Community Foundations: Balancing Community Needs and the New Donor Mindset

By Laura McKnight, Embolden

Your community foundation is working hard to get your donors involved and help them understand the importance of supporting not only their own favorite causes, but also the most pressing community needs identified by your team and board of directors.

You are also closely watching key trends in philanthropy:

  • Families want to be involved in philanthropy and philanthropic legacies are community treasures to be passed down through the generations.
  • Nonprofits in your community expect to see a benefit from the rising philanthropic investments in our society.
  • Donors want to be associated with philanthropic institutions that are committed to transparency, results, and data-driven strategies.

You want to maximize these trends to grow your mission. If you are like many community foundations, though, you are facing a challenge as you balance two seemingly competing factors:

  • Community needs. The needs in your community keep growing. Nonprofits’ requests are growing. This makes it even more important for you to grow your unrestricted funds and your own operating endowment.
  • New donor mindset. You are watching social impact grow as a priority in today’s culture, and you know philanthropy is an important part of your donors’ lives. Donors enjoy a wide range of social impact activities, including giving money to nonprofits, volunteering, serving on boards, purchasing products that support a cause, recycling and respecting a sustainable environment, celebrating at community events, and marketing favorite charities.

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Data, Trends, and the Value of Written Foundation Policies

By Ruth Masterson, Exponent Philanthropy

I can’t count the number of times a member has called with a sticky situation—how to handle a conflict of interest, or a board member not pulling his or her weight—but, when I ask about what expectations or policies are written down, I learn that there’s nothing in place. That’s an awkward time for the board to decide what the foundation’s policy is! Having policies in writing is one of the best ways to avoid being tripped up by such problems.

To learn more from our members about which policies they find most useful, we ask about a number of policies and documents and share the results in our annual report. We’ve learned that foundations are most likely to report use of written conflict of interest statements (80%), investment policies (78%), grant guidelines (76%), and vision or mission statements (70%).You can put this data to use in your own foundation today. Start with the most common policy and work your way down. Starting with a conflict of interest statement, ask if your foundation has this policy, and, if not, if this policy would be helpful in a pinch. Not all foundations need to have all these policies—for example, not all foundations need a donor intent statement—and there are others that your foundation may benefit from that are not on this list. You only want to adopt those policies that are meaningful and relevant for your foundation.

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8 Silo-Smashing Trends in Philanthropy

By Kris Putnam-Walkerly, Putnam Consulting Group

In my work as a philanthropic advisor, I come across philanthropy in all forms—from individual giving to institutional grantmaking and everything in between. It used to be that most of my clients engaged in their work from behind a wall of protection. Charity and grantmaking were held aside and in addition to other forces for good. However, over the past few years I’ve noticed philanthropy in all forms becoming less siloed and more interwoven with the world around it. Here are eight manifestations of this trend:

  1. CEO branding. Foundation CEOs and high-net-worth donors, following in the footsteps of their corporate counterparts, are realizing the personal and professional value of developing their own “brands”—through blog posts, speeches, articles, and more. By using their voices more aggressively (and sometimes independently), they help support the reputations of the philanthropies they serve and incite meaningful conversation and debate within the field.
  1. Use of advisors and coaches. Philanthropy used to be something largely driven by an individual donor or foundation founder’s own gut instincts and emotional connections, and guided only by their own perceptions and experiences. Philanthropic advisors were practically unheard of. Increasingly, however, philanthropists recognize that those with specific knowledge and experience in philanthropy, grantmaking, leadership, strategy, and operations can provide valuable insight and guidance to help funders make dramatic and rapid change.
  1. Faster health conversions. Twenty years ago, when health conversion foundations first began to appear, their path toward effective philanthropy was gradual. New health conversion foundations usually moved slowly from a broad, “supporting our community” clinical health focus to more strategic efforts that addressed social determinants of health. (Part of this was because the field’s discussion of social determinants was also in its infancy.) Nowadays, I find new health conversion foundations eager to hit the ground running with well-thought-out, strategic approaches that engage communities quickly and deeply, and strive for impact.

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New Report Details Shifts in Foundation Operations

By Henry Berman, Exponent Philanthropy

2017-fomr-cover_page_01More small-staffed foundations are engaging in activities beyond traditional grantmaking, according to Exponent Philanthropy’s 2017 Foundation Operations and Management Report released yesterday.

The only study that captures benchmarks for foundations that operate with few or no staff, which comprise the vast majority of the philanthropy sector, the report details trends in foundation grantmaking, operations, investments, and governance, based on responses from 495 association members.

Join Exponent Philanthropy for access or order your copy >>

The report highlights upward trends in strategies for increasing impact, including:

  • Reviewing grantmaking strategies regularly
  • Sending board members to conferences or education
  • Bringing in speakers or resources from the field
  • Gathering feedback from grantees about the foundation


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What Funders Say About Their Philanthropy, Then and Now

By Cynthia Schaal, Exponent Philanthropy

Philanthropy follows its own journey of learning and discovery for every donor, board member, and professional who gives. For our association members, who give as individuals or as part of small-staffed foundations, that journey can feel lonely and isolating at times.

Yet what we have come to know in our decades of working with foundations, families, and individual donors is this: The philanthropic journey has more shared experiences and ambitions than any individual may realize along their own path.

Case in point: a session at last fall’s National Conference welcoming 100+ conference newcomers.

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Proud But Not Satisfied

By Henry Berman, Exponent Philanthropy

At the time, I was part of a team that chose not to fund a reading program.

One of the biggest factors that influenced our decision not to provide funding was their choice of literature. I honestly don’t recall the exact titles, but suffice it to say the program was using works by Malcolm X and James Baldwin to engage the youth they were trying to teach. With our totally different backgrounds, we felt they should be reading Mark Twain or Louisa May Alcott.

What the hell was I thinking?

I proudly professed I wanted to help kids learn to read, yet in retrospect I can’t imagine being any more rude, patronizing, or inappropriate. What makes it worse—what has really bothered me all these years—is that I was so incredibly detached from the very people I was trying to help.

My point is this: We need a strong understanding of the people we are affecting; the situations we are trying to impact. That means actively listening to the ultimate populations we are trying to help; listening to all the perspectives that influence their world, not ours.

This story, my story, was part of my opening remarks last week to nearly 1,000 at Exponent Philanthropy’s 2016 National Conference. It wasn’t easy to share so openly among so many. But the message was too important.

As I stated later in my remarks, “We should all be proud. But we should not be satisfied.” Vast inequities persist in today’s world, and we must persevere in our belief that something better is possible. We cannot do that without acknowledging our biases, sharing our lessons, and doing the work it takes to achieve more for our communities and causes, however uncomfortable that work may be.

As the conference unfolded and its themes emerged, it became clear that we are indeed proud but not yet satisfied as a community of funders. Here is just some of what I observed. 

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[The Pulse] Philanthropy Leaders Call on American Public to Step Up to Nation’s Challenges

By Andy Carroll, Exponent Philanthropy

The Pulse
In our regular “Pulse” blog series, I explore trends influencing philanthropy by spotlighting articles, reports, and essays in the media. I cast a wide net, venturing beyond philanthropy and traditional topics to consider a variety of ideas, innovations, debates, and critiques. Read previous posts in the series   

It takes courage to attempt the near-impossible, to take on monumental challenges with only modest resources. This is the task the nonprofit sector has set for itself the past 40-plus years. Nonprofits, their funders, and the associations that serve them have struggled against poverty, hardship, and environmental degradation; achieved successes; and continually developed the rigor of their fight.

Yet it takes another kind of courage to assess, with a sober eye and honest heart, the progress made, and recognize publicly that the nonprofit sector alone cannot meet the deepening challenges. It takes courage to admit that philanthropy needs partners, a more collective effort, and a greater shared responsibility for the most vulnerable in our country.

Nell Edgington, Tom Watson, Darren Walker, and Jake Hayman are among the growing number of courageous writers and thought leaders who are questioning out loud whether philanthropy alone can solve our deepening problems. I highlighted their voices in my June 7 blog, “Hardship, Inequality, and Racial Divides Create a Reckoning for Philanthropy.”

Let’s take a deeper look at why philanthropy can’t do it alone.

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[The Pulse] Hardship, Inequality, and Racial Divides Create a Reckoning for Philanthropy

By Andy Carroll, Exponent Philanthropy

The PulseIn our regular “Pulse” blog series, I explore trends influencing philanthropy by spotlighting articles, reports, and essays in the media. I cast a wide net, venturing beyond philanthropy and traditional topics to consider a variety of ideas, innovations, debates, and critiques. Read previous posts in the series  

The model that private foundations and donors have relied on for decades to make positive impact on the world is being questioned. Economic hardship, inequality, racial discrimination, lack of social mobility, and environmental degradation are only increasing in depth and scope. And there is growing recognition that human and environmental needs that go unmet today will incur greater costs in the future. 

The scope and urgency of the challenges is causing frustration, re-assessment, and soul-searching. More foundations and donors are asking themselves not only how they can alleviate problems, but how to solve them once and for all. Can funders reduce the need for philanthropy in the first place?

Many of the nation’s 1.5 million nonprofit organizations struggle constantly, lack internal capacity, and cannot sustain their critical work. Even if foundations and donors provided more funding for general operations and capacity building, can private philanthropy solve nonprofits’ financial struggles when national and state legislators continue to cut government funding—a much larger share of nonprofits’ income? Should funders be more concerned about the decline of public funding over the past decades, since the cuts undermine the effectiveness of their grantees? 

(Among current stress points are budget battles in Pennsylvania, Illinois, and other states, which delay funding to nonprofits that provide critical services. In Pennsylvania recently, more than 17,000 people received no or reduced services due to the budget impasse.)

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From Silos to Shared Goals

In honor of our association’s 20th anniversary and the passionate leaders who have helped us grow along the way, we are pleased to launch a regular blog series dedicated to the reflections of our founders, early board members, and others with long careers in philanthropy. What has changed in the field—and in their giving—over the past decades? What has remained the same? Join us at the 2016 National Conference, September 26-28 in Chicago, to celebrate our milestone anniversary >>

By Marty Fluharty, The Americana Foundation

Last week a speaker was talking about today’s lost communications. We’re turning to text messages, email, ear buds and head phones, in our homes, and in our separate cars. There are fewer community spaces as society encourages us to “do it ourselves.”

Memories came back to a past time some 30+ years ago when there were lots of group discussions, convenings, “rump sessions” with colleagues and friends, porch get-togethers with neighbors sometimes just to talk and other times to celebrate or address concerns. The speaker was correct: We’ve lost a lot of that.

In 1992, I was asked by a colleague to help The Americana Foundation learn about an issue being discussed in our state (Michigan). I met with the board and suggested that they gather with some of the diverse stakeholders and hear their perspectives of the issue. Three intense days later, we all walked away with a list of recommendations and implementation agreements. It was a powerful lesson in what 27 people with very diverse opinions and beliefs can do when they work together.

We tend to call it collaboration, a word with many descriptions: cooperation, mutual support, shared work and goals, to work jointly, to communicate openly. Okay, you get the point. The thing is, you can’t do it alone.

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A Unique American Story: Public Policy and Private Philanthropy

By Richard Marker, Wise Philanthropy

Join Richard Marker this fall for a session at Exponent Philanthropy’s 2016 National Conference, September 26–28 in Chicago, to explore 240 years of American philanthropy in one surprisingly easy sitting, including how our changing landscape informs our current and future giving. Register for the 2016 National Conference by June 15 to save $100 >>

U.S. CapitolSome years ago, when Jacques Chirac was still president of France, the U.S. State Department asked me to meet with Chirac’s advisor on domestic affairs. She had completed a national tour of institutions of American voluntarism. I was the last stop on her tour, her opportunity to debrief.

Her leading question to me was, “How can we develop a system of philanthropy and voluntarism in France like you have in the USA?”

My response: “Before sharing some ideas, I have some questions for you: Can you imagine France without a system of healthcare for all citizens? Can you imagine a French higher education system where students pay $30k or $40k or $50k per annum to attend? And so on….”

Her response: “Impossible!” [The discussion ensued.]

This brief anecdote captures several important realities:

  • The American philanthropy/not-for-profit system emerged from a very different set of political assumptions than most of the rest of the post-emancipation world. In the United States, voluntary institutions arose to meet real needs that the political system chose not to provide. Even today there are huge splits in assumptions and beliefs about whose role is what.
  • Public policy and private philanthropy are inextricably interwoven. Sometimes these interconnections are unintended and sometimes quite purposeful.
  • Neither a government-centered system nor a voluntary system has the capacity, on its own, to provide for all needs and interests of growing, aging, and diverse populations.
  • The history of the institutions of the voluntary sector themselves reflect a social history fully connected to the political realities in place when they were created.

For many, the history of philanthropy is conflated with the biographies of famous philanthropists. And to be sure there are many fascinating narratives of the superrich and the lives they lived—some of them tales of atonement, others of beneficence, all ultimately of generosity. But that is neither new nor unique to any one nation or culture or era.

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