Current Trends in Philanthropy: The Big Picture

"Philanthropy" in the United States is a vast industry composed of individuals, foundations, and corporations that, in 2017, contributed $410 billion to charitable causes, an amount roughly equivalent to 2 percent of gross domestic product.

Of this total, nearly 70 percent is contributed by individuals, with more than half of that comprised of giving to congregations. The second largest source of philanthropic giving (some 24 percent) comes from grants made by private foundations like Gates, Ford, and Hewlett, which, along with a few dozen other major foundations, dominate a diverse ecosystem populated by tens of thousands of foundations of all sizes. Third is bequests, through which people designate universities, hospitals, and other tax-exempt organizations as beneficiaries in their wills. And last comes corporations — a surprise to many observers, who, given the dominant position of the private sector in the U.S. economy, no doubt assume that businesses play a far greater role in philanthropy.

My organization, Foundation Center, compiles comprehensive data on the more than 87,000 active U.S. foundations and, working with partners around the world, a growing number of foundations and foundation-like organizations in Europe, Asia, and Latin America. The center envisions a world enriched by the effective allocation of philanthropic resources, informed public discourse about philanthropy, and broad understanding of the contributions of nonprofit activity to transform lives and increase opportunity for all.

We also see U.S. philanthropy as having arrived at a critical juncture. Buoyed by a strong economy, U.S. foundations find themselves navigating a complex landscape in a volatile and highly polarized political environment. Foundations have something valuable to contribute in this environment —  namely, flexible resources free from market, electoral, and fundraising pressures. How they choose to use those resources to advance their work over the next few years is of interest to most Americans.

In a series of blog posts to be published over the next few weeks, we will look at some of the emerging issues that are getting the attention of U.S. foundations and will consider a number of frameworks (e.g., the Sustainable Development Goals) that are shaping the flow of philanthropic resources to different parts of the world. We'll also examine a variety of modalities — from traditional grant funding to experimentation with crypto-currencies — that foundations are using to advance their missions.

As many of you are aware, a growing chorus is questioning the foundation model, even as some donors are looking to experiment with new forms of philanthropy. A handful of younger philanthropists (Mark Zuckerberg, Pierre Omidyar) have opted to create limited liability corporations instead of setting up private foundations and have declared that their investments in social good will be directed to a broad spectrum of organizations and vehicles, not just tax-exempt nonprofits. Still, the predominant organizational form for U.S. philanthropy is the private grantmaking foundation, followed by corporate, operating, and community foundations. These legal structures and the regulatory framework in which they are embedded provide considerable flexibility for experimentation and innovation, and their continued popularity suggests that, for now at any rate, the "new philanthropy" is more of a rhetorical device than an actual phenomenon.

General Trends in U.S. Grantmaking: Subject Areas and Support Strategies

Notwithstanding the growth and innovation that characterizes twenty-first-century philanthropy, a number of its hallmarks persist. U.S. foundations have long prioritized funding in the areas of health and education, and that continues to be the case. Of the $69 billion awarded by U.S. foundations in 2016, roughly 30 percent went to health-related causes or organizations, while 25 percent went to education. Indeed, these two areas have accounted for roughly half of all U.S. foundation grantmaking (by dollars) for as long as Foundation Center has collected this kind of data, going back to the 1960s.

U.S. foundations also have long prioritized program support over general operating support. In 2016, just over 40 percent of the grant dollars awarded provided support for specific programs, with general operating support accounting for 20 percent. But persistent calls for change by nonprofit organizations and philanthropic watchdog groups over the past fifteen years have resulted in a steady, albeit gradual, increase in the amount of general operating support provided by foundations. Between 2002 and 2008, for example, general operating support accounted for 16.5 percent of total giving, while more recently (2009-2015) general operating support has averaged 19.8 percent of total giving on an annual basis.

The two population groups that tend to benefit the most from U.S. foundation giving are the economically disadvantaged and children and youth, capturing 39 percent and 20 percent of grant dollars, respectively, in 2016. Support for the economically disadvantaged in particular has grown over the past ten to fifteen years, up from 20 percent of total grant dollars in 2005 — a near doubling, on the face of it, of grant dollars targeting this population group. It's more likely, however, that U.S. grantmakers have become more intentional in targeting the intended beneficiaries of such grants. In other words, socioeconomic status has become a more frequently-used lens through which foundations make decisions about where and how to direct their giving. While a growing number of advocacy groups have been encouraging grantmakers to also employ gender and racial equity lenses in their grantmaking decisions, there is less evidence to suggest that foundations are doing so. It will be interesting, over the next few years, to see whether that changes.

Funding for Nonprofit and Philanthropic Infrastructure

This is an area of special interest to Foundation Center, which has been a critical part of the infrastructure for philanthropy for six decades. First, some background.

The nonprofit sector contributed more than $930 billion to the U.S. economy in 2014, according to data compiled by the National Center for Charitable Statistic. Nonprofit organizations — of which there are more than a million in the U.S. — work to address a broad range of issues — and employ an array of creative strategies in doing so. Given the sector's size and complexity, a substantial set of supporting organizations have emerged over time to assist them in that work. These organizations (generally nonprofits themselves) provide increasingly essential services to the field, including strategic planning, evaluation and assessment, board and staff development, data and research, legal services, and business modeling.

Infrastructure organizations (like Foundation Center) can be grouped into three main categories:

1. Philanthropy-focused organizations and networks provide services primarily in support of the work of foundations and other philanthropic entities.
2. Nonprofit-focused organizations and networks provide services in support of the work of nonprofit organizations or the nonprofit sector in general.
3. Multi-sector organizations provide services in support of the work of organizations both within and beyond the social sector.

The continued viability of these organizations (especially those in the first two groups) relies heavily on the support of the philanthropic sector. A 2018 study conducted by Foundation Center found that U.S. foundations contributed $1.94 billion dollars in support of the nonprofit and philanthropic infrastructure between 2004 and 2015 —  about 0.7 percent of all foundation giving over that period.

The need for infrastructure has grown as the work of philanthropy has grown in complexity. U.S. philanthropy has become more global, more strategic, more focused on impact, and more collaborative. Outside the U.S., philanthropy has expanded rapidly, as has the global philanthropic infrastructure, with half of all non-U.S. infrastructure organizations founded after 2000.

Support for philanthropic infrastructure, however, has not kept pace with changes in the field. Between 2004 and 2015, total giving by U.S. foundations rose 66 percent, while giving for infrastructure organizations grew just 25 percent. And since 2004, funding for non-U.S. infrastructure organizations has declined some 43 percent.

It is perhaps fair to ask whether U.S. funders should continue to shoulder the majority of the burden to support non-U.S. infrastructure organizations (beyond membership fees), as they have since the founding of the European Foundation Centre in 1989. This is a critical time in the development of the global philanthropic infrastructure, however, and outside the U.S., that infrastructure is poorly resourced even as the demand and need for it increases.

In my next post, I'll take a look at some of the current trends in international grantmaking by U.S. foundations. In the meantime, feel free to comment below and/or drop me a note (ltm@foundationcenter.org) with your questions.

Larry McGill is vice president of knowledge services at Foundation Center. Foundation Center would like to thank the King Baudouin Foundation for support that helped make this series possible.

Weekend Link Roundup (October 27-28, 2018)

A 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

In September, we reported on a coalition of mostly U.S.-based foundations and philanthropies that have pledged $4 billion to combat climate change. But what exactly can charitable efforts on that scale do to slow the pace of global warming and help people cope with its consequences? More than you think, writes Morten Wendelbo, a research fellow at American University, on The Conversation site.

Civil Society

Palaces for the People, a new book by Eric Klinenberg, a sociology professor at New York University and director of its Institute for Public Knowledge, examines how "social infrastructure" — libraries, parks, playgrounds, gardens, child care centers, churches, and synagogues — help us form some of our most significant and abiding connections. These spaces are also crucial, Klinenberg argues, for bridging divides and safeguarding the values of democracy. Katie Pearce reports for Johns Hopkins University's Hub.

Education

A lot of kids graduate high school unprepared for success in college and beyond. A new study from the New Teacher Project, a national nonprofit focused on teacher development and educational programming, puts most of the blame on school itself. Eillie Anzilotti reports for Fast Company.

Environment

The environmental movement is a lot of great things, but diverse isn't one of them. Vu Le's organization, Rainier Valley Corps, is creating a new program called the Green Pathways Fellowship designed to addressed the situation. In his latest post, Le shares a few components of the program. 

Equity

"[Philanthropy] defines people as 'low-income', 'at-risk', 'high-crime', 'low-literacy'. We define people by stigmatizing labels," Trabian Shorters, a former Knight Foundation VP who founded BME (Black Male Engagement) Community, tells Generocity's Julie Zeglin. A better approach would be to frame our narratives in terms of assets. Or as Shorters tells Zeglin: "[T]o really advance equity, you have to remind those who are really concerned with these questions that all of us are striving to do the best we can under the conditions that we're dealt. When you remind people of that, then we look at solutions entirely differently."

Giving Pledge 

Paul Allen, who died earlier this month at the age of 65, was single and had no kids. He also is believed to be the wealthiest signer of the Giving Pledge — a non-binding commitment by wealthy donors to give away more than half of their assets to charity in life or in their wills. The task of managing his $20 billion estate — and Allen's philanthropic legacy — now falls to his sister, Jody, and many in the worlds of business and philanthropy will be watching closely. Theodore Schleifer reports for Recode.

Higher Education

In the New York Times, Reihan Salam, executive editor of National Review, suggests that the "power and influence" of the most richly endowed universities in the country "is unbefitting a democratic society" and that they may not be "generating public benefits commensurate with the extraordinary public privileges they enjoy, including, most of all, their favorable tax treatment."

Philanthropy

Bringing non-family members, people with diverse perspectives, and professional advisors into the decision-making fold can help family foundations move past family dynamics and take greater risks, write Ruth Cummings and Sharon Alpert in "Diversifying Perspectives and Sharing Power at a Family Foundation," the latest installment in NCRP's and the Stanford Social Innovation Review's Power in Philanthropy series. The series also includes excellent posts by Kathleen Enright, Luz Vega-Marquis, Jim Canales and Barbara Hostetter, Alison Corwin, and Grant Oliphant.

What does effectiveness in philanthropy mean, and what does it look like? On the Center for Effective Philanthropy blog, Phil Buchanan and Naomi Orenstein are looking for your input, perspective, and suggestions as they set out to refresh CEP's definition of effectiveness.

Chronicle of Philanthropy contributor Tyler Nickerson has a good Q&A with Edgar Villanueva, vice president for programs and advocacy at the Schott Foundation for Public Education and author of the just-released Decolonizing Wealth: Indigenous Wisdom to Heal Divides and Restore Balance.

(Photo credit: EV Grieve)

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

What's New at Foundation Center Update (October)

As the change of seasons brings cooler weather, I spend more time thinking about cozying up with a good book. Here at Foundation Center, we've released a lot of new content that might make for good armchair reading material. Read on to learn more:

Projects Launched

• We're thrilled to have launched GrantCraft's latest guide, Deciding Together: Shifting Power and Resources Through Participatory Grantmaking, a first-of-its-kind look at how funders can cede decision-making power about funding decisions to the communities they aim to serve. The guide is complemented by a suite of resources at participatorygrantmaking.org. This was a labor of love for me over the past nearly two years and I’m biased, but I really think you should read this!
• September was Nonprofit Radio Month and a number of Foundation Center staff, including Grace Sato and David Rosado of our Knowledge Services team and Susan Shiroma of our Social Sector Outreach team, were guests on Tony Martignetti’s Nonprofit Radio show, which was broadcast to viewers across the country from our beautiful library at 32 Old Slip in Manhattan's Financial District. Be sure to check out Grace, David, and Susan talking with Tony about why data matters, community foundations, and family foundations.
• Foundation Maps: Australia was launched at the Philanthropy Australia National Conference. A joint effort of Philanthropy Australia and Foundation Center, this interactive platform is designed to facilitate greater transparency and insights about the grantmaking practices of Australian foundations.
• In partnership with a group of community foundation leaders, CF Insights conducted a field-wide survey of community foundation CEOs to determine the level of demand for a formalized network that would help them connect with one another on issues relevant to the community foundation field. Check out the results of the survey here.
• Foundation Center, GlobalGiving, and GuideStar released BRIDGE (Basic Registry of Identified Global Entities) information as open data, making it easier to identify and share information about entities around the world that are working to advance social good. The launch of BRIDGE open data represents both a cross-organizational collaboration as well as a collaboration between our Data and Technology and Knowledge Services teams.
• During this webinar, Grantmakers of Western Pennsylvania, Northeastern Pennsylvania Grantmakers, and Philanthropy Network Greater Philadelphia announced the joint launch of Pennsylvania Foundation Stats, a new online dashboard that provides a window on the philanthropic landscape in Pennsylvania as well as four distinct regions in the state.

Content Published

• New blog posts on our WASHfunders platform, including "Challenging Gender Norms to Achieve Sustainable Sanitation" and "Developing a Taste for Artisanal Development."
• New blog posts on PhilanTopic, including a conversation with the president of the Community Foundation of the Virgin Islands and a dashboard that tracks institutional pledges and commitments for Hurricane Florence relief and recovery efforts (since joined by a dashboard for Hurricane Michael pledges and commitments).
• New blog posts on GrantSpace, including one focused on rebooting board culture and another on starting a consulting business.
• New New blog posts on Glasspockets, including an interview with a MacArthur Foundation program officer about how citizen-made media strengthens democracy.
• The SSO team has been hard at work updating two self-paced e-learning courses — "Corporate Sponsorship for Nonprofits: How To Put a Price Tag On What You Do" and "Loving Your Mid-Level Donors: Creating a Retention Program" — with a series of short videos and quiz questions to help users assess their learning along the way.
• We've also added a new self-paced e-learning course, "How to Supercharge Your Fundraising with a Donor Club."
• We've added new videos on GrantCraft to the suite of resources on participatory grantmaking. Hear from funders across the globe, working in different issue areas and geographic areas, discuss why they engage in participatory grantmaking.
• We've added a new online course, Grankseeking for Libraries, with the help of a generous grant from the Knight Foundation. The course, which is available for free through our WebJunction Course Catalog, is designed to help libraries diversify their funding streams, learn how to work with funders, and find grants that support the local community.
• We added 814 new resources to IssueLab in September, including Giving Back to the Future, a report on the effectiveness and impact of scholarships. The report also includes a tool kit designed to help users enhance the effectiveness of their scholarship programs.

In the News

• "Increasing Transparency of Australian Philanthropy," by Luke Michael, Pro Bono Australia
• "Who’s funding what and where?", by Clare Joyce, Fundraising & Philanthropy Australasia Magazine
• "Grant Makers Boost Climate-Change Commitments by $3 Billion," by Alex Daniels, The Chronicle of Philanthropy
• "When the dichotomy blurs," by Jen Bokoff, Alliance magazine
• "Gates Foundation Assesses Progress on UN Sustainable Development Goals," Jim Schaffer and Steve Dubb, Nonprofit Quarterly

What We're Excited About

• We're partnering with the Early Childhood Funders' Collaborative and the Heising-Simons Foundation on a new interactive mapping tool that will serve as a valuable starting point for funders and practitioners looking to support the learning and development of young children across the country. The tool is expected to launch in December
• Foundation Center South doubled its Boys and Men of Color (BMOC) Executive Director Collaboration Circle funding with a $20,000 grant from the Charles M. & Mary D. Grant Foundation. The funds will support BMOC in the metro Atlanta region through a range of activities, including building the capacity of leaders and organizations, identifying and actively engaging leaders in and outside of philanthropy committed to investing in BMOC, and improving public policy in support of BMOC.
• We'll be launching a brand-new self-paced e-learning course, How to Start a Major Gift Program, in November.
• And we'll be participating in a panel discussion, Demystifying Nonprofit and Foundation Collaboration, at the IS-sponsored Upswell gathering in November, where we'll discuss valuable insights related to how you can create collaboration opportunities among your peers and with your grantees.

Upcoming Conferences and Events

Our staff will be attending these upcoming events:

• Alliance for Peacebuilding Conference, October 24-26, Washington, DC
• 2018 AIDS Philanthropy Summit, November 5-6, Washington, DC
• AFP National Philanthropy Day, Nov 2, Cleveland, Ohio
• African Philanthropy Network Conference, November 5-6, Mauritius
• Upswell, November 14-16, Los Angeles, California
• Southeastern Council on Foundations Annual Meeting, November 7-9, Louisville, Kentucky

Services Spotlight

• 212,359 new grants added to Foundation Maps in September, of which 45,078 grants were made to 6,810 organizations outside the U.S.
• Update Central is back in Foundation Directory Online. Register for monthly alerts to ensure you’re up-to-date on grantmaker leadership changes and new foundations.
• New data sharing partners: Muncie Altrusa Foundation; Harry M., Miriam C. & William C. Horton Foundation; Catherine McCarthy Memorial Trust Fund; and United Way of Western Connecticut. Tell your story through data so we can communicate philanthropy's contribution to making a better world — learn more about our eReporting program.
• 18 new organizations have joined our Funding Information Network this year, including the Puerto Rico Science Technology and Research Trust, the First Community Foundation Partnership of Pennsylvania, and the Roswell Public Library in Georgia.

Data Spotlight

• Did you know that 8 percent of all human rights funding is granted to support civic and political participation? Funders around the globe are working to support the right to peaceful assembly, informed voting, and full participation in political processes. Explore humanrightsfunding.org to learn more.
• In honor of Global Handwashing Day (October 15), we're highlighting the fact that more than 920 funders have made grants totaling $273 million to support basic sanitation and health education around the world. Check out WASHfunders.org to learn more about funders working to solve the world's water and sanitation crises.
• Lastly, we completed custom data searches for Oregon State University, the ClimateWorks Foundation, the Bush School, Texas A&M University, McKinsey & Company / Minnesota Community Foundation, and California Environmental Associates (CEA).

If you found this update helpful, feel free to share it or shoot us an email. I'll be back next month with another update!

Jen Bokoff is director of stakeholder engagement at Foundation Center.

Weekend Link Roundup (October 20-21, 2018)

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

Agricultural

The challenges facing the world's food systems are great and becoming greater. To avoid disaster, food producers, politicians, and consumers must pursue a new vision that "account[s] for human health and nutrition, environmental impact, and the hundreds of millions of jobs that depend on farming," writes Roy Steiner, managing director, food, at the Rockefeller Foundation. That will require at least four major transformations: a shift to more "flexitarian" diets; dramatic reductions in food loss and waste; stepped-up efforts to build and conserve soils; and applying our best technologies to the most underserved regions and populations.

Civil Society

"During much of the last century, philanthropic foundations based in the United States exported American ideals about democracy, market economies, and civil society. That mission was made possible by ideological support from and alignment with the U.S. government, which, in turn, imbued foundations with prestige and influence as they operated around the world," writes Ford Foundation president Darren Walker in Foreign Affairs. But, adds Walker,

American philanthropies such as the Ford Foundation can no longer count on such support. Nor can they be sure that the goals of increased equality, the advancement of human rights, and the promotion of democracy will find backing in Washington.

As U.S. leadership of the global order falters, American foundations must blaze a new path. The first step will be recognizing difficult truths about their history. The old order they helped forge was successful in many ways but also suffered from fundamental flaws, including the fact that it often privileged the ideas and institutions in prosperous Western countries and failed to foster equitable growth and stability in poorer countries. For all the good that American philanthropies have done, they have also helped perpetuate a system that produces far too much inequality. Their task today is to contribute to the construction of a new, improved order, one that is more just and sustainable than its predecessor....

In a time when society seems to be coming apart at the seams, libraries may just be "the last safe, free, truly public space where people from all walks of life may encounter each other.” In Quartz, Jenny Anderson looks at how libraries are reinventing themselves for the twenty-first century.

Climate Change

"I do not expect every foundation, corporation, and nonprofit to make climate change its top priority; there are many urgent issues that demand attention," writes Packard Foundation president Carol Larson on the foundation's website. "But if you care about children, if you care about health, or you care about economic development, you have to care about climate change. There is a role for every organization to play, and an urgent need for every organization to seize the opportunities in front of it...."

A Conversation With Lori Villarosa, Founder and Executive Director, Philanthropic Initiative for Racial Equity

Lori Villarosa’s career in philanthropy has been driven by twin passions: to do good and to fight injustice. As a program officer at the Charles Stewart Mott Foundation in the 1990s, she managed the foundation’s U.S. Race Relations portfolio, which was focused on addressing institutional and societal racism in American society and improving race and ethnic relations. Informed by the videotaped beating of Rodney King, an African-American taxi driver, by four white LAPD officers after a routine traffic stop and the officers’ subsequent acquittal by an all-white jury — and the spasm of outrage and violence that followed the announcement of the verdict — the work was, as Villarosa puts it, “incredibly challenging” and, inevitably, led to a backlash. Undeterred, Villarosa left Mott a few years later to start the Philanthropic Initiative for Racial Equity (PRE), which, since its inception in January 2003, has directly engaged hundreds of foundation representatives in discussions of racial equity and, in particular, how they can advance the mission of achieving racial equity through their own philanthropic institutions.

That work, as well as the work done by CHANGE Philanthropy (formerly known as Joint Affinity Groups), was instrumental in establishing racial justice and racial equity as areas deserving of and, indeed, demanding greater attention and funding from foundations. And foundations, hesitantly at first but with increasing urgency, have responded. Now a project of the Tides Center, PRE continues to be part of that movement, working diligently and creatively to increase the amount and effectiveness of resources aimed at combating institutional and structural racism in communities across the country.

Earlier this year, PND spoke with Villarosa about the difference between racial equity and racial justice, the challenges of racial equity/justice work in the Age of Trump, and the lessons she and her colleagues have learned as they have worked to create a more just society.

Philanthropy News Digest: I'd like to start with a definitional question. Is there a difference between racial equity and racial justice, or can the terms be used interchangeably?

Lori Villarosa: PRE is actually working on two publications right now that are diving into that question in different ways. We'll be sharing a mix of what advocates say about the distinctions and relationship between the terms and how funders who are doing work in this arena are understanding and using them.

PRE put out one of the earliest definitions of what it means to use a racial equity lens in grantmaking in a guide we developed in conjunction with GrantCraft. Julie Quiroz, who was a principal at Mosaic Consulting at the time and is now with Movement Strategy Center, and I wrote that a racial equity lens included the following components: analyzing data and information about race and ethnicity; understanding racial disparities — and learning why they exist; looking at problems and their root causes from a structural standpoint; and naming race explicitly when talking about problems and solutions. The guide was also very clear about a racial equity lens needing to be used intersectionally with other lenses such as gender or sexual orientation, and it also spoke about the importance and role of power and of organizing.

We wanted to be even more explicit about it when we launched the process to update the guide earlier this year. Most of the advocates and funders we have been interviewing see racial equity as addressing the distribution of resources, privileges, and burdens — related to the quantitative, with some qualitative mixed in — across racial/ethnic group lines. They — and we — tend to use the phrase "racial justice" more when looking both at the power to define issues — and what it takes to secure that power — and more generally looking at outcomes that are ultimately transformative and positive for all. We plan to elaborate on this more in the report and will address the strategies that activists and funders are using to advance both concepts — and what they see as the relationship between the two. It was interesting to me, for example, that while many believe racial equity is one indicator on the path to racial justice, we spoke to others who thought the terms could be, or are less, interdependent than that.

In our work, we try to bring clarity and precision to the language around this work where it’s useful and meaningful, yet not be so precious about it that it keeps people from entering into the work, at whatever stage. And we recognize that while there are distinctions, there is considerable work that needs to be done to achieve both greater racial equity and greater racial justice. Where we do get more particular is when people substitute "equity" as a way to avoid talking about race and racism explicitly, or when they substitute "social justice" as a catch-all phrase and maybe focus their program on class but not race.

PND: What was the impetus behind the formation of PRE? Was it a single event or conversation, a series of events, or something else entirely?

LV: I was a program officer at the Charles Stewart Mott Foundation in the 1990s and had worked with colleagues there, as well as with community and national racial justice partners and some of our peer funders, to develop and move a portfolio and broader body of work aimed at addressing issues of structural racism. The approved mission statement of the portfolio I managed was: "To address institutional and societal racism and improve race and ethnic relations." That was in 1994, at a time when that language was pretty cutting-edge, and we were able to fund many of the organizations that led much of the work on structural racism nationally. It was incredibly challenging work, in that it was often unchartered territory, and the discomfort people felt when confronted by the truth of our collective history and the eventual backlash the work generated wasn't unique to our institution. Without getting into the weeds, there came a point after the UN World Conference Against Racism in South Africa, and after 9/11, where many of our early investments started to gain a different level of traction, and it became clear after twelve years of building that body of work that if we wanted to keep supporting the racial justice field and advance it in the direction it needed to move, we would have to focus more of our efforts on increasing the pool of funders willing to invest in work to address structural racism.

So I left the foundation to launch PRE with seed support and a founding board that primarily consisted of the leaders we had been investing in, and our goal was to get the rest of philanthropy to join us. I was very intentional about partnering with existing infrastructure organizations, what we used to call affinity groups and regional associations of grantmakers and we now call philanthropy-serving organizations [PSOs], and making sure that we were guided by folks in the racial justice field rather than by funders — while being responsive, of course, to the needs of change agents within foundations.

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

Ten 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.

Weekend Link Roundup (October 13-14, 2018)

A 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."

Tracking Hurricane Michael Disaster Relief

Updated: November 12, 2018 - 11:30 AM 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 October 30, the death toll had risen to forty-five, including thirty-five people 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.

(Photo credit: Reuters)

TOTAL: $35,119,000

Organization Type (pledges and commitments)

Corporate Direct Giving/ Company-Sponsored Foundations	$25,099,000	56 orgs.
Private Foundations	$500,000	2 org.
Public Charities	$9,520,000	8 orgs.

Top Recipients (Total Received to Date)

1.	Unknown Recipient(s)	$14,800,000
2.	American Red Cross (national)	$7,891,000
3.	Multiple recipients	$7,200,000
4.	Florida Disaster Fund	$2,800,000
5.	Volunteer Florida	$500,000
6.	United Way Worldwide	$375,000
7.	Team Rubicon	$325,000
8.	Salvation Army	$275,000
9.	Samaritan's Purse	$250,000
10.	Center for Disaster Philanthropy	$250,000

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

While 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.

The Importance of Listening for and Sharing Stories

­When 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.

Philanthropy Delivers an Outcome — and Its Name Is Brett Kavanaugh

When 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.

Weekend Link Roundup (October 6-7, 2018)

A 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.

How to Recruit, Engage, and Retain Millennial Board Members

Here'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!

Philanthropy and Cyber-Security

With 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."