It is hard to look at events of the past few years without concluding that democracy in America is in trouble. Surveys routinely find that most Americans think poorly of the federal government and, in particular, of Congress. Such frustration and mistrust do not bode well for our system of government.
Against this backdrop, The William and Flora Hewlett Foundation announced today [8 July] that it is launching a new initiative to help alleviate the problem of polarization, with a special focus on the problem in Congress. The foundation will invest $50 million over the next three years in what it is calling the Madison Initiative. It will use this initial phase of grantmaking to assess whether and how it can help strengthen the nation’s representative institutions so that they are better able to address the major issues facing the country—and do so in ways that work for the American people.
The new initative has met with some criticism. ‘Critics, like Niki Jagpal, director of research and policy at the National Committee for Responsive Philanthropy, called the effort “problematic”,’ reports Alex Daniels, writing for the Chronicle of Philanthropy on 15 July. ‘Instead of supporting groups across the political spectrum, Ms. Jagpal said it would make more sense to dedicate more resources to current Hewlett grantees that work to alleviate poverty, attain social justice, and secure women’s reproductive health.’
While David Callahan, writing for Inside Philanthropy on 14 July, asks:
Try this exercise. When you think ‘women’ and ‘investing’ what do you think about? This piece is going to ask you to think about the ‘women effect’ as a factor across multiple dimensions where ‘women and girls’ and ‘impact investing’ come together. Across all asset classes, and a variety of stakeholders.
Let’s put it right out there … women belong as investors (whether it’s their own capital or on behalf of others), as entrepreneurs, in management, and as board members. They belong in the picture of social impact as leaders in women-led enterprises, as participants in enterprises where women can create or increase wealth, as beneficiaries of investment, philanthropy or development aid. In fact they are key actors in almost any aspect of investment you might consider.
The case has been made about why women – and gender-diverse teams – make better investors, why you’d want women on boards, on a management team, on an investment committee, or running a hedge fund. The case has also been made that getting access to capital for women and girls lifts up their families, their communities, and indeed their nations, in a way that investment in men cannot. I’m not going to use my space here to debate these facts.
Investing with a gender lens
A gender lens in impact investing means considering how you can use your investment capital to have a positive impact on women and girls, and correspondingly to help solve the challenges that are the focus of our social investments and philanthropy. Whether we’re speaking about what are often called ‘women’s issues’ such as slavery and trafficking, domestic violence or maternal health (which aren’t ‘women’s issues’ as much as core ‘societal issues’) or about food security, healthcare, education, access to finance, energy, clean water, sanitation, you name it: women are the reality in the picture – though ironically often not in the picture when it comes to considering our investments.
And we must be as committed about getting women into the picture as impact investors, and therefore also as owners, board members and fund managers, as about investing with a gender lens. And this is not just about women. It’s about diversity, and the evidence that diversity, whether it be on teams or inside portfolios, enables investors to outperform their peers.
Some of the pioneers in the ‘women effect’ conversation are Joy Anderson (Criterion Institute), Jackie Vanderbrug (US Trust, previously at Criterion) and the team at Calvert Foundation (there are too many women who have been inspirational to mention all of them here). Today, we could list dozens of women and men who have influenced this conversation, from the pioneers in impact fund management to those who started out in the early days of microfinance, SRI, community investing, and more.
When I first started out in social impact investing, it was hard to find anyone writing or talking about it (apart from my boss at Venturesome, John Kingston). But the tables have turned, and in the recent Alliance special feature, ‘Markets for good: removing the barriers’, we had not just one article but several from around the globe! It’s a joy to think that the field is now at a point that such an esteemed and diverse group of contributors can come together and debate the issues raised by Monitor Inclusive Markets’ report Beyond the Pioneer: Getting inclusive industries to scale. For me one big issue the report raises is the role of government vis-à-vis impact investing in addressing social problems.
Beyond the Pioneer is framed as an exploration of the barriers faced by social/impact enterprise (‘social ventures’ as we label them at Nesta) when attempting to scale up their operations. Many of the responses to the paper looked through the lens of social/impact investing and its role in overcoming those barriers.
In my opinion, the barriers to scale faced by social ventures as identified in the paper (at the level of the firm, value chain, public goods and government) are a helpful framework to consider what is needed to tackle any complex problem, ie it is a means of exploring a whole system of innovation around a need (as Vineet Rai points out in his contribution). It shouldn’t surprise us that solving persistent social problems effectively, at meaningful scale and with longevity, requires interventions beyond the level of a single firm. I agreed with Guillaume Taylor that the lessons from Monitor Inclusive Markets’ developing world experience have plenty of resonance with our experience making impact investments within the UK’s developed economy and government structures.
So I want to respond to the special feature on five particular points that speak to my experience investing in UK social ventures operating at the boundaries of private, social and public sectors in education, social care and local communities.
Why are so few market-based solutions to poverty getting to scale? What can be done so that they can deliver meaningful benefits to the poor?
Hosted by the Shell Foundation, the June 2014 Alliance Breakfast Club discussed these and other issues arising from the June 2014 special feature of Alliance magazine.
The discussion was facilitated by Alliance’s editor, Caroline Hartnell
‘During her interviews for the CEO job, Desmond-Hellmann brought up criticisms of the foundation and other thorny topics, to see how philanthropy’s power couple would respond.
‘“I felt like I tested what it would be like to have a conversation about a difficult issue,” Desmond-Hellmann said. And she liked what she heard.’
It seems like asking questions is something she feels she brings to her new job. As the first physician and research scientist to hold the top job at the world’s richest philanthropy, ‘That outside perspective is already proving valuable,’ she told the Seattle Times. … ‘What I hope I bring to the foundation … is coming at things from a fresh angle. I find myself asking a lot of questions, and I think that’s an asset.’
But she isn’t planning any major course changes. ‘The strategies we have are awesome,’ she said. ‘We’re working on some of the most important problems in the world.’
But so far, much of that work is still in the research phase, limited to pilot projects or facing logistical and political hurdles to implementation. Eradicating polio, for example, has proved much tougher than expected due to conflict and chaos in countries like Pakistan, Afghanistan and Nigeria. Desmond-Hellmann said her top priority is to ensure that the foundation’s investments have a broad impact.
‘If you make a medicine and no one gets it, it’s not really worth celebrating,’” she said.
Click here to read the full interview>
This post first appeared on the Foundation Center’s GrantCraft blog. GrantCraft, a service of the Foundation Center, taps the practical wisdom of funders to develop free resources for the philanthropy sector.
From 15th to 17th of May in Sarajevo, Mozaik Foundation hosted European Foundation Center’s Annual General Assembly (AGA) and Conference. Over 500 participants talked about solidarity, civil society and political governance. In the same time, 70 kilometers from the conference venue, River Bosna, Drina, Sana, Sava, Vrbas, and others burst their banks and made terrible damage to human lives, homes, livestock, and even to entire villages. Floods left behind mud with unimaginable quantities of waste and dust, but also terrified and hungry people. Around 2,100 landslides were activated throughout Bosnia and Herzegovina, and some of them washed away homes and infrastructure. Official data estimates that 1,363,000 citizens have been affected – a fourth of the population. Over 100,000 homes were destroyed or damaged and 230 schools and hospitals devastated, while landslides continued threatening homes and infrastructure. The total damage has been estimated at 2 billion Euros.
We at Mozaik Foundation knew it was time to react. Even though grantseeking is normally not allowed at AGA and Conference, we set up a Solidarity Fund and asked foundations in attendance to donate for the relief of the flooded areas. It was an immediate chance for the foundations to show the solidarity we talked about during the conference and to leverage our collective power to help out in a devastating disaster situation.
Meanwhile, we were aware that our existing community programs and actions in rural areas would be affected as well. The Mozaik team decided to approach its partners with a request to adapt our programs to the current situation. Although disaster relief and community rebuilding are not stated focus areas of the Foundation, we recognized our ability to help in an emergency situation because our deep roots in the affected communities. However, it was hard to decide how to help, how to organize ourselves, and what we could do best.
Mozaik Foundation has a long history in doing community action led by youth volunteers, supporting hundreds of youth projects all around the country. So we decided to do what we know best. We focused on three areas: (1) provision of drinking water in flooded areas; (2) youth work activities led by hundreds of young people, who will address the specific infrastructural problems in communities that are damaged due to floods and landslides; and (3) provision of free seedlings, professional support, and secured market link for vulnerable families who see a way out of the crisis through agriculture.
So far, we have succeeded to collect 190,000 EUR thanks to EFC members and individuals from all around the world. By nature of a foundation’s structure, we – the global community of funders – recognize that sometimes the best way to help is not to roll up our sleeves but instead to focus on collective impact of our funds by supporting actual work happening on the ground. Through this experience – Mozaik’s first in an emergency context – we have learned what a vital role our relationships within these affected communities play in providing help. While we have always recognized the value of financial support, our role in coordinating funding efforts and making sure that contributions are effectively distributed has highlighted to us why funders also need to be engaged in the communities they serve.
Please visit www.mozaik.ba to track flood-related donations and distributions.
Haris Buljubašić, Social Media Coordinator at Mozaik Foundation.
As an attendee of the third annual Stavros Niarchos Foundation International Conference, a watershed event in Greek philanthropy, I had the opportunity to meet, as well as listen to, an array of internationally known panellists within the philanthropic community.
After a long day, one of those speakers – Jennifer McCrea, senior research fellow at Harvard’s Kennedy School – asked the audience to reflect on what ‘SIMed’ (Surprised, Inspired and Moved) us that day. Here are my SIM moments.
I was surprised – but not in a good way –by the new research on youth unemployment conducted by Endeavor Greece and funded by the Stavros Niarchos Foundation. Over the last six years, 1 million jobs (21 per cent) were lost in Greece, and two-thirds of those jobs will not return. This means that the majority of the unemployed under age 35 will need either to change professions or to relocate.
The fact that Greek youth are ill prepared for the job market and lack basic skills did not come as a surprise to me. Our failing educational system does not prepare young graduates for the labour market. As Shawn Bohen of YearUp said of Greece, ‘There is a vast disconnect between what employers think is relevant and what universities think is relevant.’ An audience survey revealed that he’s not alone in his thinking. When asked about the most effective way to address youth unemployment, about four in ten (41 per cent) of those in attendance responded with ‘reform the education system in order to connect to the needs of the work place’, and a similar number (39 per cent) chose ‘train youth in order to acquire skills that fit the private sector’.
What inspired me the most was the emphasis on cultural investments in Greece and the socioeconomic impact of such philanthropic initiatives. Among the noteworthy projects:
Like most countries, Greece aims to use cultural investments for gains in socioeconomic development. At the conference, we discussed several successful examples of such work, including Newcastle in the 1960s, Baltimore in the 1970s and New York City’s more recent High Line project. Cultural tourism, or ‘edutainment’, could also be a source of social and economic prosperity for years to come.
Lastly, I was moved by a performance called ‘A Brave New World’ by members of Cerebral Palsy Greece, which reminded me why I do this job and that the true meaning of philanthropy is ‘the love of humanity’.
Those of us in the philanthropic world often forget this, but the co-president of the Stavros Niarchos Foundation, Andreas C Dracopoulos, summed it up in one eloquent sentence: ‘Those of us in giving and receiving must be concerned about what is good.’
Epaminondas Farmakis is president and CEO of elpis philanthropy advisors.
elpis is a consulting company focused on helping philanthropists, donors and foundations develop and implement sustainable, efficient programmes. It is primarily focused on issues in Greece, Southern Europe, the Balkans and the Middle East.
A recent busy visit to Beijing disclosed that much is happening on the ‘charity’ law front, with many other ancillary developments regarding the three regulations (san tiaoli). Beginning first with those, I will analyze where they stand and why.
It is expected that the first ones to appear will be the association (shetuan) regulations in late December 2014 or January 2015. The State Council and the Ministry of Civil Affairs (MCA) seem to be in agreement on most items in them.
There are hang-ups with the other two. With regard to the foundation (jijinhui) regulations, there has been a lot of discussion about the State Administration of Taxation’s (SAT) inability to enforce the 70% of prior year’s earning rule for payout. Indeed, in the previous blog, I mentioned that One Foundation has been having problems with that itself.
MCA and SAT appear to be fairly far apart in their negotiations, but one aspect of the proposed ‘charity’ law may help to resolve this. The draft developed by China Philanthropy Research Institute (CPRI) includes a 5% of assets payout requirement, which is easier to administer. It is also a better measure of a foundation’s capacity to do direct charitable work through its own actions or through those of its grantees. If this were to be incorporated in the foundation regulations, which may clear up the logjam.
With respect to the min fei (social enterprises), the big standoff concerns private schools. On the other side of the argument from MCA is SCOPSR (State Commission on Private Sector Reform), which is in charge of major state restructuring efforts, including reforms of the public institution sector (shiye danwei). This is a very powerful agency, which reports to the Party along with the State Council. It thus has a great deal of political clout, unlike MCA, which has virtually nil.
Although SCOPSR’s plan for state downsizing will mean that many shiye danwei in such fields as health, scientific research, etc., will be transformed into non-state-owned min fei, there is a problem for them with the private schools. They would like to bring those back into the state sector.
While this may appear to be somewhat regressive, my suspicions are that it will succeed. It appears to relate in part to the current drive for greater intellectual purity in China, which began with the issuance of the famous Document No. 9 in spring 2013. That document decried the influence of certain ‘western ideals’ such as democracy, human rights, and civil society in China.
Since then we have seen attempts to censor some public intellectuals (and many have self-censored as well); spurious charges brought against many human rights lawyers (including Xu Zhiyong and others associated with the New Citizens’ Movement (NCM)); media censorship; etc.
There seems to be a relationship between these developments and the assertion of greater control over private schools by forcing them to become state institutions once again. How this will all play out remains to be seen, and it may involve a high level intellectual/legal struggle leading to the repeal of the ‘Private School Law.’ I would say that the issuance of the min fei regulations will take the longest time of the san tiaoli before coming to fruition.
The relationship between these regulations and the ‘charity’ law is clear. That law must stand on the shoulders of the regulations in the absence of a clear law on associations and foundations, such as in Germany. Alternatively there could be a law on those two types of entities along with private institutions (as in Czech Republic). But these do not currently exist (nor are they expected even be proposed any time soon). Thus, putting the ‘charity’ law ahead of the issuance of at least the social association and foundation regulations seems misguided. Many Chinese professionals agree with this judgment.
A first question in regard to the law being proposed by both MCA and CPRI, is why it is called a ‘charity’ law at all. Consistent with civil law practice in Germany, France, and Japan, the proper term is ‘public benefit’ or gongyi in Chinese. This would also be consistent with Chinese legal terminology going back to the 19th and early 20th centuries when the term gongyi was used in China. Most recently, of course, there is the Public Welfare Donations Law from 2001.
This nomenclature was under discussion at two seminars on the CPRI proposal, which I attended as an honored Meiguoren (American) guest. These were actually some of the best seminars I have ever attended in China, as there was lots of give and take and not mere spouting by talking heads. There were several questions addressed including the following.
These were good and productive gatherings. ICCSL has presented both written and oral comments (Prof. Simon participated rather vigorously in the discussion). ICCSL is awaiting the third draft before continuing with its comments.
Karla W Simon (西 门 雅) is chairperson of ICCSL
First published on the Global Fund for Community Foundations blog.
It is appropriate (and no doubt deliberate) that the launch of the ‘What’s Next for Community Philanthropy?’ toolkit has come in 2014, a year that sees the Cleveland Foundation – America’s first community foundation – mark its centenary. This extensive toolkit, which has been produced by Gabriel Kasper and his colleagues Justin Marcoux and Jess Ausinheiler at Monitor Institute, has not really been designed for someone like me. US (and Canadian) community foundations are really the main target audience for this suite of tools and essays. So my comments on the toolkit are framed by my vantage point at the Global Fund for Community Foundations (GFCF), a global grassroots grantmaking organization working to support the development of community philanthropy worldwide.
Evolving concepts, changing terminology
Let’s start with ‘community philanthropy’. Unlike in the US and Canada (where community foundations alone can be counted in their hundreds), there are far fewer of these types of organizations (whatever they are called) in most of the rest of the world, and so by focusing on one particular institutional form, you end up with very small numbers. So although community foundations form a large part of our constituency (and we even prioritize them in the name of our own organization – a fact that is not lost on me), we have always embraced other forms of ‘community philanthropy institutions’, including women’s funds, local grantmakers, environmental funds, etc. So I was pleasantly surprised (and also curious) to see that the more inclusive ‘community philanthropy’ is used throughout the toolkit (defined as ‘community foundations and other community philanthropy organizations’).
A global world – fact not choice
One of the perils of working locally (community philanthropy organizations are mostly place-based) is that it is easy to become inward-looking and insular. The excellent essay, ‘Shift Happens: Understanding how the world is changing’ does a great job in providing a succinct overview of six different types of global trends that are having a profound effect on the nature of communities. If you are a community foundation leader or board member trying to convince your colleagues that the community that your foundation was set up to serve is no longer the same, and to find examples of how other community foundations are responding, then this document will save you many hours of internet searches. Although much of the specific data is geared towards a US audience, the essay demonstrates to any reader how global trends (both good and bad) are driving huge changes in our communities the world over.
Community foundations as specialist generalists
Community foundations tend to make grants across a range of different portfolios. This is well understood within the community foundation field, but it can sometimes seem to outsiders like a lack of focus or being overstretched. (In fact, I once got involved in a very long, rather heated conversation with a US immigration official in New York, who expressed great scepticism about the community foundation idea, insisting that all philanthropic organizations and NGOs should have a focus – he suggested water, healthcare or education – and that it was poor form to try to do everything in a community).
What the toolkit also highlights in its examples is how specialized and sophisticated specific programmes clusters and approaches have become within the community foundation field. In our grantmaking at the GFCF, we have also been looking at how to deepen community philanthropy practice around particular issues (such as youth engagement or the environment) so that community philanthropy organizations can deliver excellent programmes within the context of a broader, holistic and networked approach.
A launching point for a more linked-up global field?
Certainly there are some valuable tools in the kit that a community philanthropy organization anywhere in the world could use to test assumptions, stimulate reflection and inspire creative thinking (although for those operating in contexts where local giving is still very nascent, the level of sophistication around different kinds of donor services might seem like wishful thinking). It is also good to see strategies that have been adopted by many of our community foundation partners, often driven more by innovation and instinct than blueprint, are listed and named in the toolkit. So when in the ‘Bright Spots’ tool, which looks at ‘Promising approaches in community philanthropy’, there is a question, ‘What if you solicited small gifts from less affluent individuals?’, I think immediately of Odorheiu Secuiesc Community Foundation in Romania which created a ‘Community Card’ programme through which over 13,000 donors give small amounts each month. Another ‘bright spot’ on ‘Sharing Community Information’, asks ‘What if you conducted routine check-ups of your community?’ This takes me to a recent blog by one of our partners in Ukraine. Moloda Gromada (‘Young Community’) is based in Odessa, which has seen its own fair share of violence, resulteding in the deaths of 42 people on 2 May 2014. The foundation’s director Inna Starchikova describes how, following the violence, the foundation conducted a survey to ‘check the state of health’ (her words) of the community by asking people how they saw their own personal role in allowing the violence to happen and their thoughts on how future violence might be prevented.
What’s next for ‘What’s next’?
A separate essay, which focuses specifically on examples of community philanthropy innovation from the global field, is in the pipeline and I look forward to that. Finally, I wonder whether this kind of reflective, big picture exercise might provide new opportunities for those community foundations that are interested, wherever they are in the world , to create spaces for engagement, solidarity and collaboration. Although there may be huge differences in the financial asset bases of community foundations in different parts of the world, it seems to me that energy, innovation and commitment to community-driven development are plentiful the world over.
Jenny Hodgson is executive director of the Global Fund for Community Foundations.
The UK-based Edge Fund, which supports grassroots groups aiming at radical social change, has raised its first £250,000.
Following the motto ‘radical funding for radical change’, funding decisions are put in the hands of those most affected by inequality and oppression. The fund supports groups that are considered ‘too radical’ by most other funders.
Launched 18 months ago, Edge Fund has so far distributed £120,000 to over 80 small, grassroots groups and individuals, from lesbian migrant support groups and Roma community organizers to those opposing police repression, immigration raids and the arms trade, from anti-capitalists and anarchist groups to people working on disability rights, local community organizing and climate change. Just under 1,000 applications were received in the first year of funding.
Edge Fund’s fourth funding round has now opened with grants of up to £5,000 available. The application consists of just five questions, which can be answered over the phone or by email. The deadline for applications is 5pm on Monday 8 September.
Edge Fund is now looking for donations to make a fifth funding round possible. Click here for more information about making a donation, applying for funds or becoming a member>
The philanthropy programme at the Hewlett Foundation is changing. Fay Twersky, director of its Effective Philanthropy Group, tells Caroline Hartnell how and why. She talks about Hewlett’s new emphasis on ‘two-way openness’ and collaboration and the need to create incentives to encourage foundations and grantees to be more open. Finally, she offers her views on ‘emergent philanthropy’ and effective altruism.
Why was the decision made to phase out the Hewlett Foundation’s Nonprofit Marketplace Initiative?
Originally, the Nonprofit Marketplace Initiative came about as a result of research that showed that 70 per cent of giving in the US is from individual donors. The foundation’s goal was to get 10 per cent of that giving moving from organizations that were less effective to programmes and organizations that were highly effective. We realized, however, based on some independent research that we commissioned and an independent third party evaluation, that we were not making progress towards that goal. Individual donors, for a variety of reasons, are highly loyal in their giving and we didn’t see any signs that having more non-profit performance data would change current patterns.
Critics have suggested that rather than being a response to evidence, this decision had as much to do with change of leadership and the fact that Hewlett president Larry Kramer is less interested in ‘effective philanthropy’ than his predecessor, Paul Brest. How do you respond to this?
It’s not true. We tried to be very open about our reasons for closing down the Nonprofit Marketplace programme. We shared the information openly with our grantees; we posted a video on our website to thoroughly explain why we were making this decision. I was the one to lead the analysis and make the recommendation to Larry and to the board. Larry continues to be committed to effective philanthropy, as is shown by the fact that the budget stayed intact for our effective philanthropy grantmaking, and we will continue to make grants to strengthen the field of philanthropy broadly.
Can you talk a little bit about Hewlett’s new strategy to foster openness and transparency and collaboration?
We are in the process of developing a collaborative approach with other funders to foster ‘two way openness’. This means building on traditional notions of transparency where foundations are more open about what we do and how we do it, and also open to hearing from our grantees and from the ultimate intended beneficiaries of our work – students in schools, trainees in vocational education programmes, women in domestic violence shelters – and incorporating their insights into the foundation’s considerations as we develop strategies for grantmaking. So support for systematically listening to beneficiary voice and ultimate constituent feedback loops will be part of our new openness funding effort.