Small Foundations Pay Out Big, Study Finds

July 6, 2010

As Foundation Source processed grants last year and analyzed data collected from Form 990PF filings of nearly 500 of its small and mid-size private foundation clients, it tracked the pay outs and compiled what it found. Its just-released study concludes that, in 2009, 83 percent of these small to mid-sized foundations paid out more than they were required to by the IRS. (The IRS requires that private foundations distribute at least 5 percent of average investment assets annually for charitable purposes.)

In fact, the study says that 58 percent exceeded the minimum distribution requirement by at least 5 percent of their average investment assets.

The larger payouts are continuing into 2010, the Foundation Source also notes, reporting in May that it was seeing a 15 percent increase in grantmaking among its clients.

“Ninety-nine percent of all family foundations are under $100 million,” says Foundation Source President Andrew Bangser. “These generous foundations represent more than half of all foundation giving in the US, nearly $16 billion in 2007. … The data shows that most family foundations have not limited their giving to the minimum amount required by the IRS. And small and midsize family foundations stepped up dramatically in this tough economy to assist a wide variety of people, organizations and causes.”

Foundation Source provides support services for more than 900 private foundations across the U.S. representing $4 billion in foundation assets.

To learn more about the study, view it online on the Foundation Source’s website, or read about it in the Chronicle of Philanthropy.

-Chris Murakami Noonan, MCF communications associate


The Art of the Steal: A Lesson in Ethics and the Public Trust

March 22, 2010

This week, some of MCF’s staff went to see The Art of the Steal, a film documenting the fight over The Barnes Foundation and its $25 billion collection of post-Impressionist and early Modernist art.  This private collection includes seminal works by Cézanne, Picasso, Renoir, Degas, Manet, Monet and Van Gogh, but this isn’t a movie about art.

It’s about governance, transparency, donor intent and the interpretation of these principles by people who are entrusted to act in the best interest of the foundation.

Over his lifetime, Dr. Albert Barnes amassed an incredible collection of art at his foundation in Merion, Pennsylvania, unrivaled by many of the large, prestigious art museums in the United States, including the nearby Philadelphia Museum of Art.  But Barnes did not amass this collection to be viewed extensively by the general public; he established the foundation to “promote the advancement of education and the appreciation of the fine arts.”

First and foremost, Barnes thought of his foundation as a school for artists, a place where sincere students could view important and influential works of art away from the tourism of art museums.  Henri Matisse said the Barnes Foundation is “the only sane place to see art in America.”   Barnes was explicit in his trust documents that the collection should not be sold, moved, or loaned for any purpose, unless those demands became unreasonable or impossible due to unforeseen circumstances.

Therein lies the crux of the struggle to control the Barnes collection.  While Barnes loyalists say that to remove the collection at all would be a direct contradiction to Barnes’ original intent, several powerful people and institutions in Philadelphia, including the former Governor of Pennsylvania, several well-known philanthropists, and the Pew Charitable Trusts, have vied to move the collection to Philadelphia, where it would be more accessible to the general public (and a huge tourist attraction for the city.) They claim that The Barnes Foundation is financially unstable and has no other choice but to move the collection.  The film chronicles this fight, leading up to the dramatic decision as to the future of the foundation.

The Art of the Steal is definitely a movie with an agenda and a point of view (read this New York Times article for a full review of the film).  Funded and produced by several former students and teachers of the Barnes, the film is one-sided and paints the other side in an unflattering light.  Many of the people that the film accuses refused to participate in the movie, but some have made statements in response to the movie, including the Pew Charitable Trusts and Bernard Watson, chairman of the Barnes Foundation board of trustees.

No matter on which side of this argument you fall, The Art of the Steal provides an excellent case study on the topic of ethics.  Whether you have heard of this controversy before or not, you will walk away from the movie questioning how people can ensure that foundations and nonprofits maintain accountability with the public and whether a controversy like this could have been avoided.

At the Minnesota Council on Foundations, our members created, endorsed, and do their work by the Principles for Grantmakers & Practice Options for Philanthropic Organizations to prevent situations like this from happening.  Updated in 2009, the Principles are a how-to of principled philanthropy. Not only do they outline what philanthropic organizations are legally required to do, the Principles are also aspirational, encouraging foundations to reach for more than what the law says is necessary.  All MCF members are required to subscribe to the Principles.  In the preamble of the Principles, it reads:

“We acknowledge the fundamental roles and responsibilities of engaged individuals and the public, private and nonprofit sectors in a just and equitable society.  As a community of grantmakers, we embrace philanthropy’s role in a civil society.”

It is controversies like the one depicted in The Art of the Steal that remind those of us in the nonprofit and philanthropic sectors that we must work daily to uphold the public trust.  We must take responsibility for the privilege of sustaining a just and equitable society.  We must respect and honor the people who turn to our organizations in search of support and guidance.  And we must appreciate the opportunity to assess ourselves against written and unwritten standards of ethical principles and practice, and value the chance to reach for a higher standard.

The Art of the Steal is playing now at the Landmark Edina Cinema.

- Stephanie Jacobs, MCF member services manager


Fabulous Philanthropy Podcasts: They’re Free, and You Don’t Need an iPod!

October 1, 2009

As you can probably guess, I am an internet media junky. I love getting info in all formats, and one of my favorite formats is the podcast. They’re a great way to expose yourself to new ideas while you’re taking the bus, jogging, or just working on things around the house.

In case you’re unfamiliar with this type of media, podcasts are free bits of information, typically audio clips, sometimes video clips or pdf’s, that you can download to your PC using “podcatcthers,” free applications like iTunes or Winamp. The content is free, and you don’t have to have an iPod or mp3 player to listen to them.

There are some great podcasts related to the fields of philanthropy and nonprofit out there, and I thought I would share a sampling of some of the podcasts that I listen to. To find others, I recommend downloading a podcatcher like iTunes and running a search for “philanthropy.”

Philanthropy Podcasts:

The Foundation Center: Philanthropy Chat
In this podcast series, the Foundation Center brings you conversations with grantmakers and other experts in the field of philanthropy on topics ranging from arts funding to changing trends in grantmaking to the impact of the economic crisis on nonprofits.

The Palm Beach Philanthropy Podcast
Palm Beach Philanthropy is an nonprofit organization dedicated to promoting philanthropy, especially in the Palm Beach area.

Nonprofit Podcasts:

The 501c3Cast
The 501c3Cast is a podcast for nonprofit professionals, volunteers, and do-gooders to share information and resources to help them do their jobs better.

Social Innovation Conversations
Social Innovation Conversations brings you social change ideas through audio lectures, speaker series, and conference recordings. Download free podcasts on social entrepreneurship, environmental sustainability, philanthropy, corporate social responsibility, responsible investing, and more.

Join the Conversation: Are there any other podcasts related to philanthropy or nonprofit that you think should be added to this list? Let me know! Please add your comments to this blog entry.

-Cary Lenore Walski, MCF web communications associate


In the Media

September 30, 2009
Photo by Dan..

Ridin' the range and ropin' the headlines so you don't have to.

Your biweekly roundup of media coverage on the world of nonprofit and philanthropy (yee-ha.)

Local

Minnesota Charities Council Revising Its Standards
(Star Tribune) Minnesotans, who donate more than $1 billion a year to charities, soon will have more information before they write checks.

Philanthropy Sector Keeps Giving, Despite Economy
(Business North) Foundations cope with squeeze between falling asset value and higher demand.

Reacting to Race
(Forest Lake Press) The cultural background of the north metro area is changing rapidly, which local officials say can create new challenges for neighbors and classmates.

WomenVenture Opens Minneapolis Office
(Twin Cities Business Journal) WomenVenture now has a Minneapolis office, courtesy of a donation of space from U.S. Bancorp. The St. Paul-based nonprofit, which provides training and loans for women, moved a staff person last week into a U.S. Bank branch on 1030 West Broadway in North Minneapolis.

National
Foundations’ Agenda for Charities Should Include Money, Not Mergers
(The Chronicle of Philanthropy) More and more, foundation leaders are voicing concern that America has too many charities.

Gates Foundation Steps Up PRI’s
(The Chronicle on Philanthropy) The Bill & Melinda Gates Foundation is increasingly making loans, loan guarantees, and equity investments as ways to stretch its philanthropic dollars, The Seattle Times reports.

Less to Give
(Barron’s) Philanthropists hit by the recession face a tough choice as the giving season nears: Reduce all donations, or drop some causes? Smart advice from the field.

Nonprofits Paying Price for Gamble on Finances
(New York Times) Homeowners and businesses were not alone in taking on piles of debt over the last decade. Nonprofits of all sizes did the same, and now they, too, are paying the price.


Can Bloggers Change the World? Some Food for Thought on Blog Action Day 2009

September 28, 2009

Can bloggers change the world? The folks over at change.org certainly think so. They are busy orchestrating the third annual Blog Action Day.

The idea behind Blog Action Day is simple. Individual bloggers can only do so much, but if enough bloggers can be united to write about a single issue on a particular day from their own unique perspective, suddenly that issue has an audience of millions.

Reading about change.org’s Blog Action Day got me thinking about the prospect of this type of cross-organizational communication on common causes within Minnesota. As a communicator working in the nonprofit and philanthropic sphere, I know I daily combat the daunting knowledge that we are all in a sense “competing” for a finite amount of the public’s attention.

Seeing the change.org initiative got me thinking. What if groups hooked arms and pulled together around causes, instead of elbowing each other out of the way?

What do you think? Are there more ways that organizations within Minnesota can be collaborating on communication around common causes? How effective do you think online, cross-organizational strategies like these are, especially when there’s no common message per se, but just a common directive to draw attention to the topic?

Can you think of any groups who are taking steps to communicate jointly around a shared interest using their online communications like the folks over at change.org?

I am all ears! If you have any thoughts or examples to share about this strategy for public engagement, please leave your comments below.

-Cary Lenore Walski, MCF web communications associate


In the Media

September 16, 2009
Photo by Dan..

Ridin' the range and ropin' the headlines so you don't have to.

Your biweekly roundup of media coverage on the world of nonprofit and philanthropy (yee-ha.)

Ecology-minded Kids are Working to Gather 1 Million (Noncontroversial) Acorns
(MinnPost) Sick of the scandal over nonprofit ACORN? Here’s something to brighten your day.  Local youth participating in the Million Acorn Challenge are learning about ecology as they collect acorns for planting around the state of Minnesota.

Foundation Center Launches National Education Stimulus Initiative
(PND) New York based Foundation Center has announced the launch of a new national educational initiative to engage foundations and education leaders across the country in a unified, strategic drive to improve public education. The centerpiece of the initiative will be a web portal designed to help education funders align their grantmaking with funds available through the American Recovery and Reinvestment Act.

How Foundations Can Do the Most to Advance the Needs of Minorities
(The Chronicle of Philanthropy) Black philanthropist Robert K. Ross reflects on the soul-searching inspired by the recently proposed law to require the disclosure of the race and ethnicity of grantees in his home state of California.

In New York City, Poverty Defined In New Terms
(NPR) In response to the inadequacy of the current federal measure of poverty, New York City policy makers have created their own metrics for calculating poverty and determining support.

Stressing Results, Charity Retools Grant-giving
(The Boston Globe) The biggest charity in New England is changing how they award grants, leaving many nonprofits worried about funding. The new strategy will favor larger, less-restricted grants to fewer grantees.

United Ways 2009: A Confusing Mix of Missed and Missing Goals
(The Nonprofit Quarterly) A sign of the time, United Ways across the nation are changing how they set goals for their annual campaigns. Many UWs will focus on increasing the number of donors, not the total amount of donations. But in these trying times, skeptics wonder where these new donors will be found.


Second Helpings from the Blogosphere

July 20, 2009

Grab a plate folks, it’s time for your biweekly serving of the latest and greatest commentary from the philanthropy and nonprofit blogosphere.

Debating NBC’s Drama The Philanthropist
(Tactical Philanthropy) It’s official, folks, The Philanthropist throw-down is happening tomorrow, Tuesday, July 21.  Join Steven Gunderson, Council on Foundations CEO, and Sean Stannord-Stockton, director of Tactical Philanthropy at Ensemble Capital Management, as they debate the merits (or lack there of) of NBC’s show. Stay tuned to Sean’s blog for a complete recap of the event.

How to Innovate
(Donor Power Blog) In this video Guy Kawasaki riffs on the theme of innovation to give us ten shining pearls o’ wisdom. Although awkwardly abbreviated, the video is still a nice pick-me-up for those of us trying to drive change across their organization or across the nation. My favorite? Definitely, “Don’t worry, be crappy.”

Less is More (Again!) — Newark Museum Tagline Success in Just 4 Words
(The Getting Attention Blog) This post is a continuation on Nancy E. Schwartz’s ongoing quest for the best nonprofit tagline. For nonprofits and grantmakers alike, a tagline is one of the best tools you have for making a clear, memorable impression about your organization. Check out this post and Nancy’s tagline contest at her site.

New Models for (Philanthropy) Research & Dialogue
(Philosophy 2.0) Tony Wang critiques the current research paradigm. He recommends some new approaches to sharing information about philanthropy enabled by web 2.0 including crowdsourcing wisdom with wikis, and using twitter hashtags to communicate with grantees and stakeholders.

Using Flickr Creatively
(Beth’s Blog) Deborah Arkanase introduces us to three nonprofits using the photo sharing site Flickr to engage their base in new ways.

-Cary Lenore Walski, MCF web communications associate

Photo CC Striatic

In the Media

July 8, 2009
Photo by Dan..

Ridin' the range and ropin' the headlines so you don't have to.

Your biweekly roundup of media coverage on the world of nonprofit and philanthropy (yee-ha.)

Accepting Less*
(The Chronicle of Philanthropy) In response to the economy, many philanthropic leaders are taking voluntary pay cuts.
*Paid subscription required.

Dueling Research on the True Beneficiaries of Foundation Grants
(The Chronicle of Philanthropy) Same data, different conclusions. Two conflicting reports on giving to marginalized groups raise debate about on how research on grantmaking is conducted.

Giving Goes Flat
(Twin Cities Business Journal) Burt Cohen bemoans the apparent trend among his peers to refuse giving due to the economy, and challenges the old adage, “Whoever dies with the most chips wins.”

Innovative-Safe or Innovative-Radical?
(The Wall Street Journal) N. Ramakrishnan discusses a push for innovation in communication about neo-natal and mother health in India, and in doing so, brings up some important points about what truly defines innovation.

Kobe’s Next Conquest: China
(The Wall Street Journal) In another celebrity philanthropy double-take, NBA star Kobe Bryant helps the Chinese government in their new push to foster philanthropy in the world’s most populous nation. New wealth for middle-class Chinese brings new opportunities to buy, but also to give.

Madoff Losses Tied to Board Size, Makeup
(Philanthropy Journal) A lack of board diversity is linked to Madoff-related losses in foundations.

“Perfect Storm” of Fiscal Stress Hits Nonprofits
(John Hopkins University) Soggy socks? You’re not the only one. This new report from John Hopkins University outlines in detail the current stormy financial situation for nonprofits. The forecast for the near future? Partly cloudy at best.

Raising Children Who Care in Times That Need It
(The New York Times) Is your kid more likely to opt for Halloween candy than UNICEF? Teaching empathy is challenging, but there are new resources to help parents.

Under a New Lens: Corporate Philanthropy in a Changed Economy
(onPhilanthropy) Foundations and corporate CEO’s converged at CECP Corporate Philanthropy Summit to discuss trends and best practices in corporate philanthropy. How can corporations give efficiently and enhance their reputation without being perceived as disingenuous?

-Cary Lenore Walski, MCF Web Communications Associate