The “Trump Effect”: Funder Priorities and Responses to the Trump Administration

In the fifty days since Donald Trump took office, we have seen a myriad of responses from both large and small funders across the country. Inside Philanthropy has recently compiled their articles on the “Trump Effect,” which examine how Trump administration policies have affected funders’ priorities and reactions. The Chicago Foundation for Women (CFW) recently announced 29 new grants totaling $50,000 toward its 100 Day Fund, which aims to provide a rapid-response to Trump’s first one hundred days in office. The Bill and Melinda Gates Foundation has spoken out against the “global gag rule,” which prevents foreign NGOs from receiving US government funding if they counsel, perform, or promote abortion practices. In response to Trump’s recent executive orders regarding immigration, the Robina Foundation awarded $25 million to the University of Minnesota Law School — the largest gift in the school’s history.

The recent shifts in donor giving have enabled nonprofits to scale their efforts and engage in innovative approaches. The ACLU announced this past weekend that it will be spending millions of dollars on a grass-roots “People Power” campaign, which aims to direct citizen attention toward Trump’s policies, rather than his persona. As Executive Director Anthony Romero explained, “We’ve seen this exponential growth in people becoming card-carrying members of the ACLU… They’re younger. They’re in every state around the country. The biggest danger was in not doing something like this, where people get apathetic and they fall asleep.” The ACLU has tripled its membership and raised over $80 million since the 2016 election. People Power hopes to mobilize this base to resist Trump policies at a local level.

Read more at Inside Philanthropy, The Washington Post, and PeoplePower.org.

Hewlett Foundation Publishes Study on Use of Philanthropic Knowledge

The William and Flora Hewlett Foundation recently published a report that examines the ways in which funders and foundation staff respond and adapt to new information and knowledge. The Hewlett Foundation has been a longtime funder of organizations working to create and disseminate such knowledge across the philanthropy sector, including the Stanford Social Innovation Review, Nonprofit Quarterly, The Bridgespan Group, the Center for Effective Philanthropy, Grantmakers for Effective Organizations, the National Committee for Responsive Philanthropy, and The Philanthropy Roundtable. Although Hewlett understood the numeric reach of these grantees through subscriber and visitor metrics, they wanted to have a clearer picture of their real-world effects.

Hewlett brought in two outside firms to conduct a collaborative field scan, compiling information across 11 major knowledge producers and publications in philanthropy. The field scan included a survey of 738 funders and foundation staff, interviews with 75 board members and funders, and four in-depth case studies. The 738 survey respondents were affiliated with 528 staffed foundations. Thirty-seven percent worked for independent foundations, 32% family foundations, 28% community foundations, and 3% corporate foundations. The size of the foundation ranged from one staff member to 50+. Half of responding foundations gave less than $10 million annually.

Their research yielded the following findings:

  • Foundation staff primarily seek knowledge from their peers and colleague (92%), followed by conference (83%), newsletter (77%), and interaction with grantee (67%).
  • The survey asked participants o list their trusted sources of information. No specific organization, association, or publication was cited as a trusted source by more than 25% of respondents.
  • Funders are overwhelmingly interested in learning more about evaluation and assessment (44%). No other topic was identified as critically needed by more than 5% of respondents.
  • nders tend to feel overwhelmed by the volume of provided information.
  • Knowledge lone does not result in change. While information can help encourage a new idea or practice, it must be accompanied by a wide variety of other factors including trust, accessibility, peer and leadership support, and organizational readiness.

hese findings illustrate that knowledge production tends to be driven through largely informal processes such as conversation and email exchange. There is no paramount source of information; funders gather knowledge from a wide variety of sources and publications. Funders have a strong desire to become more outcome-oriented, but struggle to effectively measure progress and results. Although funders have a desire to use knowledge to inform their philanthropic practice, they often feel overloaded by the volume of provided information. And finally, the study demonstrates how information must be accompanied by institutional support to result in substantial change.

Read more at the Hewlett Foundation and the Stanford Social Innovation Review.

MacArthur Foundation Announces Semifinalists for $100 Million Prize

Last Wednesday the MacArthur Foundation announced eight semifinalists for its 100&Change competition, a $100 million prize with the goal of making significant progress toward a critical social issue. MacArthur will award the prize to a single project, continuing its strategic shift away from typical grantmaking in favor of ‘big bets.’ Large prizes such as 100&Change aim to enable promising solutions with sizable scale, scope, and complexity that are generally not possible via standard levels of funding.

The open competition was announced last June, and received 1,904 applications by its October 3rd deadline. The proposals were assessed based on their meaningfulness, verifiability, durability, and feasibility. The eight semifinalists include:

  • Catholic Relief Services: To improve childcare in orphanages
  • Himalayan Cataract: To reduce needless blindness in Ethiopia, Ghana, and Nepal
  • Human Diagnosis Project: To provide digital access to health care specialists for underserved patients
  • HarvestPlus: To reduce nutritional deficits in Africa by breeding fortified crops
  • Internet Archive: To provide digital access to four million books
  • Sesame Workshop and International Rescue Committee: To educate children who have been displaced by conflict or persecution
  • Rice University: To improve newborn survival in Africa
  • The Carter Center: To eliminate river blindness in Nigeria

MacArthur plans to select five finalists in September 2017 and award the $100 million prize by the end of December. Although only one will be selected, the MacArthur managing director Cecilia Conrad explained, “It is our hope that these creative proposals will benefit from expert feedback, technical assistance, and public attention. And that they attract funding from other sources, even if they do not win 100&Change.”

Read more at The Chronicle of Philanthropy and the MacArthur Foundation.

Report from Exponent Philanthropy Indicates Growth in Impact Strategies for Smaller Foundations

A recent study from Exponent Philanthropy indicates shifts in grantmaking practices for smaller foundations as they work to further expand the impact of their giving. The report, which is based upon survey results from close to 2,000 of the association’s members, found that respondents have continued to heighten their impact strategies over the past two years. Exponent Philanthropy found that 81% of respondents review their grantmaking strategies on a regular basis, an increase from 74% in 2014. Sixty-one percent have board members that attend pertinent conferences and 48% of respondents have brought in outside consultants or resources to improve their practices, up from 55% and 40% respectively in 2014.

The report found that 79% send board members to conduct site visits, 70% offer multiyear grants, 63% collaborate with other funders, 43% convene grantees, and 11% engage in impact investing. Small foundations have also worked toward formalizing their governance processes, as 80% have developed conflict of interest policies, up from 30% in 2005. Succession and a desire for greater focus in their grantmaking were indicated as top concerns for respondents.

These findings reflect and illustrate the growing focus from smaller foundations on augmenting their philanthropic impact. As Exponent CEO Henry Berman explains, “Foundations with lean operations do so much more than just write checks to their grantees. Our members are making a conscientious effort to have an 'outsized impact', allowing each dollar granted to result in more than just the monetary value of their giving."

Read more at Exponent Philanthropy and Philanthropy News Digest.

 

Confronting Poverty Through Philanthropy: Washington Center Study Offers Insights

The Washington Center for Equitable Growth has published a working paper on the distribution of wealth in America, revealing several stark observations in regards to poverty and inequality. Authored by professors Thomas Picketty (Paris School of Economics), Emmanuel Saez (UC Berkeley), and Gabriel Zucman (UC Berkeley), the study uses data from taxes, surveys, and national accounts to provide a comprehensive picture of national income distribution since 1913. Their key findings, listed below, hold implications for both policy makers and philanthropists working to confront poverty in the United States.

• Over the past forty years, the bottom 50% of earners have seen their income increase by only 2.6%, reaching an average income of $16,179 in 2014.

• Government spending (on Medicare, Medicaid, food stamps, infrastructure, defense, and education) provides some degree of benefits to lower income earners, although it may have marginal effects. In 2014, the average income of the bottom 50% ($16,179) was augmented to $25,045 if one considers the benefits of direct and indirect spending.

• However, these benefits are disproportionately awarded to individuals older than 65. After-tax income for seniors in the bottom half of earners increased by more than 70% in the past 35 years, while after-tax income for adults between 20 and 45 has remained stagnant.

• The top 1% and the bottom 50% of earners have swapped their share of total national income in over the past forty years. Between 1974 and 2014, the top one percent has gone from holding 10% of national income to 20%, while the bottom half has dropped from 20% to 12.5%.

• The tax gap between top and bottom income earners has decreased significantly in the past century. Between 1944 and 2014, the tax rate for the top 1% decreased from 45% to 36%, while taxes for the bottom 50% increased from 15% to 24%.

• Women’s growth in the American workforce has counteracted overall measures of inequality. However, women comprise only 27% of the top 10% of earners, and only 16% of the top 1%.

• Even for the upper-middle-class (those making between the bottom 50% and top 10% of earners), pre-tax income has remained stagnant over the past fifteen years.

• The redistributive effects of government spending provides greater financial benefits to the upper-middle-class than to the bottom 50%. In 2014, 14% of income was transferred to the upper-middle class, while 10% was transferred to the bottom half of earners.

Moving forward, the authors conclude that future efforts to combat poverty and inequality ought to focus primarily on raising Americans’ primary income through education, job training, and equalizing the distribution of financial capital.

Read more at The New York Times. The full report can be found at the Washington Center for Equitable Growth.