring positive, lasting results to the organizations governed by those boards. There's another population that is often overlooked for board service, however, one that is well positioned to bring new and different perspectives to nonprofit board deliberations. I'm talking about millennials.

According to BoardSource, 57 percent of nonprofit board members are over the age of 50, while only 17 percent are under 40 (about the age of the oldest millennial). While work experience and years of service often translate to effective board service, so, too, can the fresh perspective and ground-level experience that younger professionals often possess. In our work at Community Resource Exchange, we see the value that young people bring to nonprofit boards. For example, one of our clients recently was looking to re-engage and strengthen its board, and it did so by recruiting a group of twenty- and thirty-something program participants to join the board. In no time, the new board members were able to provide their (significantly older) colleagues with first-hand knowledge of the organization's programs and share their deep understanding of social media and cultural trends. In this and many other ways, the fresh perspective of the younger board members reinvigorated the older board members and energized them to engage with new ideas, emerging technologies, and the increasingly important role of social networks.

This is precisely the kind of value-add nonprofits should seek out in board members. All too often, though, boards are seen solely as a source of funding for the nonprofits they serve. The proper role of a board of directors is much more than that. Boards are tasked with setting the direction of the organization, ensuring that it has adequate resources, and providing fiduciary oversight. They support the strategic direction of the organization by helping to set that strategy, making connections to ensure its successful implementation, and monitoring activities, outcomes, and goals. When we move beyond the narrow conception of board service as fundraising and see it for the important governance role it is, then the value of having millennials on a board is even easier to see. By introducing younger perspectives and experiences into board deliberations, governance tends to become more creative, flexible, and plugged into our rapidly changing world. And who wouldn't want that? Ready to get started? Read on!

1. Identify your slice of the issue-area pie. There are many nonprofits out there working to effect the same outcomes and applying for the same grants as your nonprofit. And you know that differentiating your organization's work from the work of other organizations is important to its success. But when it comes to recruiting young board members, you need to understand that millennials are more interested in getting behind a cause than an institution, and they prefer to do so in interesting and innovative ways. Clarifying your organization's unique value-add as it applies to creating change is essential before you start to recruit young people to your board. Ask yourself: What do we do that represents a different approach or solution to our issue? What is it about our mission that brings people together around our cause? Highlighting the compelling work your organization does is not enough. You need to explain how your approach is unique and why your organization is the one all millennials should want to support.

2. Take it back to show-and-tell. Remember back in the day, sitting in your third-grade classroom and listening to a friend's description of her new toy, and her going on and on and on… The moment, however, she showed the rest of you her show-and-tell item, you and your classmates would emit a collective “Ohhhh” and lean forward, as if enthralled by the power of seeing and experiencing. Let's bring back show-and-tell! Prospective millennial board members eager to make a difference can listen to explanations of your organization's value proposition all day long, but the real hook for most of them will be when you follow up the telling with some showing. That means taking them on site visits to meet program participants or giving them an opportunity to deliver a much-needed service for a day. Show them the impact your organization is having every day and connect that impact to how their service on your board will contribute to and amplify that work. Young people are eager to give back — but they also want to feel and see their own impact. By showing the impact of your programs and how it relates to your board's work, prospective millennial board members will have a much clearer idea of the connection between your organization and the community it serves and how they can contribute.

3. Build in accountability and camaraderie. The world that young professionals have to navigate is fast-paced and rapidly changing, and service on a nonprofit board is another commitment they  need to balance. What can you do to hold them accountable and committed to their board duties? One great tool for bringing millennials on to a board is the cohort onboarding model, in which a group of new board members all begin their service at the same time. Such an approach helps to establish a sense of camaraderie and shared purpose among new members and make them more likely to hold each other accountable in terms of their service. I experienced this first-hand in my service on the alumni board of City Year New York, which brings on a new cohort of young board members every year and assigns them to various committees where they work closely with five to seven peers. The number of times I chose not to skip a board meeting because I knew my peers would hold me accountable is a testament to the effectiveness of the model. (Buddy systems and accountability partners are other options if the cohort onboarding model isn't right for your organization.) Another advantage of building accountability and camaraderie into board service? Critical mass. Power in numbers means increased commitment among members of the group and will also increase the amount of creative ideas it tends to generate.

4. Be open to all types of contributions. Board service is typically thought of as giving your time, connections, and financially (through your own gifts — the "give" — and/or your fundraising efforts — the "get"). When it comes to younger professionals who may be less able to give financially, you need to be open to other kinds of giving — for example, resources they may have access to through their place of work, their personal and school networks, and/or their creative fundraising ideas. Younger board members should be encouraged to share their time and talents beyond the "give," and to facilitate that sharing, your board chair and executive team should set clear yet flexible expectations around their giving. Valuing and recognizing the different kinds of contributions millennials can make will contribute to greater diversity of thought on your board (as well as more outside-the-box thinking), and add to the range of assets and skills on which your organization can draw.

5. Establish a culture of inclusivity, open-mindedness, and communication. Before it can be open to the possibility of millennial board members, your current board and executive team should be open to contributions from professionals of all ages and backgrounds. Which means your organizations should take the steps needed to create both an organizational and board culture that values different perspectives, ideas, and contributions. To reinforce that kind of openness, the processes for board ideation, planning, and decision-making should be transparent (i.e., clearly defined and communicated) and inclusive of all voices.

Of course, none of these practices will get much traction if your organization is not actively committed to supporting diversity, equity, and inclusion — and that means age and experience as well as race, gender identity, abilities, and sexual orientation. We cannot emphasize this enough: It's important to always value your board members for who they are and how they can contribute — not just for what they can contribute.

Headshot_erin_m_connellRemember, the fresh perspectives, creativity, and new ideas that millennials bring to your nonprofit board will only serve to strengthen your organization!

Erin M. Connell is an associate consultant at CRE, a nonprofit consulting firm that provides the strategies and tools needed to build sustainable, high-performing organizations.

Philanthropy and Cyber-Security  

October 01, 2018

CyberSecurity-796x532With more than a trillion dollars flowing last year from donors and government agencies to grantees in the United States alone, online thieves have discovered fertile hunting ground. In the three years since hackers stole usernames, passwords, IP addresses, and other account data from some 700,000 nonprofits that used the Urban Institute’s online tax filing system, cyberattacks have only gotten more clever, and the stakes higher.

To thwart hackers, organizations in the philanthropy space need to focus on both common security practices and their special vulnerabilities, from the bottom to the top of the organization.

Foundations and nonprofits have the same security concerns as any business, but they also have particular needs based on their mission-driven orientation compared to, say, a retailer or bank. "You often have part-time or volunteer employees, and they like to be helpful," says Mark Walker, knowledge management and technology officer at the Jessie Ball duPont Fund. "And many philanthropic workers wear multiple hats, which means the person responsible for watching over security may not have time to be as thorough as they'd like."

Philanthropy often involves large transfers of money between organizations or people who don't interact daily. That gives hackers an opportunity to trick inexperienced employees who are unfamiliar with how cyber-crooks operate. "They'll contact you with a sense of urgency to act," says John Mohr, chief information officer at the MacArthur Foundation. "If the president of your foundation asks you to wire money quickly, you might not stop to wonder if it's really her."

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