Transparency Talk

Category: "Annual Report" (18 posts)

Glasspockets Find: Documenting a Transparent End to The Atlantic Philanthropies
April 23, 2012

When the board of The Atlantic Philanthropies voted in 2001 to end the foundation’s active grantmaking in 2016 and then close its doors by 2020, it became the largest endowed institution ever to do so.  Atlantic-logo-200The decision meshed well with the philosophy of the foundation’s founder.  To spend down the multi-billion-dollar endowment of The Atlantic Philanthropies within a fixed period of time concurred with Charles F. Feeney’s personal commitment to what he called Giving While Living.  (Mr. Feeney will be nearly 90 years old at the end of 2020.)

Referring to the better-known Giving Pledge in correspondence to Bill Gates in early 2011, Mr. Feeney wrote:

“I cannot think of a more personally rewarding and appropriate use of wealth than to give while one is living—to personally devote oneself to meaningful efforts to improve the human condition.  More importantly, today’s needs are so great and varied that intelligent philanthropic support and positive interventions can have greater value and impact today than if they are delayed.”

Mr. Feeney’s foundation has provided Duke University with a grant to fund Winding Down The Atlantic Philanthropies.  The second in this planned series of reports was released in February.  Its subtitle, 2009-2010: Beginning the Endgame, implies that a shift in focus has arrived, nearly a decade after the board’s historic decision.  The report follows the staff’s attempts to begin “an orderly process to ‘imagine the end of Atlantic’.”  As a tool of transparency, the report provides an inside look into the thinking underway.  It also chronicles the challenges and opportunities presented within this context for two of Atlantic’s major programs—Children & Youth in the United States and Population Health in Viet Nam.

Atlantic Philanthropies has an excellent What We’re Learning section that offers many valuable insights into its work that can be used by others in the field.  In addition to the new report, its predecessor in the Winding Down series, The First Eight Years: 2001-2009, is available for free download or to view.

-- Mark Foley

Creating a Video Annual Report: The Mitchell Kapor Foundation's Experience
April 2, 2012

(Cedric Brown is Chief Executive Officer of Mitchell Kapor Foundation)

Cedric BrownAs much as I hate to admit it, I rarely spend more than 30 seconds looking at annual reports. I'm usually attracted to the paper, design, or lead stories, but don't really delve into the sometimes-substantial reading required to make it through one of these tomes. And who has time? I'm not sure if there's a general trend toward simplification of such publications, but that's what I had in mind in late 2010 when starting to consider a format for the Kapor Foundation's first annual report

Given that we're a small family foundation interested in the intersection of social justice and tech, I wanted to use a tack that would reflect our values, style, and general approach to work. And I especially wanted it to be simple to digest. Daniel Olias Silverman, the Irvine Foundation's fantastic director of communications, advised me that the world is moving to video. And so move we did.

Mitchell Kapor FoundationWorking with the Kapor Center's in-house production team, we scripted brief highlights from the Foundation's areas of work. I wanted each of our staff members and the Kapors themselves to have a role, giving voice to our priorities and accomplishments. This vision was met with a little skepticism and camera shyness. But on the day of the shoot, everyone came through like pros - well, maybe not, but at least our natural selves shone through. We left the footage in the hands of the director, Trevor Parham, who added photos and animation to bring our words and work to life.

When we distributed the video through emailing it and posting it on our website's home page, I hadn't expected to get the kind of positive, "WOW!" reviews that came back to us.  Some of our community partners expressed appreciation for getting the pithy information in an entertaining format (and a little hip hop  beat in the background never hurts). Of course, we didn't win any awards or such, but we accomplished my ultimate goal of explaining what the Foundation does in a way that would be widely and clearly understood. The video format also allows us to be (a certain kind of) green by minimizing the use of paper, to save production money, and perhaps best of all, to have almost three times the distributive reach that we would've had strictly through our mailing list!

So this year, we've taken it a step further. No animation against a green screen this time, but we again aimed to deliver the highlights of our efforts in a concise way, using a knockoff of an increasingly popular format. Check it out.

Watch the video »

I'm now a believer that video is indeed the way to go. If you're thinking about doing the same, I'd advise a few practical things:

  1. Write a narrative that outlines your organization's mission and framework;
  2. Use video or photos of grant recipients and partners in action to help tell your story; and perhaps most importantly,
  3. Videos need not be overly fancy or polished. While we at the Kapor Foundation benefit from an incredibly talented in-house team, I've actually seen interesting work done with flip cam footage and freeware. Just be neat (aesthetically) and tell a good story!

Looking forward to seeing your work next year!

-- Cedric Brown

Mirror, Mirror on the Wall, Who is the Most Transparent of Them All?
March 28, 2012

Logo_omidyar_200

David Sasaki, who works with the Omidyar Network (ON) in Mexico City, wrote in his blog last week that he aspires to be the "most transparent grant-maker in philanthropy," publishing his grants data on his personal blog as well as making it available in XML format using the International Aid Transparency Initiative (IATI) standards - meaning that anyone, anywhere, can access and repurpose his data. Sasaki has promised that within 15 days of a grant being awarded, he will share via his blog the following information:

  • Amount of grant
  • Date that grant agreement was signed
  • Name and link to receiving institution and other organizations involved in the project
  • Name and link to co-funders
  • Summary of grant
  • Contextual analysis of related issues
  • Metrics to gauge the impact of the grant
  • Date and manner that the relevant project will be evaluated

Omidyar and Sasaki are helping to grow the movement for transparency and accountability in philanthropy with this pledge of open grants data. This is the logical next step for one of the eight founding funders of a global effort called the Transparency and Accountability Initiative donor collaborative (TAI), which aims to empower citizens to hold their governments to account. It has been our experience at Glasspockets that funders seldom mention transparency unless they are speaking about grantees or governments, so it is refreshing to see that Omidyar is committing to play a leading role in grantmaker transparency.

The TAI funders' collaborative states on its web site that one of its aims for government transparency is "...encouraging all those working in this field to learn from their successes and failures so that they can have greater impact in the future." This is exactly what Glasspockets aims to do in fostering greater transparency, specifically among grantmakers. Just recently  Omidyar Network's Glasspockets profile was posted to the Glasspockets website and it shows the different ways in which ON is becoming more transparent as well as steps it could take to fulfill Sasaki's aspiration of becoming "the most transparent grantmaker in philanthropy."

The Glasspockets' assessment was developed by pouring over hundreds of foundation web sites to come up with a set of criteria that constitute the best existing practices in online foundation transparency. Of a total of 23 transparency and accountability elements, Omidyar Network meets 14, including making available online its code of conduct policies, conflict of interest policy, whistleblower procedures, and process by which it sets its executive compensation. But like other foundations, it is lacking what many in the field have found the most challenging: sharing details about things like an assessment of the foundation's overall performance, a centralized knowledge base of lessons learned from previous program evaluations, details about its investment policies, and information about its diversity practices. The Glasspockets Heat Map, portrays the information most and least publicly shared by the foundations and shows that Omidyar is not unique in this regard; as many of the 37 foundations that have volunteered for the Glasspockets assessment also lack these elements.

The most challenging criterion for the field to meet is that of assessing overall foundation performance: only 7 of the 37 grantmakers on the Heat Map have some documentation pertaining to overall foundation performance publicly available online. However, given the emphasis many foundations now place on grantee performance and outcomes, and how such assessments can help inform the course of other funders working in similar fields, it is arguably among the most important criterion. The Robert Wood Johnson Foundation, the James Irvine Foundation, and the Commonwealth Fund, just to name a few, have each posted their overall foundation performance assessments publicly. Most recently Humanity United, founded by Pam Omidyar, used its online annual report as a mechanism to assess its overall performance. The Robert Wood Johnson Foundation also developed an internal transparency and accountability scorecard that can be used as a helpful reference by other grantmakers aiming to improve their own transparency practices.

The TAI donor collaborative grantmakers well know from their global government transparency efforts, creating a culture of transparency can be a daunting task requiring influential leaders to build momentum. So thanks to Sasaki and the Omidyar Network for kicking off this important conversation, and leading by example.  Philanthropy is most commonly defined as the use of private wealth for public good. Growing numbers of foundations are discovering that transparency is the best means for putting the public in public good.

Help the philanthropy story unfold, submit your Glasspockets profile today.

-- Janet Camarena

Glasspockets Find: Beyond the Grant Dollars, Hewlett Foundation Explains Tools Available to Support Grantees
January 17, 2012

William and Flora Hewlett Foundation

As we continue to showcase examples of foundations' transparency, Paul Brest, retiring president of the William and Flora Hewlett Foundation, provides a nice window into the thinking behind the foundation's work. Grants aren't the only way the foundation seeks to solve social and environmental problems. In Beyond the Grant Dollars, his opening essay of the recently released 2010 Annual Report, Brest pulls back the curtain to explain the added value of the program staff in magnifying and maximizing impact.

He writes, "The Beyond the Grant Dollars project has two primary objectives:

  • To improve the Foundation staff's and Board's decisions about the mix of strategies and the allocation of financial and human resources that can best achieve our goals.
  • To determine the skills, experience, and other qualities we should look for in new staff members and ways to improve the development of Foundation program staff."

Brest does a fine job detailing a number of ways that funders like the Hewlett Foundation employ staff to get the biggest bang for the buck, all the while trying to keep their eyes on the prize. With solid examples from the foundation's own experience as a highly engaged philanthropist, he thoughtfully presents the rationale for the various tactics mobilized for mission achievement. And, as in the best instances of lessons learned, he does not only discuss successes. In his own words, "potentially high returns also involves a significant risk of failure."

Finally, Brest mentions the desire to capture the substantive knowledge that program staff acquire in their fields and in their various activities and disseminate it for internal use as well as externally "when it has the potential to inform nonprofit organizations, foundations, and others."

View the President's Statement and the full Annual Report, or see past Annual Reports dating back to 1966.

-- Mark Foley

Glasspockets Find: Better transparency for community foundations’ donor-advised funds
December 20, 2011

The Community Foundation of Middle TennesseeDonor-advised funds (DAFs) are an increasingly popular vehicle for philanthropic donors. DAFs are often administered by community foundations and comprise a significant and growing portion of their management portfolios. Grantseekers who visit the Foundation Center often ask about how to learn more about the specifics of securing support from this below-the-radar source of funding, and the truth is many individuals like the privacy aspects a donor-advised fund can provide since little disclosure is required.

A colleague recently shared the 2010 report to the community of The Community Foundation of Middle Tennessee. We both agreed that it did a nice job of providing, in a brief paragraph, some transparency for many of the foundations' DAFs. Here's a sample narrative for the Lady Bird Charitable Advised Fund, established in 2005:

"Lady Bird has been an involved civic leader in this community for decades. Most recently, "President Lady" led the Nashville Rotary Club through a campaign to double its endowment, while serving the Bredesen Administration as President of the Governor's Books from Birth Foundation, which has built on the Imagination Library Program created by Dolly Parton and currently provides free books to more than 170,000 children under age five in Tennessee."

Are there examples of donor-advised funds' transparency to which you would like to draw attention?

-- Mark Foley

Glasspockets Find: Rethinking the Annual Report
April 13, 2011

Kapor_screenshot This week's Glasspockets Find:

The Mitchell Kapor Foundation posted its 2010 Annual Report as a YouTube video. To explain why they chose this novel format, Kapor wrote: "In the spirit of being transparent, paperless, accessible, and plain ol' fun, the Kapor Foundation staff decided to do a video annual report that captures the highlights of 2010." The companion blog post includes links to grant lists and financial data found in traditional annual reports.

As some foundations do away with print materials and move away from traditional annual reports, is Kapor's example the shape of things to come? If you've seen other interesting approaches to the annual report, please share them here.

-- Daniel Matz

Modernizing the 990-PF to Advance the Accountability and Performance of Foundations: Part 2
March 21, 2011

(John Craig is executive vice-president and COO of The Commonwealth Fund. Craig is chair of the Nonprofit Coordinating Committee of New York, and a former chair of The Investment Fund for Foundations (TIFF). He serves on the boards of the TIFF Education Fund, the Greenwall Foundation, the International Women's Health Coalition, and the National Center for Law and Philanthropy, and on the investment committee of the Social Science Research Council.)

The full essay on which this post is based appears in The Commonwealth Fund's 2010 Annual Report.

John E. CraigIn my previous post I discussed some concerning flaws of the Form 990-PF, the tax return filed annually by private foundations. To address these flaws, I present some guidelines to consider for modernizing the 990-PF – a modest proposal, if you will:

The return should prod foundations to use web sites to report information on their programs and performance that cannot be readily conveyed on a tax return. The Foundation Center reports that only 26 percent of foundations have web sites. Surely in the Internet age, maintenance of a site that discloses basic information on the foundation's activities, governance, and management should be a fundamental test of accountability. Foundations should be allowed to detail their charitable activities by linking to their web site. Such sites enable far more comprehensive, timely, and accessible reporting of this information than a tax return can ever achieve.

Craig_pull_quote_3One of the biggest obstacles to e-filing is the return's Part XV requirement to list detailed information on all grants. Foundations should be able to meet the requirement by providing a link and by participating in the Foundation Center's web-based Grantsfire and eGrant Reporting program, which allows foundations to post information on grants nearly in real time or submit such data to the Center on a regular basis. This step would allow raw data on grants by individual foundations to be available on their web sites, while cleaned and structured data would be available through the Foundation Center's electronic databases.

 The reporting of expenses should be disaggregated functionally. Doing so would enable users to readily identify what part of the foundation's expenses is devoted to grants and direct charitable activities, grants administration, endowment management costs, unrelated business costs, and general administration.

The major missing gap of endowment investment performance should be filled. Requiring all foundations with assets of $10 million or more to report the net investment returns on their endowments for each of the last four calendar quarters would quickly produce a comprehensive time series on endowment returns that could be parsed by foundation size, intended life expectancy, and other variables to enable reliable peer benchmarking.

The basic return should be as short and uncomplicated as possible, and written in plain English. Essential tax code terminology should be provided parenthetically. The calculations of the required payout, payout shortfall, and excise tax on investment income should be concise and presented in a format easily followed by lay users. Secondary information should be requested in supplemental schedules. The requirement to list individual securities in the endowment portfolio should be replaced with one aimed at revealing any worrisome concentration of the endowment in a few securities—say, amounting to more than 5 percent.

Craig_pull_quote_4The Commonwealth Fund estimates that with these and other revisions, the annual cost of filing its 990-PF would fall from $18,000 currently to around $10,000—and its return would be more informative.

A revised 990-PF would also improve the principal databases for monitoring foundation activities. Nevertheless, the size and diversity of the foundation sector, the perils of the IRS using limited data to promulgate performance benchmarks, and serious IRS resource constraints lead to the conclusion that the foundation community itself should take primary responsibility for ensuring transparency, accountability, and best-practice adoption. Among the most promising approaches for helping institutions meet these goals is the Foundation Center's web-based Glasspockets project, which is increasing understanding of best practices in foundation transparency and accountability by drawing on information that foundations make available online.

As Foundation Center President Brad Smith argues, greater transparency is the best means to protect the freedom that philanthropies need to pursue their missions. Modernization would make the 990-PF an even more valuable instrument for promoting transparency and accountability and would strengthen the sector's own self-regulatory efforts to ensure effective use of the nation's philanthropic resources.

— John Craig

A Glasspockets Partner Resource: Are Foundation Annual Reports Still Relevant?
December 27, 2010

Talking to Ourselves Report In a digital age where information can be updated from anywhere at anytime, many wonder if the annual report is a thing of the past.  The recently released report, Talking to Ourselves? A Critical Look at Annual Reports in Foundation Communications, and  companion website, WhyAnnualReports.org, are designed to get the conversation going about why foundations issue annual reports and whether they are still relevant. 

A co-production of the Philanthropy Awareness Initiative, the Williams Group, and the Communications Network, the report grew out of a 2008 Communications Network conference session that explored the value of foundation annual reports.

Do you think there is still a role for the Foundation Annual report, or have you retired yours?

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About Transparency Talk

  • Transparency Talk, the Glasspockets blog, is a platform for candid and constructive conversation about foundation transparency and accountability. In this space, Foundation Center highlights strategies, findings, and best practices on the web and in foundations–illuminating the importance of having "glass pockets."

    The views expressed in this blog do not necessarily reflect the views of the Foundation Center.

    Questions and comments may be
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    Janet Camarena
    Director, Transparency Initiatives
    Foundation Center

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