Increasing Resources to Address Disparities and Gaps

The Challenge

The data are consistent: increasing racial equity and strengthening social justice remain challenges to our society.  But the amount of money that institutional philanthropy directs toward closing gaps or disparities in racial equity is minuscule compared to money with no such purpose.

Barriers to progress include:

• The term “philanthropy” is alien to so many people, even though it’s so widely practiced.
• The false belief stemming from mainstream 19th and 20th century philanthropy that “philanthropists” are White and old, if not dead, limits entry to participation.
• Models of philanthropy historically have been more focused on helping the needy than on fixing systems that contribute to problems.
• The amounts given to “social justice” represent a very small portion of the total giving pie.
• Philanthropy’s endowed funds are often invested in ways that work against social justice, rather than helping it.

Benchmark Practices.  Progress is made when philanthropic organizations get good at these benchmark practices:

Helping groups, communities, and individuals discover the power of their giving, and what they have to give

Uncovering the philanthropic traditions of various communities – women, youth, African American, Native American, all immigrant groups — serves to unlock their potential to be advance solutions that better include them in the all word of “with liberty and justice for all.”

Uncoupling philanthropy from formal institutions arouses the volunteer can-do spirit America is famous for. Philanthropy isn’t just for dead white men and their lawyers any more. Philanthropy isn’t even just about money any more – it’s about “time, talent, and treasure,” a far broader concept that invites all to participate. Because everyone can give something, philanthropy has become democratized. If only we could think of a better word for it.

Helping people and communities think of themselves as suppliers or producers of good ideas and solutions, rather than as beggars or consumers of charitable welfare provides them with a whole new way of looking at their plight and their prospects, and energizes the hunt for solutions.

Instituting opportunities for volunteer service, drawing on people’s time and talent more than their treasure, opens the door for people to become engaged with community problems (and solutions) in ways they might not otherwise.  Voluntarism is booming; “volunteer management” is a degree program. Community service is a frequent requirement for high school graduation. National service is on the table. “Commit random acts of kindness” is a popular bumper sticker. This is philanthropy on a grand scale, and if some of it can be directed to fixing in addition to ameliorating, so much the better.

Stepping up with a beefier role for your philanthropic organization

Designating more of the program budget to social justice and racial equity allows you also to raise more money for social justice. Themes of social justice, even themes that seem controversial, have consistently been shown to attract rather than repel donors.

Dedicating assets beyond the grantmaking budget, considering your operating budget and portfolios of investments (of treasure, time, and talent) reveals new opportunities support justice and equity. Endowment funds can be used for more than earning income; mission-related investing, proxy voting, screening investments – all allow you to express your intentions. Your operating budget allows you to send each dollar you spend in new directions.

Drawing on the social and reputational capital of your board, individually or collectively, is a way of putting the organization’s mouth where its money is.  Reminding board members that this service allows them to play a different role than their service as business owners, professionals, or civil servants – they can be philanthropic, with all the nuance that the word allows.

Developing special opportunities can attract contributions from donors discovering their interest in helping to fix obvious situations of inequity. A large number of philanthropic organizations in the path of Hurricane Katrina created special funds for distributing relief funds collected from near and far.

Allocating your resources to make a difference, create impact, move the needle, to bend those trend lines – all those magnificent goals of philanthropy – requires a different model of giving than just writing a check to a worthwhile cause or even building a building in your name. Making a difference means, by our definition, adding to the forces needed to move a particular needle or bend a particular trend line.

Considering different models and philosophies of allocating assets can shake up thinking and open creativity. “Social investing” discussions go here; we endorse focus on “results,” but results like “closing the achievement gap” cannot be done with one grant, by one organization, or with one hundred thousand dollars. Concerted efforts that ply all the pathways are needed, worked over time and constant intentionality to close a particular gap. The field has to learn how to fund concerted efforts. We salute discussions of “social returns,” not just “economic returns,” and the concept of double and triple bottom lines.  But more realistic expectations and more modesty is needed in most of those claims.

Recognizing that not everything useful has to be big, there’s still great power in small gifts, spontaneous gifts, gifts that are obviously valuable to the recipient – all have a place. We think they are especially valuable if done in the context of a bigger picture.  This is sometimes called “giving by design.”

Attending to the transparency of your transactions, and accountability to proper authorities, keeps you viable and attractive as a collector of assets. Trust is a big issue in some communities, extending to questions of who gets to hold the money, who gets to decide where it goes, and who decides whether it was well spent after all. If money collected in the name of social justice is squandered, wasted, or otherwise blown, it burns the very bridges you’d worked so hard to build.

Learning to brag appropriately for how you’re spending your philanthropic resources rather than how much you’ve managed to raise would be a big step forward. It would suggest your organization has an interest in being useful, not just showy.

Benchmark Signs of Progress.  Philanthropy gets high marks for progress achieved on this pathway when you can see signs that…

• There is greater understanding among a broader base of people of what “philanthropy” means and what it can do.
• There is greater awareness, especially among the stewards of “old money,” of the various tools they can legitimately use to pursue goals of equity and justice is legitimate, fruitful, and consistent with their current missions.
• More money, especially in relation to total giving, is targeted to issues of social justice and racial equity.
• More philanthropic activity and resources is devoted to fixing the systems and addressing the root causes of poverty, inequity, or injustice.
• A greater slice of the philanthropic assets is invested in ways that advance the philanthropy’s mission, or at least don’t conflict with it.

Examples of Good Practice

The Black Belt Community Foundation covers an Alabama area with limited monetary resources. Its motto is  “Taking what we have to make what we need.” Rather than starting with financial donors, the foundation sees the community as the endowment, starting with its people. They represent talent, skill, dedication, kinship/friendship networks, inter-generational wisdom, commitment to nurturing youth and the preservation of cultural wisdom from many traditions. These strengths keep this community despite limited financial resources.

The Southern Rural Development Initiative created a special tool that allows communities to assess the location of philanthropic capital. With the Philanthropy Index, individual rural communities and small towns in the South can assess their ability to create a permanent charitable fund to support community life. It combines objective data with the collective knowledge of community leaders to measure philanthropic potential.

The Community Investment Network is a network of African American giving circles, in which young professionals learn about the power of creating solutions for their communities, and discover opportunities for making a difference with their resources.  HindSight Consulting , organizers of the Next Generation of African American Philanthropists, coaches and assists this network.

The New Mexico Community Foundation addresses wealth creation in ways that honor local culture; from the revival of buffalo herds, sheep and wool production, to sweat equity.  Revitalizing these assets allows more trade to occur and local wealth to grow.

The Twenty-First Century Foundation is a national foundation and public charity that makes grants to support African American community revitalization. It supports donors with program design, grantmaking, administrative record keeping and money management. It has created the Black Men and Boys Initiative, the African American Women’s Fund, the Fund for Greater Harlem and the Metro Chicago Fund as ways to focus donors’ interest.

The Arkansas Community Foundation has 25 affiliates – local foundations at work in 33 mostly rural counties. Similar to branch banks, affiliates are led by boards of local community leaders. They make local grants and develop more grantmaking resources. Hurricane Katrina evoked a huge outpouring of sympathy and compassion from all over the country and the world.

A large number of philanthropic organizations in the path of Hurricane Katrina created special funds for distributing relief funds collected from near and far. Examples: Foundation for the Mid South, Bush-Clinton Katrina Fund, and the Louisiana Disaster Recovery Foundation.

SpectrumTrust (formerly known as the Diversity Endowment Funds) is a partnership between communities of color and The Saint Paul Foundation that has built permanent endowments within communities of color throughout Minnesota. They include the Asian Pacific Endowment, the Pan African Community Endowment, El Fondo de Nuestra Comunidad, Two Feathers Endowment, and the Multicultural Endowment.

The Hamilton Community Foundation (Canada) has committed all of the Foundation’s discretionary grantmaking dollars to its Tackling Poverty Together initiative.

The Arkansas Community Foundation matched funds put into their local affiliates, creating a larger pot for grantmaking.

The Jacksonville Jaguars Foundation pledged larger grants over multiple years to specific youth-serving agencies that demonstrate success in providing services to low-income and minority communities.

The Community Foundation in Jacksonville (Florida) allocated two-thirds of its unrestricted grantmaking budget to its “Education for All” initiative.

The Community Foundation of Ottawa recast its grants program to follow the assets model of community development, gaining a new spectrum of opportunities to choose from in its social justice efforts.

The F.B. Heron Foundation focused on a double-bottom line – financial return plus social return – on investments. The foundation put more of its assets to work. Not only some of the excess cash flow normally designated for grantmaking – but 24% of its endowed assets as well, expanding on the idea of mission-related investing.

The National Committee for Responsive Philanthropy promotes the concept of “social justice philanthropy” through its materials, such as with this definition: “Social justice philanthropy is the practice of making contributions to nonprofit organizations that work for structural change and increase the opportunity of those who are less well off politically, economically and socially (2003).”

The Community Investment Network encourages organizations and individuals to think and act more strategically with their giving to impel greater social change in their communities.

The Social Justice Funding Collaborative is a growing network of national organizations within the field of philanthropy that calls on grantmakers and donors to increase and deepen their commitment to funding social change.

The Philanthropic Initiative for Racial Equity (PRE) is a multiyear project intended to increase the amount and effectiveness of resources aimed at combating institutional and structural racism in communities through capacity building, education, and convening of grantmakers and grantseekers.

The Diversity in Philanthropy Project is a voluntary effort of leading foundation trustees, senior staff and executives committed to increasing field-wide diversity through open dialogue and strategic action.

Resources

Compounding Impact: Mission Investing by U.S. Foundations, by Sarah Cooch and Mark Kramer. FSG/Social Impact Advisors, April 2007.

Criteria for Philanthropy at Its Best: Benchmarks to Assess and Enhance Grantmaker Impact. National Committee for Responsive Philanthropy, 2009.

Rethinking the Philanthropic Script: Community Philanthropy, Collective Giving and Giving Circles, by Darryl Lester and Athan Lindsay. Responsive Philanthropy, Summer 2009. www.NCRP.org
Guide to Social Investing, by Working Group for Effective Social Investing, 2008.

From Grantmaker to Leader: Emerging Strategies for Twenty-First Century Foundations. Frank L. Ellsworth and Joe Lumarda, Eds. John Wiley and Sons, 2008.

The Balancing Act, by Dorothy Reynolds. Part 1. The Role of a Community Foundation as a Grantmaker. Part 2. The Role of a Community Foundation as a Vehicle for Philanthropy; Part 3. The Role of a Community Foundation as a Community Leader. 2008. Available from Charles Stewart Mott Foundation.

Social Justice Grantmaking II. Foundation Center 2009. Available at www.FoundationCenter.org

Effective Philanthropy: Organizational Success Through Deep Diversity and Gender Equality, by Mary Ellen S. Capek and Molly Mead. Available from www.effectivephilanthropybook.org

The Color of Wealth, The Story Behind the U.S. Racial Wealth Divide, by Meizhu Lui, Barbara Robles, Betsy Leondar-Wright, Rose Brewer, Rebecca Adamson. The New Press, 2006

Policy Points, a publication of the Southern Good Faith Fund Public Policy Program (in Little Rock), explicitly acknowledges the connections between philanthropy and policy work. The Southern Good Faith Fund is an affiliate of Southern Bancorp, Inc., and is “committed to increasing incomes and assets of low-income and low-skilled residents in rural communities. See www.southerngoodfaithfund.org

The State of the South 2007: Philanthropy as the South’s “Passing Gear,” by MDC Inc, Chapel Hill.

Tables of Giving Toolkit, published by Faith Partnerships, Inc (Raleigh), is “a learning resource to encourage faith institutions to assess community needs and assume their rightful role as community philanthropists as they work to pool financial assets to address some of the systemic ills that blight our communities.” See www.faithpartnerships.org

On the Brink of New Promise: The Future of U.S. Community Foundations, by Lucy Bernholz, Katherine Fulton, and Gabriel Kasper. “…within and around community philanthropy. Every individual community foundation—and the field as a whole—will face new choices. The path ahead
is full of promise. Unfortunately, that promise will not be easily realized.” See http://www.blueprintrd.com/text/foc_FINALfutureofcommunity_complete.pdf

More Giving Together: An Updated Study of the Continuing Growth and Powerful Impact of Giving Circles and Shared Giving. Report of the Forum of Regional Associations of Grantmakers, 200?

The First Charity: Why Philanthropy Must Make Democracy, by Robert Matthews Johnson. Seven Locks Press, 1998

Remaking America: How the Benevolent Traditions of Many Cultures Are Transforming Our National Life, by James A. Joseph. Jossey-Bass, 1995

Grassroots Philanthropy: Field Notes Of A Maverick Grantmaker, by Bill Somerville. Heyday Books, 2008.

Just Money: A Critique of Contemporary American Philanthropy, by H. Peter Karoff (editor). The Philanthropic Initiative, 2004.

A Hand Up: Black Philanthropy and Self-Help in America, by Emmett Carson. Washington, DC: Joint Center for Political and Economic Studies Press, 1993.

African American Philanthropy, produced by Council on Foundations. http://www.cof.org/files/Documents/Publications/Cultures_of_Caring/bibafam.pdf.

Short Changed: Foundation Giving and Communities of Color, by Applied Research Center, 2007 http://www.arc.org/content/view/271/48/

The Cost of Sticking Your Neck Out,” by Stuart Applebaum, Foundation News & Commentary, Sept/Oct 2005.

New Frontiers in Mission-Related Investing, by Luther M. Ragin, Jr., F.B. Heron Foundation, 2003. See http://www.fbheron.org/documents/ar.2003.viewbook_new_frontiers.pdf