Philanthropy, Old, New and Enduring


Chris Baker

Dr Christopher Baker

Last week I attended a forum entitled Philanthropy, Old, New and Enduring presented by Swinburne University’s Asia Pacific Centre for Social Investment and Philanthropy in conjunction with O’Keefe and Partners. 

Julie Johnson, Managing Director at O’Keefe Partners, presented on giving trends research which they undertake annually, evaluating changes in performance and perceptions from not for profits.  It was apparent from much of the information presented that perceptions are radically different to performance and I don’t know how valuable that is in practical terms when one is trying to implement a fundraising plan. But what was quite interesting was to see that corporate sponsorship had increased in 2011 – 2012, and differences in donor segmentation.  By that we mean – who are the most philanthropic amongst us as ranked by age.  The research presented indicated that people aged 40 – 59 are a new part of the population who are giving now, joining the 60 – 74 year olds, and that their charitable emphasis is on social and family welfare and education (which probably reflects where they are in their lives and their focus on family).

One key change in perceptions which I did find useful, was in the challenges faced by not for profit organisations.  Apparently, for the first time, charitable competition is a key factor, or something that organisations are taking into consideration, joining issues such as the economy, acquisition costs (ie costs of fundraising) and the global financial crisis.

The good news is that the research indicated there will be growth in the philanthropic landscape in the next 3 -5 years with an increase in the giving pool, and that people want to put money where it will make a difference, but also want to see accountability and transparency.  Key motivations seem to be wanting to invest in society and making it a better place.

Dr Christopher Baker from Swinburne then spoke on his research on Inheritance and Charitable Giving, which involved a long search into Victorian probate records from 2006 to see where, if any, charitable bequests were being made.

The data showed that inevitably, immediate family are the main beneficiaries of wills and that 9/10ths goes to children.  Only 1 in 20 wills make a charitable bequest which make up 1% of the total value of the testamentary trusts, and the wealthy do not give more proportionally than the less well off.

The data represents a snapshot of the intentions of people who were mostly born before 1930, giving weight to Dr Baker’s assertion that he has concluded that “it is indeed older people who tend to die” and therefore people who had a particular life experience including living through the depression, World War II and the norm of nuclear families. Dr Baker points out that in 2006 Australia had experienced its 15th consecutive year of growth in net wealth (with 55% of wealth held in houses and 70% home ownership), so that when these over 80 year olds passed away, they were mostly relatively comfortable and their children would arguably be in their 50s and no longer necessarily economically dependent (thus perhaps leaving space for a charitable bequest without this being to the detriment of the family if only one had thought of it at the time of amending/updating one’s will).

Probate is a record of personal assets held at time of death and excludes superannuation.  Apparently there are 35,000 deaths each year in Victoria.  Of the probate records sampled by Dr Baker, out of 1700 final estates (with no surviving spouse) 91 bequests were made to charities and 75% of the records viewed were of estates less than $500,000.  The value of total bequests studied was $11 million, but the typical – ie median bequest was $20,500.  Dr Baker’s studies showed that smaller estates left a larger proportion to charity.  However, he notes that the probate data under-represents the very wealthy who may well have other vehicles for investment (such as trusts etc) outside their personal estate.

What was interesting is that 80% of estates of people with children left nothing to charity, but people without children were 10 times more likely to leave a charitable distribution.

A national study (excluding Queensland*) will be undertaken by Dr Baker next year, and it will be interesting to see if there are state differences.

As an aside, Include a Charity is a new campaign aimed at increasing people’s awareness about making charitable bequests and providing more information to financial and legal advisers.

The session ended with a short panel discussion.

Does your organisation have a bequests strategy?  On the basis of this data, one might be discouraged from even considering chasing bequests – is it too hard? or is it a blue-sky opportunity?

How do you feel about bequests in your own situation?    Is an argument for “giving while living” a contradiction of the benefits of giving through bequests?

Let me know what you think – I look forward to your comments.

* Apparently the Queensland Government has denied a request to waive search fees on probate records for Dr Baker’s research, so they will be excluded from the study.

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Season’s Greetings


for those of you who know I love both classical music and flashmobs. . . . . . and to all my ozphilanthropy readers, a happy new year.

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Philanthropic Investing in Aboriginal Women & Girls


effective-philanthropy

Guest post by Carolyn Munckton

Last month, I had the great pleasure of attending the AMP Foundation’s launch of an outstanding new research report called The Best of Every Woman:  An Overview of Approaches for Philanthropic Investment in Aboriginal Women and Girls.

It’s a long title and a reasonably long read (hence it’s taken me a while to write this blog piece), but it is worth it for current and potential funders of Indigenous programs and organisations.

The research report was put together for the AMP Foundation by leading philanthropy research consultancy Effective Philanthropy.

The facts and statistics on the challenges and disadvantage faced by Aboriginal people in Australia are stark and confronting.  The report includes a lot of this illuminating detail that shows how Aboriginal people are the most socio-economically disadvantaged group in Australia.  “Many families and communities are caught in a cycle of poverty, with poor health, high levels of single parenthood, low education, high rates of unemployment, low incomes, poor access to essential services and high levels of involvement in the justice system.” 1

The Best of Every Woman report advocates investing in programs to assist Aboriginal and Torres Strait Islander women, who can then act as catalysts for social change in their local communities.

This is powerful stuff and also pretty obvious.  Maybe I’m biased because until recently I was a board member of the Australian Women Donors Network and was involved in getting the network established. For the past four years, I’ve been helping to spread the word about the need for philanthropic investment in women and girls to overcome disadvantage and to fulfill the potential of women and girls.

Aboriginal and Torres Strait Islander women play a critical role in leading improvements in the health and wellbeing of their families and communities.

The report presents a number of case studies that demonstrate this.

The AMP Foundation should be congratulated for commissioning this report to determine how social investment might best support Aboriginal woman and girls.

As well as discussing the challenges that Aboriginal women and girls can face the report importantly identifies a framework for philanthropists and policy-makers to identify programs that can support the next generation of Aboriginal women and girls to reach their education, career and life aspirations.

Key findings of the report include:

  • A non-linear education pathway is common amongst Aboriginal women.
  • The availability of culturally appropriate childcare has an important role to play in an Aboriginal woman’s decision to defer taking up further study or work.
  • Facilitating access to information and networks can have a significant effect.
  • Supporting and strengthening cultural identity is important.
  • Leadership support and growth capital could drive future successes.

There is plenty of detail in the report that will help funders better understand the current barriers for Aboriginal women and girls and the potential they have to achieve and create positive life outcomes for themselves, their families and their communities.

The report identifies the types of programs that can support Aboriginal women and girls to overcome the barriers and importantly, the key success factors that can be used when designing, funding and/or delivering those programs.

The report’s Foreword has been written by Professor Kerry Arabena, Director of the School for Indigenous Health, Faculty of Medicine, Nursing and Health Sciences, Monash University, who also spoke at the Melbourne launch that I attended.  Professor Arabena said that young Aboriginal people are positive about the future and have moved away from seeing themselves as disadvantaged and are ready to take advantage of Australia’s profound opportunities.  She was extremely positive about the potential for change and she urged the audience to take the opportunity to affect and support this change.

I think the next generation of philanthropists and philanthropic funders will accept this challenge and tools like The Best of Every Woman report will guide and support the change.

Effective Philanthropy consultants Regina Hill and Louise Doyle have done a great job in pulling all of this research together and consulted with a wide range of organisations and people involved with delivering programs and services to Aboriginal people right across Australia.

There are a number of philanthropic trusts and foundations that currently fund Indigenous programs and many of these were also consulted.

This report will be very useful for current funders and for those who want to get involved and help make a difference.  It is a daunting area of philanthropy and one were mistakes can easily be made.  This report can be used to inform future program design, funding and delivery so that support for Aboriginal women and girls can effectively contribute to social change and improvements for many Aboriginal people – men, women, boys and girls.

[1] The Best of Every Woman, page 23

About Carolyn Munckton

Carolyn was an inaugural board member of the Australian Women Donors Network (2009-12) and recently became a director of the Inner North Community Foundation because she loves the idea of local people supporting their local communities.  She has so far waded through two units in the Masters of Social Investment and Philanthropy at Swinburne University.

You can find her semi-regular thoughts and readings on philanthropy and fundraising in Twitter handle @carolynmunckton.

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Giving Circles and Impact100 WA


James Boyd from artsupport Australia was the guest of Swinburne Philanthropy Alumni at the final Maimonides Society event for the year.

James has been involved in the establishment of Impact100 WA which is a giving circle based on the 14 highly successful Impact100 giving circles in the United States, originally established by Wendy Steele in Cincinatti in 2001.

James gave a highly entertaining presentation which clearly posited the benefits of giving circles – as opposed to donor circles – and how to set them up successfully to ensure sustainability. While Impact100 WA is only in its first year, James spent some time last year as one of the winners of the 2010 FIA Perpetual Scholarship visiting and studying giving circles in the US.

James stressed that some of the language is interchangeable – collective giving groups or collaborative giving groups – but that the importance is on them being giving groups and not donor groups – with the main difference being that they are set up by people who choose a cause – not a cause or a not for profit which then mobilises its donors.

Here’s the giving circles guide for dummies which James shared with us which you might find amusing and instructive: How to start a Womens’ Giving Circle, aka the Barbie video.

From James’ interviews and study in the US it was clear that while giving circles are more popular with women (participant gender ratio is 80% women to 20% men) there are several other common attributes to successful giving circles:

they have at least 5 participants
an agreed minimum donation amount and time frame
clear decision making processes on how to distribute to agreed charities
money in/money out – ie the giving circle does not create an endowment – gifts are spent in the year they are pledged
the circle is donor driven – not cause driven or fundraiser driven or organised by a charity or not for profit.
encouragement of donor participation and education
a social element
formality varies depending on size.

James spoke about Colleen Willoughby from the Washington Womens Foundation and how their ideal was to mobilise womens’ interests to give them knowledge about their community. That group now has 500 donors contributing $2000 each which gives them $1,000,000 to distribute each year. Their keys to success: donor education, learning and leadership. They make very few grants of less than $100,000 because they want to see real impact within their community. This highly professionally organised giving circle was contrasted with the Portland Giving Circle which has 12 women who contribute $500 each. They give one grant of $6000 to a women rising out of poverty in Portland through the Portland Community Foundation – and have now created an alumni of the women they have supported. Although organised in a more ad hoc manner, the impact on the community and benefits back to the women donating through their satisfaction and pride in participating are equally valuable.

Giving circles demonstrate other long term benefits such as a high number of members contributing additional funds to programs supported, high percentage of giving circle donors participating in not for profit boards, high level of support for charities’ fundraising efforts, pro bono support and increased volunteering through their experience of close engagement with the organisations supported through the giving circles. In addition members share their learnings through speaking engagements on community issues, philanthropy and giving.

James talked about both intrinsic and extrinsic advantages of giving circles:
power by numbers – they make you feel like a major donor as you are part of something bigger
they create an engaged, enhanced and shared giving process
enable less wealthy people to be involved
informal and flexible
create enriched community involvement
&
can support “risky” projects
suit hard economic times
are ideal for rural or remote communities
create scope for advocacy
appeal to men and women
success breeds success
they bring new money to the philanthropic sector.

While there are many models for giving circles, ranging from the very large to the very small, some of the key elements remain the same:

Some of decisions needed to be made in setting up a giving circle include:
What do you want your impact to be – and where do you want your impact to be?
What causes are you interested in?
What size do you want to aspire to?
What are your short and long term objectives?
What is the donation level? (hint – most common in US is $1,000 with the average being $2,500)
What is your communications strategy?
What’s the giving process – ie through a central point or directly to the non profit
What is the application process, assessment process, reporting process for recipients?
What is the circle’s commitment to education and social engagement?
Are there admin costs? What will they be?
Workload – how much and who will do it?
Sustainability – the big question.

Impact100 WA determined a cause area – youth at risk, and used this as the hook to find more donors to join the circle. There is an emphasis on equality of all members, so people who might contribute more dollars still only have one vote when it comes to determining recipients. Impact100 WA decided to incorporate as an entity, but not to seek DGR, so they have all funds directed to the Australian Communities Foundation which then provides tax deductible receipts to all donors.

This year Impact100 WA distributed their first $100,000 to an organisation which made it through from 28 applications and a several tiered shortlisting process. According to James, the keys to success for Impact100 WA are: leadership, visible impact, member equality, 100% distribution of funds, education and learning, professionalism and excellent communication.

Seri Renkin also presented on her experience of being part of a giving circle, initially through Social Ventures Australia‘s Angel Network, and then through an informal extension of this. Seri’s group targeted financially independent women wanting to support women, children and young people in Victoria. Her group of ten participants contribute $5000 per year and have had to evaluate how they can create impact and support organisations without being a drain on them. They initially undertook a large amount of due diligence and research, but realised they were being overanalytical and have now moved to a more flexible approach. They particularly wanted to invest in capacity rather than programs. Seri spoke with great passion of their commitment to social change, the importance of evaluation and reflection, the need to understand how far your money is going, and the impact it makes on the sector.

Both Seri’s and James’ examples demonstrate that great impact can come even from smaller contributions – in passing Seri mentioned a local group which contributed funds towards an air conditioner so that women in a prison could spend more time making tee-shirts, (which they enjoyed doing), in a room which had previously been overheated and thus restricted the amount of time they could spend there.

Another example of a giving circle is the Awesome Foundation, also based on an international model, where ten people contribute $1,000 per year and have an open process for applications from an “awesome” project. Still growing strong in Melbourne, their most recent grant has been recently awarded to a project alleviating street poverty in Burkina Faso.

Further reading:

What do you think of giving circles? Are you aware of any that work in a different way? How likely would you be to join one? What do you think the drawbacks might be?

I look forward to your comments.

Sharon

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Not for Profit Summit – keynote speaker Debra Allcock-Tyler


Debra Allcock-Tyler photo from Civilsociety.co.uk

I heard the most amazing speaker last week at the Not for Profit Summit presented by the Office of the Community Sector in the Department of Planning and Community Development at Geelong.

Debra Allcock-Tyler is the CEO of the Directory of Social Change in the UK which has “a vision of an independent voluntary sector at the heart of social change”. Debra gave two keynote addresses, the second of which I will report on here.

The theme was around Big Society in the UK. Debra began by describing this policy idea as being like hay. “Good ideas get fed to the horse and what comes out the other end is . . . . .”

Debra spoke about three planks of Big Society:
1) Localism
2) Reform of Public Services
3) Community Engagement

Localism
In the UK, power has been devolved to local authorities, and in the new scheme of things there is a right to challenge. What this means is that not for profits can tell local authorities that they would like to tender to provide various services, but that then the tender process becomes highly bureaucratised, and the successful bidders are usually private contractors.  Debra’s highly amusing yet sad example of this was of a neighbour whose house backs onto a sports oval which has fallen into disuse and disarray.  The neighbour went to the local council to see if she could obtain a grant to buy some materials to enable her and some local volunteers clean up the space (ie wheelbarrow, whipper snipper, protective clothing, rubbish disposal).  The council thought this was such as good idea that they decided to clean up all the local sports areas, but under EU procurement rules, this needs to go out to tender. 

So it ended up that a commercial contracting firm was employed to come in every now again to mow and tidy, thus losing the local investment, community engagement and care which would have ensued should the neighbour have been able to organise this as a community activity for her particular sportsground.  The policy thus ends up with outsourcing, and not with local people, whereas if the funds had been provided as a grant, this would not have been the case.

Public Service Reform

Debra is of the view that governments think improvement is about making things cheaper, but if you drive down price you are driving down quality.  If the government is constantly seeking to reduce costs this ends up “marketizing” the public services.  The example cited was the Work Programme. This involves private contractors hiring charities to take on their more difficult cases in work placement, as the private contractors are more interested in only dealing with the cases which they can get through efficiently and quickly (and cheaply). The response from the charities involved in having the more difficult cases thrust to them is that they may not be able to see out their contracts, as they don’t have the resources to adequately support those client who need the most care and time. I know this is sounding terribly dry, so I apologise for not having managed to convey the delight, humour and wit of Debra’s speech. What she was trying to do I think was to convey a warning to us here, to be very wary of potential changes in public policy in this area.

Debra was particularly scathing of the voluntary sector (as she calls it – we would call it the not for profit sector) in colluding with government in allowing the outsourcing and tendering processes to occur, rather than calling for grants. Another example she gave was where a contract might have been awarded to ABBS.co.uk (a bunch of blokes with shovels) to clean up the canal, rather than allowing local volunteers to be engaged through the Friends of the Canal, and build their sense of community and ownership. (further research tells us that the Friends of the Canal are now in full swing – and across all of England).

It is important, Debra stressed, for the voluntary sector not to collude and only apply for money through tenders as if that were the only way to get funding. Her view is that this would not lead to long-term outcomes – because sometimes the not for profit sector organisations get distracted from their core mission and purpose in chasing the tender money trail. Debra reminded us to always go back to the core:

Who are we? What we are here to do? Who do we want to serve? What are our values and vision?

Debra also made some rather pithy comments about social investment (which I have been meaning to write about for some time and promise to do so soon). This is basically where charities are able to borrow funds in order to carry out their mission (and must repay them). Why, for goodness sakes? asks Debra, should the not for profit sector, which has been so good at not being in debt (compared to the private sector and the government) be encouraged to go into debt, at a time when there is too much debt? (a very interesting take on it).

Debra disagrees that the voluntary/nfp sector should become more like business (after all didn’t business pretty much stuff up the economy?) and she warned against colluding (that word again) with the idea that the not for profit sector is unprofessional. On the contrary, she stated that governance is much stronger and more rigorous in the voluntary sector. Debra also spoke briefly about the Great Giving Campaign which also aims to move away from the idea of handouts, but the acknowledgement of generously given gifts, particularly as grants and foundations provide the most sustainable form of income in the UK for the voluntary sector.

With a final nod to the ACNC, Debra spoke highly of the UK Charities Commission, saying how welcome it was there, and not a body to be feared. It is completely independent of government, is there to protect the public, and is a good body.

Debra concluded with an apt quotation from George Bernard Shaw:
This is the true joy in life, being used for a purpose recognised by yourself as a mighty one. Being a force of nature instead of a feverish, selfish little clod of ailments and grievances complaining that the world will not devote itself to making you happy. I am of the opinion that my life belongs to the whole community and as I live it is my privilege – my privilege to do for it whatever I can. I want to be thoroughly used up when I die, for the harder I work the more I love. I rejoice in life for its own sake. Life is no brief candle to me; it is a sort of splendid torch which I’ve got a hold of for the moment and I want to make it burn as brightly as possible before handing it on to future generations.
from Man and Superman 1903.

Debra is also the author of It’s Tough at the Top and Pleasure and the Pain (no fibbing guides) I am recommending these, as I think they will be fun reads for managers and leaders.

Debra reminded us that we don’t have to succumb to external pressures based on government policy where things really don’t make sense and don’t benefit not for profit organisations or their beneficiaries/clients. If you do get a chance to hear her another time when she is hear I would make an effort to do so.

Thanks to the Office for the Community Sector for including her in the Not for Profit Summit line-up.

What do you think about the potential for Big Society taking hold as part of the political agenda here? I look forward to your thoughts.

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The Power of We


It’s Blog Action Day and this year’s theme is The Power of We so I thought I would just do a very brief post here to talk about the Rotary Community Service Awards which were handed out last night.

I don’t know a lot about Rotary, but their motto, Service Above Self, certainly has a synergy with The Power of We, and judging by the ongoing popularity of Rotary, and the fond reminiscenses of several people who spoke in relation to how Rotary had supported them, they have a lot of people contributing to their own sense of “we”.

The awards were handed out in six categories, covering Recreation & Arts, Youth, Homelessness, Community Health and Mental Health, Aged Care & Community Support, and Vocational Support & Community Leadership. While there was more of an emphasis on the prizes (and those sponsoring them) than the depth of the partnerships being celebrated (in that it would have been good to hear more about what the partnerships entailed), it was great to see so many organisations who are developing corporate partnerships, and maintaining ongoing and meaningful relationships with those partners beyond handing over the money and writing acquittal reports.

Highlighting and celebrating the work of the not for profit sector is always a welcome activity and if we can learn more about what makes the best partnerships tick and share that knowledge, it’s all for the better.

I attended the event as a guest of Portland House Foundation who were partnered with Carers Victoria.

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Changes afoot at peak body?


Further to the not so recent news that AbaF and artsupport are to merge next year into one body, and that Louise Walsh of artsupport will soon be the new CEO of Philanthropy Australia, the Australian Financial Review yesterday noted that some artsupport staff will also be joining Philanthropy Australia.

What does this mean for the new body for private sector support for the arts if the artsupport expertise has been removed from the equation – and even more puzzling, what impact does this have on Philanthropy Australia? Will it have a stronger arts focus or a a stronger Private Ancillary Fund focus? (as that is where the skills and energy of artsupport have been directed – brokering support for the arts mainly from Private Ancillary Funds) and does it reflect a change in strategy for Philanthropy Australia towards a greater emphasis on Private Ancillary Funds?

Here’s Philanthropy Australia’s strategic plan released earlier this year. I note the point that Philanthropy Australia faces unmet needs by parts of the community who are donors who do not belong to the organisation as members: “Some of those segments with ‘unmet needs’ are easy to identify: – corporate foundations; aspiring philanthropists (i.e. those who are giving in the tens of thousands as individuals but do not yet have a formal structure); fledgling and start-up foundations, including PAFs; trustee companies; professional advisors; researchers and students of philanthropy. Other segments may prove more of a challenge to identify and engage, such as diaspora giving or giving by and to specific cultural or religious groups“.

I also note the High Net Worth study Philanthropy Australia undertook for the Commonwealth Department of Families, Housing, Community Services and Indigenous Affairs released in February 2011 (and which is referred to in the strategic plan).

Is Philanthropy Australia moving towards being a peak body for high net worth givers only, even though their second goal as stated in the strategic plan is to Encourage all Australians to increase their giving and philanthropy?

A further question that could be asked is also about how an incoming CEO can bring staff with them. Shouldn’t any new roles be advertised openly in a fair and judicious process? If members of Philanthropy Australia aim to make grantmaking transparent and based on merit, shouldn’t we be expecting our peak body to also behave in this manner, reflecting the ethos of a just and fair society that so many philanthropic organisations strive to achieve through their work? Just asking . . . . not to mention the staff already in place – how will this all work even with the addition of offices in Adelaide and Brisbane (as announced at the recent Philanthropy Australia conference).

Interesting times ahead as we see how new leadership and staff drive the direction of Philanthropy Australia.

What are your views?

my bias – organisational member of Philanthropy Australia through Inner North Community Foundation, former employee of AbaF, and colleague of both incoming and current staff at Philanthropy Australia. NB views are my own and do not necessarily represent those of my employer.

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Hallmarks and Next Steps for Australia’s Philanthropy: Coming of Age as a Business #PhilAus12


Genevieve Timmons photographed by Ian McKenzie 2007

Last week I attended the Philanthropy Australia biannual conference in Sydney entitled ‘Making Philanthropy Our Business”. Genevieve Timmons, Philanthropic Executive for Portland House Foundation, and Deputy Chair of the Inner North Community Foundation presented at one of the concurrent sessions and has been very generous in sharing her speech with us. Genevieve has more than 25 years experience in philanthropy having been a Senior Fellow in 1999 with the Johns Hopkins International Fellows in Philanthropy, a board member of the George Hicks Foundation, Grants Adviser for the Merrin Grenet Foundation, a board member at the Victorian Foundation for Survivors of Torture, Board member of the Fellowship for Indigenous Leadership and a Fellow of Leadership Victoria. She started in early 1988 with the Reichstein Foundation, and spent 8 years before that working in the not for profit sector, notably as the founding staff member of CERES in Brunswick.

Here’s what she had to say:

In the last 25 years philanthropic grantmaking has emerged as a relatively new industry, both in Australia and across the world. Giving is not a new concept, and in fact goes back as far as recorded history can take us. But it is only in the last three decades that an overhaul of the traditions of philanthropy has transformed giving, moving on from often random acts of generosity, guided by hunches and good intentions, to more thoughtful and deliberate strategies for giving money for social progress and benefit.

Early pioneers in Australia established a membership organisation in the late 1980s, the Australian Association of Philanthropy (AAP), now known as Philanthropy Australia. AAP joined just a handful of membership organisations across the world, including the Council On Foundations in the USA (established 1949), the Canadian Centre for Philanthropy (mid 980s) the European Foundation Centre (1989), the Association of Charitable Foundations UK (1989), and Philanthropy New Zealand (1990). From this small group of leading organisations, there are now thousands of membership organisations globally with a focus on developing the quality and breadth of philanthropic giving.

With the leadership of Philanthropy Australia and their international peers came the first collective sense of philanthropy as a public, structured activity, a notable turning point. Thoughtful, planned giving has become widely recognised as the remit of philanthropy, along with an increase in the numbers of people involved as donors, staff or trustees of foundations and trusts, allied professionals, and also as grantseekers and fundraisers. Momentum has also been added by an array of new giving structures, services and organisations to facilitate giving, new legislation and approaches to marketing. Most important, in the last 25 years there has been a substantial increase in the amount of money being given as investment in social progress.

There are several key features of contemporary philanthropy that are hallmarks of our growth and maturity today, and that present rich challenges and opportunities to accelerate our progress in the time ahead:

• Strengthening our claim as a profession
• Understanding our place in a civil society
• Optimising the value of grantee relationships
• Learning about and understanding our impact
• Working with and being led by the next generation

Each of these is worthy of detailed consideration and analysis in their own right, but it is beyond the scope of this paper to do that justice. I want to simply signpost them as a collection for us to bear in mind, and to keep alive in future discussions and exchange.

1 STRENGTHENING OUR CLAIM AS A PROFESSION
There are numerous milestones which mark the growth and maturity of philanthropy, coming from a mysterious and small base to where it is today. The current scale and complexity of activity is a radical transformation from 25 years ago. Clearly our sector has taken shape, but are we ready to be called a profession? And what is required to qualify? In recent discussions with Wendy Scaife, from the QUT Centre for Philanthropy, she raised the point that there are requirements for any field of endeavour to qualify as a profession. To be called a profession, there is an expectation of service and standards that can be predicted, requiring agreement on what these standards are and assurance that regardless of who the individuals may be, there is confidence in practice and service.

The following definition is helpful in understanding what constitutes a profession:
‘A disciplined group of individuals who adhere to high ethical standards and uphold themselves to, and are accepted by, the public as possessing special knowledge and skills in a widely recognised, organised body of learning derived from education and training at a high level, and who are prepared to exercise this knowledge and these skills in the interest of others. Inherent in this definition is the concept that the responsibility for the welfare, health and safety of the community shall take precedence over other considerations.’ (Dr John Southwick, ‘Australian Council of Professions’ Perth, April 1997)

While we all have different and contrasting approaches as grantmakers – and long may these differences live – there is now more consistency in expectations of each other, we talk about ‘we’. It is a cause to celebrate that there is so much we have in common, explicit features and frameworks of core business, accepted practice in the philanthropy sector.

For example:
Philanthropic grantmakers enjoy centralised information, access to relevant resources and research, provided to a large extent by Philanthropy Australia and complemented by other organisations across the world, including the membership organisations mentioned earlier. Looking beyond Australia, I have derived particular benefit from the work of Philanthropy New Zealand, and the collection of trusts and foundations which make up their philanthropy sector have been a great source of enrichment – I salute my colleagues, particularly Jenny Gill and Robyn Scott who have been the backbone of sectoral development in New Zealand over many years. In other countries, Stephen Burkeman in the UK, the Council on Foundations, Grantcraft, Stanford Social Innovation Review in the USA, WINGS in Brazil – there are no doubt many more that others would want to acknowledge.

We have specialist courses and training, for example at QUT Australian Centre for Philanthropy and Nonprofit Studies, and the Asia-Pacific Centre for Social Investment and Philanthropy at Swinburne.

We have formal and informal exchange, and professional development opportunities – conferences, plus workshops and seminars, visiting scholars and practitioners, facilitating and debate on issues of importance to us all. I cannot emphasise enough the value of colleagues’ generosity in sharing questions, gems and ideas that have been useful, and the challenges we wrestle with. If there is any one ingredient that will equip and strengthen our sector, and ensure grantmaking reaches its greatest potential in the future, I believe it is this commitment to exchange.

We have deliberate peer networks with specialist focus on how and why we give, exchanging information and transferring knowledge. The wide collection of affinity groups and special focus organisations such as the Women Donors Network, Changemakers, Woor Dungin, Jewish Funders Network and Australian Environmental Grantmakers Network – no doubt there are more. Community foundations such as the Inner North Community Foundation and the Australian Communities Foundation also make a deliberate contribution to this work.

We have more clarity than ever guiding operations and governance, with job descriptions and staff titles, explicit governance roles and responsibilities, tax legislation….. We have databases and tracking systems, grantmaking cycles, websites and, grant agreements and annual reports, all of which may differ but are easily recognised across the sector as common practice.

We have been present at the table with governments over many years, again through Philanthropy Australia, ensuring a voice to government for inquiries and legislation and preparing submissions to ensure changes are responsive to our sector.

There is a growing interest in funding partnerships and collaborations, between grantmakers and across sectors with government and business. The recent launch of the Victorian state government Guiding Principles for Collaboration between Government and Philanthropy is the most recent example of this.

These are just some of the core features and frameworks of our work as grantmakers today. While it is beyond the scope of this paper to make the case for or against philanthropy as a profession, it is a timely and useful question to be asking whether we qualify, and if not, what more it would take.

2 UNDERSTANDING OUR PLACE IN A CIVIL SOCIETY
Understanding the place of philanthropic grantmakers in the context of a civil society is another hallmark of our sectoral maturity. Clarity on where we fit in wider society is essential for effective engagement with governments and corporations, and to understand the collective funding and policy impact for not for profit work. It is also essential when defining relationships with the not for profit sector, and individual grantee partnerships.

Hopefully most of the mystery around the term philanthropy has been dispelled and we have moved on from a time when philanthropists could be mistaken for stamp collectors or flirts – as observed by John Prendergast (Community Trust of Southland, NZ) when noting the term sits in the dictionary between philanderer and philatelist.

A civil society is made up of three pillars – the non-profit or community sector, the government sector and the commercial sector. All three of these sectors generate money in support of not for profit work, and in each case the application of this money is influenced by the different policies, culture and accountabilities of each. There are important distinctions in the purpose of giving as a result.

Our responsibilities are grounded in the unique and creative capacity of philanthropic giving to provide funds which go beyond the concerns of government, free from accountabilities to a political constituency and votes of taxpayers; also free from the constraints of commercial business, having to raise profits and account to shareholders. This is a distinct point of leverage, a strategic place in a civil society to improve the wellbeing of humanity and the community.

There are examples of where this strategic positioning has been quantified eg in the USA in the 1980s, there were government decisions being made to shift responsibility for public housing and homelessness into the Independent sector, to be funded by the churches, welfare organisations and philanthropic sector.

Statistics show that philanthropic grants make up a relatively small percentage of income to the not for profit sector. In 2006-07, not-for-profit groups in Australia received $76.6 billion in income, with 33% of that from government grants, 30.5% income from services, and 9%, or $7.2 billion, through donations, fundraising and sponsorship. An estimated 5000 foundations in Australia are giving between half a billion and one billion dollars per annum. The philanthropic dollar may be only one in a hundred, but the influence as grantmakers is not about the scale of the dollars, so much as the way in which social investment is approached. Philanthropy can and does do more than serve as an additional source of money to be tapped, another drop in the funding bucket.

Harnessing the best of corporate thinking through philanthropy continues to be one of the great opportunities for growth and strategic giving. The trend towards ‘giving while living’ has sharpened the strategic positioning for philanthropy, bringing forward a group of intelligent and capable philanthropists from the corporate world, both in Australia and across the world. Philanthropy is rightly seen as the sixth form of investment, and giving matched with business acumen and drive can have powerful results. Peter Scanlon and the work of the Scanlon Foundation on social cohesion is just one outstanding example among many.

Another example is in the aftermath of the Black Saturday bushfires north of Melbourne in 2009. Portland House Foundation, along with Twiggy Forrest and others, moved quickly to support people in Flowerdale – listening to local people who had fought and survived the fires and wanted to get started rebuilding their community. By responding to their urgent, immediate appeal to establish their own temporary village, the Flowerdale community was able to get started and lead the rebuilding of their community. While this support was ahead of government, who carried the major responsibility for the disaster response strategy, it ensured that the community could eventually tie in with government resources as the disaster recovery was rolled out, and the Flowerdale community was hailed as one of the shining examples of resilience in rebuilding.

The optimal positioning for philanthropy is to be recognised for thoughtful and informed approaches, openness to discussion and development of ideas, and willingness to carry risk in the hope of finding solutions for some of societies’ most intractable problems. Also to be known for a capability to build rich and productive relationships with grantees, peers in the sector, government, corporations – and be capable of nimble, decisive funding partnerships. What this takes and how it works is still in the mix, another challenge continuing into the future.

OPTIMISING THE VALUE OF GRANTEE RELATIONSHIPS
Healthy, efficient relationships with grantees are another critical hallmark of contemporary philanthropy, where trust, mutual commitment to outcomes, and shared learning are the basis for the transaction. Philanthropic giving can only ever be as effective as the people who manage and spend the money, and how grantmakers engage with grantseekers can make or break intended outcomes. The way in which relationships are established inevitably depends on available resources, time and expertise of the grantmaker.

Research was undertaken as part of my Fellowship at Johns Hopkins International Fellows in Philanthropy Program in 1999, where a set of stereotypes of funding partnerships were identified, illustrating various levels of engagement, confidence and trust :
• Poacher & gamekeeper
• Patron and supplicant
• Social venture capitalist and social entrepreneur
• Hand in hand
• Hand in glove
• Noses in, hands behind back
• Autoteller

How relevant are these stereotypes 12 years later, either to grantmakers or to grantseekers?

Refinement of the funding relationship and advancing the quality of the relationship can be guided by this checklist of questions to grantmakers :
• APPLICATION PROCESS
Are grantmaker processes draining valuable time and resources of not for profits, chasing funding that costs them too much or that they won’t receive? What is the average percentage of applications received that are funded, and the percentage that are rejected? Can the process of applying for grants be made more lean and efficient for grantseekers?

• COMMUNICATION
Are there opportunities for open communication and mutual learning while the grant is being spent? Is there an appropriate level of trust and confidence in the grant recipient as the manager of funds? Does the funding relationship build on the skill and acumen of non-profit organisations?
• REPORTING AND MUTUAL LEARNING
Can reporting on outcomes, managing problems and making mid-course corrections all be done in a timely and efficient way? How are lessons captured and built into future funding decisions?
Are funding cycles long enough for effective relationships to be built, and useful outcomes to be
delivered?

These are just a few of the questions that have led grantmakers to streamline and develop new approaches to the funding relationship. As executive with the Portland House Foundation (PHF), and also as a board member with the Inner North Community Foundation, it has been possible to strengthen the grantee relationship in a number of ways without requiring excessive demands on time and resources. In fact it is to the relief of all involved that there are now established ways of exchanging information and monitoring progress that are nimble and time efficient for both the grantmaker and the grant recipient.
Example : PHF terms of the grant agreement include explicit expectations of the relationship :
Efficiency
• Respect for time and resources
• Appropriate and relevant documentation, ‘low docs’ approach
High level of trust
• Mutual agreement on plans for appropriate expenditure of grant
• Open and responsive communication with regular face to face contact
• Willingness to flag problems and negotiate mid-course corrections
No surprises
• Mutual agreement on Foundation Charter and Cluster Funding approach
• Consistent relationships with key individuals over time
• Positive management of any transition and changes within organisations
Learning and development
• Willingness to build capacity and exchange knowledge with peers
• Participation in roundtable discussions focus on key innovations, learning and good practice
• Willingness to explore relevant partnership opportunities with other PHF grant recipients

Example : Round table group reporting sessions have been organised with grantees of the Portland House since 2004, and have been well received by all involved. Brief verbal reports are given by up to 8 – 10 grantees at a time, sharing their progress, highlights and challenges with the Foundation and with each other. These reports are accompanied by written information where appropriate. In addition to reporting, the sessions provide grantees with opportunity to share skills and information, form partnerships and learn about related initiatives addressing disadvantage in the non-profit sector.

Example : Showcasing grantee work Portland House Foundation, the Inner North Community Foundation, the Reichstein Foundation and the Australian Communities Foundation are among a growing number of grantmakers who have made a priority of showcasing the work of grantees in public events, inviting peer grantees, donors and other potential supporters to hear face to face about not for profit work being done.

3 LEARNING ABOUT AND UNDERSTANDING OUR IMPACT
Surely the questions any grantmaker would want to be able to answer is “Did we get the
results we intended from our funding?” “Did we add value to people’s lives and what did that look like?” “Are there ways we can improve on what we have been doing?” This challenge to know what impact grants have and to learn from what has been achieved is possibly the most significant, faced by both grantmakers and grant recipients. In order to arrive at answers, there must be :
• in-depth information available on grants given
• a logic and method for sorting and classifying this information
• analysis to understand outcomes and identify lessons learned.

Harking back to history again, in the late 1980s and early 1990s, there were early efforts to bring together information on what was being funded with philanthropic dollars in Australia, led by the Australian Association of Philanthropy with the Reichstein Foundation, the Stegley Foundation, the Myer Foundation, ANZ Trustees and the Helen Schutt Trust, (now the Helen MacPherson Smith Trust). As colleagues we gathered information on what had been achieved with funding, and produced the earliest annual reports, to promote funding outcomes to the wider public. This involved follow up with grant recipients, many of whom were delighted to be asked about their outcomes and achievements, and to know that their work would be noted and promoted by grantmakers for the first time. Since this early pioneering, annual reports from grantmakers have become accepted common practice, and the wave of new communication technologies has brought with it websites and electronic media, providing a rich and rewarding window on work done by not for profits with philanthropic support.

As this public information started to build, our early group of pioneers also discussed the possibility of developing a data set and common language among grantmakers, to describe individual and collective philanthropic granting in Australia and identify the funding trends. This would provide valuable information on the fields of interest, target groups to benefit, size of grants, geographic location and types of structure funded, and show priorities and gaps. These first efforts to codify giving were problematic, because technology was fairly undeveloped, the task was time intensive and possibly costly, and it was difficult to agree on a common coding and classification system that made sense and worked for everyone:

Example : The challenge of classifying a grant for Somebody’s Daughter Theatre Company, a theatre company for women in prison? Some might classify it as arts and culture because it is theatre, or law and justice because it is to do with the justice system, or education because it involves skills development, or advocacy because it gives voice to women in prison …..

Progress has certainly been made since this early wrestle with the idea of a common classification language, and most grantmakers now have some form of database to track critical information. Technology has delivered an array of software tools to record and track funding by individual grantmakers. Philanthropy Australia and Philanthropy New Zealand both offer a menu for establishing a database, and there are various simple and complex commercial packages also available to manage granting at every stage, and deliver detailed information as required. Collective data on specific areas of funding is quoted occasionally from the sector, eg the total amount given as scholarships, levels of funding for a natural disaster, or philanthropic dollars directed to a particular issue such as mental illness. And the Australian census and tax figures can add to the picture. But ultimately, provision of the information is voluntary, figures are often out-dated, estimates are very broad, and not comprehensive.

The challenge remains for the philanthropic sector to be able to aggregate comprehensive and consistent information about what is funded and for whom, and to speak collectively about funding trends, gaps and priorities. When this is achieved, it will also be a significant contribution to transparency of giving. The work of Glass Pockets, a website created by the Foundation Center in the USA, advocates greater transparency in philanthropy, and illustrates the value and some of the current thinking behind public information and accountability for grantmakers.

As the amount of public information on philanthropic activity has grown, so too has interest from researchers, policymakers and not for profits. This interest has sparked a call for grantmakers to move to the next frontier of understanding the impact of funding, through monitoring, assessment and evaluation. Grantmakers have responded in a variety of ways :
• Establishing internal data collection systems
• Contributing to collective efforts to gather and share information with peers
• Building in requirements that projects be evaluated as part of the funding agreement
• Funding grant recipients to undertake evaluation and monitoring, to clarify the outputs, outcomes and opportunities generated from their work
• Hosting opportunities for grantmakers and grantseekers to share information and lessons learned
• Contributing to formal research and dissemination of information
• Undertaking internal reviews and strategic analysis of grantmaking activity, and disseminating this information

Example : Measuring outputs, outcomes, opportunities…. of the scholarships programs – yes, we funded 43 young people to attend school with bags, books, musical instruments, sporting equipment and to participate in school camps. Did the young people succeed at school? Was succeeding at school their best option? Did they realise more of their potential and talent as a result of having the scholarship? Did their opportunities change for them in the future? Did any of them end up representing Australia at the United Nations, or at the Paralympics in the ten years after that? Or perhaps they ended up in prison like their father and grandfather before them. Can we establish whether the scholarships are the best place to focus? Or are there other ways our money could be applied to accelerate the progress and help these young people be happy and fulfilled, and be the best they can be? We need to keep digging and know these things in order to understand whether what we funded was worthwhile and whether it was successful?

Example : Internal strategic reviews have been done in the last 15 years by a number of grantmakers, to clarify progress, identify strengths and opportunities, and agree on future priorities. Information has been made available from some of these extensive reviews, including the Reichstein Foundation and the Myer Foundation in Australia, and the ASB Community Trusts, the Community Trust of Southland, the Whanganui Community Foundation and J R McKenzie Trust in New Zealand.

This monitoring and assessment has inevitably increased demands on time and resources of both grantmakers and grant seekers, which are required when the task of monitoring and assessing is taken seriously.
The approach of the ‘learning organisation’ has become more important among grantmakers and not for profit organisations, seeking to be :
“ ..an organisation that learns and encourages learning among its people, promotes exchange of
information .. creating a more knowledgeable workforce .. where people will accept and adapt to new
ideas and changes through a shared vision.”

The challenge for the future regarding learning is to remain curious and be willing to keep asking questions, to understand the tools and systems that can be applied, and work together to share and add value. The benefits accruing are that we remain agile and informed as organisations and as a sector, equipped to move with the economic and social changes that are part of our landscape and capitalising on the best use of every dollar invested.

5 WORKING WITH AND BEING LED BY THE NEXT GENERATION
The last of the hallmarks in philanthropy to note today is the challenge to ‘lift as we climb’ with generations coming along behind, to ensure that creativity and leadership by younger people is valued and celebrated in philanthropy. Recruiting and involving young people is an obvious priority for many family foundations, and also boards and staff teams seeking to be representative; to build with new ideas and fresh perspectives; and to ensure smooth succession in governance and operations.

Barriers to younger people engaging with philanthropy can be juggling time across a myriad of activities such as study, travel, starting careers and earning a living, establishing personal relationships, sometimes parenting, and enjoying social networks. In addition to these ‘time of life’ issues, opportunities for involvement with philanthropy may not be relevant or attractive to younger people. There must be open doors for direct involvement of young people with grantmaking, appointment as board members and advisors, pursuing personal not for profit interests and linking these interests with funding. Most important is ensuring there is open space to bring in innovation and ‘new-style charitability’ a term used by a young social entrepreneur, Will Dayble who runs a company called Squareweave in Melbourne.

Will is one of many in his generation who see giving as something everyone can do, with small amounts of money and judicious use of time. Will is investing serious time to develop web based applications which are the new understood method for innovations in giving, making everything around charity more efficient and cost effective. Crowd funding, promoting social enterprise and better targeted international giving are just three examples of new approaches to giving, engineered by young people determined to find ways to keep building a better world. All I can say is watch this space, listen to their new ideas, learn their language, and follow their lead as the next generation put their stamp on philanthropy. ….. the sky is the limit.

Example : “Crowd-funding” is a new model of raising funds, most famously used in Barack Obama’s Presidential campaign. Recently a family in Midland, outside Perth was able to raise over $600,000 through crowd funding, for their First Home Project. The couple’s aim was to buy a large building, where they could live and continue to share their home with asylum seekers and people in desperate need. The banks had rejected their application for a loan, so they put an appeal out on the internet. Astonishingly, within 13 days, the full $600,000 had been pledged in loans and donations, from many people who read about their plan and had confidence in them. A quarter of the funds are made up of donations, the remaining 75 percent is comprised of loans.

I hope this paper has prompted more thought on where we have come from and where we are headed in philanthropy, and the hallmarks of contemporary philanthropy that are important to you. I also hope that there has been something of value that you can take away to accelerate your progress.

I wish to acknowledge the rich and rewarding exchange with my colleagues and peers both in Australia and New Zealand, and also my international colleagues in the Johns Hopkins International Fellows in Philanthropy Program, active across 50 different countries

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Community Foundations Forum: Bequests Pt 2


The highly dynamic and energetic Bill Holland spoke to us about the Acorn Foundation in Tauranga in New Zealand.

The foundation was formed in 2002 and has undertaken a fundraising strategy based mainly on bequests. It is one of 11 community foundations set up in New Zealand . People who commit to a bequest are asked to contribute $5000 payable now or out of the estate – an incentive is that if the funds are paid now it is tax deductible. The foundation usually keeps 1% for administration and distributes 5% regardless of the returns each year – which seems to average out. Whatever is left remains in the corpus.

One of the lovely touches they have incorporated into their grantmaking is the use of a card identifying the donor (bequestee) so that people realise that the funds come from people and not just from the foundation, so they receive a little story about the people who have supported them. Bill told the story of Eva Trowbridge, who, along with her sister, moved to New Zealand with their husbands. Both couples had no children and Eva was the last survivor of the four. Eva left money to the Acorn Foundation in her will, partly to support a student studying health sciences – to prevent children from having to go to the hospital where she worked for most of her life. Eva left $600,000 – and had been a cleaner at the hospital, reiterating the point that you don’t have to be rich to be generous.

The benefits of bequests through community foundations are that capital can be left intact, the annual income is distributed in perpetuity, donors can direct where the funds are to go, and it creates a passive income stream for the recipient organisations. In nine years the Acorn Foundation now has 165 named funds (most set up through bequests), partly through talking to Rotary, Probus Clubs, solicitors and investment advisers. They set up 30 new funds each year and this year distributed $350,000 from their funds under management of $7 million. Note that this is funds currently available from realized bequests – so when all of the 165 named funds donors pass on they estimate that their corpus will grow to something like $100 million.

All of the community foundations at the forum were quite impressed with these figures which are high in comparison to most of the community foundations here (with the notable exceptions of the Australian Communities Foundation, Lord Mayor’s Charitable Foundation and the Geelong Community Foundation).

Bill’s enthusiasm for the work of their foundation was infectious (and exhausting – many of us asked where he gets all his energy from). It was great that he came across from NZ to talk to us here about how they have developed the Acorn Foundation (even though of course the tax structures there are different to ours and they seemed to have less impediments as to whom they can distribute funds to). Thank you Bill for sharing!

What do you think of this strategy for a foundation or charitable organisation? Can focussing on one donor development stream be the best way forward?

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