Freedom vs Accountability

One of the strengths of being an independent funder – whether a foundation or a philanthropist -  is in that very independence. It means you can act quickly, take risks, or take a long-term view in ways that statutory funders can’t. But as with most things philanthropic, there is a flip side. Independent funders are not accountable to the public and they don’t have to base their giving on research or recognised priorities such as the Sustainable Development Goals. This lack of accountability opens them to criticism, for example, of being driven by a donor’s preference or desire for status instead of need.

To ensure their decisions are relevant and they are working for the greater good, it is up to independent funders to introduce ways to hold themselves to account. Institutional funders use several mechanisms to do so. For example:

• Increasing the voice of beneficiaries in decision-making e.g. The Blagrave Trust
• Increasing the diversity on their Boards e.g. Kellogg Foundation
• Commissioning research e.g. Lankelly Chase
• Opening their decision-making up to scrutiny. 67 UK grant makers have published their data on 360Giving
• Asking grant applicants and recipients for feedback and benchmarking themselves against each other e.g. using CEP’s grantee and applicant perception reports

These measures are all optional and rely on the funder’s desire to develop their practice and allocate resources to listening to the views of others and being transparent. Funders are not immune to external pressures to become more accountable. They care about their reputation and there is kudos to be gained by being a pioneer or innovator. Can change be driven – or at least accelerated – by bringing more external pressure to bear? One interesting development in the US is the ratings site Grant Advisor, where organisations seeking funding can review and rate funders in the style of Tripadvisor. Grantees can give ratings on accessibility, the relationship and comment on the philanthropic goals e.g. “Be prepared for a very bureaucratic process and program officers who are not that knowledgeable about the overall goals.” The site launched in 2017 and for now covers California and Minnesota.

It will be interesting to see if rating sites such as GrantAdvisor catch on and serve to increase accountability by driving greater transparency and comparison. Or is there a danger that they will encourage ‘safe’ grant making and so undermine the very value of funders’ ability to act independently?

5 Take-Aways for Philanthropy Advisors

At the recent STEP Special Interest Spotlight event, I was delighted to be in a room full of private client advisors who had all signed up for the breakfast session on philanthropy. The session was titled: The Importance of Integrating Philanthropy into your Practice. It was chaired by Suzanne Reisman, who brought an enviable amount of energy and enthusiasm to the early morning slot.

My five take-away points from the speakers and discussions were:

1. People’s concerns about tax is an opportunity to talk about philanthropy.

2. There is an opportunity to raise the topic of giving when drafting a will.

3. Discussing philanthropy deepens relationships.

4. Philanthropy is a topic that can bridge the gap between older and younger generations.

5. Clients want to know that advisors empathise with their values and principles.

And of course, I was in happy agreement with Suzanne’s motto that “philanthropy is always the answer”.

There was one challenge from the floor, proposing that it is not the advisor’s role to raise the topic of philanthropy and that clients will know whether giving is something they wish to participate in, or not, without any prompting. (Research from the US suggests otherwise: for example, the US Trust’s study found that high net worth clients wanted the subject of philanthropy to be brought up early in the advisor/client relationship). But generally, I went away heartened that there are private client advisors who see discussing philanthropy as part of their role.

http://www.sjsu.edu/advancement/docs/philanthropic-conversation-study.pdf

Don’t let these top 5 charity myths stop you giving

This is a joint blog with my fellow philanthropy advisor, Lauren Janus of Thoughtful Philanthropy.

In just a few short weeks, the Christmas season will be in full swing. Many in the charity sector would like the official start of this frenetic—and let’s face it, often materialistic—season to be Tuesday, 28th  November, better known as #Giving Tuesday. While just four years old in the UK, Giving Tuesday is a global movement to focus people’s energy, time and money on charitable causes. Last year, PayPal alone reported £35 million was donated to charity globally on Giving Tuesday.

As you decide how to join in with Giving Tuesday 2017, don’t let these common myths about charities hold you back.

1. I can’t afford to give enough to make any difference.

So, you’re not swimming in surplus pounds (who is?). That doesn’t mean the £20 you can afford to give can’t materially impact someone’s life. If you’re new to giving or just like to see the face of the person benefiting from your donation—however small—microlending could be just the thing for you. Sites like Kiva and Deki allow you to lend as little as £10 to people around the world. These borrowers may be looking to send a daughter to primary school in Nicaragua or set up a roadside fruit stand in Rwanda. You get to choose the person and their project, and when the loan gets repaid, you can decide whether or not to lend the money out again.

And if you prefer to give locally, don’t forget that most charities are small, meaning even modest donations can go a long way. In the UK there are over 100,000 registered small charities in England and Wales; that’s nearly 80% of all charities. Around half of all small charities have an income between just £1 and £10,000 so whatever amount you can give will mean the world to them.

2. All charities say they’re doing good work. But how do I know for sure?

Sadly, the charity sector has lost the trust of much of the British public in recent years. While public scrutiny of charities can be productive, much of the recent mistrust is largely undeserved. Most charities are doing good work under difficult circumstances, and by doing a bit of research, you can better understand how your pounds are being spent.

A good way to identify charities that have proved themselves in some way is to look at who else has funded them. If the organisation has been funded by a large grant maker like the Big Lottery Fund, Comic Relief or Esmée Fairbairn Foundation, then you know that they will have been assessed as worth backing and report regularly on their work. Over 50 funders now publish all the details of the grants they make on 360Giving.

If you want more evidence, an increasing number of charities can point to the impact of their programmes through independent data-driven evaluations. Research organisations like GiveWell and The Center for High Impact Philanthropy at the University of Pennsylvania conduct rigorous studies of issues like maternal mortality and improving the lives of women and girls. These organisations publish recommendations of the charities they think are proving their impact—and their case for more donations.

3. Once I give they will just keep hounding me for more money.

This is a fear that lots of donors have. But there are strict rules about how your data can be used and shared that charities must follow. If you think about it, it is not in their interest to annoy you as they would like you to think well of them and consider supporting them again. The best thing to do is let them know whether or not you want them to contact you and what about. If you do have problems, then you can  register with the Fundraising Preference Service to stop any unwanted communications.

4. Why do they need my money when they have a highly paid CEO and offices in London?

Running a charity can be stressful and complex. How well would most business leaders cope with providing a 24/7 service to people with complex needs, using volunteers and with an unpredictable income? It is in our interest to have talented people running charities which are tackling such important social issues like poverty, heart disease, loneliness and mental health.

Some CEOs of large charities do get a large salary but they still are paid far less than those salaries paid by private companies. Acevo's 2017 Pay and Equalities Survey found that the average pay of charity chief executives was £50,000, which was £5,000 less than in 2015.

And as for having offices in London? There has been a lot of discussion about this in the sector and some charities such as Action for Children have moved out of London. If it bothers you, then of course you can give to any number of local and regional charities. But do remember that some London-based charities serve the community there; others involved in influencing policy and campaigning will benefit from being based near parliament and still others will have been gifted their buildings or have historical arrangements that mean they are paying a very low rent.

5. Surely the government should be doing this work and not charities.

Charities are crucial in plugging the gaps where government services just don’t suffice. For example, charities provide food and shelter for destitute refugees with ‘no recourse to public funds’ or those trying to live on benefit sanctions. They also add value to what the government can afford to deliver, for example, by providing sports, arts and music activities for young people on top of the school curriculum.

Importantly, charities also keep the government accountable by petitioning on behalf of society’s vulnerable people. They remind our elected officials of their responsibilities to provide fair housing, enforce laws against animal cruelty and direct government funds towards reducing inequality, for example. Charities are a vital part of what makes our democracy—and our government—work for all of us.

Don’t let the common myths about giving to charity stand in your way this Giving Tuesday. Charities of all sizes are doing amazing work and need your support. This Giving Tuesday, give with both your head and your heart.

Lauren Janus, Philanthropy Advisor, ThoughtfulPhilanthropy.com

Emma Beeston, Philanthropy Advisor, emmabeeston.co.uk

Got the grant? Now keep in touch

Congratulations, your hard work has paid off and you have secured a grant. You now need to get on with delivering whatever activity you set out in your bid. But you have another job to do: to maintain the relationship with your funder.

Just how much of a relationship you can develop will depend on the size and length of the grant and the nature of the funder. At a minimum, send a thank you and comply with whatever conditions and requirements are set. Most commonly this will be a grant report at the end of the funding period. And even if this is not requested, you should always send a short report explaining what the grant was spent on and the difference it made.

The easiest way to work out what sort of a relationship the funder wants is to ask them. When and how often they want you to get in touch? Do they ever visit? Do they want to see your annual report? Do they want an invite to your AGM? When such a conversation is not possible, you can look at their public information for clues as to the relationship they want with grantees. Do they share details of projects they have visited in their annual report? Are their case studies on their website? If yes, then there it is likely that they will be interested in hearing from you. So, do let them know if you have any significant events where they could attend. Or if you have a good story with a positive outcome from their funding to share. And if they are active on social media, send them photos and stories of the work they are funding or that tie in with wider campaigns such as world mental health day, volunteer week or local charity day.

Will this mean they will fund you again? It doesn’t circumnavigate the application process, but it won’t do any harm to remind them that you exist, delivered what you said you would and do good work. And linking your work to theirs could be good for your credibility and help with raising your profile.

Not communicating with your funder is the worst thing you can do. If a grant holder goes quiet when asked for information, it is nearly always bad news. It usually means the funded work has gone off track due to staff turnover, loss of funding or other serious issues. Being upfront and telling a funder what is going on is always the best approach. However hard to do, it is far better than a funder hearing it from someone else first. And it really will affect the possibility of future funding if a grant report is never returned or the work does not go to plan and you never explain why.

So when you are still in the warm glow of getting the grant, don’t forget to write that plan for how you are going to manage the ongoing job of communicating with your new funder.

Giving While Living or Leaving It Behind?

It must be Autumn as I have started to see various campaigns urging me to write a will and remember a charity (generally a large national one) when I do so. It’s Free Wills Month in October and then there’s Will Aid in November. The awareness campaigns are important as research shows that although 35% of people want to leave money to charity in their will, only 6.3% do. But just how significant is legacy giving?

Lately there has been a rise in wealthy donors ‘giving while living’. One of the key exponents of this approach is Chuck Feeney of The Atlantic Philanthropies, and better known are the various giving pledges where you commit to give anywhere between 1% and 50% of your wealth to good causes. Some of the benefits of ‘giving while living’ are:

·         You can help tackle urgent problems that need action now

·         You get to direct your giving and enjoy the rewards it brings

·         It provides you with new learning and connections, purpose and meaning

·         You can add your own skills and experience to tackle problems

And it can take away the worry about burdening future generations with too much money.

Has this approach reduced the likelihood of people leaving a legacy?

My recent experience suggests not. I have had several conversations with potential philanthropists lately where helping younger generations get on the property ladder, contributing to university fees and uncertainty about the future (especially the costs of social care) have prevented them from wanting to make big donations now. They are much more likely to consider leaving a legacy as ‘giving while living’ feels too much of a risk.

But in fact, the statistics for the UK suggest that both are on the rise. The Coutts Million Dollar Donors report found that high value giving increased to £1.83bn in 2015. And the NVCO Almanac found that legacy income rose to £2.5bn in 2014/15, and according to Legacy Foresight is set to rise to £3.3bn by 2021. So it looks as if organisations working to bring about social change will benefit from both gifts today and bequests to come.

And if you are about to embark on writing or rewriting your will, I have one plea. Please take your time to choose the cause or charity who will receive your legacy. I recently spoke with a donor who confessed that they had given no thought to which charity they named in their will. They picked something familiar and it turned out that the one they chose did not even do what they thought it did. Legacies are too precious for that. Make sure your last act of generosity is fully aligned with your wishes and creates the most impact.

http://38r8om2xjhhl25mw24492dir.wpengine.netdna-cdn.com/wp-content/uploads/2016/10/Legacy-Giving-Report-FINAL.pdf

http://www.atlanticphilanthropies.org/news/new-book-explores-giving-while-living-approach-to-philanthropy

http://philanthropy.coutts.com/en/reports/2016/united-kingdom/findings.html

https://data.ncvo.org.uk/a/almanac17/individuals-2/#Legacies

Criticising Philanthropists

At its heart, philanthropy is a good thing. A private individual gives their time, expertise and most often, money to support others.

But philanthropy does not happen in isolation. It takes place in a context of politics and power and so it quickly becomes contested and complicated. Would more good be achieved if people paid more taxes instead? Should decisions about what causes get funding be determined by a wealthy elite? This opens up philanthropy to criticism and there are, rightly, calls for it to be more democratic, more strategic and transparent.

But criticism is often leveled at individual philanthropists and the choices they make and this raises a number of issues:

First of all, philanthropy is a public expression of your values. It is an exposing place to be. When philanthropists are then criticised, is it any wonder some chose to stay anonymous or only support safe causes and organisations? This goes against the desire for greater transparency. It also discourages independent philanthropists from their vital role of taking the risks that government funders cannot.

Secondly, it discourages philanthropy altogether. Promoting philanthropy and encouraging more people to give takes public support and peer role models. Philanthropy’s not the answer to all social ills, but in the UK alone there are estimates that persuading more wealthy people to give could easily grow giving by £1.3bn to £5.2bn. (see below). I am fascinated by what we consider acceptable. If you decide to go into banking, no one berates you for not being a doctor or a teacher. So why are we so quick to criticise philanthropic acts?

And lastly, choosing which causes to invest in and which organisations to back is not easy to do. And because philanthropy is personal, people will have different priorities: health, social justice, art, animal welfare. I have certainly heard it argued passionately that there is no point trying to address poverty as climate change is the key issue. And vice versa that environmental change can only occur if injustice is tackled first. Advice, research, consultation with those affected are all incredibly helpful. But there is no right answer. Criticising someone’s choices suggests that there is one right thing to do and worse, supports the idea of the philanthropist as powerful saviour. Philanthropy is better and stronger when everyone is engaged in it and all their gifts are combined – not everyone will support the arts so it is OK if some people do. There is plenty of room to give to small and large, local and global, crisis support and campaigns for long-term systemic change.

So yes, we can educate philanthropists about need. We can help them to make as much difference as they can with their money. Buts let’s do so in a way that creates an encouraging and constructive space that attracts others to join.

http://www.thinknpc.org/publications/giving-more-and-better/

Am I safe from robots?

Over the summer I have been troubled by robots. Will I be replaced by artificial intelligence (AI)?

Surely not? Surely my years of experience and practice are invaluable and difficult to replicate? As a human philanthropy practitioner, I am able to identify trends and assess all the many factors involved in deciding how good a proposal or prospect is and what degree of social change it will achieve. I can’t imagine a machine being able to understand the importance of culture, ethos and passion. I like to think my reading of accounts and plans and conversations with workers, service users, Trustees and Chief Executives lead me to robust, deep and nuanced judgments.

But then I read another account of the power of algorithms and the power of AI and it reminds me that machines fed with big data will be much quicker than me in spotting trends and correctly attributing benefits. In the financial services industry, algorithms are already making their presence felt. For example, HSBC has an online investment service using alogrithms and robo-advisors are expected to be responsible for assets worth $285 billion in 2017 (see links below).

And perhaps robots will not just be quicker at analysing data but will also be better than me. The things I rate as important such as questioning and listening skills, building rapport, and sector knowledge may lead to me making wrong assumptions and biased decisions. However objective I like to think I am, a robot is less easily swayed by a good story, charisma or being wrongly attached to a familiar intervention.

So perhaps it is only a matter of time before I too am replaced by a robot. And that may well be where my hope lies – time. How long is it going to take for someone to invest in the technology needed? Someone will have to create the algorithms and gain access to the relevant data. Someone will also have to make decisions about what impact measures to use. It is one thing to invest in robots where there is a profit to be made but who is going to invest in philanthropic robo-advisors?

The charitable sector has been slow to adopt digital. Perhaps this delay will mean that it becomes the last bastion of the value of human relationships when all around are working with robots. I might find a home there for my skills in connecting humans trying to achieve social good. But I am no luddite, and I feel uncomfortable with this conclusion. Philanthropy should grasp the opportunity that robots will bring to better understand who and what to invest in to achieve the maximum good. My hope is that I will continue to bring the human judgment and compassion, whilst my robot assistant does all the number crunching and data checks.

http://www.telegraph.co.uk/investing/news/hsbc-latest-bank-launch-robo-advice-service/

http://www.nevarezwealthmanagement.com/blog/robots-versus-humans-financial-advisers-digital-age

Is it time for complexity-friendly funding?

When I started out in grant making 15 years ago measuring impact could be quite different from today. When asking how a charity knew what difference a particular project or intervention made, it was not unusual to get the answer “from the smiles on people’s faces”. So, the move toward measurement, evidence and a focus on outcomes was welcome. It provided a helpful approach for funders when deciding how best to allocate resources. And more importantly, a useful tool for charities to really understand what was working and where to focus their limited resources. It also provided additional internal benefits for charities, such as motivating staff and helping those who received support to see the progress being made.

But there are limits to the outcomes approach, and these are now being discussed more frequently. Some people continue to see measuring outcomes as a tick-box exercise – targets that meet the needs of external audiences - rather than an opportunity to learn. Effort can be wasted measuring things that don’t need to be measured – surely we can all agree that play is good for children’s development and people’s wellbeing improves when they connect with others? And by tying everything into a neat logic flow, from problem to intervention to result, are we not missing the fact that people’s lives are far more complex than this? That it is hard to attribute positive change to single interventions that inevitably take place in the context of so many other factors.

This brings me to my favourite read so far this year: the report “A Whole New World: Funding & Commissioning in Complexity” from Collaborate (link below). It “challenges the idea that an intervention (project, organisation or programme) can be held accountable for the impacts it makes in the world.” Instead “outcomes are created by people’s interaction with whole systems”. It puts forward the case for a complexity-friendly version of funding which puts people back into the heart of funding approaches. It calls for an approach that recognises that people working in the sector don’t need to be incentivised using targets; that measurement is just one mechanism for learning; and that it is healthy systems that support social good.

The report sets out lessons for funders. But what does it mean for charities and other social purpose organisations? It is not saying to stop measuring your impact, but to recognise other important factors such as: trusting relationships, the expertise of staff and the interconnectedness of processes, interventions and organisations. And when dealing with funders, strive to be honest; challenge narrow targets and a metrics-only focus; be confident in your expertise; speak up and out about your added value – your ethos, your people; be humble about what you claim is down to you and embrace the complexity of those you serve and the context you operate within.

https://collaboratecic.com/a-whole-new-world-funding-and-commissioning-in-complexity-12b6bdc2abd8

The persistence of application forms

Application forms are a long-standing part of life. We apply to do a course, to join a club, to take out a loan, to get a job. They are also the commonest tool used to seek funding.

There are alternative methods:

Letters – equivalent to a CV and cover letter, some funders ask applicants to make their case for support in a letter. They may make suggestions as to length and content, but it is left up to the applicant what to include and how to structure the letter.

Pitches – these are used in live crowdfunding events like the Soup movement and The Funding Network but there are also some funding events trialling this approach. It brings storytelling and emotional engagement to the fore as you appeal directly to an audience and appeal to them for funds.

Films – like a pitch, but captured in a short film and not in person. Appeal films are more often used in social media campaigns but are sometimes requested by funders as part of the application process. It is a way to clearly demonstrate what you do, visually and in just a few minutes.

Platforms – there are several models where charities put forward their details and wishes for interested funders and donors to select. This can be just as a nominated charity for the local co-op branch or one of several hundred on Localgiving, the Big Give or the Good Exchange.

So with all these alternatives why does the application form persist?

It is easier to process – it is in date at the point of a decision (unlike platforms); it consistently gathers everything that is needed for a decision (unlike letters); everyone provides the same information which can be imported and analysed in databases; it includes a signature so can be a declaration of truth and accuracy as well as permission to store data and take up references.

It supports fairness – gathering the same information in a uniform format makes it clear what information is wanted and makes it easier to make comparisons and judgements based on evidence. Inviting applications means you are open to groups you don’t yet know about. It is not just about who can tell a good story or present well. And although they do take time to do well, they probably take less time than making a film or being present for a pitch, so are more accessible for those on limited resources.

There are still things that funders can do to improve the application process. For example, only asking for information that will definitely be used; not asking for documents that are already on the charity commission website; being very clear what information is being sought and why. And an eye also needs to be kept on whether the alternative approaches become better for user-led or smaller groups, or ease the burden on fundraisers and applicants. But in the meantime, it looks as if application forms, for good reason, are here to stay.

The head and heart of philanthropy

I sing in a community choir and one of the songs in our repertoire is ‘Bread and Roses’.

“Hearts starve as well as bodies

Give us bread, but give us roses”

This comes from a protest poem by James Oppenheim and has been set to music many times including by John Denver. Although singing is an escape from work, this particular song always gets me thinking about philanthropy.

Philanthropy is often framed as oppositional: either ruled by the heart or by the head. At one extreme, donors are characterised as easily moved by emotive stories and thoughtlessly giving money to whatever causes they care about. At the other end philanthropists are described as dispassionate and objective, keen on impact and effectiveness and looking to scale up social change using business approaches and technology.

But of course, the truth lies somewhere in the middle. What’s the point of effectiveness without understanding and compassion? And money given just with the heart can be a missed opportunity to fund something else with greater impact. Paul Connelly puts this across really well in his article ‘The Best of the Humanistic and Technocratic: Why Philanthropy Requires a Balance’ – the answer is to recognise the strength in both approaches.

As a Philanthropy Advisor, my role is often about stepping in to correct any imbalance. This could mean adding the head: such as researching alternatives or conducting thorough assessments. Or it could involve ensuring the human element is part of any potential solution, for example, challenging the desire for easy measurables when people’s lives are complex and chaotic.

A recent trip to the Foundling Museum in London reminded me that the head and heart have often gone together in philanthropy. Established in 1739 by philanthropist Thomas Coram, the Foundling Hospital was both the UK’s first children’s charity and first public art gallery. Coram was motivated by the plight of abandoned children but it took 17 years of campaigning and negotiating to get his hospital built. And from the start he was supported by artists – including Hogarth and Handel – who donated works and gave concerts to raise funds. Music and art was part of the children’s education and paintings lined the walls. Coram saw they needed bread – and roses too.