June 24, 2008
California Foundations Back Compromise to Defeat Diversity-Disclosure Measure
By Suzanne Perry
A coalition of 10 big California foundations has headed off controversial state legislation to require big grant makers to disclose information about the diversity of their giving, staff members, and boards by pledging to spend millions of dollars to strengthen organizations that serve minority and low-income people.
Joe Coto, a Democrat from San Jose who drafted a measure that was passed by the Assembly, agreed to withdraw the legislation on Monday following months of talks between the foundations and three legislative caucuses that represent members of minority groups.
“In essence, [the foundations] met and maybe surpassed the goals of the bill on their own,“said Mike Welch, Mr. Coto’s legislative director.
The grant makers — including the James Irvine Foundation, the William and Flora Hewlett Foundation, and the David and Lucile Packard Foundation — signed a statement agreeing to announce by the end of 2008 a set of multiyear grants “in the multimillion-dollar range” to help minority-led and grass-roots groups and to provide leadership training to a “diverse pipeline” of philanthropic executives, employees, and board members.
The California legislation, known as AB 624, would have required foundations with more than $250-million in assets to disclose the racial and gender composition of their boards and staffs and the number of grants and percentage of dollars going to groups led by and helping members of African-American, Asian-American, Hispanics, and other minority groups — as well as those helping gays, lesbians, bisexual, and transgender people.
The bill — which was awaiting action in the Senate — was promoted by the Greenlining Institute, a public-policy organization in Berkeley that argues that foundations give only a small percentage of grants to minority-led organizations and as tax-exempt organizations should be required to account for where their dollars go.
But it was strongly opposed by many grant makers nationwide, who argued that it interfered with the traditional right of foundations to make giving decisions without government pressure and that reporting requirements were not the best way to bring more diversity to philanthropy.
James E. Canales, Irvine’s president, said the foundations tried to find a constructive approach to address the issues underlying the legislation. “We shifted the discussion away from data reporting toward what we think are a set of activities that will benefit nonprofit organizations serving low-income and minority communities in California.”
Representatives of the Greenlining Institute said they were pleased with the outcome, although they hope to see more California foundations join the plan.
“We think overall this is a good place to start,” said Adam Briones, program manager. “We look forward to building on it and working with foundations to make it stronger, to make it more concrete.”
The foundations — which developed the plan with the heads of the Asian Pacific Islander, Black, and Latino legislative caucuses — pledged to meet regularly with community leaders to review its progress and to issue a public report each year on their activities to implement it. They also agreed to conduct a study of California’s nonprofit organizations, including which groups they serve and how many are led by minorities.
The other foundations that backed the plan are the Ahmanson Foundation, the Annenberg Foundation, the California Endowment, the California Wellness Foundation, the Ralph M. Parsons Foundation, the UniHealth Foundation, and the Weingart Foundation.
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I certainly had a few problems with this proposed legislation. That being said, its still pretty sad that it took a scare like that to actually force these foundations to do some real work (or at least say they are doing work) on diversity and inclusion. Hopefully others will follow in their footsteps. A good first step would be for them to attempt to actually diversify their own staff and board members…
— Marie Jun 27, 09:59 AM #