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'Open Letter' to Council Members and Other Nonprofit Leaders

October 10, 2008

Just received this e-mail (as many of you undoubtedly did) from Council on Foundations chair Ralph Smith and CoF president and CEO Steve Gunderson:

Dear Colleagues,

At the conclusion of the Council's 57th annual meeting in Pittsburgh, we committed that we would work to ensure that philanthropy will step up and take on "the challenges of our time." That commitment served as the theme and frame for the 2007 Annual Conference in Seattle, as a point of departure for the 2008 Summit at National Harbor and the upcoming 2009 conference scheduled next May in Atlanta.

Little did any of us know or expect that "the challenges of our time" would include an economic situation of the scope and magnitude now facing our nation and the world. Even so, there is no avoiding the question: what could it mean for philanthropy to step up in these circumstances? How can we play a constructive role without raising unrealistic expectations?

This is a conversation that has started already and will continue for sometime. We look forward to listening carefully, participating when and how we can and providing whatever technical assistance and support would seem appropriate. For starters, we have three broad recommendations:

1. Let's reach out to the nonprofit sector in general, especially those organizations, leaders, and networks we currently support. Our nonprofit partners will bear the brunt of shrinking resources and growing need. Within parameters defined by our respective missions, resources and work, we should actively look for creative ways to assist the sector in weathering this storm and serving those most impacted.

2. Let's play an active and visible role in helping communities and regions figure out the scope and extent of the challenges they face, and in finding and crafting solutions that make sense. We know that some regional associations and community foundations already are using the convening role of philanthropy to build the "big tent" under which diverse stakeholders can gather to create shared understanding and to search for common sense solutions. The exciting work of the Dade Community Foundation, the Arizona Grantmakers' Forum and the Clinton Center for Community Philanthropy represent just the tip of the iceberg of what our colleagues and peers are doing already. We'll share these examples in the toolkit.

3. Let's pay special attention to those situations where the loss of philanthropic resources could be the unintended consequence of mergers and consolidations that are the inevitable products of economic restructuring. In the D.C. area, there is considerable concern that the takeover of Fannie Mae and Freddie Mac could result in an annual reduction of up to $47 million in philanthropic support for programs around child welfare, hunger and homelessness. We know that this was not what was intended and we are hopeful that federal officials will work with local philanthropy and the nonprofit community to rectify the situation....

The economic crisis shows no signs of abating -- and it could wind up, as Smith and Gunderson write, as "one of biggest challenges of our time," an event so disruptive it alters the direction of society for years to come. What would that look like? And, as Smith and Gunderson ask, what would it mean for philanthropy to step up in such circumstances? Let the conversation begin....

-- Mitch Nauffts

Comments

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I think Gunderson's and Smith's point about mergers is significant and there's more about them that needs to be discussed. It's certainly important to consider the philanthropic consequences of mergers among banks and other financial service companies in this context, but M&A activities have been occurring increasingly in the finance world over the past decade. And communities where headquarters have left have had to cope with the consequences. There's learning to be gleaned already. Admittedly, we're talking about larger amounts of dollars, but aren't many of the issues quite similar?

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