1. SURVEY: FOUNDATIONSUPPORT FOR GULF COAST MOSTLY TARGETED FOR SHORT-TERM RELIEF, AND MOSTLY COMPLETED ONE YEAR LATER

One year after Hurricanes Katrina and Rita hit the Gulf Coastregion, it appears that relatively few foundations are supporting long-term recovery efforts. This is one of the critical findings from an Aug. 9 FoundationCenterreport, which indicated that foundations have contributed some $577 million in the aftermath of the GulfCoasthurricanes. The Aug. 17 Chronicle of Philanthropy contrasted this amount with the $1.1 billion that was contributed by foundations after the September 11, 2001 terrorist attacks. Close to half of all the foundations surveyed by the FoundationCenterreported that they have supported GulfCoastefforts, with 82 percent of all hurricane responders indicating that they supported immediate relief efforts. Only about 22 percent of all hurricane responders have helped with longer-term recovery efforts, according to the survey, which also found that over 90 percent of the foundations have completed their grantmaking to the region. The American Red Cross was, by far, the largest single recipient of foundation support, receiving almost one-third of all hurricane-related foundation funding.

2. FOUNDATIONS COULD FACE INCREASING CRITICISM, QUESTIONS ABOUT ACCOUNTABILITY AS A RESULT OF BUFFETT GIFT TO THE GATES FOUNDATION

Investigations into foundation effectiveness and accountability may increase as a result of Warren Buffett's $31 billion gift to the Bill and Melinda Gates Foundation. That was one of several predictions offered by panelists at a June 30 Hudson Institute discussion, where both praise and criticism of the gift were aired. Panelists praised Warren Buffett and Bill and Melinda Gates for drawing clear lessons from past philanthropic efforts, and for stipulating that the Buffett gift be spent out relatively briskly and while at least either Bill or Melinda Gates is still living. The criticism was focused more generally on repercussions to the sector, with several panelists raising questions about the value to society of having only a very few people control grantmaking of a $60 billion foundation. Further, the amount of philanthropic money involved could revive questions about foundations' status as tax-exempt entities and whether their assets should be taxed after a certain period - perhaps after 40 years, a time period proposed by Congress nearly 40 years ago. Alan Reynolds of the Cato Institute raised this issue in a July 2 syndicated Washington Times column.

Other concerns are being raised about the Gates Foundation's increasing size and the prospect of other large foundations being created. Rick Cohen, who resigned in September as executive director of the National Committee for Responsive Philanthropy, said at the Hudsonpanel that a well-endowed organization, like the Gates Foundation, could stifle criticism, with nonprofits stifling their objections to foundation activity for fear of losing their current or possible future funding. Cohen said such a behemoth's presence could also put increasing pressure on the foundation sector, since the government could justify - in fact, he said it already has justified - scaling back programs in areas where significant private philanthropic efforts are underway. Meanwhile, large-scale foundation initiatives - such as those that empower women in developing countries or promote safe sex apart from abstinence - at the Gates Foundation or elsewhere are likely to induce increasing criticism from those government officials and advocacy groups who have opposing political agendas, according to a June 27 Forbes column by Paul Maidment. And in an Aug. 16 Toronto Star op-ed, the University of Toronto's Anne-Emanuelle Birn raised concern about the Gates Foundation's "agenda-setting from above" in determining global health priorities, which she said results in locally-defined needs being given short shrift.

3. CONFIDENCE IN SECTOR MIGHT IMPROVE IF MORE FOUNDATIONS FOCUSED ON NEEDS OF LOW-INCOME AMERICANS, NCRP REPORT SUGGESTS

Public and regulatory confidence in the sector might improve if more foundations focused on meeting the needs of low-income Americans, according to the lead essay in a new collection covering some of the hot issues in philanthropy. The National Committee for Responsive Philanthropy's State of Philanthropy 2006: Creating Dialogue for Tomorrow's Movements includes essays from officials at the New York Foundation and the California Endowment reflecting on changes these foundations have made in their approaches to grantmaking to increase their impact in the area of social justice. Another chapter, by the chief charity regulator in Massachusetts, explores state regulation of foundations.

In the opening essay, David Jones of the Community Service Society of New York and David Campbell of SUNY Binghamton call for "A New Foundations Debate." They argue that the discussions about foundation strategy and compliance with regulations that have dominated the field in recent years - which they admit have improved the sector - should give way to more difficult but important discussions about priorities and public benefit. More research and attention should focus on the role of foundations in society, and specifically foundations' role in addressing the needs of low-income families, Jones and Campbell argue. The authors suggest that tax law changes may be needed to encourage some types of foundation giving, such as giving that benefits low-income Americans.

4. FORMER FOUNDATION LEADER SAYS FOUNDATIONS TAKE FEW RISKS, NEED TO SPEAK OUT AGAINST RESTRICTIVE GOVERNMENT ACTIONS

Foundation officials talk a good game, but they actually take few risks with their funding, according to Hodding Carter III, former president of the John S. and James L. Knight Foundation. Carter acknowledged that he has believed for some time that, "The world is filled with foundations that haven't had a forward thought in years and are living off the fat of their own land." In his May 11 speech, "Philanthropy and the Battle for America," at the City University of New York's Center on Philanthropy and Civil Society, Carter expressed dismay that foundations have remained largely silent while basic liberties and governmental responsibilities are under assault. According to Carter, who is now a professor at the Universityof North Carolina at Chapel Hill, few foundations are challenging the definition and terms of the War on Terror, the lack of government care for its citizens' welfare, threats to civil liberties, or the corrupting power of money in the democratic process. By the nature of their work, those in philanthropy can see impending disaster in various fields, he said. So, why aren't they speaking out about the perils?

Carter suggested foundations should speak out by increasing their funding of those underfinanced institutions that are already trying to "speak truth to power," and urged foundations to develop other creative new ways to "mobilize" relevant information. He also suggested that democratizing foundation boards could help, since this should raise the consciousness of foundations about class issues in our society.

The next talk in CUNY's Leaders in Philanthropy series will take place Oct. 10 and will focus on trying to find common ground between ideologically different viewpoints. Speakers will be two men who helped spend out assets at two foundations perceived to be politically divergent, James Piereson, formerly of the John M. Olin Foundation, and Vincent McGee, formerly of the Aaron Diamond Foundation.

5. AUTHOR SAYS "PROFESSIONALIZATION" HAS "HOMOGENIZED" PHILANTHROPY; BOOK OFFERS MODEL FOR GIVING, STRESSES EVALUATION

Much of organized philanthropy has become "neutralized and homogenized" as a result of the trend toward professional management of philanthropy that has also left unanswered fundamental questions about foundations' effectiveness, accountability, and legitimacy. That's according to the Universityof Texasat Austin's Peter Frumkin, who in a new book offers a framework for giving that he contends could address these three main challenges in philanthropy. Developed through interviews and interactions with over 100 donors over the past several years, Strategic Giving: The Art and Science of Philanthropy defines the concept of strategic giving that Frumkin says results when there is alignment along five core dimensions of a "philanthropic prism." These include the value produced through giving, the programmatic approach or logic model supporting giving, and the choice of vehicle for giving.

Beyond defining strategic giving, Frumkin offers much criticism of and some recommendations for foundations and other donors. He argues that the move toward professionalization at private foundations has contributed to a shift away from the "art" of philanthropy, or the private passions and values of a donor, and toward the "science" of philanthropy, which has pushed the field toward greater levels of process effectiveness. However, focusing heavily on philanthropy's science has created cool and technocratic institutions and hindered the long-term advancement of the field.

Frumkin also stresses the importance of evaluation in the field and the need for foundations to make their evaluations more publicly available, so that other funders and observers can better understand failed initiatives and figure out what can be done differently in future efforts. Today, too many foundations support projects that are "unconstructive failures," according to Frumkin, with foundations choosing not to communicate openly the results of evaluations or failing to conduct evaluations at all.

6. AUTHOR SAYS ARROGANCE A PROBLEM AT FOUNDATIONS; PROFILES EIGHT CASES OF "MAJOR MISTAKES" RESULTING FROM FOUNDATION ARROGANCE

While observing that many foundations exhibit "uninspiring mediocrity," erring on the side of caution for fear of making mistakes, Martin Morse Wooster of the CapitalResearchCenterwrites in a new book that an even greater problem is foundations making mistakes because of arrogance on the part of program officers and presidents. It's an arrogance bred by the power imbalance between grantors and grantees, as well as an overvaluing of foundations' own expertise, according to Wooster's Great Philanthropic Mistakes, published by the Hudson Institute's BradleyCenterfor Philanthropy and Civic Renewal. Wooster offers profiles of eight cases in which foundations made "major mistakes" by thinking that, with enough money and expertise, they could prevent overpopulation, cure cancer, and offer educational and culturally beneficial television which (they incorrectly thought) the market would not provide. Woostercites previously published reports and reviews of foundation efforts to support his point that the foundation initiatives he profiles have generally had "no noticeable effect" and, in some cases, actually hurt the people or causes they were trying to help.

Woosterconcludes that the least successful foundations have the largest communications offices, which he sees as a sign of their lack of humility. Being humble is the key to avoiding mistakes, Woostercontends. Foundations should approach social problems using the methods of reporters, with program officers really listening and taking heed of the true needs of those seeking help, and not just assuming they know best and can use their money "to order the poor to do what they say."

7. NCRP SURVEY: COMMUNITY FOUNDATIONS' LARGELY PROGRESSIVE OUTLOOK UNDERMINED BY GIFTS TO CONSERVATIVE CAUSES

Community foundations have, by and large, adopted what the National Committee for Responsive Philanthropy calls a progressive stance of promoting social justice. However, at the same time, many community foundations also give to conservative organizations that have goals which are inconsistent with, or actually undermine, the foundations' missions. That's according to an essay by NCRP's Rachael Swierzewski in State of Philanthropy 2006, which draws on her examination of the grantmaking of the 25 largest community foundations by giving. All but three of these foundations gave grants totaling $3.1 million to conservative nonprofits in 2003. This total includes grants to one of the most active anti-gay organizations from nine of the largest foundations that are otherwise supportive of gay rights, Swierzewski reports. One part of the problem, according to NCRP: unlike their conservative counterparts, these community foundations often don't require or suggest that donors to their donor-advised funds select grantees that reflect the foundations' progressive missions, nor do they state that the foundations reserve the right to reject such grantmaking. They also don't question their donors about such funding, or communicate with donors about why such funding may not be in the community's best interest. But the larger problem, according to NCRP, is that many community foundations emphasize asset building over community building, and value donor input over community needs.

8. BOOK SAYS FOUNDATIONS HAVE DRIVEN COMPREHENSIVE COMMUNITY INITIATIVES, CREATING ONLY INCREMENTAL SOCIAL CHANGE AT BEST

Among the scores of comprehensive community initiatives created nationwide in the past two decades, "every single one of them was sponsor-driven." That is, the efforts were developed by funders, with partnering community organizations telling foundations what the latter wanted to hear about the need for funding. Ira Silver, a sociology professor at Framingham State College in Massachusetts, focused his book, Unequal Partnerships: Beyond the Rhetoric of Philanthropic Collaboration, on his research into the early-1990s, anti-violence and antipoverty effort, the Chicago Initiative. This initiative, a collaboration between foundations and community organizations in Chicago, was "mostly business as usual" in its funder-grantee dynamic, according to Silver, with funders wielding most of the power; and strapped-for-funds grantees seconding funders' interest in the cause. In the end, grantmaking fostered at best incremental and "institutionally safe" social change, not reform addressing underlying structures of social inequality. Though these Chicagofoundations sincerely intended to act responsibly, Silver suggests their interest in preventing violence was "literally a 'display' of generosity": Once the media spotlight on the problem of urban violence faded, so too did funders' interest in the effort.

Nevertheless, Silver reports that the initiative did produce some benefits - both short- and long-term - to the community. And more generally, collaboration between foundations and community-based organizations is a rare example in today's society of people engaging each other across class lines.

9. BOOK: FOUNDATIONS PLAYED CRITICAL ROLE IN REBUILDING U.S.-JAPAN RELATIONS; LESSONS FOR TODAY'S INTERNATIONAL RELATIONS

U.S.philanthropy played a critical role in quickly repairing U.S.-Japan relations after World War II, according to a new book that suggests foundations can play a similar role in helping improve relations between countries today. Published by the Japan Center for International Exchange and distributed in the U.S. by the Brookings Institution, the edited volume Philanthropy & Reconciliation: Rebuilding Postwar U.S.-Japan Relations focuses primarily on the relatively few foundations that supported non-relief/non-reconstruction activities related to international exchange, education, and civil society during the postwar years. According to the book, foundations helped improve Americans' knowledge about Japan immediately after World War II through promotion of cultural/area studies, and especially by investing in promising young scholars and leaders in various academic fields.

There are some implicit lessons for today's foundations in attempting to help improve, say, American understanding of the Islamic world, JCIE's Kimberly Gold Ashizawa suggests briefly in one chapter. For starters, based on the U.S.-Japan case as detailed in the book, any such effort will require strong leaders at participating foundations who have intimate knowledge of political and educational systems in the foreign cultures in question.

10. BOOK: FOUNDATIONS' POTENTIAL TO ADVANCE EQUITY IN MEXICOUNREALIZED; SHOULD FOCUS ON INCREASING DIASPORA GIVING

Foundations can play a pivotal role in advancing equity in Mexico, but their potential has not been realized, according to a book focused on private giving from the United States to Mexico and edited by Barbara Merz of the Global Equity Initiative at Harvard University. In one of the chapters in New Patterns for Mexico: Observations on Remittances, Philanthropic Giving and Equitable Development, Merz writes, with Lincoln Chin, that efforts to strengthen democratic reform and reduce structural barriers to effective participation present particularly important funding opportunities for American foundations interested in addressing social inequities in Mexico. Foundations could also help improve Americans' understanding of Mexico, and could help increase the flow of philanthropic resources to Mexico from both domestic and diaspora sources - by supporting efforts to expand access to financial services for migrants in the United States, and by strengthening hometown associations, or organizations of immigrants raising funds for the betterment of their communities of origin. Foundation gifts to Mexico totaled over $60 million in 2002, making the country the third largest recipient of foundation giving, according to research reported in the book.

11. NONPROFIT CONGRESS TO DEVELOP POLICY PLATFORM IN ATTEMPT TO MAKE SECTOR MORE UNITED, INCREASE PUBLIC UNDERSTANDING

Five hundred delegates from across the country will attempt to find common ground among nonprofit organizations at the first-ever Nonprofit Congress, convening in Washington, DC on October 16. The two-day Congress will develop a "Top Priorities" policy platform and in other ways attempt to make the sector a more united and powerful advocate in the political and policy-making realms, at all levels, as well as increase the public's understanding of the sector. Organizers are currently conducting a survey of all nonprofit representatives to help delegates develop common guiding principles - ranging from a commitment to serve others to promoting civic engagement to catalyzing change - for the sector. The National Council of Nonprofit Associations' Audrey Alvarado offered some topics likely to make the Congress's agenda during a recent interview with the Meyer Foundation's Albert Ruesga posted to Ruesga's independent White Courtesy Telephone blog. Among these topics: the need for sustainable funding strategies in the sector; the need for greater collaboration among nonprofits to enhance service delivery; and interest in partnering with the public sector to meet community needs.

12. ANALYSIS FINDS NATIONAL NONPROFIT ADVOCACY GROUPS ARE "TOP-DOWN" ENTITIES DRIVEN BY DONORS; LIMITED ENGAGEMENT WITH GRASSROOTS

Based on its intentions, the Nonprofit Congress could serve to represent grassroots citizens, especially poor and low-income people, better than established national nonprofit advocacy organizations currently do, according to a new analysis. Cynthia Gibson, a New York City-based consultant and a senior fellow at Tufts University, contributes an article in the Summer issue of the Nonprofit Quarterly that reports on her survey of over 800 national advocacy groups. Gibson found that these organizations tend to be "top-down" - driven by both foundation donors and professional staff - with little direct involvement of grassroots citizens. These organizations also tend to focus on more sophisticated "insider" activities, such as media campaigns, policy analysis, and lobbying, rather than on strategies that directly engage the larger public, such as grassroots organizing, petitioning, and canvassing. And most of these organizations don't even survey their members to find out about them or to ask them about the activities or agendas they should be undertaking, Gibson reported.

Of Related Interest

NCRP Shares Cautionary Tale for Foundations Engaging Nonprofits As Non-Grantees
When a foundation engages a prospective grantee in a lengthy exploratory process but ultimately decides not to fund the group, it's to be expected that the failed grantee would express some bitterness. And yet surprisingly the philanthropic literature offers little advice for dealing with such a sticky situation, according to the Spring issue of the National Committee for Responsive Philanthropy's Responsive Philanthropy. The newsletter attempts to provide some guidance by sharing one such cautionary tale, involving the Northwest Area Foundation and a coalition of American Indian organizations. Representatives from the two sides air their differing views of the same grant-planning story, a story of two parties who disagreed on the best approach to fighting poverty and failed to communicate and overcome their differences.

Wall Street Journal: Foundations Help Sustain Stem-Cell Research Efforts, Raising Concerns
Several foundations and philanthropists are helping sustain stem-cell research efforts in California while state funding is tied up in legal challenges, the Aug. 16 Wall Street Journal reported. Private donors have contributed more than $100 million in recent years to a new state research agency as well as to research programs at state universities investigating stem cells for medical treatment possibilities, according to the article. Beyond the political controversy associated with such research, the private giving raises concern about the potential for private individuals' influence on the direction of research that is being managed by a state agency. The state might have been forced to sharply curtail operations were it not for gifts from, among others, the Eli and Edythe L. Broad, Moores, and William K. Bowes foundations and the Jacobs Family Trust, according to the article.

Related Reading

Foundation Leader: Think of Grantees as Vendors More Than as Customers
Foundations need to think of the nonprofits they fund as vendors more than as customers, and to think of their customers as the people their grantmaking is ultimately trying to help or serve, according to Emmett Carson. Currently head of the Minneapolis Foundation but soon to be president of the Silicon Valley Community Foundation, Carson said that too many foundations fall into the nonprofits-as-customers trap in an Aug. 16 Newsmakers interview with Foundation Center's Philanthropy News Digest. It's good to think of grantees as partners and to treat them with respect and courtesy, Carson said. But too many foundations are concerned with pleasing or taking care of a grantee instead of ensuring that the foundation is working with the "vendor" that is most effectively serving its customers - or at least is the best positioned to do so, perhaps with some capacity-building support.

Publication Aims to Offer Funders Approaches to Evaluating Funding's Immediate Impact
The National Research Council of the National Academies has published Enhancing Philanthropy's Support of Biomedical Scientists in an effort to provide public and private funders practical and novel approaches to evaluating the immediate impact of their funding, specifically funding for biomedical researchers. The publication draws from the formal reports presented at a June 2005 meeting on the topic of philanthropy evaluation that focused on efforts at various private and public funders, including the Lucille P. Markey Charitable Trust, the Burroughs Wellcome Fund, and the Ford, Doris Duke Charitable, and Robert Wood Johnson foundations. Each foundation-specific report analyzes the particular funder's reason for and approach to program evaluation, as well as how its evaluation data is used to impact funding and policy decisions.