June 30, 2009
Join Us to Discuss Episode Two of "The Philanthropist"
Join the Chronicle on Wednesday at 10 p.m. Eastern time for a real-time discussion about the latest episode of the new NBC show The Philanthropist.
For those who missed it, you can also catch a replay of our discussion of the premiere episode.
July 02, 2009
New York Pastor Resigns
The Rev. Brad R. Braxton, senior pastor of Riverside Church, in New York, resigned this week after less than a year on the job in part because of a controversy about his compensation, reports the City Room, a New York Times blog.
The church fight is the latest in a series of incidents in which the public has expressed concern about a nonprofit leader’s pay; some charity experts expect such scrutiny to grow during the recession.
The Rev. Braxton was appointed in September to lead the church, but some congregants objected to his annual compensation of $600,000, including a $250,000 salary and a housing allowance. According to experts on American churches, the compensation was well above average, but within the range for senior leaders of similar-sized churches in other big cities, writes Times reporter Paul Vitello.
To be sure, the reverend’s pay was only part of the dispute, with some members of the church arguing that the new leader would move River Side away from its progressive activist roots.
Given the economic tough times, many nonprofit executives at large organizations feel pressure to limit their pay and some have opted to forgo bonuses or have their salary reductions, according to a Chronicle article.
What do you think? Does it seem there is more public concern about nonprofit compensation? Should charity executives reduce their pay during the recession?
July 01, 2009
Aid Groups Spending More Money on Security, Survey Finds
Aid organizations are devoting more money to keep their employees safe, according to a new survey by International Medical Corps.
Michael Kleinman highlights some of the survey’s findings on the Change.org blog.
Among them:
-35 percent of respondents said their organization has a specialized safety and security department.
-Charities spend most of the money they make available for security on training and on salaries for security personnel.
-Nearly all groups have a written policy statement on security and all field sites have security guidelines available.
Mr. Kleinman notes one surprising finding: Employees based in a charity’s headquarters office were more likely to say their organization needed to heighten its awareness of security incidents than were staff members who work in the field (34 percent compared with 13 percent).
Stephanie Bowen, a spokeswoman for International Medical Corps, said the group would not be be widely releasing this particular survey, but was planning to publish a larger study on security in the next few months.
Can Foundations "Borrow Their Way Out of the Recession"?
John Copps of New Philanthropy Capital, a British charity that advises philanthropists on how to give more effectively, asks on the organization’s blog whether foundations could borrow money to maintain their levels of giving during the recession.
It’s a shame that, given the increase in demand for services, many grant makers have been forced to cut their budgets, Mr. Copps says. He wonders: “Could grant makers borrow to maintain their activity over the next few years, until their sources of income recover?”
Perhaps they could borrow against future sources of income — the profits of a company or an endowment — to keep giving during the downturn, he says.
Mr. Copps notes that many foundations have decades, or even centuries, of good credit histories. “Surely they are a good bet for lending?” he says.
He acknowledges that there are practical problems, such as the culture among trustees. “But could this be a potential solution to the forthcoming drop in grant-making and a way for innovative foundations to find value?”
What do you think?
Group Sheds 'Sunlight' on Failed Bid
While many charities proudly announce when they’ve won a government contract or grant, almost none publicly discuss why an attempted bid failed. On its blog, Sunlight Labs has done just that.
Sunlight Labs is run by the Sunlight Foundation, a Washington nonprofit group, and uses technology to push government officials and members of Congress to be more public about their work. (Read The Chronicle’s article about the Sunlight Foundation.)
In June Sunlight said it would try a radical idea: With help from independent Web developers and others, it would draft an application to operate Recovery.org, the federal government’s Web site used to track economic-stimulus money.
But the project did not work, writes Clay Johnson, director of Sunlight Labs. Among the problems: Sunlight didn’t understand the terminology used in federal contracts.
On the blog, Mr. Johnson describes the mistakes he made and writes about what his group learned from the effort, taking some pride in the experiment’s negative result.
“We’re proud to fail,” he writes. “Too often, especially in this community, people wring their hands and try and figure out what’s possible before trying something. While some may use the cliché of ‘don’t let perfect be the enemy of good,’ I think it may be more appropriate to say: ‘Don’t let what’s possible get in the way of doing something.’”
What do you think? Have other nonprofit groups talked publicly about a failed bid for a contract or grant and what they’ve learned from the experience?
June 30, 2009
Philanthropy Experts Debate Nature of Foundation Assets
Philanthropy experts are debating the nature of charitable dollars — are they public or private funds?
The discussion is not new, but has become more important lately as it is key to the question of how the government should regulate foundations and whether it should force them to give more to the poor and other disadvantaged populations.
The Philanthropy Roundtable, a Washington association of grant makers, released this month a new report that attacks the idea that philanthropy is public money because donors receive a tax deduction and grant makers are tax-exempt.
“The ‘public-money’ claim is not well founded in legal authority,” says the report, How Public is Private Philanthropy: Separating Myth from Reality. The report, which was the subject of a recent discussion at the Bradley Center for Philanthropy and Civic Renewal, goes on to say about the tax benefits, “There is no evidence that these benefits were meant to give government other types of control over philanthropies.”
The public-money argument, the report says, threatens the independence of philanthropy, which is key to its success. There is “strong authority in favor of charitable independence, the contributions of foundations and other charities to American society under the traditional, limited philanthropy-government relationship, and the serious consequences that greater government control could have for this relationship.”
The National Committee for Responsive Philanthropy, a foundation watchdog in Washington, disagrees.
“The authors asked the wrong questions and their conclusions miss the mark,” Aaron Dorfman, executive director of the committee, writes on the group’s Web site.
Mr. Dorfman says that taxpayers should have a partial say in how foundation assets are spent. And instead of discussing the public or private nature of philanthropy, he says that the authors should look at more important questions. For example, “Is the status quo in philanthropy good enough? Is the current regulatory framework, combined with current practices, producing the results we as a society expect from our philanthropic institutions?”
Under the argument that philanthropic money is in part public money, Mr. Dorfman’s organization is pushing foundations to make changes in their giving. The proposals have been heavily criticized, especially the recommendation that foundations should give at least 50 percent of their grant dollars to disadvantaged populations.
While the committee has said it does not want lawmakers to require foundations to comply with those ideas, members of Congress have shown interest in them.
What do you think? Where do you side in the debate and why?
June 29, 2009
Should Nonprofit Groups Return Money Tainted By Madoff?
Do charities that benefited from Bernard Madoff’s massive Ponzi scheme have a legal or moral responsibility to give back the money?
Steven M. Davidoff, a law professor at the University of Connecticut, asks that question on The New York Times DealBook blog. To illustrate the conundrum, he describes a lawsuit filed by the trustee of Mr. Madoff’s estate, Irving H. Picard, against Jeffry M. Picower and other affiliated entities, including the Picower Foundation.
The complaint alleges that the Picower Foundation received roughly $5-billion in profits from investing with Mr. Madoff over two decades. It also says the foundation’s representatives knew, or should have known, that Mr. Madoff was engaged in a fraud, given the incredibly high rate of returns. (See The Chronicle article on the lawsuit).
The foundation gave away more than $20-million a year — money that never really existed — to charities that included the Boys and Girls Club of America and the Children’s Aid Society, Mr. Davidoff writes.
He also cites the Carl and Ruth Shapiro Family Foundation and the Chais Family Foundation as examples of grant makers that may have benefited financially from Mr. Madoff’s scheme, and then donated much of their ill-gotten gains to nonprofit groups.
Could those charities be required by law to give back the money?
“Under the law of fraudulent conveyance,” writes Mr. Davidoff, “there is a six-year lookback, and they could conceivably be sued to return the money. However, traceability of the money here will be a problem, and in many cases protect the charities.”
But if charities are not legally liable to return the money, he asks, do they have a moral obligation to do so?
Mr. Davidoff doesn’t think so. “These charities simply do not have the money to return and, in any event, it would affect the worthy causes to which they contribute,” he says.
“It is for this reason alone that I believe that this is more a rhetorical — but still necessary — exercise, and that the majority of charities as a practical matter will not be asked to return the money.”
What do you think?
June 28, 2009
Does 'Paraskilling' Hold a Key to Helping Poor Nations?
“Paraskilling,” the practice of breaking down skilled services such as education and health care into simplified tasks that can easily be completed by unskilled workers, may help charities and government organizations bring those services to needy people in developing countries, writes Adrienne Villani at the online publication Beyond Profit. But Ms. Villani wonders if something is lost when jobs like teaching are broken up in this fashion.
To Ms. Villani, who encountered paraskilling via a new report on serving emerging markets by the Monitor, consulting group, “I thought it a savior, that which we had all been waiting for. It could easily be applicable to health care, education, financial services.”
The Monitor report, she writes, spotlights the example of Gyan Shala, a charity in Ahmedabad, India, that provides elementary education to poor children. Its one-room schools are staffed by teachers from nearby neighborhoods who follow highly standardized lesson plans.
“Junior teachers, who teach for just three hours a day, deliver lessons out of highly structured workbooks,” writes Ms. Villani. Most parents pay the equivalent of 60 cents per month for their children’s tuition, with the rest subsidized by donors.
But while the benefits of making education affordable and accessible seem evident, Ms. Villani raises concerns. “I’m just not sure about the efficacy of giving students 20-minute lessons — each taught by a different teacher — multiple times a day,” she writes. “A strong rapport is just not built between student and teacher.”
She adds, “I also worry about the passion of these lower-skilled teachers. They are teaching to earn an income, not because of a passion for pedagogy. A child becomes passionate about something when a teacher is passionate.”
What do you think— is paraskilling an effective way for charities to deliver education and other services to people in developing countries? Click on the “comments” link below to share your thoughts.
New York Arts Fund Offers Cheap Rent to Charities
The New York Foundation for the Arts is offering some help to recession-plagued arts groups in the city: a chance to claim some discounted office space, according to Dana Variano on the PhilanthroMedia blog.
Citing a report in the Philanthropy News Digest, Ms. Variano says the foundation is now soliciting proposals from groups and artists affiliated with it.
Those artists and charities selected for the program will be eligible for discounted rent – -$200 per month — on work space in the foundation’s office, which will include Internet access, discounted scanning and printing services, meeting rooms, and other amenities.
Ms. Variano praises the program and suggests it might be a model for helping arts groups and artists — and even small for-profit entities — in other cities weather the recession. “Have an extra office or building area in your workplace?” she writes. “Why not try renting out the space to help out a struggling small business, and save some funds yourself?”
June 26, 2009
Can Foundations 'Agree to Agree' About Some Principles?
Recent recommendations on good grant making by the National Committee for Responsive Philanthropy have divided foundation leaders, but there are key points the nonprofit world seems to agree on — and can do something about, says the Alliance for Justice.
On the Washington group’s blog, Sue Hoechstetter, the organization’s senior adviser for foundation advocacy, says both supporters and critics of the committee would seem to agree on its recommendations that foundations increase advocacy work and provide more operating support for charities.
And where there is common ground, she hopes that philanthropic leaders will work together to make changes.
For example, she suggests, “With much of the nonprofit sector experiencing economic crises, and general support funding on the decrease, the Philanthropy Roundtable and Council on Foundations could together develop a strategic campaign to increase their members’ general support grant making.”
Read The Chronicle’s article about the controversy surrounding the committee’s proposals. (A paid subscription or free temporary pass is required to view the article.)
What do you think? Are there principles proposed by the National Committee for Responsive Philanthropy that foundations can universally agree upon?
Michael Jackson and Philanthropy
As people mourn the death of the pop star Michael Jackson, fans, the news media, and others are discussing his charitable work, which some say paved the way for the current surge in celebrity philanthropy.
The entertainer supported dozens of charities during his life, including USA for Africa, the Make-a-Wish Foundation, and the Elizabeth Taylor AIDS Foundation. He reportedly was listed in the 2000 edition of the Guinness Book of World Records for “Most Charities Supported by a Pop Star.” The number was 39.
As a humanitarian, he is perhaps best know for “We Are the World,” the 1985 song he wrote with Lionel Richie that raised millions of dollars for famine relief in Africa. To honor the King of Pop’s philanthropy, some fans and small companies have pledged to make donations to his favorite charities.
Yet as with the rest of his life, Mr. Jackson occasionally triggered controversy with some of his philanthropic efforts.
In 1992 he created the Heal the World Foundation, which provided aid overseas but also brought needy children to his California home, the Neverland Ranch. According to Fox News, the charity’s work raised concerns when the singer was accused of child molestation. (Mr. Jackson was acquitted of the charges.)
In addition, in 2006, questions were raised about whether Mr. Jackson earned money from the charity singles he released.
On his blog, Jeff Trexler, a professor of social entrepreneurship at Pace University, in New York, discusses the two sides to Mr. Jackson’s charity efforts.
While there may be lessons to be learned from the way Mr. Jackson approached his philanthropy, “for now,” Mr. Trexler writes, “a moment of silence for a man who, like so many of us, gave as much as he felt that he could.”
What do you think? How did the pop singer reshape how musicians and celebrities do philanthropy?