Philanthropy Information Retrieval Project

The Philanthropy Information Retrieval Project (PIRP) reports on new ideas and other developments that may affect the field of philanthropy in the years to come. In contrast to other publications that cover today’s breaking news, PIRP generally highlights emerging issues that may be visible only on the horizon. In line with its role as an early alert system for the field of philanthropy, PIRP intentionally includes items that are critical of current practice and policy as well as reports that are supportive. PIRP was started in 1996 by the John D. and Catherine T. MacArthur Foundation and was transferred to the Aspen Institute in 2003, where it is currently funded by the Robert Wood Johnson Foundation, the Northwest Area Foundation, and The Philanthropic Collaborative. Burness Communications, Bethesda, Md., prepares the copy. As the publication’s editor, I welcome your comments and suggestions. -Alan J. Abramson, Director, Nonprofit Sector and Philanthropy Program, The Aspen Institute

1. SEVERAL FOUNDATIONS FUNDING AN EMERGING HUMAN RIGHTS MOVEMENT WITHIN THE U.S., ACCORDING TO REPORT

Many foundations have funded human rights work internationally, but a new Ford Foundation publication reports on an emerging human rights movement within the United States that Ford and other foundations are beginning to support. This emerging movement has resulted from a "vast public conversation" about the role of America in the world and the implications of that role both abroad and at home, according to Close to Home: Case Studies of Human Rights Work in the United States. The report features 13 case studies of human rights efforts underway across the country dealing with such issues as the death penalty, race and gender discrimination, and prisoner and worker rights. Employing human rights as a model for social change has had the "unexpected benefit," according to the report, of increased media coverage both domestically and internationally.

Besides Ford, the Atlantic Philanthropies as well as the JEHT, Shaler Adams, Otto Bremer, and other foundations have supported domestic human rights initiatives. But there are significant obstacles to funding U.S. human rights, including the scarcity of foundation staff who are knowledgeable about both human rights and the domestic policy context. Another challenge is "U.S. exceptionalism," a resistance to applying international agreements at home. In fact, human rights work in the U.S. sometimes spurs vehement reaction. By their very nature, domestic human rights activities challenge the notion of U.S. superiority that the report says has become part of the national identity.

2. FOUNDATION-FUNDED ‘NEO-COMMUNIST’ GROUPS PLANNING PROTEST THIS SUMMER, CONSERVATIVE NEWSLETTER SAYS

Several foundations are funding "neo-Communist," "anti-U.S." groups out to subvert American society and values, and they are particularly focused on protesting this summer’s Republican National Convention in New York, according to the Capital Research Center. The organization featured an article in the April Organization Trends that identifies what it considers the chief anti-war groups in the United States. The article recounts their histories and suggests that their chief goal this year, quoting one anti-war organizer, is to "shut down or disrupt" the Republican Convention, set for August. The report also identifies these groups’ foundation contributors.

3. HARVARD’S PETER FRUMKIN SUGGESTS ELIMINATING THE FOUNDATION PAYOUT REQUIREMENT ENTIRELY TO IMPROVE FOUNDATION GRANTMAKING

Foundations are not aligning their financial decisions with their social missions, according to Harvard University’s Peter Frumkin, who goes on to suggest that the right solution may be to eliminate the legislated annual payout requirement entirely. The March/April issue of the Philanthropy Roundtable’s Philanthropy magazine features excerpts from Frumkin’s speech on the payout debate at the Roundtable’s annual meeting last year. Frumkin said that there should be variance among foundations regarding how much is actually paid out annually; those grantmakers working to solve time-sensitive, pressing social problems, for example, should probably be paying out more than the minimum 5 percent. But, in fact, nearly all foundations adhere strictly to 5 percent payout every year, which Frumkin says is prima facie evidence that there is no connection between the financial and social purposes of foundations. Doing away with the minimum requirement, with Congress in effect saying ‘you have to figure this out for yourself,’ would force foundations to grapple with how to align their social and financial strategies, he said, after conceding that it sounds like "an academic, blue-sky idea."

4. INCREASING INTEREST IN GLOBAL ISSUES HASN’T ACTUALLY LED TO INCREASED GIVING, DUE TO SEVERAL OBSTACLES, ARTICLES REPORT

There is increasing interest in international grantmaking, but many obstacles limit the level of such giving - and it has remained largely flat, at best, over the past decade. The March 13 San Jose Mercury News reported on growing interest in international giving among Silicon Valley and other philanthropists, citing the Giving USA survey that American citizens increased their charitable giving to internationally-focused organizations by 10 percent in 2002 from the previous year. But U.S. foundations’ international grantmaking actually decreased slightly during the 1990s, if giving from the Bill and Melinda Gates Foundation is excluded, according to an analysis cited in a March essay of the Alliance Extra.

This online publication reprinted comments from an October speech in Chicago by Rien van Gendt, a Dutch foundation leader and chair of the European Foundation Centre International Committee. Van Gendt stressed the importance of taking into account global concerns for even domestic social funders, and he emphasized that European funders have shown as limited interest in truly international giving - beyond Europe - as have their American counterparts.

International giving by American foundations is limited not only by legislative regulations, particularly new anti-terrorism laws, and the political context within which foundations operate, but also often by the foundations’ own governing documents. Many foundation articles of incorporation and charitable trust instruments include legal language that unintentionally and unnecessarily precludes grants to non-U.S. organizations, according to a recent primer from The Philanthropic Initiative. Global Giving: Making a World of Difference identified this restriction in its concise, informative overview of what global philanthropy actually is and the options for grantmakers to get involved.

5. FOUNDATION TRUSTEES ENJOYING TRAVEL PERKS, NEWSPAPER REPORTS

Some of the nation's leading foundations underwrite high-end travel costs and perks that many public corporations no longer permit for their executives, according to the April 18 Boston Globe. Yet another investigation into foundation practices by the newspaper found that several foundations allow staff and trustees to fly first-class or on private jets and stay at expensive, luxurious hotels, and some even pay for spouses to go along. The article made a point of reporting that one foundation would not provide the newspaper the total costs of one expensive trip and initially understated the trustee-related costs of two trips. The article also indicated that another foundation provided the costs of several trips "after some reluctance."

6. FOUNDATIONS MUST DEMAND GREATER ACCOUNTABILITY OF NONPROFITS AND FUND THEIR EFFORTS TO ACHIEVE IT, ACCORDING TO ONLINE DISCUSSION

Funders must offer funding for efforts to increase grantee accountability to ensure that all nonprofits take on this responsibility, not just the largest and wealthiest among them, according to respondents in a recent online discussion. The Skoll Foundation and Alliance magazine co-sponsored this January discussion among nonprofit and foundation leaders around the world, which stressed the critical role that foundations play in encouraging increased accountability of nonprofits. The March issue of Alliance Extra features a summary of the discussion,

in which Barbara Kibbe, formerly of the David and Lucile Packard Foundation and currently with the Skoll Foundation, was one notable foundation participant. Peter Shiras of Independent Sector also participated and issued an essay prior to the discussion that elaborated on why accountability has become an increasingly crucial issue, and suggested areas of focus for foundations, including improving their own governance structures. If foundations don’t demand greater accountability from their grantees, one respondent in the discussion said, most nonprofits won’t embrace it. This respondent, Steve Rudolph of the Jiva Institute in India, suggested that few small nonprofits around the world are even aware of the growing calls for accountability, because their funders aren’t talking about it.

7. STANFORD SITE FEATURES WHAT APPEARS TO BE THE FIRST ‘WEBLOG’ ON PHILANTHROPY, HEADED BY FOUNDATION LEADERS, ACADEMICS

The Stanford Social Innovation Review has started what appears to be the first Weblog, or "blog," dedicated specifically to the subject of philanthropy and nonprofits. Since the start of the year, Bruce Sievers, formerly of the Walter and Elise Haas Fund and currently a visiting scholar at Stanford University, has been periodically posting to the blog commentary on current articles and essays he links to from around the Web. Beginning this month, Sievers has been joined by a team of co-bloggers, including Cole Wilbur of the David and Lucile Packard Foundation and Joe Valentine of the Morris Stulsaft Foundation as well as several academics, including Stan Katz of Princeton University. Recent postings to the blog - and public comments about them - have focused on whether there are too many nonprofits, the role of private funding in public education, and heightened Congressional scrutiny of foundations.

Sievers will draw on a forthcoming essay in speaking May 17 in Washington at a lunchtime discussion on philanthropy’s role in encouraging civil society. Hudson Institute's Bradley Center for Philanthropy and Civic Renewal will host this discussion, which is open to the public. Contact Hudson’s Krista Shaffer  for more information.

Foundations need to make their Forms 990-PF more descriptive and informative about their grantmaking, since the federal tax form has become the principal communications vehicle for nonprofits, according to the Minnesota Council on Foundations’ Bill King. The Spring 2004 issue of the MCF’s Giving Forum features an article about the rise of the "once-obscure" tax form, which has been the main source of information for recent critical news coverage of the field. Foundations may improperly or incompletely report on the form their grant guidelines and grantmaking activity, according to the article, in part because it has only recently been considered a truly public document, reviewed by people other than charity regulators.

But because their tax returns are very public now, foundations, according to MCF’s King, should have their communications and program staff contribute to their Forms 990-PF. These staffers should add additional information about each grant and its benefit to the community, as well as ensure that information about grant guidelines and applications procedures on the form is consistent with other foundation materials. King says this will help advance a foundation’s image rather than tarnish it, in an era when the public demands more information from foundations.

9. THERE ARE TIMES WHEN IT WOULD BE REDUNDANT TO EVALUATE A FOUNDATION’S GRANTMAKING, EVALUATION PRIMER SUGGESTS

The Philanthropic Initiative has issued a publication that helps grantmakers understand what’s involved in the process of evaluating grantmaking and even offers examples of when evaluation may be redundant and unnecessary. According to this publication, Making a Difference: Evaluating Your Philanthropy, examples of redundant evaluation include: if a grantmaker invests significant time identifying leaders and institutions in advance of funding them; if a grant is small relative to the size of the nonprofit; if another funder is conducting an evaluation that serves the same purposes; and if the cost and effort of an evaluation will take away from the real work of the organization without providing conclusive results. This publication is the third of seven in TPI’s Venturesome Donor Series, following reports on raising children with philanthropic values and global giving.

10. MULTI-YEAR, GENERAL OPERATING SUPPORT SHOULD GAIN PREFERRED STATUS AMONG FOUNDATIONS, ACCORDING TO SEVERAL SECTOR LEADERS

Where appropriate and feasible, funders should prefer multi-year, reliable general operating or core support over support for specific projects, according to a group of nonprofit and foundation leaders. Paul Brest of the William and Flora Hewlett Foundation was the principal author of a statement from this group, created out of concern about the health and vitality of the nonprofit sector and about the state of foundation-nonprofit relations, according to an April 8 release from Independent Sector endorsing the short statement. In addition to the Hewlett Foundation and Independent Sector, the Edna McConnell Clark and Surdna foundations, Open Society Institute, and the Rockefeller Brothers Fund signed on to these "guidelines for the funding of nonprofit organizations," which also recommend that foundations, when they do provide project support, incorporate funding for administrative and fundraising costs required by a nonprofit to manage the project.

And according to Kathleen Enright of Grantmakers for Effective Organizations, multi-year support for general nonprofit operations is one way foundations can increase the efficiency and impact of philanthropy. Enright discussed grantmaking effectiveness in a Q&A with the Foundation Center’s Philanthropy News Digest, which posted the Newsmaker interview earlier this month. General operating support, she said, enables nonprofits to boost their effectiveness by allowing for investment in professional development, efficient technology systems, and appropriate financial management.

University of Illinois at Chicago’s Stanley Fish suggests that, when talking to legislators and regulators, it might be worth it to stand up for one’s views unapologetically, and to present one’s self as a formidable adversary rather than an easy mark. In his March column for the Chronicle of Higher Education, Fish wrote that academic administrators’ need to change tactics and go on the offensive with legislators. But his reasoning could have some relevance for foundations and other nonprofits. He says that academic leaders have been "diplomatic, respectful, conciliatory, reasonable, sometimes apologetic, and always defensive," and instead, he thinks they’d do better being "aggressive, blunt, mildly confrontational, and just a bit arrogant." It’s an approach that has worked for him, he writes, because it has taken legislators by surprise and because it shows them that he’s taking their responsibility seriously.

Note to Readers

We would appreciate your offering us information that we can include in a future edition. If you have an item you believe would be helpful to your colleagues, please e-mail it to Doug. Thank you in advance for your cooperation.