Foundation CEOs Experience Gender Pay Gap

By Ruth Masterson, Exponent Philanthropy

Today is Equal Pay Day, the day when women’s earnings “catch up” to men’s earnings from the previous year. The average American woman would have to continue to work through this date in 2017 to earn as much as the average American man in 2016.

The Pay Equity Landscape

According to the most recent data, women earned 80 cents compared to $1 earned by men for the same work. Research shows that the pay gap is even worse for African American women, Native American women, and Latinas, whether you compare their average salaries against overall men’s salaries or the salaries of men within the same race/ethnicity. Asian American women experience a smaller inequity than women overall, but the pay gap persists for them too.

Nationally and across all sectors, pay equity improved greatly between 1960 (when the U.S. Census Bureau began collecting data) and 2000, from 60 cents on the dollar to approximately 78 cents. Since 2000, however, the rate of progress has slowed dramatically.

Our own salary data for foundation members by gender goes back to 2004 and, as with the national data, also shows a lack of progress in recent years.

The ratio of women’s salaries to men’s does not show improvement over the past decade among CEO/executive directors of Exponent Philanthropy member foundations.

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Take a Fresh Look at Feedback

feedback-1825515_640By Ruth Masterson, Exponent Philanthropy 

As you engage in your philanthropy—working with grantees, applicants, board members, and, in many foundations, staff—you’re giving and receiving feedback all the time about things that concern you and things you love, whether you mean to or not. Feedback comes through via unconscious facial expressions, comments during meetings, or your enthusiasm for the work.

As a longtime student of giving and receiving feedback, I’m far from perfect at it. But I have found that bringing intentionality to my communication has been helpful. I encourage you to do the same.

Giving Feedback

Our staff at Exponent Philanthropy were trained by The Management Center in the SAW model of giving feedback:

  • S: Share your experience (what you loved or what concerned you) and how it affected you; mention why you think it matters.
  • A: Ask if you got it right and acknowledge that you may have made assumptions. Although your experience is always valid, your assumptions, understanding, and perception can be wrong.
  • W: Wrap up with next steps and state what you expect or will do next. It’s fair game to make a request of the other person, but it’s best not to go into the conversation with an expectation of what the outcome will be. Allow the other person to participate in finding a solution.

I’ve found it helpful to prepare in advance what I want to say using the SAW steps, keeping the following characteristics in mind. Download a worksheet to help you prepare >>

Some Characteristics of Good Feedback

  • Be specific. Talk about a single behavior or pattern of behaviors, not a person’s general character. Feedback should never be a smokescreen for making sweeping judgments. I think it’s best if you talk about one example or one pattern per conversation. Even if you have multiple topics to cover, it can be hard for the listener to take it all in. Give the recipient time and space to incorporate one thing at a time, especially if your goal is to improve a situation.

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Creative Grantmaking Done Legally

By Ruth Masterson, Exponent Philanthropy 

Your foundation can be extremely imaginative while still keeping its grantmaking straightforward. Or it can take full advantage of the tax code’s flexibility to make grants that are more complicated—and still perfectly legal. Our goal is neither to encourage you to stay simple or to get complicated with your giving, but to help you be aware of all the strategies at your disposal.

In fact, private foundations can make grants to almost anyone or any organization, including other private foundations and tax-exempt organizations, such as 501(c)(4)s, 501(c)(5)s, and 501(c)(6)s. Private foundations also can make grants to foreign organizations, individuals, unincorporated groups, and for-profit entities. You must just follow two steps: the grant must be for a charitable activity or project, and you must follow appropriate procedures as determined by the IRS.

Do speak with an attorney before taking on any of the “somewhat complicated” or “complicated” grants below, because there are nuances that are beyond the scope of this article.

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Women’s Salaries and the Gender Pay Gap in Philanthropy

By Ruth Masterson, Exponent Philanthropy 

There is a disparity between what men and women earn in philanthropy, at least as indicated by responses to our member survey in the area of foundation CEO/executive director salaries.

According to our most recent report, women who are CEOs or executive directors of small-staffed foundations earn, on average, 87¢ for every $1 paid to men in 2014:

  • 39% of foundations are male led, with an average salary of $143,589
  • 61% of foundations are female led, with an average salary of $125,092

In the same year, male CEOs received 6% pay raises, on average, while women received 5% pay raises.

The discrepancies in salaries are not due to the CEO/executive director’s years of experience, and they are not due to the foundation’s asset size, with one exception. When the foundation’s assets are $50-99.9 million, women’s average earnings jump to $1.09 for every $1 paid to men. In all other categories by asset size or experience level, the ratio ranges from 81¢ to 92¢ per $1.

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Find Out What It’s Like on Your Grantees’ Side of the Table

BRuth Masterson, Exponent Philanthropy 

Eager to pilot our new Grantee and Applicant Perception Survey with her grantees, Meg Ramsey (The Ramsey McCluskey Family Foundation, Lincoln, MA) was especially interested to learn what her grantees were thinking about the foundation’s grant process, reporting, and site visits. Anonymity was key, so her grantees did not feel that providing constructive criticism or a negative response would hurt them in later grant cycles.

Invest in learning from your grantees and applicants >>

The results—tallied by our staff and reported to Meg—revealed the foundation to be already involved in some wonderful projects that were appreciated by grantees, such as grantee community convenings, where grantees are able to meet for breakfast and share their best practices in areas such as using social media; and its 3-year Trilogy Grants given to a small set of grantees each year.

Meg also learned some things to improve the foundation’s processes going forward. For one thing, her grantees asked permission to use a common grant application, not realizing the foundation already welcomed that option. Grantees also wished for more multiyear giving opportunities and less paperwork.

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Foundation Benchmarking Demystified

By Ruth Masterson, Exponent Philanthropy 

Apples to apples

Are you uncertain whether your foundation is benchmarking to its fullest advantage? Do you wonder if you should do more?

Benchmarking can be a simple, straightforward process. Your foundation can benefit from it with minimal time and effort, and on any budget.

Common types of benchmarking include:

Reasons to Benchmark

Foundations choose to benchmark their practices for many reasons.

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6 Ways to Champion Change From the Inside Out

By Ruth Masterson, Exponent Philanthropy 

Do you want to catalyze change at your foundation? Perhaps you want to improve board dynamics, refine your mission, or implement new technology. Many forces can initiate change, and here we explore how your fellow trustees and staff champion change successfully from the inside out.

Every situation is different, of course, and we encourage you to use these ideas not as a checklist, but as inspiration and support as you craft an approach tailored to your particulars.

Prepare. You don’t need to become an expert in all matters related to the change you will propose, but it is important to gather sufficient information to demonstrate that you know what you’re talking about, and to be able to share appropriate information with others. Be sure to appeal to both the head (with data, sample forms, time lines, and the like) and the heart (with stories of others’ successes or lessons learned, for example).

You may also want to spend time learning about change itself. Inside Change looks carefully at how change happens within organizations and encourages us to think about how to transform judgment into curiosity, frustration into excitement, and fear into courage.

Listen well. Plenty of evidence suggests that people are curious, innovative, and adaptable. So why can it be so hard to create change? Well, to start, when people feel pushed, they often resist.

In Humble Inquiry, Edgar Schein describes the emphasis our culture places on telling and doing rather than listening and asking. He describes the power of learning to inquire, humbly. By asking others about their experiences and ideas, we create the possibility of learning from them and, in turn, building trust and gaining information that can inform and improve our plans for change.

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Help Your Board Members (or Anyone) Be Open to New Ideas

By Ruth Masterson, Exponent Philanthropy 

Is your foundation board stuck or complacent? Have you been wanting board members to consider a new strategy or project, only to find they just aren’t willing to listen? Perhaps you need a new approach—a fresh one—to create the space where board members feel willing to consider change.

I found a helpful idea in a book I’m reading, Intentional Leadership by Jane A.G. Kise. Within it, a chart outlines the elements of Carl Jung’s theory of personality types and makes suggestions for what individuals of different types might need to be open to change. 

The personality types have been popularized by the Myers-Briggs Type Indicator®, a questionnaire that aims to determine where individuals fall on Jung’s spectrums. This structure is something many of us are familiar with; briefly stated, the four spectrums are these:

  • I/E: Introverted (energized by down time) or Extroverted (energized by being around others)
  • S/N: Sensing (relying on sense perceptions) or Intuitive (relying on intuitions)
  • T/F: Thinking (preferring to approach situations with logic) or Feeling (preferring emotional understanding)
  • J/P: Judging (making quick decisions) or Perceiving (preferring to gather more information)

So, back to where we started: You want to be a catalyst for change on your foundation board.

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How Well Do You Listen to Grantees?

By Ruth Masterson, Exponent Philanthropy 

The good news is that many funders already listen to their grantees. Almost two-thirds (62%) of Exponent Philanthropy member foundations use information from grantees to inform their grantmaking, and 38% gather feedback from their grantees in a systematic way.

But not only can it be hard to set aside time to ask and listen,
the power dynamic between grantees and funders (wherein grantees want to stay on funders’ good sides) is a powerful one that strongly influences what your grantees may be willing to say.

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New Data Demonstrates the Power of Small-Staffed Foundations

By Ruth Masterson, Exponent Philanthropy 

Foundations that work with few or no staff—the largest segment of the philanthropy community—are achieving outsized impact across the country and around the world.  

Grants-Awarded-in-Dollars

Today, Exponent Philanthropy released the 2015 Foundation Operations and Management Report, the premier benchmarking resource for small-staffed foundations and their advisors.

Join Exponent Philanthropy today for access to the Foundation Operations and Management Report and other member benefits. Access to this year’s report is a member-only benefit.

Based on data collected in mid-2014, we learned that member foundations granted an estimated $4.4 billion to local, national, and international causes in their most recent fiscal year. They have an estimated total fair market value of $87.8 billion, up from $74.1 billion at the end of 2012.

We also learned other important things about our member foundations:

  • Member foundations use lean operations, spending just 14 cents in charitable operating costs for each dollar of grants awarded. One-quarter of foundations surveyed operate with no paid staff; of those with paid staff, one-third have only one staff member.
  • An estimated 158,000 grants were awarded by member foundations collectively, down from an estimated 203,000 a one year earlier. Median grant size increased from $15,415 to $19,116 during that time, suggesting foundations are giving fewer grants but increasing grant size to maximize impact.
  • Giving-By-Top-Funding-AreasWhereas the majority of grants went to local communities, 21% of foundations surveyed give internationally—indicating a notable role for small U.S.-based foundations on the international stage.
  • Member foundations demonstrate leadership by reviewing grantmaking strategies regularly (74%), using information from grantees to inform grantmaking (62%), and collaborating or meeting regularly with other funders (58%).
  • Member foundations saw a significant increase in returns on their investments, reporting average returns of 14.1%, up sharply from 9.7% reported in the 2013 Foundations Operations and Management Report.
  • Members are generous in their giving. Median qualifying distributions were 5.19% of noncharitable use assets, or an average of 6.50%, exceeding the required 5%.
  • Member foundations are adding impact investments to their portfolios. Thirteen percent of foundations surveyed engage in impact investing, and these members maintain an average of 41% of their portfolio in impact investments.

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