Memo to Foundation CEOs: Get a Youth Council

Seven years ago, we launched a President's Youth Council (PYC) at the California Endowment, and it seems like a good time to tell you that the young people who've served on the council over those seven years have significantly influenced our programming as a private foundation, been a source of reality-checking and ground-truthing on how our work "shows up" at the community level, and have substantially increased my own "woke-ness" as a foundation executive.

Before I get into the details, I'd like to briefly share why we decided we needed a President's Youth Council and how it works: In 2011, our foundation embarked on a ten-year, statewide Building Healthy Communities campaign that was designed to work in partnership with community leaders and advocates to improve wellness and health equity for young people in California. We had already been using a variation of a place-based approach in our work, and so we selected fourteen economically distressed communities to participate in the campaign — some urban, some rural, and all, taken together, representing the complex diversity of the state.

At the time, I was aware not only of the privileged position I occupied outside my organization, but also of how sheltered I was as a chief executive within my organization. More often than not, I received information about the effectiveness and impact of our work in the form of thoughtfully crafted memos from staff, PowerPoint presentations, and glossy evaluation reports filled with professionally designed charts and graphics. Even when feedback in the form of recommendations from consultants or comments from the community came my way, it was all carefully curated and edited. As I had learned — and this is especially true at large foundations — when members of the community get "face time" with the CEO, it is a carefully managed and considered process.

Being at least vaguely conscious of these issues early on in our Building Healthy Communities work, I wanted to ensure I would have some regularly calendared opportunities to meet face-to-face with young leaders from the communities we were serving. So, we solicited nominations from grantee-leaders in each of the fourteen program sites, and a President's Youth Council, featuring mostly young people of color between the ages of 17 and 21 and of varying sexual/gender orientations, was born.

Seven years later, here's what it looks like.

Overcoming the Risk of a Rural Census Undercount

The 2020 Census is the single most important event for rural America in recent history. Its impact will be felt for decades to come. And while most of the focus of the public discussion around the census has been on the prospective citizenship question (rightfully so), there also are fundamental changes in census methodology hidden in the weeds of the process that have the potential to diminish federal and state investment in rural America by hundreds of billions of dollars.

Below we address some key engagement factors: community trust and online versus in-person census data collection, and examples of private foundations working on a complete count.

Hundreds of billions of dollars reflect the enormous importance of the census for apportionment of everything from congressional seats, to U.S. Department of Agriculture (USDA) allocations, to Medicaid and SNAP (food stamp) payments.

As an example, just six modestly sized federal programs under HUD and USDA that currently represent $25 billion in federal investment might change dramatically based on 2020 Census counts. A rural undercount will also reduce funding for foster care, Title 1 grants, and free or reduced lunches for high-poverty schools, Head Start programs, energy assistance for low-income households, and much more.

5 Questions for...Chera Reid, Director of Strategic Learning, Research and Evaluation, Kresge Foundation

As director of strategic learning, research, and evaluation for the Kresge Foundation, Chera Reid leads Kresge's efforts to use data to inform its grantmaking and social investing strategies, partner with grantees to ensure that the foundation's evaluation efforts support organizational and community needs, and shape how the foundation advances the fields in which it works. Previously an officer in Kresge's Education program, Reid has long focused professionally on issues of access and equity in institutions and systems and in her current role is leading the foundation's efforts to apply an equity lens to its evaluation activities, place-based practice, and collaborations across different fields and sectors.

After earning a bachelor's degree in English and African American Studies at the University of Virginia and a master's from the University of Michigan, Reid served in leadership positions at the New York branch of America Needs You and the Phillips Academy Andover Institute for Recruitment of Teachers while earning a PhD in higher education from New York University.

PND spoke to Reid about Kresge's transition from a foundation known primarily for making capital challenge grants to one focused on using a variety of tools to help grantees build stronger communities, the challenges of equity work, and how she stays upbeat and positive in challenging times.

Philanthropy News Digest: You were named Kresge's first director of strategic learning, research, and evaluation in 2015, when Kresge was just a few years into its transition from being a foundation known primarily for making capital challenge grants to one focused on helping grantees build stronger communities. What role did the Strategic Learning Research, and Evaluation program play in that transition?

Chera Reid: When the foundation was primarily a capital challenge grantmaker, and we'd ask whether a project had been completed, a grantee would send in a photo of the completed physical structure. The other piece of it was financial. Kresge only released capital challenge grant funds when campaigns were nearing their finish line, which went a long way to ensuring the success of the grant.

The work I've been doing since I've been in my current role is about creating an intentional, learning organization. By virtue of that charge, the work I'm engaged in is about organizational culture change and about learning not just for the sake of feeling good about ourselves and to say we're doing it — it's about action and informing our decision making going forward. And accountability now is more about holding ourselves accountable to people in the communities in which we work and holding one another accountable to our mission.

What has changed at the foundation as we moved to a more strategic approach over the last decade or so is that we have expanded our view of our role. Kresge as a capital challenge grantmaker was an excellent thing. We were brilliant at doing one thing: helping to build libraries, hospitals, and educational institutions. But today we're using a more complete toolkit of philanthropic resources. And that means we are table-setting, we're bringing actors together from disparate fields, from the edges of practice and at the neighborhood level, and saying, "How about it? What do you think you can create together?"

We're also bringing different forms of capital to the table and saying, "How can we remove some of the risk associated with this work? Can we blend different forms of capital to get to the root of what people and communities are saying are their most pressing challenges? And how can we put learning, evaluation, and research to better use?" They’re all tools in our toolkit. By being intentional about using learning and evaluation to inform a more strategic approach to philanthropy, we are committing to doing all the things that philanthropy can and should be doing to drive change.

When Sebastian S. Kresge started the Kresge Foundation in 1924, his directive as to what it should do was really broad: promote human progress. Today, it is about expanding opportunity for low-income people in cities and doing it with an equity lens. And in 2024, the year of our centennial, we'll be asking ourselves, "How did we do? What can we point to that shows the distance we have traveled as an organization in expanding opportunity for low-income people in America's cities? Have we really done it with an equity lens? What is the path we want to chart institutionally as we look beyond 2024." Learning and evaluation are a really important part of that conversation, in that they help us hear the story, give us space to be more reflective, and enable us to look across different bodies of work and imagine the future we are trying to shape and contribute to.

PND: From an evaluation and learning perspective, what are the primary challenges of the foundation's equity work?

CR: Positing that we need to do that work through an equity lens has not been the issue, though that most certainly is not the case across the philanthropic sector. But for Kresge, bringing an equity lens to our practice has been a bridge. It resonates with other grantmakers and helps us come together and say, "Okay, what is it that we really need to learn?"

We try to incorporate the principles of equitable evaluation in whatever we’re working on. Evaluation in service of equity is about asking questions that get to root causes. It's about participant orientation and ownership, and also about ensuring that the work is multiculturally valid.

We do not have it all figured out. It's a challenge. As a sector, philanthropy has been able to work in ways that are not about evaluation in service of a bigger goal; we've been allowed to make evaluation about ourselves. But that is changing. And one thing adopting an equity frame means is that the many consultants we work with as evaluators have a long way to go to meet our goals and aspirations. What do I mean by that? We need more people who bring an equity lens to evaluative thinking, work, and consulting. In some ways, we've created that challenge for ourselves because in the past we did not ask for that kind of skill set. But we need more examples, and we need more of our peers to come forward and say, "This is what we’re trying to do and model." There is definitely a sense of urgency around the challenge within the foundation.

Museums Should Lead in Socially Responsible Investing

Museums and galleries all over the world have been grabbing headlines lately as a result of controversies over the source of funding from donors and trustees.

Artists and members of the public have objected to sponsorship from companies and individuals linked to the sale of opioids, tobacco, fossil fuels, private prisons, or the manufacture of tear gas. But the outcry overlooks a bigger opportunity for endowed cultural institutions to signal their values: how they invest.

The financial investments of four museums that have been criticized — the Metropolitan Museum of Art, the Museum of Modern Art, the Solomon R Guggenheim Museum, and the Whitney Museum of American Art — total more than $6 billion. Turning down a few million dollars in individual donations because of where the money comes from might feel good. But it ignores how these institutions invest the billions of dollars they already control.

Cultural institutions generally invest in public equities. It is reasonable to assume at least a portion of their public equity allocation is in an index fund, such as the S&P 500, which includes the very same types of companies — tobacco, weapons manufacturing, and fossil fuels — that are objected to in connection with controversial donors.

Yet there are hundreds of alternative vehicles that could allow for values-driven investing — including index funds such as the MSCI KLD 400 Social index and the S&P 500 ESG index. These exclude companies that produce negative social and environmental impacts. Then there are exchange-traded funds aligned with issues of race and social justice, gender equity, alternative energy production, and the UN sustainable development goals. In fact, in the U.S., $12 trillion is currently invested for positive environmental and social impact through funds such as these — one-quarter of all assets under management. So why aren't cultural institutions investing in these opportunities?

Mention the topic of socially responsible investing and people often ask whether investors sacrifice financial returns when they introduce factors such as environmental stewardship and good governance into investment decision making. The answer is no.

In fact there is a growing body of evidence demonstrating that socially responsible investments outperform conventional ones. Wealth advisers such as Perella Weinberg and impact investors as diverse as the state of North Carolina and the Russell Family Foundation are sharing their evidence and portfolio experience to prove it.

Cultural institutions should be at the forefront of socially responsible investing, and this is where their boards can help. So far, it is small arts organizations that are leading the way. Over the past few months, Building for the Arts and Creative Capital each invested in the NYC Inclusive Creative Economy Fund, the first impact investment vehicle targeting low-income communities. And in June, the Souls Grown Deep Foundation committed its entire $1 million endowment to an impact investment strategy focused on promoting racial and social justice and economic opportunity in the arts.

These three organizations see their investment portfolios as another tool to advance their mission. Larger operations such as the Ford Foundation, the Heron Foundation, and the Rockefeller Brothers Fund have also demonstrated how to align the endowment of a nonprofit institution with its values.

Science and natural history museums including the Field Museum and the American Museum of Natural History have divested from fossil fuels in alignment with their stance on climate change. The time has come for our largest cultural institutions to demonstrate similar leadership.

Let's bring the best of Wall Street and Museum Mile together.

Laura Callanan is founding partner of Upstart Co-Lab and former senior deputy chair of the National Endowment for the Arts. Maxwell Anderson also contributed to this article, which originally appeared in the Financial Times and is republished here with permission.

ADA and Web Accessibility Guidelines for Nonprofit Websites in 2019

Signed into law in 1990, the American Disabilities Act (ADA) prohibits discrimination against people with disabilities and is aimed at making all public spaces inclusive and accessible to everyone. The ADA Amendments Act of 2008 later clarified the "definition of 'disability' to ensure that [it] would be broadly construed and applied without extensive analysis."

Let's take a look at how the ADA has affected websites in recent years, as well as what compliance entails for nonprofit organizations.

Until recently, organizations with websites were encouraged to comply with established Web accessibility standards, although compliance is not mandatory. The details of compliance were a hot topic of discussion as recently as June 5, 2018, within the World Wide Web Consortium (W3C), a private organization that recently released updated guidelines for its Web Accessibility Initiative (WAI).

The primary goal of WAI is to make the Internet a place where anyone can get involved "regardless of cognitive, neurological, visual, speech, physical, or auditory disabilities they may be burdened with." The guidelines developed by the initiative — with the help of disability organizations, government resources, and research labs — are known as the Web Content Accessibility Guidelines (WCAG), the latest version of which is WCAG 2.1.

A Top-Down View of What WCAG Compliance Entails

Adoption of WCAG includes providing text options for non-text content, clear titles for Web pages, "disability-considerate colors," and straightforward site structure so that people with focus-related disorders can navigate the site. It's worth noting that many websites were already compliant with the guidelines.

Most Popular PhilanTopic Posts (August 2019)

Labor Day has come and gone, the days are getting shorter, and you're probably feeling the urge for goin'. Before you do, check out some of the posts that were popular with our readers in August. Enjoy!

• Charitable Gift or Bribe? Lori Loughlin’s Legal Case Rests on Dubious Claim (Doug White)
• Beyond the Dollar: Catalytic Philanthropy = Funds + Leverage (Liz Gibbs)
• Philanthropy Has Changed How It Talks — But Not Its Grantmaking — in the Decade Since NCRP's 'Criteria' Was Released (Aaron Dorfman)
• The Ice Bucket Challenge Multiplier: Driving Impactful Science Through Effective Research Funding Practices (Neil Thakur)
• 12 Tips for Filling Out/Submitting Online Applications (Allison Shirk)
• What's New at Candid (August 2019) (Jen Bokoff)
• How Foundations Are Transforming Risk Into Opportunity (Olga Tarasov, Kaylah Ford)
• Heart, Head & Hand: An Advanced Approach to Persuasive Communication (Thaler Pekar)
• Current Trends in Philanthropy: International Giving by U.S. Foundations (Larry McGill)
• [Review] 'Decolonizing Wealth: Indigenous Wisdom to Heal Divides and Restore Balance' (Grace Sato)

Interested in contributing to PND or PhilanTopic? We'd love to hear from you. Drop us a note at Mitch.Nauufts@Candid.org.

Charitable Gift or Bribe? Lori Loughlin's Legal Case Rests on Dubious Claim

Last week, Lori Loughlin, the actress, and her husband, the designer Mossimo Giannulli, may have provided a glimpse of their defense strategy when they appear in court in October in connection with payments they made, say prosecutors, to help their daughters gain entrance to the University of Southern California. Their likely argument: the money wasn't a bribe; it was an act of altruism.

Loughlin's case is part of a larger — and by now, infamous — scandal involving thirty-four parents who were charged last March with paying money to a third party to "facilitate" their kids' admission to elite universities. Fifteen of those parents have pleaded guilty to fraud. One of them, actress Felicity Huffman, has pleaded guilty to paying $15,000 to have her daughter's SAT exam score artificially inflated and is scheduled to be sentenced on September 13. Unlike Huffman, Loughlin and Giannulli, who parted with $500,000, are planning to fight it out in court.

Loughlin's attorney, William Trach of Latham & Watkins, contends the money the government calls a bribe was really a charitable donation. "Checks were made out to USC Athletics and to a fund at USC," he says. "Those checks were cashed by USC." Trach’s logic, apparently: the money was sent to a tax-exempt charitable organization, and the organization put the money into its bank account; therefore, it was a charitable contribution. (Yes, the University of Southern California, with its $5.5 billion endowment, is a tax-exempt charitable organization.)

Money also traveled through another charity, Key Worldwide Foundation (KWF), which was established by William "Rick" Singer, the man behind the admissions scheme. Singer has pleaded guilty to racketeering charges and is now cooperating with prosecutors. We will likely hear more about KWF during the trial, but one question the prosecution should ask is how much Loughlin and her husband donated to entities not caught up in the scandal. Since their lawyer contends that their donations — that's plural — were in support of opportunities for underprivileged students, it might be helpful to know if the couple supported other, similar causes. In fact, it would provide context for their claim of generosity to know how charitable in general the couple has been over the years.

What's New at Candid (August 2019)

Although it’s still officially summer, we've been busy here at Candid, releasing new research, continuing the consolidation of our regional offices, expanding our Funding Information Network, and more. If there's anything you'd like me to cover in these monthly updates, shoot me an email. My colleagues and I are anxious to hear your thoughts!

Project Highlights

• In the wake of tragic mass shootings in California, Texas, and Ohio and newly urgent conversations about gun control and the Second Amendment, understanding the full impact of gun violence in America is imperative. Our IssueLab colleagues have created a Gun Violence Special Collection that brings together evidence and insights from nonprofits, foundations, and research organizations working to understand that impact. In 1996, the U.S. Congress passed an amendment to a spending bill that banned the Center for Disease Control (CDC) from using any of its budget for gun violence research, leading to a dearth of data that could help inform the gun control debate. In the more than twenty years since, the social sector has produced over two hundred reports that explore policy models, provide data and statistics, and examine a range of sub-topics. Feel free to reach out to the IssueLab team if you have questions about the resources in the collection.
• The surge in fires in the Amazon basin is a fresh reminder of the destructive impact that humans can have on ecosystems that are critical to life on the planet. Philanthropy continues to support efforts to ensure the right to a clean, healthy, and sustainable environment, including the rights of Indigenous, marginalized, or other communities to the unspoiled natural resources that enable their survival; the right of Indigenous and marginalized communities to share in and determine the distribution of lands, territories, and resources; and the protection of these natural resources from destruction, overdevelopment, and/or pollution. To learn more about what funders are doing to support the environmental and resource rights of Indigenous and marginalized communities, check out this dashboard courtesy of the Advancing Human Rights initiative, a collaboration between Candid and the Human Rights Funders Network, in partnership with Ariadne: European Funders for Social Change and Human Rights and Prospera: International Network of Women's Funds.
• Candid and the Human Rights Funders Network also have released a report that details foundation grantmaking for human rights globally. Conducted in partnership with Ariadne and Prospera, Advancing Human Rights: 2016 Key Findings highlights the scale and scope of funding for human rights, and sheds light on tough questions such as: Where is the money going? What are the gaps? And who is doing what?
• CF Insights, a service of Candid, has launched the 2018 Columbus Survey Results Dashboard — the most up-to-date, comprehensive data set focused on financial trends and operational activity among community foundations in the United States. The data and findings provided in the dashboard are based on FY2018 survey responses provided by 251 community foundations and are supplemented by publicly available data.
• Be sure to check out the new infographic on Foundation Funding for U.S. Democracy that looks what foundations to combat the decline in local journalism.

You can learn more about other projects we’ve been working on in the Gain Knowledge section of our website.

Beyond the Dollar: Catalytic Philanthropy = Funds + Leverage

For as long as I have been working in the philanthropy field, New Zealand has been regarded domestically, and in international polling, as one of the most generous countries in the world. Based on comprehensive data captured in the Gallup World Poll for the period 2013-2017, last year's CAF World Giving Index placed New Zealand third on the list of most generous countries, behind Indonesia and Australia and ahead of the United States (fourth place) and the United Kingdom (sixth).

Each country is ranked for three behaviors:

• Helping a stranger
• Donating money
• Volunteering time

Historically, these have been the ways we think about charity and philanthropy: giving by way of money or service, either in an immediate sense or, using a vehicle such as a charitable trust, donating money to specific causes or recipients in perpetuity.

Catalytic philanthropy is different, both more sophisticated and more focused on collaboration and measurement of return on investment, and is based on maximizing positive impact. Here is what it means for people and organizations in New Zealand:

1. Catalytic philanthropy represents a new approach to an age-old practice. The term describes the use of influence and leadership to leverage every dollar to the max. For instance, an organization with a corporate social responsibility program (say, an annual campaign in support of a bold-name charity) could be more strategic about increasing the impact of its giving by engaging with government and pressuring it to invest more in the charity’s area of interest, or by working harder with partners to garner more support for the charity.

In 2019, the scale of social need and urgency of the global climate crisis demands that we leverage our ability to give in much more practical and commercial ways than we have before. This is where catalytic philanthropy comes in: going beyond money to bring to bear every resource and partnership available to advance a cause or address a problem.

2. Silos are so twentieth century. The traditional model of philanthropy was adapted from the conduct of dynastic families like the Fords and Rockefellers in the early twentieth century. In the twenty-first century, the transparency demanded of charitable activity, combined with clear-cut social and environment concerns, gives the advantage to philanthropists and organizations that can think laterally and find inventive ways to extend their reach.

An example of this model is Foundation North, which employs what it calls "venture philanthropy" to engage other interested organizations and communities in finding solutions to complex social challenges. No longer is a single charity "responsible" for raising cancer awareness or cleaning the Hauraki Gulf; these days, we understand that we’re all in it together and that answers and funding have to be leveraged from a range of players to create long-term and sustainable impact.

Innovation is key to continually improving the impact philanthropy has on its intended cause or recipient. Under our founder Andrew Barnes' leadership, Perpetual Guardian established its own foundation, enabling donors, including those with more modest resources, to amplify the impact of their giving.