Last week Jake Hayman posted a blog entitled Not Fit For Purpose: Why I’m Done With the Foundation World and caused, by voluntary sector standards, quite a storm. For a blog that Jake says gets about 6 hits a day, he’s had about 4,000 in the last week, from the UK and abroad.
The piece was accompanied by a survey (as Jake admits, obviously biased in its subject), which has now had 100 responses. That isn’t a huge sample but still seems worth analysing. Hidden in the data are clearly some very experienced voices on both sides of the grantmaking coin. Some analysis is below.
As Jake’s piece spread, many looked in horror as a relatively young member of the sector went straight to bite the hand that feeds. He posted the next day: “I apologise. The blog was obnoxious. For 10 years I watched people smarter than me saying the same thing calmly and eloquently and not getting heard, so I pushed it.” I had commented on the blog before it went live and thought much of the analysis justified, with notable exceptions of good practice of course.
The debate is certainly now going. The question is how far will it run and what will, if anything, change? The key point to my mind is that while the sector definitely has some great leaders interested in reform, there haven’t been any seriously dissenting voices to what he’s said. James Perry sums it up nicely in a comment to the piece “My reflection is that whilst I agree with each of your points without reservation, I do not know a single person in the foundation world who is wanting it to be this way. It is the system that is broken, and the people working within foundations, whilst imperfect like the rest of us, are as much a victim of this as anyone.”
Clearly, although it may be the first to exhibit such raw frustration, Jake’s isn’t the first piece in this ilk by any means. The best pieces by far I’ve come across are (two of them referenced by Jake):
- Clara Miller, The Looking-Glass World of Nonprofit Money
- Tris Lumley, Transforming Our Anti-Social Sector
- James Perry, The End of Charity
- David Carrington, What Enables or Disables Funders to Lead Change in their Organisation?
So, the survey analysis
Of the 100 respondents we currently have data for:
- 45 were charity employees, another 29 were charity trustees or founders. 14 were foundation employees and 10 were foundation trustees or grants committee members. A further 38 were ‘other’ – presumably Jake and members of his extended family and friends from different computers (though often claiming to be ex-employees of charities or foundations etc). There were some who were more than one thing – e.g., a charity employee and a trustee
- 80% were based in the UK
- 65% do work on activities primarily based in the UK
- There was a healthy split of organisational sizes from £0-99k all the way to £50m+
First up, in the responses there didn’t seem to be any substantial disagreement between those that work for foundations and those that work for charities, except charities saying they felt less trusted with money than foundation people thought and foundation people thinking that the investment of endowment income in ‘bad’ things is perhaps more prevalent than their grantees realise. But all in all there was agreement in the analysis below.
There were two main questions, both referring to the “the 19 things that some (not all) foundations do some (not all) of the time that I don’t think they should do (but what do I know?)”.
Firstly “How much do you agree that these things happen (regardless of whether they should or should not happen)?”
Of those that responded in agreement or disagreement (i.e., those that didn’t respond “Don’t know/you write so inarticulately I can’t judge”) we find that most people agreed that all these things happen.
The top 10 points that people Agreed did happen in descending order of their weighted average score were (all received at least 80% agreement):
- Procure everything through applications, leaving grantees continually guessing what a foundation might want, rather than just stating what they want to achieve and proactively going out to find partners
- Turn social leaders into perpetual beggars
- Set up funding in a way that encourages charities to compete rather than collaborate
- Hoard power within a group of people who don’t give enough time (and don’t always have the expertise) to be effective
- Turn innovators into operators
- Procure programmes rather than fund innovation
- Base grant-making processes around their own convenience with little respect for social need or the organisations they are funding
- Rely on grantees to do all the work
- Make charities jump rather than seek them out and support them long term
- Think in binary – ‘yes’s or ‘no’s as judgments rather than conversations
Of the rest, there was still at least 50% agreement that all the following happen, with no more than 15% of participants disagreeing with any statement (the remainder neither agreed nor disagreed). Least prevalent last:
- Embrace a ‘ticking’ culture
- Fail to share insight
- Define sustainability as the growth of an organisation through revenue rather than the dissemination of an idea, concept or approach into the mainstream beyond the organisation
- Build decision making committees out of people without expertise to make decisions
- Only care about ‘their’ money
- Distrust charities with money rather than empower them with it
- Exclude service users and front-line workers
- Hire conservative lawyers and financial managers in order to excuse risk aversion
- (Try to) make loads of money out of porn, arms, tobacco, gambling and killing the environment via their endowments when they shouldn’t
- Never set out to really achieve something as organisations themselves
So, at least all these things need looking at to a greater or lesser degree, but fairly substantively so. The ‘best’ foundations shouldn’t be doing many or any of these things, across all their programmes.
Secondly “How much do you agree/disagree that these are bad things if they do happen (regardless of whether or not they happen)?”
On these the findings are quite conclusive. Of those that responded (90% of the group), over 90% Strongly Agreed or Agreed that every single issue that was highlighted was a bad thing to happen.
Those where there were lingering areas of doubt (though all getting at least 80% agreement) were:
- Procure programmes rather than fund innovation – suggesting that the suggestion that a foundation’s primary responsibility is to fund innovation for government to pick up and scale. One foundation employee emphasised to me once the importance of foundations in their independent role of funding controversial areas of work, for example. One finds it hard to imagine, for example, the government ever quite doing justice to the funding needs of the refugee rights sector.
- Rely on grantees to do all the work.
- Hire conservative lawyers and financial managers in order to excuse risk aversion.
So were one setting up a new foundation, or adapting an existing one, then one might suggest that these are the five things you would focus on not doing:
- Procure everything through applications, leaving grantees continually guessing what a foundation might want, rather than just stating what they want to achieve and proactively going out to find partners
- Turn social leaders into perpetual beggars
- Set up funding in a way that encourages charities to compete rather than collaborate
- Hoard power within a group of people who don’t give enough time (and don’t always have the expertise) to be effective
- Turn innovators into operators
Free comments
To add colour, there was an open text box for comments. There is some fairly blue language, suggesting that this is a topic that attracts some strong emotions, but much thoughtful commentary too. Alongside a few comments that suggested Jake was just disgruntled he didn’t raise any money, and a perceptive comment that suggests he is too harsh about the value of fundraisers, and one that argues he should have spent the first ten years of his career achieving no social change but just building cushy relationships with funders to profit from later on which just baffled me, from the comments on the survey those that stand out, sanitised, are:
- Charity employee and trustee £1-2m: “I’ve stopped taking philanthropic (or lottery or government cash) for my NFP. We trade or die. Grants are corrosive of organisational purpose, strip charities of capacity, destroy long term planning…disincentivise success (via you can’t ever make a profit by doing stuff better/more efficiently)…Foundations that took equity positions in NFPs and then actively engaged as an intelligent investor would be interesting to explore.”
- Charity founder £100-250k: “As a very small and quite young charity, the time, energy and effort invested in grant applications sometimes feels enormous, relative to our total staff capacity. It is frustrating when application forms are long and complicated and the support for completing them is limited; it is not that we don’t want to do what the trust wants us to do, but we don’t know what it is that the trust wants us to do… why do we have to play this guessing game? Why can’t we just sit down with people that actually understand the work they are trying to fund and explain the ideas to them. Some back and forth would be really fantastic; an opportunity to discuss how to amend and improve the points that trusts don’t like in our application forms. The binary “success” or “failure” is frustrating. The lack of feedback on a failed application is infuriating. It is, all in all, much easier and more rewarding to raise money ourselves, directly from individual donors. And yes, this does mean that we direct time away from delivering front line services and turn amazingly passionate staff members into fundraisers.”
- Charity employee £50+: “This is a fantastic article. But it might be stronger if you could point to a few examples of good practice, that might have/could have been improved if Foundations hadn’t been ‘guilty’ of some of committing some of the behaviours that you criticise them for.”
- CSR Professional: “I think many Corporate CSR Departments are actually doing a better job! We would spend hours, days and weeks with NGOs and charities we work with designing and agreeing a contract whereby we would fund their work delivery, then provide ongoing coaching and capacity building, monthly or more, help them seek other funders, help them widen their impact…So if Foundation grants can be more connected to real business impacts, e.g. helping train workers in safety, help communities report pollution, etc, then it gets easier for business to engage and coach and capacity build and increase the impact of the NGO-charity.”
- Foundation employee £1-2m: “Well made points but not all foundations are the same model which does add complexity especially for ones that actively fundraise and are responsible to live funders. Whilst slow to change, charitable foundations/trusts do tend to have a far more insightful understanding of needs/solutions than private philanthropists and general population which is a wider concern”
- Charity employee £500k-£1m: “As a charity, we’re doing an amazing job…yet too often we’re not able to do that as we’re too reliant on (and scared to stand up against) those with the power and money to allow us to make it happen. As a result, we’re slogging our guts out and often to the point of making ourselves so tired that we get exhausted and stop because it feels ‘too hard’ to make a positive difference that could be so easy if we had the backing.”
- Foundation funded researcher £10-50m: “It may be useful to distinguish what Foundations promote as their modus operdandi and what they actually do. Something recognized by the author. Perhaps useful to acknowledge and even measure the cognitive dissonance.”
- Foundation employee £50m+: “I am sure many solutions will come at a cost. Foundations will become less ‘efficient’ (higher overhead: grants made ratio).”
- Charity employee £10-50m: “The third sector too is complicit in the broken model, through (a) rolling over and letting this happen to it (b) also failing to innovate, collaborate and share on a grand scale and (c) being chock full of rampant egotism. Regardless, the model IS broken, structurally and fundamentally, and anything we can do to start a debate around how to start fixing it is very welcome.”
- Foundation employee £50m+: “I truly believe that the foundation model is extremely problematic, as in itself it perpetuates social inequality rather than challenging its root causes. I strongly believe that social justice cannot be achieved through the current foundation model.”
- Charity employee £250-500k: “In my experience the worst aspect of this whole world is my own experience of being turned from an innovative and strategic thinker into a fundraiser – the stress of repackaging really important work into projects over and over again to keep a small organisation going and its brilliant staff employed has led to my own decision to leave the field. I share your frustration and sadness”
- Consultant: “This discussion is happening in many closed rooms across the country. People are pulling their hair out trying the work out how they can change the system. It is vital that the industry convenes its leading funders, recipients, beneficiaries, commissioners and others to show that a new way of working is possible, desirable, realistic and better than the status quo.”
- Charity founder £100-250k: “thank you for this article…I’m also close to getting out despite my commitment to human rights.”
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