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51 posts categorized "Governance"

Most Popular PhilanTopic Posts (May 2014)

June 01, 2014

It was a rough month for Typepad, the blogging service/platform used by tens of thousand of blogs, including PhilanTopic. On two separate occasions during the month, the platform was subjected to significant DDoS (distributed denial-of-service) attacks that knocked it completely offline. In fact, we were down for the better part of six days. Despite the inconvenience, it was a busy month here, as some of our favorite contributors -- Allison Shirk, Derrick Feldmann, and Foundation Center president Brad Smith -- checked in with popular posts. Here's another chance to catch up on some of the things you may have missed....

What have you read/watched/listened to over the last month that made you think, surprised you, or caused you to scratch your head? Share your finds in the comments section below....

Taking Board Leadership From Good to Great

May 14, 2014

Headshot_kevin_monroeI'm a consultant who spends a lot of time working with nonprofit boards,
and as I ponder the experiences and effectiveness of many of those boards, I can't help but notice the gap that exists between their promise and actual performance. In fact, it brings an old song to mind...

You may say I'm a dreamer,
But I'm not the only one.
I hope someday you'll join us,
And the sector will grow as one.

Okay. I took some liberties with the lyrics. But since this is about board leadership, I thought you'd catch my drift and forgive me.

I'm in this line of work because, as the song goes, I'm a dreamer at heart and truly believe in optimal scenarios, especially as it relates to the millions of do-good organizations around the world and the people who lead them every day.

Imagine how different things would be in communities across the U.S. and around the world if every board member that served a nonprofit or NGO vowed to invest only their best into the organizations they lead and serve. They would read the financials and the body language of frustrated employees. They would hold executive leadership accountable in the boardroom – and in high regard outside it. They would balance criticism with encouragement. There would be fewer dictates and more discussion. Instead of being evaluative of goals, they would be evangelical about missions. What if breaking even and taking chances were equally rewarded? What would happen then?

Imagine.

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[Review] 'Abusing Donor Intent: The Robertson Family's Epic Lawsuit Against Princeton University'

April 16, 2014

(The newest book by Doug White, a well-known expert in the fields of philanthropy and nonprofit management, is "equal parts thriller and cautionary tale," writes Daniel Matz, Foundation Web Manager at the Foundation Center. Click here for more from PND's long-running Off the Shelf series.)

What is a gift? In an ordinary sense, a gift is something — money, property, advice — given freely by one party to another without the expectation of receiving something in return. We all like gifts, and so, too, do the 1.4 million nonprofits in the United States that benefit from private donations, large and small. But in the calculus of large-scale institutional philanthropy, a gift isn't really a gift; it's a gesture with a purpose — a purpose informed, to varying degrees, by the intent of the person or institution that gave the gift. And therein, as Shakespeare might say, lies the rub.

Cover_abusing_donor_intentIt's no surprise that wealthy donors and foundations seek out organizations and institutions that share their own passions and interests. But what do donors really expect from a nonprofit grantee in the long run? In the performance-measured, accountability-driven world of twenty-first century philanthropy, grantee reporting is de rigueur. For most nonprofits chasing after scarce dollars (and hoping for future gifts), the willingness and ability to demonstrate that they've aligned themselves with a donor's intent goes without saying. But what happens when a donor, after many years of happy engagement with an organization or institution, begins to believe that the original intent of the gift is no longer being honored? Our intuition tells us that, at some level, gifts/grants/donations involve a leap of faith, and that when the trust between donor and recipient is compromised, the recipient is unlikely to receive additional future gifts from that donor. A donor or foundation might even go public with its disappointment in order to discourage others from making gifts to the recipient. But rarely does a foundation or donor who has become disenchanted with a recipient ask for their money back. Which raises the question: Should they be able to? And does a statute of imitations ever apply in such a situation?

Those are two of the questions Doug White, a well-known expert in the fields of philanthropy and nonprofit management, tackles in Abusing Donor Intent: The Robertson Family's Epic Lawsuit Against Princeton University. Just as White earlier explored a rogues' gallery of swindlers and incompetent trustees in Charity on Trial, here he invites the reader to look behind the curtain of privilege and wealth, this time to learn just how bad things can get when a donor and beneficiary no longer see eye-to-eye. Informed by the slow burn of a decades-old frustration, not to mention the disposition of hundreds of millions of dollars and the reputation of one of America's oldest and most respected universities, Abusing Donor Intent is equal parts thriller and cautionary tale.

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PND Talk: Founder's Dilemma

March 14, 2014

In the fourth installment of our PND Talk series (you can find the others herehere and here), Anonymous outlines a situation with which too many nonprofit executive directors are familiar: the founder who can't or won't relinquish the reins of an organization or agency that has outgrown his or her capacity to manage it.

Fortunately for Anonymous, our late, good friend (and all-around wise person) Carl Richardson was on hand to help and responded with some practical advice that surely must have helped. But see what you think. And then use the comments section at the bottom to share your thoughts and advice....

Founders_dilemmaHELP. I'm working with a great organization that is experiencing a huge growth spurt -- and approaching a total budget of nearly $1 million. But the founder is still "running the show" as if it were a tiny volunteer-driven operation. He inserts himself into everything, from giving staff directives, to changing information on the Web site, to starting new programs without consulting with anyone. Basically, he is an extremely impulsive person and is unable or unwilling to hand the agency over to a professional staff (though he claims otherwise).

A few months ago I stepped in as ED with a twelve-month contract. But despite the fact that we've made some amazing progress, I am not sure I can "save" the organization -- and am beginning to believe I helped create a monster.

We have plenty of board members who are willing to roll up their sleeves, and new blood willing to help. But through his actions, the organization's founder makes it clear that he is in charge, and after a while people get discouraged and become unwilling to engage.

This founder was the sole support of the agency for nearly a decade, and I understand and appreciate his commitment and compassion. Yet the agency has grown beyond his capacity to run - and not just because he has a business to operate as well.

I have dealt with difficult founders before, and I hate to walk away. But I fear for its future -- and my reputation!

_______

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Trust and Corruption

March 03, 2014

(Mark Rosenman is emeritus professor at Union Institute & University and a frequent contributor to PhilanTopic. He lives in Washington, D.C., from where he drew many of the examples of the national problems cited below.)

Rosenman_headshotSelf-serving and dishonest actions in both the public and private sectors are severely testing the trust and confidence of Americans. That's a problem for government, for courts and the criminal justice system, for corporations and business leaders, and, yes, for the nonprofit sector.

It's a much more significant problem, however, for the larger society. Are we destined to slide further toward the pernicious levels of corruption so prevalent in other parts of the world? Can the already strained fabric of American society hold as growing numbers of public, private, and charity officials scramble to profit, legally and otherwise, from their positions? What happens when the fundamental American belief in fairness is undermined by declining confidence in the institutions we all rely on?

Make no mistake, confidence in our institutions is declining. Since the early 1970s, those of us who have a "great deal" or "quite a lot" of confidence in our institutions, including banks, newspapers, and the medical establishment, has fallen dramatically – in some cases by more than 50 percent. Confidence in religion, the Supreme Court, schools, organized labor, and the presidency has fallen by 25 percent or more, while fewer than 25 percent of us have a "great deal" or "quite a lot" of confidence in big business.

Charitable organizations don't fare so well, either. Following a precipitous drop more than ten years ago, a recent survey found that over a third of Americans have "not too much" or no confidence in nonprofits. Meanwhile, Congress's approval rating has fallen to an all-time low of 10 percent.

Interestingly, the few institutions that have shown gains in public confidence include the military and the police and criminal justice system. But while the military is the most respected of American institutions, a series of recent incidents is beginning to take a toll. They include a scandal involving two Navy officers and a senior agent with the Naval Criminal Investigative Service, and a series of misconduct charges leveled at senior military officers for abusing their positions and accepting illegal gifts. His confidence shaken, Secretary of Defense Chuck Hagel has demanded a broader investigation.

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5 Questions for...Ellen Dorsey, Executive Director, Wallace Global Fund

February 27, 2014

In late January, Divest-Invest Philanthropy, a coalition of seventeen foundations with nearly $2 billion in assets, introduced itself to the world with the announcement that its members have agreed to divest their portfolios of investments in fossil-fuel companies and invest a portion of those resources in climate change solutions instead. Arguing that continued investment in the fossil fuel industry carries both ethical and financial risks, coalition members are calling on other foundations to realign their portfolios away from investments in coal, gas, and oil companies and to join them in supporting and sustaining the clean energy economy.

PND recently spoke with Ellen Dorsey, executive director of the Wallace Global Fund, a leading member of the coalition, about the genesis of the divestment movement and the need to act now.

Headshot_ellen_dorseyPhilanthropy News Digest: What was the catalyst for the creation of the Divest-Invest Philanthropy coalition? And what is at stake here?

Ellen Dorsey: The catalyst was the climate crisis itself — a serious threat that affects all of us — and the need to divest from fossil fuels and invest in climate change solutions. As a responsive philanthropy, we want to support that shift and encourage the philanthropic sector as a whole to take this movement seriously.

So the goal of the initiative is not just to announce the commitment by seventeen foundations to divest from fossil fuels and invest in clean energy; it's also to call on the philanthropic sector more broadly to engage in the climate debate and encourage other institutions to both divest from coal, oil, and gas companies that are driving the problem and actually use their investments creatively to identify and fund climate solutions in ways that help move us toward the kind of new energy economy that the world needs.

PND: It's clear that members of the coalition see divestment from fossil fuels as a moral issue. The letter you released in January says, "Mission-based institutions whose goals and constituencies are threatened by the extraction and combustion of fossil fuels should not also seek to profit from them." When did your foundation, the Wallace Global Fund, decide it has a moral obligation to address the threat posed by our continued reliance on fossil fuels?

ED: In 2009, we began analyzing our grantmaking and our investments. We quickly realized there were real inconsistencies. One striking example was investing in fossil fuels at the same time as we were working to combat climate change and all its environmental and human rights impacts. How could we be invested in the very industries driving the crisis we were asking our grantees to solve? Not only was our investment strategy potentially undercutting our grantmaking, we were foregoing the opportunity to use our investments as a tool to achieve our mission and goals. We could be helping create the clean energy economy the world requires.

Additionally, we don't believe there is only an ethical risk to investing in fossil fuels. We also believe there are serious financial risks. Prudent investors are listening to the warnings that fossil fuel stocks are overvalued, as we cannot possibly burn the reserves coal, oil, and gas companies currently hold without cooking the planet. It is clear that a tectonic shift is required in the way we produce and consume energy, and smart investors will put their assets in the energy sources of the future.

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Weekend Link Roundup (February 8-9, 2014)

February 09, 2014

Sochi_logoOur weekly roundup of new and noteworthy posts from and about the nonprofit sector....

Fundraising

Interested in learning how to run a successful online fundraising campaign? Slava Rubin of Indiegogo tells you how in this animated video.

Governance

With foundations subject to more stringent tax laws and regulations than ever before, writes Virginia P. Sikes in the Nonprofit Quarterly, foundation boards and executives need to pay special attention to self-dealing, compensation for personal services, excess business holdings, and grants to charities that lobby -- "four areas from which complications and issues often arise."

Nonprofits

In a post on her blog, Beth Kanter draws a useful distinction between organizational cultures that are data-informed as opposed to data-driven. Among other things, writes Kanter, data-informed cultures

have the conscious use of assessment, revision, and learning built into the way they plan, manage, and operate. From leadership, to strategy, to decision-making, to meetings, to job descriptions -- a data-informed culture has continuous improvement embedded in the way it functions. Key Performance Indicators (KPIs) are the specific quantifiable metrics that an organization agrees are necessary to achieve success. They are the mileposts that tell a data-informed organization whether they are making progress toward their goals....

Philanthropy

In a letter posted on the James Irvine Foundation Web site, Jim Canales, president of the foundation since 2003, says good-bye, as he gets ready to head east to the Boston-based Barr Foundations, to the visionaries, the truth-tellers, the optimists, the ego-less, and the merely curious who have been "essential to the progress that the Irvine Foundation has made and who have personally contributed to my growth and learning as CEO."

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Weekend Link Roundup (January11-12, 2014)

January 12, 2014

Calendar01_JanuaryOur weekly roundup of new and noteworthy posts from and about the nonprofit sector.

Communications/Marketing

Kivi Leroux Miller has a nice infographic on her Nonprofit Communications Blog illustrating key findings from her 2014 Nonprofit Communications Trend Report.

Interesting post on the Open Democracy blog by Janey Stephenson, an activist and filmmaker, about the language of activism and how word choices subtly shape the way activists position themselves with respct to contentious social issues.

Data

The Markets for Good team has announced the launch of its first reader-proposed theme, "Beyond Data Silos," which was suggested by Andrew Means, founder of Data Analysts For Social Good. Means frames the conversation, which is open to contributions from all comers, thusly:

[W]hether they hold grain or information, silos are stores of value. Recognizing that, and without parsing this metaphor to death, we can ask new questions. Chief among them is how to get the most value from data that lies in different parts of an organization and from data that could be shared for greater good between organizations. Also, how can we ensure faster communication of key information across an organization, across the sector?

Looking forward to reading what others have to say about these and related questions over the next three weeks or so.

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A New Kind of Strategy for Nonprofits -- Convene, Reflect, and Take Time to Strategize

October 07, 2013

(Carla Goldstein, JD, is chief external affairs officer at the Omega Institute and co-founder of the Omega Women's Leadership Center.)

Headnote_carla_goldsteinThe top managers of the Legal Aid Society's Juvenile Rights Practice only get to meet once a month, if that. "We needed time away from our hectic court-based environment to think more clearly, without interruption, and in a supportive environment," says Ann Marie Scalia, attorney-in-charge of the Manhattan Juvenile Rights office. Theirs is not a unique story.

In Washington, D.C., GirlTrek, a national nonprofit focused on helping black women and girls improve their health by walking, was at a turning point. The group was growing exponentially but needed time to plan and figure out the most strategic way to scale and launch their big push to get one million black women "walking in our neighborhoods" by 2018.

In New York State's Orange County, the domestic violence prevention organization Safe Homes identified a need to improve their internal communications and supervisory structure and to incorporate self-care into their institutional culture. That might seem like a luxury, but given the high stress levels among staff in an extremely challenging environment, it was critical for Safe Homes.

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Weekend Link Roundup (September 28-29, 2013)

September 29, 2013

Ty-mattson-breaking-bad-02Our weekly roundup of new and noteworthy posts from and about the nonprofit sector....

Civil Society

How are market forces, public policies, and digital technologies changing nonprofit organizations, philanthropy, and associational life at the heart of civil society? That's one of the questions the Project on Philanthropy, Policy, and Technology at Stanford's Center on Philanthropy and Civil Society set out to answer last year through a series of monthly charettes. Now, the fruits of those conversations (and a lot of good, hard thinking) have been captured in a series of reports issued by the Digital Civil Society Lab at Stanford PACS. Written by Lucy Bernholz, Chiara Cordelli, and Rob Reich, the reports -- The Emergence of Digital Civil Society (42 pgaes, PDF); Social Economy Policy Forecast 2013: Project on Philanthropy, Policy, and Technology (38 pages, PDF); Good Fences: The Importance of Institutional Boundaries in the New Social Economy (18 pages, PDF); and The Shifting Ground Beneath Us: Framing Nonprofit Policy for the Next Century (30 pages, PDF) -- are thought-provoking, deeply researched, and a pleasure to read. They're also available as free downloads from the Stanford PACS site.

Responding to Dan Pallotta's hugely popular TED Talk -- and echoing some of the conclusions arrived at by Bernholz, Reich, and Cordelli in their Recode Good work -- Ashoka's Valeria Budinich suggests that one of the most important points made by Pallotta in his talk (and first book) is a point everyone chooses to ignore: Philanthropy's moral foundations -- and the resulting legal and policy framework in which it operates -- have remained largely unchanged since the 1700s.

Climate Change

The most exhaustively researched climate report in history is out -- and, as environmental journalist Richard Schiffman explains in The Atlantic, its findings are grim.

For those as troubled by the findings of the report as Schiffman is, the UN Foundation's Kathy Calvin has some words of encouragement.

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Six Ways to Make Your Volunteer Board Members Feel Appreciated

August 13, 2013

(Allison Shirk is a freelance grantwriter based in the Northwest. In her last article, she offered some tips to help you spice up your grant proposals.)

Headshot_allison_shirkA new generation is making its presence felt, and its members are eager to give more than just their hard-earned money. They want to give their time and talent, to get down in the trenches and serve on boards. They want their ideas to be taken seriously, put into action, and reported back on with charts and graphs. Oh, and they want to be appreciated and recognized for their efforts and contributions to your cause or organization.

What's that? You're too busy to let your volunteer board members know their efforts are appreciated? You might want to rethink that. Before you start planning your next volunteer appreciation event, run through this checklist of things you can do to show you care.

Common courtesy. The easiest way to appreciate and recognize volunteer board members costs you nothing. It's giving them a proper greeting when they arrive for a meeting and letting them know how grateful you are for the time and effort they’ve expended to be there. It's small things like starting and ending the meeting on time. It's making sure everyone's voice is heard and that everyone has a chance to contribute to the discussions.

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Silence Isn’t Golden

July 09, 2013

(Mark Rosenman is an emeritus professor at the Union Institute & University and directs Caring to Change, an initiative that seeks to improve how foundations serve the public. In his last post, he urged PhilanTopic readers to assess how they value the things they value.)

Rosenman_headshotConfronted by headlines about truly questionable practices at a few dozen charities, the response of too many nonprofit leaders has been to bury their heads in the sand and try to pull the hole in after them. What these leaders fail to appreciate is that silence in response to scandalous behavior is neither golden nor in their best interests.

By now, most of you have seen the carefully researched list compiled by the Center for Investigative Reporting, in partnership with the Tampa Bay Times and CNN, of "America's 50 worst charities" -- tax-exempt organizations that "channel most of the money they raise to professional solicitors, mimic other charities' names, deceive donors on telemarketing calls, divert money and contracts to people with ties to their organizations, and use accounting tricks to inflate the amount they report spending on their missions."

Yet, despite overwhelming evidence of self-dealing by these groups and their closely associated entities, key leadership organizations in the sector, including Independent Sector, have responded to requests for comment from the press by declaring that they didn't have enough information to make a judgment, while others have defended outrageous fundraising percentages diverted to what the California Association of Nonprofits' Jan Masaoka labels the "philanthropic-consultant industrial complex."

When it comes to nonprofits, these kinds of abuses are nothing new, and neither is the timidity of nonprofit leaders in condemning them. Their silence in the past has greeted media coverage of huge salaries paid to charity officials, outlandish benefits, self-dealing within boards, tax gimmicks for donors, and malfeasance in program operations. Unfortunately, the cost of that silence is something we all bear.

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Board Compensation in Grantmaking Foundations: Reasonable and Necessary?

February 20, 2013

(Mark Hager is associate professor of nonprofit studies in the School of Community Resources and Development at Arizona State University. This post originally appeared on the Foundation Center's Transparency Talk blog.)

Headshot_mark_hagerTradition dictates that board members work for free in most quarters of the nonprofit sector, but that isn't necessarily true for grantmaking foundations, especially independent ones. In a new paper (free access until late March) published in Public Integrity, the ethics journal sponsored by the American Society of Public Administration, Elizabeth Boris and I consider the question of what varieties of grantmaking foundations compensate their board members for governance duties. It reboots and reframes an earlier analysis conducted by the Urban Institute, the Foundation Center, and GuideStar.

In the paper, we point to several interesting examples, including a very large foundation's generous policy of trustee compensation spelled out in its organizing documents, another with seven-figure annual compensation paid to a bank to act as a very part time "institutional trustee," and another that underwent IRS investigation for eye-popping compensation that essentially amounted to trustees looting a charitable trust. These cases aren't typical, but they are part of the big picture of how work gets done in grantmaking foundations and how much insiders get paid to do it. In more typical cases, foundations might have justifiable reasons to compensate board members, including to ensure representation from beneficiary populations or to extend health insurance benefits to family founders. It's the extreme cases, however, that threaten to color all of philanthropy.

Compensation for governance duties is perfectly legal, so long as it falls under the IRS' broad standard of "reasonable and necessary." The practice is pretty rare in community foundations, partly due to the fact that they rely so heavily on public contributions and are therefore subject to public scrutiny. It also appears to be fairly rare in corporate foundations, but that may largely be due to the fact that many corporate foundation trustees get paid as corporate executives, making their compensation invisible on the foundation side. About one in five independent foundations, however, appear to report compensation of their board members for governance duties, as reported on Form 990-PF.

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Weekend Link Roundup (January 26-27, 2013)

January 27, 2013

Mosby-cold-snapOur weekly roundup of new and noteworthy posts from and about the nonprofit sector....

Diversity

On the Tides Foundation's What's Possible blog, Toby Thompkins asks some thought-provoking questions about African Americans and U.S. history to remind us that "Martin Luther King, Jr. Day is not just a day for or about black Americans; it is a day for and about all Americans."

Governance

On her Social Velocity blog, Nell Edgington shares five questions to get your board "moving." They include: Why do you serve? What do you bring to our organization? And what do you want to contribute financially?

Impact/Effectiveness

Are we on the threshold of a new economic movement "that will result in all investors -- individual and institutional -- committing at least some portion of their investable assets to social impact"? Lisa Hall, president and CEO of the Calvert Foundation, believes we are, and in an essay in GreenMoney she explains how impact investing is driving that paradigm shift.

In a guest post on the Forbes blog, Kayleigh O'Keefe, associate director at the Corporate Executive Board, shares a "three-step method for "converting passive support into lasting partners":

  1. For each of your key stakeholder groups, define a specific desired behavior.
  2. If a certain stakeholder group is not doing what you’d like them to, determine why.
  3. Focus your efforts o n removing the barrier to the desired behavior change.

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The Archives of U.S. Foundations: An Endangered Species (Part 1)

January 23, 2013

(John E. Craig, Jr. is executive vice president and COO of the New York City-based Commonwealth Fund, a private foundation that works to "promote a high performing health care system." A version of this post originally appeared on the Foundation Center's Transparency Talk blog).

A foundation's archives preserve records of the programs, activities, products, governance, people, and history of the organization that may have enduring cultural, historical, research, or institutional value. Yet despite the important role archives play in a field that focuses on investing in ideas, a recently released survey about foundation record management practices reveals that only a small minority maintain foundation archives. Clearly, there is a need to make a case for why foundations should devote resources to archive development and management. And there are at least six compelling reasons for why foundations should give their inactive files and historical records serious attention.

1. Historical Research on Social and Economic Developments and Influential Institutions and Individuals.
The late Paul Ylvisaker described philanthropy as "America's passing gear," and foundations serve this purpose in numerous ways: by helping to launch movements (such as civil rights, environmental protection, or health care reform); by developing new institutions and strengthening existing ones; by making society more inclusive through support of programs to improve the lot of vulnerable populations; by building up the knowledge base for social improvements and scientific advancement and, through the support of individual researchers, contributing to the nation’s intellectual capital; and by strengthening the social fabric and physical capital of the communities in which foundations operate. In the hands of good researchers, the records of foundations can provide guidance for future generations in tackling new and continuing social problems. For example, no history of the civil rights movement would be complete without access to the permanent records of the Ford Foundation; no history of the development of the "miracle" rice strains that sparked the Green Revolution, which helped transform Southeast Asian societies in the 1960s and 1970s, would be complete without the records of the Rockefeller and Ford foundations; and no history of the healthcare reform legislation of 2010 would be complete without the records of the Commonwealth Fund, the Kaiser Family Foundation, the Robert Wood Johnson Foundation, and other national and regional healthcare philanthropies.

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