Fall 2007
Related Family Philanthropy Topics
Family Philanthropy:
Accountability and Impact
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Tim Ober |
The increasing emphasis in recent years on public accountability has affected family foundations along with the rest of the philanthropic sector. Some family foundation leaders feel an increased responsibility to ensure that the grantmaking process is clear and decision-making is fair, and that public benefit is not mixed up with private family benefit.
"This money has been given to the public good, and it's up to you to give public benefit," said Tim Ober, Mardag Foundation president. Mardag has worked to correct an assumption that when family members are personally involved in an issue or with an organization it could mean the foundation will fund it. "We've had to be up front to say some things are outside what Mardag funds," he said.
Many smaller family foundations struggle with questions of impact. While a grant of $5,000 or $10,000 can have a big impact on a small organization, funding innovative solutions to large problems can be beyond the scope of a small foundation. For some family foundations, this has sometimes meant participating in funding collaboratives.
Larger family foundations are also concerned about impact — and ensuring the public is adequately informed about that impact. "We recognize that we are using tax-privileged dollars," says Kate Wolford, president of The McKnight Foundation. "If we don't inform the public about what we do in a meaningful way, we will see a lot more discussion of regulation and other initiatives that are not helpful."
At McKnight, accountability means ensuring that funds are used well. Many foundations struggle with how focused to be in their strategies, according to Wolford. When strategies are narrow it may be easy to document quantitative results, "but that might not be the best way to serve the public good in a sustainable manner."
In areas such as the foundation's early childhood work, Wolford explains,
McKnight is trying to build a constellation of grantees in direct service, research and documentation, with the goal of enhancing the state of practice in the whole field. Says Wolford, "we recognize the importance of investing in the nonprofit sector, not just providing support for the delivery of a specific set of services."
When It's Not All in the Family:
A Role for Non-Family Leaders
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Kate Wolford |
Many family foundations find the involvement of staff or board leaders from outside the family a welcome and valuable addition. They can bring missing but needed skills in such areas as finance or the law, for example; they can bring diversity to a family board; and they can help to defuse family dynamics that might interfere with a foundation's operation.
Tim Ober, president of the Mardag Foundation, frequently recommends the benefits of involving non-family to other foundation leaders at family foundation conferences. "Other directors often raise concerns, but I say, ‘Just do it; they bring in a wonderful outside perspective.'"
While staff at family foundations share many of the same challenges as staff at other foundations, Kate Wolford, president of The McKnight Foundation, notes, "In family foundations, a lot is about the integrity of the relationship, helping family keep connected to the values that gave rise to the foundation and providing access to the information they need to make sound decisions."
Wolford, who is not a member of the McKnight family, credits the foundation's board with ensuring that she gained a deep knowledge of the foundation and of board members when she was hired. "I'm not sure that learning always happens before you step in the door as it did for me," she says. "And it's helpful to have a strong basis for interpreting the vision and translating the ideas going forward."
Edie Thorpe, president of the James R. Thorpe Foundation and board member of the Surdna Foundation, notes that non-family board members have added to the depth and experience of the Surdna Foundation board. She expects that the younger generation at the Thorpe Foundation will find a non-family director.
But both foundations want family to remain the majority of the board. "We're very committed to the family foundation concept," Thorpe explains. "It gives the next generation a wonderful focal point, something to work on together, to be proud of, and to share in the family legacy in the community."
Nonprofits and Family Foundations:
Forging a Relationship
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Edie Thorpe |
In addition to doing the necessary homework to understand a foundation's interests and how it operates, how can nonprofit organizations work best with family foundations? The answer is that no one size fits all. As Tim Ober, president of the Mardag Foundation, puts it, "The struggle for nonprofits dealing with family foundations is that they come in many flavors, sizes and structures."
Ober recommends that nonprofits find ways, such as holding open houses and sharing newsletters, to make family foundations aware of what they do and what their needs are.
Providing feedback about the impact of grants already received is another good way to connect, according to Joe Bailey, president of the Gordon and Margaret Bailey Foundation. "The personal touch really makes a difference," he says. "We appreciate when someone we've worked with has taken the time to write back or call and let us know how funds are being used."
When feasible, site visits can be an important connector for both family foundations and nonprofits. Edie Thorpe, president of the James R. Thorpe Foundation, believes site visits — along with honesty, open communication and respect — can be the "crux" of the relationship. "Site visits are a wonderful opportunity for everyone involved," said Thorpe. "You can learn more on their turf than you ever could reading a proposal, and nonprofits we see treasure the opportunity to have a board member come in and meet with them."
"Find and respect the way each family foundation operates," is how Sarah Andersen, president of the Hugh J. Andersen Foundation, sums up her advice for nonprofit applicants. And she surely speaks for many family foundations when she describes how she hopes nonprofits look at the foundation. "I would hope they see us as approachable and easy to work with. I would hope they see us as a partner in trying to make the community better."
© Copyright 2007 Minnesota Council on Foundations
Reproduction in any form without the written permission of the publisher
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