84 posts categorized "Governance"

New Tax on 'Excess' Executive Compensation Poses Challenge for Tax-Exempt Organizations

March 18, 2019

Tax_puzzleThe ability to attract and retain high-quality executives is an important component in the success of any tax-exempt organization and the fulfillment of its mission. A new provision of the Internal Revenue Code added by the Tax Cuts and Jobs Act of 2017 will have a "sea change" impact on the cost of compensating such individuals. Under the provision, "excessive compensation" paid to executives by a tax-exempt organization will subject the organization to a substantial excise tax liability. The penalty may be viewed as an attempt to level the playing field, inasmuch as the tax consequences associated with the payment of "excessive compensation" paid by for-profit employers, in particular by for-profit public companies, to their senior executives can result in the loss of a tax deduction for excessive compensation payments.

What Is the New Excise Tax?

Effective as of January 1, 2018, "applicable tax-exempt organizations" are subject to a 21 percent excise tax on the sum of (i) compensation paid by the tax-exempt organization (and certain entities related to the tax-exempt organization) for a taxable year to a "covered employee" that exceeds $1 million, and (ii) any "excess parachute payment" paid by the tax-exempt organization to a covered employee.

Which Tax-Exempt Organizations Are Subject to the Tax?

Any organization that is exempt from federal income tax under Internal Revenue Code section 501(a), such as public charities (e.g., United Way), exempt farmers' cooperative organizations, certain state or local governmental entities, and certain political organizations, are subject to the tax.

What Is a "Covered Employee"?

A "covered employee" for purposes of the new excise tax is an employee (or former employee) of a tax-exempt organization that (i) is one of the five highest paid employees of the organization in a taxable year, or (ii) was considered a covered employee under clause (i) for any preceding year after 2016. Once an employee (or former employee) is considered a "covered employee" for a taxable year, he or she will be treated as a covered employee for all subsequent taxable years. Therefore, over time, a tax-exempt organization's covered employees may well exceed its current top five highest-paid employees.

What Kind of Compensation Is Subject to the Tax?

For purposes of the new tax, compensation includes wages that are subject to federal income tax withholding, as well as certain non-qualified deferred compensation at the time it is included in income (e.g., when such amounts become vested). Interestingly, compensation paid to a licensed medical professional (e.g., doctor, nurse, or veterinarian) for the performance of such medical services (but not for any administrative/executive services performed by such persons) is excluded from the $1 million compensation limit under the legislation.

What Is an "Excess Parachute Payment"?

Under the new tax, an "excess parachute payment" is the amount by which a "parachute payment" exceeds the covered employee's "base amount." A parachute payment is one or more payments of compensation to a covered employee that is contingent on the employee’s separation from employment and where the present value of such amounts equals or exceeds three times the employee's base amount. An employee's base amount is the employee's average taxable compensation over the five taxable years (or lesser employment period if applicable) immediately preceding the taxable year of the termination of employment. In calculating an employee's parachute payments, amounts paid (i) from a qualified retirement plan (e.g., 401(k) plan, 403(b) tax-deferred annuity plan, or 457(b) eligible deferred compensation plan), (ii) to a licensed medical professional (as described above), and (iii) to an employee that is not a "highly compensated employee" (as defined for purposes of qualified plan requirements), are excluded.

What Steps Should a Tax-Exempt Organization Take?

A tax-exempt organization subject to the new excise tax should be proactive in taking the following steps:

  • Identify all "covered employees" for 2017 and 2018 (remember, once an employee, or former employee, is determined to be a covered employee, he or she will thereafter be treated as a covered employee regardless of their later years' compensation level).
  • Review all compensation arrangements with covered employees.
  • Determine the organization's potential tax liability under the tax.
  • Consider whether any current compensation arrangements with covered employees can be revised, if necessary, to avoid or reduce excise tax exposure.
  • Be mindful of the new tax rules when negotiating new compensation arrangements with executives or others who are currently covered employees or may be expected to become covered employees in the future.

Conclusion

The new excise tax is a major change with respect to the landscape in which tax-exempt organizations compensate their executives. Failure to understand and properly apply these new rules can result in significant tax liability for the tax-exempt organization. Accordingly, it is strongly recommended that all tax-exempt organizations subject to the new excise tax take the above action steps now so that they may appropriately mitigate or eliminate any potential excise tax liability.

Headshot_Bruce_Wolff_Hi-ResBruce L. Wolff (bwolff@bracheichler.com) is counsel in the Labor and Employment Practice at Brach Eichler LLC, a law firm located in Roseland, New Jersey.

Board Diversity: Moving From Awareness to Action

February 26, 2019

Board-diversity-bubbleThe lack of board diversity in both the nonprofit and for-profit sectors is hardly news. And a growing body of reports, articles, and data clearly shows that boards not only are not diverse, they're not even moving in that direction. Indeed, an annual survey of boards of directors of nonprofit organizations published by BoardSource found that 84 percent of board members are white, while 27 percent of boards surveyed reported not having a single member of color.

The survey conducted by my own firm, Koya Leadership Partners, affirms these trends. Of the hundred-plus boards we surveyed, 68 percent of all board members identified as white, while just 24 percent identified as a person of color. We wanted to understand why boards aren't changing, so we decided to ask.

Here's what we learned: 96 percent of boards believe that diversifying the board or executive committee is a key objective, but only 24 percent have taken steps to increase diversity. Clearly, there is a serious gap between intention and action.

Alarmingly, our survey found that most boards aren't even taking simple steps to increase inclusion and advance diversity such as developing a written diversity and inclusion statement, with only 11 percent of the boards we surveyed saying they had done so. Another key finding was related to board recruitment, with effective recruitment strategies emerging as a serious challenge for boards, which often struggle to fill board seats with candidates who contribute to the overall board diversity.

The good news? Closing the diversity gap is far from impossible. In fact, there are a number of steps any board can take, starting now, that will help move it toward real diversity and inclusion. Here are four:

1. Assess your own board through the lens of diversity. If your board has never ordered up a self-assessment, now is the time. Board assessments are an excellent first step to understanding the various talents, skills, perspectives, and experiences board members bring to table and are invaluable in helping board and senior leadership identify what is missing. You can find useful examples of a board matrix online, or you can make one of your own that lists each board member next to their demographic characteristics, experience, skills, and relevant attributes. Many boards find this to be a useful exercise that helps everyone better understand who and what is represented on the board, as well as who and what is not.

2. Recognize that becoming more diverse and inclusive requires culture change. Adding new board members who bring diverse backgrounds and perspectives is critical. But it's not enough. Many boards will also need to undergo a more holistic cultural change process that includes honest assessment, education, and a commitment to changing every aspect of board culture so that it truly embraces inclusivity.

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Weekend Link Roundup (February 23-24, 2019)

February 24, 2019

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

Democracy

"The key to improving the voting process," writes Adam Ambrogi, irector of the Elections Program at the Democracy Fund, "is straightforward: expand accessibility while also prioritizing security."

Giving

Have women's motivations for giving changed over time? Andrea Pactor, interim director of the Women's Philanthropy Institute at the Lilly Family School of Philanthropy; Hillary Person, a former development director at the Pensacola State College Foundation; and Dyan Sublett, president of the MLK Community Health Foundation, take a look at the data.

Governance

On the NCRP blog, Rick Moyers, former vice president of programs and communications at the Eugene and Agnes E. Meyer Foundation and a board member at BoardSource, reminds readers that while "[d]iversity is only one aspect of a larger conversation about equity and power," many boards aren’t ready to have that conversation. With that in mind, there are four things senior leadership should look for to determine whether their board is ready for deeper work in pursuit of equity.

International Affairs/Development

GiveWell has announced a call fro proposals from outstanding organizations operating in Southeast Asia and, in partnership with Affinity Impact, a social impact initiative founded by the children of a Taiwanese entrepreneur, will  provide three grants — one of $250,000, and two $25,000 grants — to organizations that are operating programs in global health and development in any of the following countries: Bangladesh, Cambodia, East Timor, Indonesia, Laos, Myanmar, the Philippines, and Vietnam. More details here.

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Weekend Link Roundup (February 9-10, 2019)

February 10, 2019

Homepage-large-fc-and-gs-are-candid_tilemediumA 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

"Someday, perhaps, an entire nation could be powered by renewable energy, but that day is too far off to deal with the climate threat," say Joshua S. Goldstein and Staffan A. Qvist in a new book called called A Bright Future: How Some Countries Have Solved Climate Change and the Rest Can Follow. Instead, Goldstein and Qvist tell Marc Gunther, countries should be looking to nuclear as the short-term answer to the problem. For many in the environmental community, that is a non-starter. Gunther explores the dilemma.

Governance

Writing on the Center for Effective Philanthropy blog, Kim Williams-Pulfer, PhD, a postdoctoral researcher at the Indiana University Lilly Family School of Philanthropy, shares some thoughts on nonprofit boards and the diversity imperative.

International Affairs/Development

On the OECD Development Matters site, Benjamin Bellegy, executive director of the Worldwide Initiatives for Grantmaker Support (WINGS), shares his thoughts on how philanthropy can best contribute to the 2030 Sustainable Development Goals agenda.

Journalism/Media

Journalism and the news media in the U.S. are in trouble, the traditional business model for news threatened with extinction by the consolidation of eyeballs and ad dollars on a few mega-platforms. Forbes contributor Michael Posner looks at the conclusions of a new report funded by the Knight Commission on Trust, Media, and Democracy and finds that while the report diagnoses the problem well, "its recommendations do not go far enough."

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Weekend Link Roundup (November 24-25, 2018)

November 25, 2018

Givingtuesday3A weekly roundup of noteworthy items from and about the social sector. For more links to great content, follow us on Twitter at @pndblog....

Arts and Culture

What role might foundations play in addressing Adverse Childhood Experiences (ACES), a significant risk factor for a variety of health and social problems across the lifespan? John Mullaney, executive director of the Nord Family Foundation, has been thinking about that for some time now and, in a post here on PhilanTopic, shares his thoughts.

Climate Change

Thirty years after The New Yorker published "The End of Nature," Bill McKibben's seminal article about the greenhouse effect, McKibben returns to the pages of the magazine with a look at what we have learned in the decades since about climate change, extreme weather, and their impact on human society. You will not be encouraged.

Education

On the HistPhil blog, Leslie Finger, a political scientist and lecturer on government and social studies at Harvard University, considers some of the implications of foundation grants to state education agencies.

Fundraising

It's not enough for nonprofits to simply thank their donors, says Vu Le, who shares twenty-one tips designed to help you and your organization be better at recognizing and appreciating the people who support your work.

On the Bloomerang blog, Terri Shoemaker, chief strategy officer at Abeja Solutions in Phoenix, Arizona, pays tribute to "the small donor. The little ones. Those generous folks that give when they can to a mailing, online, or even to your very specific appeal on social media."

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Weekend Link Roundup (November 10-11, 2018)

November 11, 2018

11-10-2018-malibu-fire-pchA weekly roundup of noteworthy items from and about the social sector. For more links to great content, follow us on Twitter at @pndblog....

Civil Society

On the twenty-ninth anniversary of the fall of the Berlin Wall, Richard Marker reflects on "the fragility of civil society, the brevity of memory, and the destructive hubris of leaders motivated by xenophobic rage."

Criminal Justice

In the New York Times, Michelle Alexander, author of the acclaimed The New Jim Crow, hails "the astonishing progress that has been made in the last several years on a wide range of criminal justice issues." But she warns that "[m]any of the current reform efforts contain the seeds of the next generation of racial and social control, a system of 'e-carceration' that may prove more dangerous and more difficult to challenge than the one we hope to leave behind."

Environment

The world is drowning in stuff, writes Elizabeth Seagran, PhD, a staff writer for Fast Company. Isn't it time for nonprofits and foundations to do the environment a favor and just say no to all the cheap swag they hand out at conferences and events?

Giving

Nice post on the Charity Navigator blog about philanthropically minded celebs who have turned giving into an art.

Governance

On the GuideStar blog, Bill Hoffman, CEO of Bill Hoffman & Associates, LLC, a Tampa-based consulting firm, shares six things individual nonprofit board members can do to support their CEO's success.

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Nonprofit Boards and Risk

October 11, 2018

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

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

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

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

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How to Recruit, Engage, and Retain Millennial Board Members

October 03, 2018

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

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

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

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Weekend Link Roundup (July 14-15, 2018)

July 15, 2018

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

Education

In the twenty-first century, are private secondary schools antithetical to the public good? On the Aeon site, Jack Schneider, a scholar of education history and policy at the University of Massachusetts Lowell, considers the arguments for and against.

Environment

Ireland has announced that it will completely divest itself of investments in fossil fuels over the next five years, becoming the first country to make such a commitment. Adele Peters reports for Fast Company.

Governance

According to a new report from the Indiana University Lilly Family School of Philanthropy, nonprofit boards "that include a higher percentage of women tend to have board members who participate more in fundraising and advocacy. [And members] of these boards also tend to be more involved in the board's work." You can view the full report (58 pages, PDF) here and the executive summary (8 pages, PDF) here.

Health

A little bit of good news. A report from the Blue Cross Blue Shield Association finds that the rate of opioid use disorder among its members declined last year to 5.9 per 1,000, compared to 6.2 per 1,000 the year before, while the decline in opioid prescriptions being filled by doctors has fallen 29 percent nationally since 2013. Christopher Zara reports for Fast Company.

Higher Education

Forbes contributor Josh Moody tries to answer the question: Why are there so few women at the top of the Ivory Tower?

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'Skin in the Game' and the Importance of Board Giving

June 19, 2018

Skin_in_the_gameWhen we engage with new clients, we always begin with the imperative — up front and with clarity — that in order for a campaign or fundraising project to be successful, 100 percent board participation is required. Board members, as the legal stewards of an organization, must lead by example. And the impact of their participation goes well beyond the individual gifts themselves.

Nonprofit organizations rely on their boards for many things: governance and budgeting, guidance, community involvement and, of course, fundraising. Though some boards downplay the fundraising aspect, we believe it's essential that each board member be an active participant in ensuring the financial health of the organization on whose board they serve. The boards that waffle on this target by not articulating a clear expectation upfront are the ones that most often fall short of their fundraising and leadership goals. In fact, the majority of successful organizations report high board giving rates, while studies have found that board giving is more positively correlated with overall fundraising success than any other single factor.

Many boards have mandatory giving policies. According to a recent BoardSource survey, 68 percent of nonprofit organizations have a policy requiring board members to make a personal contribution on an annual basis. Some boards have a "give or get" policy that allows board members to either give a personal gift or to raise funds from family and friends equal to the amount of the required gift. We prefer a "give and get" approach, obligating a board member to lead with a personal investment and inspiring others by saying "join me," rather than outsourcing that responsibility to others.

Not every board has a policy that requires board giving. For those that do, the process is straightforward and requires a simple call to remind board members of their obligation. The process of new board member recruitment and orientation should include an early and candid conversation about fundraising expectations and financial obligations. Board leadership must set a good example by giving first and publicly announcing their gift as a way to encourage others.

Of course, board members may feel unmotivated to give, for any number of reasons. They might not understand why their contribution is necessary. Compared to major gifts, annual gifts from individual board members might seem inconsequential. If board giving is not a precondition of board membership, some board members may feel uncomfortable broaching the topic and will avoid asking because they feel embarrassed; they don't want to feel like they're pressuring their fellow board members, or stretching them beyond what they are able to do. Others may feel that contributing their time is sufficient and a gift isn't necessary. (While time is valuable, the giving of actual dollars by board members is important to the financial health of nonprofits and creates a culture of giving that may not develop otherwise.) 

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Tips for Finding the ‘Perfect’ Board Member

April 25, 2018

Man-wearing-a-leather-jacket-holding-a-clapperboardOne of the questions we get a lot from our nonprofit clients is: How do we find passionate, engaged, committed board members? Putting together a high-functioning board isn't just about recruiting the "right" people. It's about having the proper mindset and a good plan. Here at Envision Consulting, we often describe the search for the perfect nonprofit board member as a bit like looking for romance, complete with angst-ridden courtships, elaborate proposals, occasional heartbreak, and, with a little luck, true love at the end of your search.

Still with me? Here are some tips to make your search a lot less Romeo and Juliet and a little more The Wedding Singer:

1. Have a "Wish List." You're more likely to find board members who add value to your organization if you understand (and can articulate) beforehand what it is you're looking for. Broaden your wish list beyond skills/expertise (yes, every board should have a CPA) and financial clout (believe it or not, wealthy board members don't always equate to well-resourced nonprofits). Think about the personal characteristics, perspectives, experiences, and networks a candidate is able to bring to your organization. When we have this conversation with our clients, they often tell us they want board members who are available to participate in board meetings and organizational events, have the ability to think strategically, and hold themselves (and others) accountable — the kind of intangible qualities that are difficult to quantify but can have a huge impact on the success and productivity of a board and the broader organization.

2. Fools Rush In. It takes two to tango, right? Too often, nonprofits are overly focused on finding the perfect new board member and neglect to properly "court" candidates by listening to their concerns and answering their questions — only to be shocked (shocked!) when the relationship doesn't pan out. Good board candidates will want to evaluate your organization as much as you want to evaluate them — and they're likely to be selective about which boards they agree to join. Beyond just making a good impression on the candidates you're interested in, you also may need to address how you plan to provide (in an authentic way, of course) the experience the candidate is hoping to gain by joining your board. We strongly encourage our clients to tell candidates in detail about the orientation process and other ways they support new board members.

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[Review] 'Engine of Impact: Essentials of Strategic Leadership in the Nonprofit Sector'

November 28, 2017

The nonprofit sector has never faced more difficult challenges — or had the potential to create greater impact — than it does today, argue William F. Meehan III, director emeritus of McKinsey & Company, and Kim Starkey Jonker, president and CEO of King Philanthropies, in their new book, Engine of Impact: Essentials of Strategic Leadership in the Nonprofit Sector. But for nonprofits — by 2025 projected to need up to $300 billion more annually beyond currently expected revenues in order to meet demand — to benefit from the largest intergenerational wealth transfer in U.S. history (an estimated $59 trillion expected to change hands between 2007 and 2061), they will have to "earn the right to expand [their] role and maximize [their] impact" in what Meehan and Jonker refer to as the coming "Impact Era."

Book_engine_of_impact_3dDrawing on a number of surveys, including the 2016 Stanford Survey on Leadership and Management in the Nonprofit Sector; a variety of Stanford Social Innovation Review articles, business and nonprofit management books, and Meehan's course on nonprofit leadership at the Stanford Graduate School of Business; and Jonker's experience overseeing the Henry R. Kravis Prize in Nonprofit LeadershipEngine of Impact outlines the challenges nonprofits currently face — lack of impact data, transparency, and sustainable operational support; donors' tendency to give impulsively to well-known organizations rather than high-impact ones; ineffective boards — and then explores a number of tools that nonprofits can use to address those challenges. They do not include venture philanthropy or impact investments, which Meehan and Jonker, somewhat "controversially," are skeptical of. Instead, they urge nonprofits to embrace the "essentials of strategic leadership" — mission, strategy, impact evaluation, insight and courage, funding, talent/organization, and board governance — which, when brought together thoughtfully and intentionally, create an engine of impact that drives organizational success.

Quoting liberally from business management expert Peter Drucker, Ashoka founder Bill Drayton (an early mentor of Meehan's), Good to Great author Jim Collins, and other luminaries, the authors illustrate each component of strategic leadership with concrete examples often drawn from the work of Kravis Prize winners such as the Afghan Institute of Learning (AIL), BRACLandesa, and Helen Keller International. And while they concede that some of them may be obvious, they are quick to note, based on survey results, that they are not all well understood or effectively implemented.

They emphasize, for example, the importance of a well-crafted mission statement, and caution organizations against mission creep, even if avoiding the latter means saying no to a new funding source. Indeed, saying "no" seems to be a critical part of strategic leadership, in that the urgent need to achieve maximum impact in a time of enormous challenges and limited resources is too important for nonprofit leaders to be distracted by non-mission-aligned activities — or by debates over semantics (e.g., "theory of change" vs. "logic model"): "if you ever find yourself caught in a debate about these terms' usage," Meehan and Jonkers write, "we suggest you leave the room immediately. We do."

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Weekend Link Roundup (June 10-11, 2017)

June 11, 2017

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

Children and Youth

On the Annie E. Casey Foundation blog, Tracey Feild, managing director of the foundation's Child Welfare Strategy Group, shares five lessons from the foundation's recent efforts to develop tools to measure and address racial disparities in child welfare systems.

Education

"If Facebook’s [Mark]. Zuckerberg has his way, children the world over will soon be teaching themselves — using software his company helped build." The New York Times' Natasha Singer considers the efforts of Zuckerberg, Salesforce founder Marc Benioff, Netflix chief Reed Hastings, and other Silicon Valley billionaires to remake America's public schools.

Giving

In an article for Nature, Caroline Fiennes, founder of Giving Evidence, an organization that promotes charitable giving based on sound evidence, argues that "[p]hilanthropists are flying blind because little is known about how to donate money well." The solution to the problem, she adds, "lies in more research on what makes for effective philanthropy [and donor effectiveness]."

And here, courtesy of the International Council for Science's Anne-Sophie Stevance and David McCollum, research scholar at the International Institute for Applied Systems Analysis, is an SDG-related example of exactly the kind of approach and methodology Fiennes would like to see more of.

A recent column by New York Times columnist David Brooks in which Brooks asks, "What would I do if I had a billion bucks to use for good?" raises other interesting questions, writes John Tamny on the Real Clear Markets site, including: Why do the superrich think their skills in the commercial space render them experts at charity? And: Why should the supperrich be expected to do "good" after they have created wealth — and the jobs and social advances that usually come with it?

Reid Hoffman, a supperrich Silicon Valley entrepreneur and founder of networking site LinkedIn, tells The Atlantic's Alana Semuels that having people who know how to apply capital in the service of getting things done is a good thing for social causes, as long as those same people are careful about big-footing the politics of the issue.

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Weekend Link Roundup (February 4-5, 2017)

February 05, 2017

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

African Americans

It's Black History Month. Here, courtesy of the Washington Post, are a few things you should know.

Arts and Culture

The Trump administration is rumored to be toying with the idea of eliminating the National Endowment for the Arts. Who stands to lose the most if rumor becomes reality and the Republican-controlled Congress pulls the plug on NEA funding? In an op-ed on the Artsy blog, Isaac Kaplan says it would be the American people.

Climate Change

With the Trump administration determined to pursue "a ‘control-alt-delete’ strategy — control the scientists in the federal agencies, alter science-based policies to fit their narrow ideological agenda, and delete scientific information from government websites," is philanthrocapitalism our best hope for finding solutions to a warming planet? Corinna Vali reports for the McGill International Review.

Can shareholder advocates really move the needle on the issue of climate change? Nonprofit Chronicles blogger Marc Gunther weighs in with a tough but balanced assessment.

Diversity

In a post on the Center for Effective Philanthropy blog, Alyse d'Amico and Leaha Wynn reflect on what the organization has done, and is doing, right in the area of diversity and inclusion.

Education

"Nearly sixty-three years after the landmark Brown v. Board of Education case kick-started racial integration in schools — and six decades after a group of African-American students had to be escorted by federal troops as they desegregated Little Rock’s Central High School — students nationwide are taught by an overwhelmingly white workforce," write Greg Toppo and Mark Nichols in USA Today. "And the racial mismatch, in many places, is getting worse."

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New Law Will Significantly Strengthen Nonprofit Sector in New York

December 06, 2016

Img_newyorkOn November 28, 2016, Governor Andrew Cuomo signed into law a Nonprofit Revitalization Reform Bill that will strengthen the regulation and operation of nonprofit organizations in New York State in many ways while also helping the communities they serve. The timing could not be better. In the current national political climate, nonprofits are likely to be called to provide new levels of support in multiple areas, including protection of civil rights, delivery of social services, immigration enforcement, family planning, and more. 

The new law will help by introducing major improvements in many areas of nonprofit governance. For example, it will help ensure that board members are more familiar with, and responsible for, their organization's policies and procedures around conflicts of interest and whistleblower complaints. It bars any person who is the subject of a whistleblower complaint from involvement in handling that complaint and creates new levels of legal liability for individuals who abuse nonprofit assets for personal gain, even when they do not serve as an officer, director, or employee of the organization.

The law creates an incentive for nonprofits to review and correct procedures related to conflicts of interest, particularly those that happen innocently. This will apply to a wide range of potential conflict situations, such as when a director is unaware that a relative has an interest in a transaction or when a board approves a transaction after considering alternatives but fails to document the basis for its approval. The law outlines both a mechanism for a board to ratify a procedurally defective transaction if it was in the organization's best interest and an incentive for the board to tighten up its procedures going forward.

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