Transparency Talk

Category: "Why Transparency" (146 posts)

The Foundation Transparency Challenge
November 2, 2016

Janet CamarenaI often get asked which foundations are the most transparent, closely followed by the more skeptical line of questioning about whether the field of philanthropy is actually becoming more transparent, or just talking more about it.  When Glasspockets launched six years ago, a little less than 7 percent of foundations had a web presence; today that has grown to a still underwhelming 10 percent.  So, the reality is that transparency remains a challenge for the majority of foundations, but some are making it a priority to open up their work. 

Our new Foundation Transparency Challenge infographic is designed to help foundations tackle the transparency challenge. It provides an at-a-glance overview of how and why foundations are prioritizing transparency, inventories common strengths and pain points across the field, and highlights good examples that can serve as inspiration for others in areas that represent particular challenges to the field. 

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Using data gathered from the 81 foundations that have taken and shared the “Who Has Glass Pockets?” transparency assessment, we identified transparency trends and then displayed these trends by the benefits to philanthropy, demonstrating the field's strengths and weaknesses when it comes to working more openly.

Transparency Comfort Zone

Despite the uniqueness of each philanthropic institution, looking at the data this way does seem to reveal that the majority of foundations consider a few elements as natural starting points in their journey to transparency.  As we look across the infographic, this foundation transparency comfort zone could be identified by those elements that are shared by almost all participating foundations:

  • Contact Information
  • Mission Statement
  • Grantmaking Priorities
  • Grantmaking Process
  • Key Staff List

Transparency Pain Points

On the flip side, the infographic also reveals the toughest transparency challenges for philanthropy, those elements that are shared by the fewest participating funders:

  • Assessments of Overall Foundation Performance
  • Diversity Data
  • Executive Compensation Process
  • Grantee Feedback
  • Open Licensing Policies
  • Strategic Plans

What’s In It for Me?

Community of Shared LearningOnce we start talking about the pain points, we often get questions about why foundations should share certain elements, so the infographic identifies the primary benefit for each transparency element.  Some elements could fit in multiple categories, but for each element, we tried to identify the primary benefit as a way to assess where there is currently the most attention, and where there is room for improvement. When viewed this way, there are areas of great strength or at least balance between strengths and weaknesses in participating foundations when it comes to opening up elements that build credibility and public trust, and those that serve to strengthen grantee relationship-building.  And the infographic also illustrates that philanthropic transparency is at its weakest when it comes to opening up its knowledge to build a community of shared learning.  For a field like philanthropy that is built not just on good deeds but on the experimentation of good ideas, prioritizing knowledge sharing may well be the area in which philanthropy has the most to gain by improving openness. 

“The reality is that transparency remains a challenge of foundations, but some are making it a priority to open up their work.”

And speaking of shared learning, there is much to be learned from the foundation examples that exist by virtue of participating in the “Who Has Glass Pockets?” assessment process. Our transparency team often receives requests for good examples of how other foundations are sharing information regarding diversity, codes of conduct, or knowledge sharing just to name a few, so based on the most frequently requested samples, the infographic links to actual foundation web pages that can serve as a model to others.

Don’t know what a good Code of Conduct looks like?  No problem, check out the samples we link to from The Commonwealth Fund and the Alfred P. Sloan Foundation. Don’t know how to tackle sharing your foundation’s diversity data?  Don’t reinvent the wheel, check out the good examples we flagged from The California Endowment, The Rockefeller Foundation, and Rockefeller Brothers Fund. A total of 19 peer examples, across seven challenging transparency indicators are offered up to help your foundation address common transparency pain points.

Why did we pick these particular examples, you might ask?  Watch this space for a follow-up blog that dives into what makes these good examples in each category.

#GlasspocketsChallenge

And more importantly, do you have good examples to share from your foundation’s transparency efforts? Add your content to our growing Glasspockets community by completing our transparency self-assessment form or by sharing your ideas with us on Twitter @glasspockets with #GlasspocketsChallenge and you might be among those featured next time!

--Janet Camarena

 

Free Webinar: What Story Does Your 990 Tell About Your Foundation?
September 22, 2016

What does your foundation’s 990 say about the organization? 

Now that the IRS has started releasing e-filed Forms 990 and 990-PF as machine-readable, open data is available to the public. While this move will spur transparency and openness in the philanthropy field, foundation leaders may be uncertain of how open data and potential public scrutiny of philanthropy may impact foundation programs, staffing and investment management. 

Glasspockets recently partnered with the Communications Network to offer an insightful webinar on the Form 990’s potential risks and vulnerabilities, as well as how to use Form 990 to share the work of your organization. 

The webinar highlights the types of information included on the 990-PF, how the 990-PF data is being used now and in the future, and recommendations on how to communicate your foundation’s work through the 990-PF.

Check out this great webinar!

A Brief Analysis of the Clinton and Trump Foundations
September 13, 2016

(Jacob Harold is GuideStar president and CEO.  He has written extensively on climate change and philanthropic strategy; his essays have been used as course materials at Stanford, Duke, Wharton, Harvard, Oxford, and Tsinghua. This post first ran on the GuideStar blog.)

Nonprofits are a cornerstone of American democracy. They reflect the political diversity of the American people. That diversity is well illustrated by two institutions currently in the news: the Bill, Hillary and Chelsea Clinton Foundation and the Donald J. Trump Foundation.

GuideStar takes no position on elections and we will not comment on Hillary Clinton or Donald Trump as candidates for the presidency. We have, however, been repeatedly asked about the Trump and Clinton Foundations. Accordingly, we would like to offer a few notes of analysis on their structure, size, strategy, and transparency practices.

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Structure

Let us begin with a comparison of the basic facts. The Trump Foundation is legally categorized as a “private non-operating foundation” whereas the Clinton Foundation is a “public charity.” In simple terms that means the Trump Foundation is meant primarily as a vehicle for distributing grants from the Trump family fortune—although it also accepts funding from other donors. The Clinton Foundation is meant primarily as a vehicle for directly operating programs for the social good—while also making some grants to other organizations. 

Despite these differences, both organizations are, in a (non-legal) sense, “celebrity foundations.” They are seeded by money donated by their founders and also serve as a vehicle for members of the public to demonstrate their support of a prominent person. At their worst, celebrity foundations are vanity projects with negligible impact. At their best, such organizations channel fragmented resources and yield extraordinary impact for society. For example, the Michael J. Fox Foundation is known as one of the most sophisticated players in the fight against Parkinson’s Disease.  

Both the Trump Foundation and the Clinton Foundation are filed under section 501(c)(3) of the U.S. tax code, meaning they legally cannot engage in electoral activity. In general, they appear to have followed this requirement. There is at least one exception, though. The Trump Foundation made one donation to a political action committee associated with Florida Attorney General Bondi. It is not legal for a foundation to make a donation to a PAC; the Trump Foundation has paid a $2,500 IRS fine for this infraction. The the Trump Foundation characterized this as a clerical error although others have described it as a case of "pay-to-play politics." At the very least, this incident indicates insufficient controls and lax managerial oversight.      

Size

One thing is indisputable: the Clinton Foundation is far larger than the Trump Foundation. The latest comparable data from December 31st, 2014 shows the Clinton Foundation with assets of $354 million, compared with the Trump Foundation’s $1 million. The Clinton Foundation had total expenses of $91,281,145, versus $596,450 for the Trump Foundation. The Clinton Foundation had 486 staff compared to zero staff at the Trump Foundation.  

The Clinton family’s tax returns suggest that the majority of its charitable giving has been through the Clinton Foundation. Without access to Mr. Trump’s tax forms it is difficult to know the scale of his charitable activities outside the Trump Foundation. But it does appear that the dollars have not matched the pledges. An investigation by the Washington Post has not been able to validate that Trump has actually donated the money he pledged, instead finding, “Trump promised millions to charity. We found less than $10,000 over 7 years.” In addition, the last donation to the Trump Foundation by any of its trustees—family or otherwise—was in 2008. Indeed, David Farhenthold of the Post has suggested that the Trump Foundation has transformed over the last decade from "standard-issue rich person’s philanthropy into a charity that allowed a rich man to be philanthropic for free."

All told, the data at hand would suggest that the Clinton family has—at least over the last several years—donated more money (and at a far higher proportion of their wealth) than the Trump family.

Similarly, it appears clear that the Clintons have out-raised Trump. The Clintons’ fundraising for their foundation is one aspect of a broader fundraising portfolio totaling $3 billion over the last four decades. This is a remarkable number but they are not alone operating at this level: the Bush family raised $2.4 billion over a similar period. Trump has certainly helped raise money for both charitable and electoral efforts, but the total is undoubtedly less than the Clintons’. 

Fundraising at this scale takes place in a rarefied social circle. Each of these families—the Clintons, the Bushes, and the Trumps—must navigate a tangle of relationships with wealthy individuals. These relationships have caused some to claim that fundraising for the Clinton Foundation compromised Clinton’s role as Secretary of State. There appears, though, to be little evidence to support this claim. The Clinton Foundation signed an MOU in 2008 clarifying that Hillary Clinton would not have a role with the Foundation during her tenure at the State Department. And, indeed, funding for the Clinton Foundation decreased significantly during that period (2009-2013). A fair argument can be made that the Clinton Foundation should have been more aggressive in dealing with the perception of potential conflict. To its credit, the Foundation now proactively shares its key legal and audit documentation and has built a tool on its website to provide an additional layer of transparency about its donors (including both Donald and Ivanka Trump). 

Transparency and Strategy

Transparency is not a guarantee of effectiveness—but, in general, we believe that transparency is correlated with excellence in nonprofits. Transparency indicates an openness to questions and accountability. And, importantly, the act of transparency can force an organization to be clear about its goals and strategy.

Most nonprofits—including the Trump and Clinton Foundations—are required by law to file a regulatory document with the IRS, the Form 990. The 990 provides important baseline information but does not give a full view of the nuances of nonprofit work. Accordingly, GuideStar invites nonprofits and foundations to share additional data. Approximately 128,000 have done so. Some 34,997 organizations have provided enough to get one of GuideStar’s four “transparency seals”; of those, 1,061 have earned the highest level, Platinum. The Clinton Foundation is one of them. The Trump Foundation has provided no additional information and so has not earned a transparency seal. 

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As a part of achieving a Platinum seal, the Clinton Foundation has provided a set of quantitative metrics about its programs. For example, one metric, “number of farmers benefitting from access to improved agricultural practices, increased yields, and enhanced market access,” rose from 66,124 in 2014 to 114,825 in 2015. Another, the “number of girls and women provided access to job skills training and livelihood support,” rose from 35,587 in 2014 to 48,696 in 2015. The fact that the Clinton Foundation provides such metrics makes it far easier for donors and citizens to meaningfully analyze the institution’s value to society.

The Trump Foundation provides no such metrics. Any analysis must therefore be based on the content of publicly available tax forms. These forms appear to indicate an unfocused generosity. For example, the below sample from the Trump Foundation's 2014 tax return includes grants to the Orthopaedic Foundation, the Palm Beach Opera, the Police Athletic League, Protect our Winters, and the Ronald McDonald House of New York. There is nothing inherently wrong with sprinkling many small grants in unrelated areas. But the Trump Foundation’s approach would certainly not meet the standard of focused, proactive grantmaking commonly called “strategic philanthropy.” 

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Conclusion

Both the Clinton and Trump Foundations have been the subject of controversy while seeking to contribute to social good. They are undoubtedly different from each other in size, structure, and openness. Indeed, the two organizations reflect the perceived styles of the two candidates: one systematized, the other improvisational. Donors regularly decide which approach they prefer for their giving. Later this year voters will decide which approach they prefer for their leadership.

--Jacob Harold

YouthGiving.org: Opening Up the Power of Youth as Grantmakers
September 7, 2016

(Sarah Bahn is a former Foundation Center knowledge services fellow. She is currently pursuing a Bachelor of Arts in peace and justice studies at Tufts University. A version of this blog first ran on the GrantSpace blog.)

SarahbahnWhen I enrolled in the “Experimenting with Philanthropy” course at my college, I had the opportunity to work with a board of my peers to distribute $10,000 to local nonprofits. After so many years of being a dedicated supporter of the nonprofit sector—from childhood bake sale fundraising to volunteering at homeless shelters and completing summer internships—I finally felt like I was playing a real, powerful role in the social sector. I only wish I had known to get involved with grantmaking sooner.

Engaging youth in grantmaking increases their agency and leadership skills while also bringing much needed fresh perspective to the field. After the course, I became passionate about the need for young people, even children and teens, to act as real leaders in philanthropy.

BREAKING NEWS: They already are! When I started interning at Foundation Center this summer, I dove in to help with the launch of YouthGiving.org, a website that gathers and shares information about the youth giving movement so that young changemakers, and the adults who support them, can access amazing tools for youth grantmaking, like:

  • A funding map tracking youth-driven grants around the world
  • A program directory with over 800 youth grantmaking programs
  • Hundreds of resources about engaging youth in philanthropy
  • News about the movement, upcoming events, blog posts from experts, and LOTS MORE!

If this information had been easily accessible in this way when I was younger, I would have known that there are at least 14 youth grantmaking programs where I grew up (Washington state), 35 in Massachusetts where I attend school, and hundreds more around the world! It turns out that there are A LOT of people who are also passionate about young people being leaders in the social sector. Check out the Program Directory to find youth giving programs where you live.

“ Youth grantmaking is not just a cute group of kiddos running a lemonade stand for charity, although that's great, too!”

Thanks to YouthGiving.org making this philanthropic movement more transparent, the whole world can now see that there are tons of young people who are making real, tangible change in their communities. In fact, youth have made more than $14 million in grants since 2001 (check out grants data on the Funding Map) -- youth grantmaking is not just a cute group of kiddos running a lemonade stand for charity, although that's great, too!

YouthGiving.org connects members of the youth giving movement, elevates the stories of incredible young leaders, and  serves to make the field of grantmaking more inclusive as more young people can now see themselves as active leaders in philanthropy.  By expanding knowledge and collaboration about youth giving, more young people can access grantmaking opportunities and those who do will see the impact their peers are making across the globe. 

Transparency for the youth giving movement is critical because it illuminates the ways in which young people have been raising their voices to move the needle on the issues they care about. As this resource gains traction, I hope that other young people like me will know that they’re not alone in thinking that youth deserve a space at the grantmaking table.

-- Sarah Bahn

2016 Olympic Games: What Rio Doesn’t Want the World to See
August 9, 2016

(Leticia Osorio is a program officer at Ford Foundation. This post first ran in Ford Foundation’s Equals Change blog.)

Leticia_osorio_0142cWith the 2016 Summer Olympics in Rio de Janeiro under way, it is clear the Olympic legacy already falls short of its initial promises to the city.

 Rio is still dealing with inadequate and unfinished infrastructure projects and overinflated costs, on top of the economic and political instability facing Brazil. These unfilled promises mimic the disorganization and corruption from the 2014 World Cup in Rio.

Both games brought promises of meaningful transformations for Rio’s citizens, but instead ended up violating human rights, increasing public debt, and concentrating expensive infrastructure mostly in developed neighborhoods.

Six million people live in the city of Rio de Janeiro, and one in four of them are poor residents living in slums called favelas. In preparing for the World Cup and Olympics, the city government announced a comprehensive development plan that they called the social legacy plan. The favelas have long been starved of investment in public infrastructure, so the prospect of new developments and upgrades was exciting. Instead, the plan only further segregated poor residents.

In Providencia, Rio’s oldest slum, the main project was the construction of a $20 million cable car. While developers promised the cable car would connect residents to jobs, in reality 30 percent of residents were threatened with forced evictions to make way for the project. Not only was the community unaware of the project beforehand, but it also had no input in the draft planning or approval processes.

OLYMPIC PROTEST PHOTO

 The damaging effects of the Olympics on Rio’s poor residents

Widespread threats of forced removals of citizens from their neighborhoods for development projects related to major sporting events in Rio have been controversial. The Popular Committee on the World Cup and the Olympics— a civil society network comprising social movements, NGOs, research centers and universities— estimates that from 2009 to 2015, 22,059 families were forcibly uprooted from their homes for development projects related to these events.

 Agencia Publica, an investigative journalism outlet and a Ford Foundation grantee, told the stories of 100 evicted families, providing them a voice through one of the largest multimedia investigations related to the Olympics. According to Agencia Publica's co-director Natalia Viana, these firsthand stories provide “concrete evidence of serious human rights violations, of the right to housing, to freedom of movement, to information and even freedom of expression.”

Fifty days before the opening of the Olympics, the governor of Rio declared a state of financial emergency and asked for federal support to avoid a collapse in public security, health, education, transportation, and environmental management.

The cost of the Rio Olympics is estimated to be more than $10 billion and that does not include all of the tax exemptions, public loans, and fiscal incentives that have not been disclosed. The government gave special legal exemptions to developers, allowing them to circumvent planning and urban laws, restrict civil liberties, waive mandatory environmental analyses, ban local and informal businesses, and criminalize public protests.

“ More than 90 percent of the 900 families in the low-income community of Vila Autodromo were forcibly relocated to make way for the Olympic Park.”

The NGO Justiça Global, another Ford partner, produced a video series of four episodes telling how such measures are felt disproportionately by those who are already not well protected, such as those with insecure housing, informal jobs, or already suffering from marginalization and discrimination.

For example, more than 90 percent of the 900 families living in the low-income community of Vila Autodromo were forcibly relocated to make way for the Olympic Park, even though most of them held land concessions titles granted by the state. Although compensation and nearby alternative housing was offered, many families resisted leaving, prompting violent clashes with police. The residents felt they were excluded and disturbed by the games for the capital interests of wealthy developers.

In reaction to the negative impacts related to these infrastructure projects, Rio’s government has responded by blocking access to information and reducing transparency. The organization Article 19, another Ford grantee, put in 39 Freedom of Information requests on the impact of the construction of the Transolimpica bus rapid transit system on the lives of the families whose homes are in the way of the new bus system. But only one was fully answered. It was impossible to find out information on the final route of the bus system, although hundreds of families had already been forcibly displaced.

Additionally, more than 2,500 people killed by the police in Rio since 2009, as reported by Ford grantee Amnesty International. In the month of May alone, 40 people were killed by police officers on duty in the city and 84 across the state. The communities most affected by this violence are those living in slums located around the main access routes to and from the international airport and competition arenas.

Involving communities to ensure shared benefits

While cities agree to host major sporting events based on the premise that the resulting development and legacy will benefit everyone, wealthy developers are usually the ones that get all of the gains at the expense of residents, especially those who are poor and marginalized. So what is happening in Rio is not a new story.

What is new is that communities in Rio are starting to push back. A robust civil society network came together to monitor and collect information on development processes, expenditures, and rights violations. It helped residents speak out against harmful development plans and get compensation for those being displaced. The network submitted reports to international organizations, including the Inter-American Commission on Human Rights and various United Nations mechanisms. Communities became the defenders of their own rights, and they sought the assistance of powerful institutions like the Public Defender’s Office and the UN Special Rapporteur on Adequate Housing, leveraging alternative planning and national and international advocacy.

The alliances established between communities and relevant stakeholders were unfortunately not enough to reconfigure the existing power relationship between the city government and the residents. The laws that were passed to relax tender regulations and urbanistic controls did not ban forced evictions or set procedural safeguards, and there was no broad public debate over the nature of improvements needed.

Governments and public managers still need to learn how a city can stage world events successfully while also respecting the rights of the communities living in the path of infrastructure projects. Participatory development and stricter international regulation is a good place to start. Just like how government and business elites organize and lobby to host these games, we must help communities organize and defend their rights to ensure that they are truly benefitting from the development and investment associated with these games.

-- Leticia Osorio

Flooding the Locks: Philanthropy’s Knowledge Conduits
August 3, 2016

 Panama Canal Authority Photo 3

(Adriana Jimenez is grants manager at the Surdna Foundation and also serves on the board of directors of the Grants Managers Network.  She is a regular Transparency Talk contributor and discusses issues pertaining to transparency, data, and grants management.)

Adriana ImageThe Panama Canal expansion project opened last June following several delays and controversies. It was a risky bet with promising outcomes.

While the expansion aimed to improve global trade by doubling the canal’s capacity, it now runs the risk of failure from faulty design. The project was wrought with conflicts of interest, imprecise data, and dubious processes; its stakeholders consider critiques of the canal “unpatriotic,” reluctant to learn from mistakes.

Uniquely positioned to embrace risk, foundations should tread outside their comfort zone to achieve large-scale, systemic change; but they should also learn from the Panama Canal’s massive gamble. When making big bets, transparency, data-informed decisions, accountability, and clarity of process lead to better outcomes. “Success” means having honest conversations about what’s working and what’s not, rather than aiming for perfection.

As foundations move to take on more risk — including increased knowledge-sharing and openness, advocacy funding, financial risk, and impact investing — they will need to operate with greater transparency and accountability. Their staffing functions will evolve to support them in this process. The field of grants management is already shifting in this direction. At many organizations, grants managers are pushing for increased innovation, transparency, collaboration, and improved systems that will lead to more impact.

“Uniquely positioned to embrace risk, foundations should tread outside their comfort zone to achieve large-scale, systemic change.”

From Data Processing to Knowledge Management

Grants management is changing from a process and compliance role to one that focuses on data analysis, information sharing, and knowledge management. According to the 2016 Grants Managers Network Salary & Jobs Survey, grants managers now spend approximately 25% of their time on functions of information/knowledge, evaluation, and strategy (with an additional 14% on data management), and only 10% on compliance and 11% on administrative support.

This evolution has occurred naturally as grants managers work with larger amounts of data, fueled by increasingly powerful technological platforms and processing power. Within this change, we are moving up the ladder on the Data, Information, Knowledge and Wisdom Pyramid from merely processing data, to helping foundations analyze it and convert it into valuable, meaningful information and knowledge. As grants managers, we now play a key role in strategy by facilitating smarter, data-informed grantmaking.

GMNsalarysurveycover-768x994Like the locks of a canal, grants managers ensure that the right data flows out of our organizations at the right time. We are on the frontlines of providing data and information for external surveys; 990 tax returns; mapping tools; annual reports; foundation websites and searchable public databases; etc. We may also participate in collaborative efforts such as the Foundation Center’s e-Reporting and hGrant, or help implement the principles of IssueLab’s Open Knowlege (for example, by appropriately coding and tagging data, and linking our grants management systems with open repositories for knowledge-sharing, analysis and learning; or by adding open-licensing requirements to our grant contracts). The data and information we deliver allows foundations to deepen impact through collaboration with the field.

Supporting Instinct: Data-Driven Grantmaking Policies

Grants managers can also help foundations set internal policies and procedures that are driven by data, not just habit or inertia. For example, statistics showing a low percentage of grants to new organizations might trigger a change in a funder’s letter of inquiry process to promote more openness through Requests for Proposals (RFPs). Other data might be used to assuage fear of change or generate internal buy-in at the board and/or staff levels. In many cases such data supports — not contradicts — staff and boards’ instinct for change, and leads to increased openness and trust by demonstrating that policy decisions are not arbitrary.

“‘Success’ means having honest conversations about what’s working and what’s not, rather than aiming for perfection.”

At the Surdna Foundation, three years of grantmaking data were used to show that transitioning a portion of the grants approval process from quarterly board approvals to monthly delegated grant approvals would streamline operations, liberate time for “bigger-picture” learning, and benefit grantees by eliminating five weeks from the proposal review process.

In 2014, The William and Flora Hewlett Foundation internally reviewed ten years of grantmaking data and discovered a drop in the average duration of its overall grants. To offset this trend, the Foundation’s grants management team used this data point to advocate with their board for the creation of a “Duration Fund” that would renew Hewlett’s commitment to multi-year support, reduce grantee uncertainty, and lessen administrative burdens. Likewise, statistics showing a lower-than-expected percentage of general operating support grants triggered a conversation around increasing unrestricted support --- when used appropriately to advance strategy --- in accordance with the Foundation’s values. Since embarking on its initial ten-year review, Hewlett’s grants management team has been spearheading the assessment of its grantmaking data each year to identify areas for foundation-wide policy improvements.

Tracking Diversity Data

Grants managers are playing a key role in the movement to increase transparency around diversity in philanthropy. By collecting demographic data (including race, ethnicity and gender) about the staff and board composition of their grantees, foundations can hold themselves accountable to values of diversity, equity and inclusion in their grantmaking portfolios, and make progress towards mission and goals.

Trends tweetC 1024x512Many grants managers are leading the process of collecting, structuring, and sharing this aggregate data (often based on D5 Coalition principles) with organizations such as GuideStar and Foundation Center, bringing greater transparency and understanding of diversity in foundation giving. Diversity data can also help funders track how organizations and fields evolve over time, and contribute to the broader body of public information about trends among nonprofits.   

Glasspockets includes Diversity Policies and Diversity Data indicators in its Transparency Trends tool. According to these indicators, 46% of participating foundations make their diversity policies publically available, and 7% share information on the demographics of their own staff and boards (The James Irvine Foundation, for instance, includes this information as an infographic on its annual report).

Legal and Financial Compliance: Pushing the Boundaries of Risk

Transitioning to a more strategic, knowledge management-based role has helped grants managers keep sight of the end goal of their compliance functions, i.e., to create greater impact. Contrary to the perception of compliance as a “risk-averse” function, many grants managers are using the due diligence process to maximize their foundations’ boldest efforts, pushing for greater risk-taking and transparency. In this context, our role is to assess, communicate, and document risk --- not avoid it --- to help foundations make informed decisions about potential rewards and trade-offs.  This shift has occurred as grants managers are increasingly included in strategic conversations “upstream” with program staff and senior leadership.

Advocacy funding is one example. Due to common fears and misconceptions around 501(c)3 lobbying limitations (and certain funders’ hesitation to support these expenses), grantseekers sometimes conceal activities linked to the dreaded “L” word in their proposals.  Foundations should encourage the opposite. With a nuanced understanding of the rules of nonprofit lobbying and advocacy funding, grants managers can foster honesty and openness with applicants about their proposed activities, clarify legal limitations, and encourage lobbying where appropriate as a critical tool towards achieving positive systemic change.

Throughout the due diligence process, grants managers can also advise grantees and program staff on financial issues, and lead constructive discussions with grantseekers to build trust and set expectations from the onset.

Rather than reducing organizations to a set of ratios or denying funding based on numbers, we can advise on alternate ways to structure a grant to provide greater impact (such as providing a capacity-building grant or using a fiscal sponsor). Many of these scenarios require creativity and flexibility to make the grant viable despite all obstacles; some funding may also be riskier in nature (such as exercising expenditure responsibility in countries opposed to civil society, or supporting new entities with no financial track record), but nonetheless more effective.

CEP-Investing-and-Social-ImpactImpact Investments: The Riskiest Bet

The move toward impact investments has arguably been one of philanthropy’s biggest bets as foundations struggle to maintain the balance between purpose and perpetuity (or timely spend-down). According to the Center for Effective Philanthropy’s 2015 Investing and Social Impact report, 41% of foundations now engage in impact investing (including Mission-Related Investments and Program-Related Investments), and another 6% plan to do so in the future. This shift has substantial implications for the staffing of foundations, and some are tapping into the skills of grants management to fill the gaps.

In particular, grants managers are playing a key role in the due diligence process for Program-Related Investments (PRIs), transferring our knowledge and skills from the financial compliance processes. We are also building out systems to track and monitor loan repayments and reporting. Through these functions we act as a bridge between finance and programs, contributing towards organizational learning and mission.

As a leader in the impact investment space, the Kresge Foundation was the first to develop a PRI module in Fluxx (now available to all Fluxx users) to better capture the nuances and complexities of PRIs.  The build out was led by the Foundation’s Program Operations and Information Management department (formerly known as its grants management department, but recently renamed to reflect the totality of its strategic functions).

Transferring PRIs into Kresge’s grants management system has made the Foundation’s processes more transparent, says Marcus McGrew, Director of Program Operations and Information Management: “All of the Foundation’s work that lived in people’s heads has now been consolidated into one data management platform.”

Transparency of PRIs and other impact investments will become increasingly critical as 990 tax returns are now available as machine-readable, open data, and as the line between endowment and program strategies continues to blur.

Like the philanthropic sector, success of the Panama Canal will depend on leaders’ humility and willingness to learn from failure. This will require implementing best practices to ensure the locks flow as intended. If transparency and accountability matter for the world’s greatest engineering feat, they matter for philanthropy.

--Adriana Jimenez

Get Open: Leaders Reflect on Glasspockets' Impact
July 27, 2016

Let Glasspockets help your foundation achieve greater heights. Sharing strategy, knowledge, processes, and best practices in philanthropy is better for everyone – from the grantmakers to grantees and the communities they serve.

But don't take our word for it...

In our new video, Glasspockets: Making the Case for Transparency, philanthropy leaders - including representatives from the Barr Foundation, Ford Foundation, The William and Flora Hewlett Foundation, Conrad N. Hilton Foundation, among others - reflect on the positive impact that Glasspockets and working more openly has made on their work.

Get Open - join the "Glass Pockets" movement today!

Start with taking and sharing our "Who Has Glass Pockets?" transparency self-assessment.

-- Melissa Moy

What's Your Story?: Q&A with Kenneth Rainin Foundation's Amanda Flores-Witte
July 21, 2016

(The Kenneth Rainin Foundation, which recently joined the Glasspockets transparency movement, shares how innovation, technology and creativity played a role in telling its story in its annual report. Janet Camerena is director of transparency initiatives at Foundation Center. Amanda Flores-Witte is senior communications officer at Kenneth Rainin Foundation.)

Janet Camarena: Increasingly, foundations are wondering whether there is still a need for the time and expense of issuing an Annual Report. The thinking goes that with the advent of informative foundation websites, that perhaps the annual report is an antiquated ritual. The Kenneth Rainin Foundation recently updated this ritual by issuing its Turning Points 2015 Year in Review as an entirely online resource, creatively using video and the Medium platform to tell the story of the road you traveled last year. Can you begin by telling us why your foundation determined the annual report exercise, whatever the format, was still a worthwhile one?

Amanda Flores-WitteAmanda Flores-Witte: When we set out to work on any project, our aim is never to do something solely because it is expected or because we did it that way last time. We get curious and ask questions, while revisiting our goals and keeping transparency in mind. This is exactly the approach we took when thinking about our year in review. We challenged ourselves to think creatively about how we could best share our story while highlighting the work of our grantees and partners.

Fortunately, technology has breathed new life into annual reports by offering a variety of tools, platforms, and formats, and more innovative ways to share information and engage readers. We felt that a summary that highlighted the year's activities-or captured the turning points in each program area-would be a valuable tool for people to get to know the Kenneth Rainin Foundation and learn about our progress. We thought an online report would allow us the flexibility to present our story in an interactive format using text, photos, audio and video, and make the report more interactive. We know that people engage with content in different ways and use a variety of devices to access it, so it was important for us to also have the ability to leverage our assets and promote the report on social media, our website and our newsletter.

JC: The Kenneth Rainin Foundation emphasizes innovation, and the word "cutting edge" comes up a lot throughout the organization, including in the mission. I imagine this must set the bar pretty high - that your own communications be cutting edge? Beyond the Annual Report, are there other ways that you try to live up to that "cutting edge" aspiration when it comes to telling the story of the foundation?

AFW: We strive to be authentic and shine a bright light on the terrific work our grantees are doing, as well as build our presence online, which is where people tend to spend a great deal of time. Being innovative means that we are continually revisiting how we communicate our work-is there a better, more effective or more inspiring way to accomplish our goals? We are always curious about what other organizations are doing and enjoy exploring. In addition, our board of directors and staff are not shy about sharing their ideas and challenging us to think bigger or look at projects through a different lens. There is nothing more exciting to us than brainstorming an idea and then diving in to research how to best execute it. Kenneth Rainin FoundationWe value flexibility and being open minded as our projects evolve. We also realize there are risks involved when we embrace new or unconventional ideas. In our organization, staff members have the freedom to experiment. This way of thinking is at the heart of all our programs. We realize that some things might be less successful than we wanted, and there will be successes we didn't anticipate. Either way, we always learn valuable lessons that we can apply to the next big idea.

JC: Next, let's talk about the formats, beginning with the Medium platform. What is Medium, and why did you decide this was the right platform for the Rainin Foundation to tell its story? And what kinds of criteria should foundations use to determine whether Medium might be right for them?

AFW: We worked with a consultant who understood our requirements and helped us explore different avenues and tools that could help us accomplish our goals. Ultimately, we decided that Medium would be the ideal platform for creating a media-rich presentation while also giving us the opportunity to amplify our voice and access an expanded audience.

Medium is an online publishing platform that was founded in 2012 and has evolved into a community of 30 million monthly users, according to a January 2016 CNN story. It has become such a popular publishing platform that even the White House, Bono and the Gates Foundation use it.

Criteria for whether to use Medium will vary depending on what an organization wants to accomplish. For us, it was important to have a platform that was easy to use and incorporated performance metrics. We didn't want to get bogged down trying to master a new technology. Medium is user-friendly and intuitive, and the visual design closely aligns with the Foundation's desired aesthetics-a clean presentation with plenty of white space. Medium also exposes us to a broader audience, which is hard to get elsewhere, and the platform makes the post shareable. The trade-off is that Medium's standard features, which make it very simple to use, can feel limiting. If you are looking for more customization or want flexibility with typefaces, color and layout, Medium may not be the best choice.

JC: The videos that you produced as part of the Turning Points 2015 progress report were particularly effective in humanizing the foundation. More often we see grantee videos on a foundation site, but you deliberately chose to put your own team on camera. However, being in front of a camera can be intimidating. Can you share with us how you prepared your team for it, and whether you have any advice for foundations around who tells the story, and how to prepare them? And please share any other general advice you have for foundations about how to prepare and use video to share the progress of their work.

AFW: We think it's important to share experiences and stories authentically, and video can be an effective tool to accomplish this objective.

Before we embark on a new project, we develop a creative brief to think about our audience and what we want them to feel or take away from an experience. This brief ensures that stakeholders are all on the same page, which gives the project a strong start and basis for ongoing evaluation.

For our CEO and staff videos, we hired a talented video team who helped everyone feel at ease and made the process fun-this was really important to us. A few days before the shoot, we provided our staff with a couple of questions to answer about a stand-out moment they had in 2015, and then checked in with them before filming to ensure they had an idea of what they wanted to get across. We didn't rehearse with them, nor did we do a lot of takes during filming.

We loved capturing the personalities of our program staff in a more informal way and allowing viewers to hear the story directly from the staff person who experienced it. By being willing to improvise a bit, we were able to capture memorable moments. Of course, our approach to video production changes according to our project goals. Some projects are impromptu, while others may require much more planning.

JC: Are there other foundations or nonprofit organizations that inspire you when it comes to opening up their work in interesting or new ways? Share some examples.

AFW: We're fortunate to work in a field where so many people do fantastic work, take risks and share it with the world. There are numerous resources, and we count the Communications Network as one of the best places to access tools and expertise. We are continually inspired by the work of other foundations and organizations. Some of our favorite sources for inspiration include the James Irvine Foundation; the Bill and Melinda Gates Foundation; the Evelyn and Walter Haas, Jr. Fund; The San Francisco Foundation; the Robin Hood Foundation; and many, many others. We often reach out to foundations for referrals and learn about their approach to a project, the challenges they encountered, and their overall experience. We want to especially thank Daniel Silverman at the James Irvine Foundation. He's been so gracious with his time and advice, no matter how many times we contact him.

JC: You spoke about performance metrics earlier. What has your audience response been like for both the video and Medium? And how are you measuring their impact?

AFW: The response has been positive. We have surpassed 5,000 video views, which is a strong showing relative to our target audience. Last year for the Medium post, our goal was to engage 12% of our email list. We surpassed this number, quadrupling our goal. This year, we're hitting our targets for views and interaction, and anticipate that the numbers will continue to increase throughout the year, as they did in 2015. It's interesting to note, however, that the videos are garnering more attention than the Medium post, which is something we'll take into account in our planning for the next end-of-year report.

We're always looking to strengthen how we measure impact. For this project, we analyze how people engage with the information on our website, third party websites (Vimeo and Medium) and social media. We look at responses and comments, viewing and reading times, and shares. One big takeaway for us has been the need to continually promote the report and videos in the foundation's communications, staff email signatures, and by leveraging and repurposing the content in creative ways.

JC: Will this be the framework you use for your 2016 Year in Review, or do you have something new and "cutting edge" you're considering?

AFW: We're not locked into a specific framework. Like all of our projects, we will reflect and ask ourselves, "Is this still working? What can we do better? What did we learn?"...so stay tuned.

Glasspockets Find: Exponent Philanthropy Video Series Encourages Transparency
July 14, 2016

(Melissa Moy is special projects associate for Glasspockets.)

Embracing failure has the potential to maximize effective and impact in philanthropy.  This trend of self-reflection and sharing lessons learned among foundation and funder leaders is upping the ante on the need for transparency and opening up the work of grantmakers.

Exponent Philanthropy – a philanthropic membership organization representing approximately 2,300 foundations and funders – won a Fund for Shared Insight grant last year to produce a video series that shares wisdom and best practices in philanthropy. The videos will delve into how foundations can be more open about how they work, why and how they make their decisions, and the lessons they have learned – both good and bad.

This year, Explonent Philanthropy released a total of nine Philanthropy Lessons videos that highlight tips and best practices for funders, grantees and philanthropy work. 

Among the videos, the importance of transparency and the tricky topic of evaluation are explored.  How can funders and grantees communicate honestly with one another, and with the communities they serve?  How can impact and effectiveness be measured?  What criteria should be used? 

Several funders acknowledged the challenge in evaluating the effectiveness of grantees and the measures used.  One funder likened the overzealousness of foundation reports to “overjudginess,” where foundation expectations of grantees may be unfair.  Another funder said it’s OK for a grantee to fall short of their program objectives; instead, he expected grantees to be honest and explain the encountered challenges and barriers.

Miguel Milanes, vice president of Allegany Franciscan Ministries (also profiled on Glasspockets), described the importance of flexibility and listening, truly listening to grantees.

Milanes’ organization had given a $2,000 grant to help preserve Mexican American culture through traditional dance and requested a written report on the project outcomes.  Unable to speak or write in English, two grantee representatives gave a face-to-face report to Milanes and shared two binders full of photos and receipts documenting the project.

“It was more important than any report I’ve ever received,” Milanes said of the unorthodox grant report.  “That was a seminal moment.  It changed the way we did our grantmaking and our reporting.  We accept other types of reports and documents on the grants we make.”

Other foundation leaders raised questions about the how and why of evaluation.  Would pre-and post-test survey results really show the impact of helping a human trafficking survivor?  Is the requirement of sending an international fax report of every attendance list for an African HIV women’s program excessive and costly?

Exponent Philanthropy’s innovative project also invites website visitors and funders to share their lessons and personal stories on the website and also via social media using #MyPhilLesson. 

One website visitor, Lisa Tessarowicz of The CALM Foundation, shared how being “uncomfortable” and not having the answers actually helps foundations to think creatively, take more risks to “experiment more and think critically” about how money is given away.

We look forward to seeing more stories from funders, grantees and community at large.  It will interesting to see what grantmaking leaders glean from their experiences with grantees, and how they will apply these important lessons to improve philanthropy and elevate transparency.

--Melissa Moy

Building the Social Sector's Collective Brain Trust: Redesigned IssueLab Launched
June 23, 2016

(Janet Camarena is director of transparency initiatives at Foundation Center.)

Janet Camarena

Recently when I was helping my son cultivate his ant farm, I learned that a lone ant is a dead ant.  Ants are the ultimate collective, working in teams, and by doing so, they accomplish amazing feats that no lone ant alone could do. 

Do Ants Know Something Foundations Don’t?

As you may know from unwelcome encounters in your home, ants tend to move very effectively by moving in swarms.  They operate with what scientists call a “collective brain” or “swarm intelligence” that helps them share knowledge, move quickly over great distances, build bridges and highways, organize, and make collective decisions that accomplish tasks that they couldn’t do alone. 

"IssueLab’s relaunched website has almost 20,000 knowledge resources, covering 38 different issue areas, from 7,000+ organizations around the world."

Philanthropy by contrast is increasingly fragmented, with individual foundations developing and often holding lessons learned, strategic direction, and operating plans close to their vests. Yet, like ants, they are often trying to move proverbial mountains and accomplish goals that a single institution can’t do alone. So, is there something we can learn from the insect world, much like how observing bird flight informed and inspired the development of aircraft?  Can we observe insects to inform the development of collective intelligence?

There is hope here in that increasingly, philanthropy articles and conferences are turning to the theme of collective impact, and knowledge sharing, which are in many ways a departure from the current practice in philanthropy in which fragmentation - or the “lone ant” phenomenon - tends to be the prevailing norm. And there is also hope in the form of new tools that are available to you to help us all work smarter, provided we commit to take advantage of them.

Moving Toward a Collective Brain Trust

New tools recently launched by IssueLab may give us all a roadmap to how to go from struggling, lone ants to mighty ants. IssueLab’s relaunched website has almost 20,000 knowledge resources, covering 38 different issue areas, from 7,000+ organizations around the world. Each resource includes links to the full report, and helpful data, such as article abstracts, related articles, and author information. 

Many of these resources include lessons learned and were funded directly by foundations. Together, IssueLab resources represent one of the greatest assets of the social sector, provided they remain easily findable and usable by others.

The Path to Open Knowledge

Toward that end, IssueLab's relaunched website also includes helpful resources aimed at helping the social sector commit to creating a culture of open knowledge. The website includes recommended principles and also tactical practices that organizations can adopt to move toward this vision of a collective brain trust, from which we can all mutually benefit.

Given the critical connection between transparency and shared learning, earlier this year Glasspockets added Open Licensing to the "Who Has Glass Pockets?" transparency self-assessment profile. Since this is one of our newest elements, and it is an emerging practice among foundations, we want to draw particular attention to a set of tools now available on IssueLab's redesigned site that aim to demystify the path to open knowledge.

IssueLab breaks it down into the following practices:

  • Articulating an open knowledge policy; 
  • Using open licensing on all knowledge products; 
  • Using open knowledge repositories like IssueLab to catalog and better share your work; and 
  • Using a shared descriptive vocabulary, such as schema.org, on your organization’s website to make it easier to discover and index knowledge products.

To learn more about each practice, visit IssueLab's Open Knowledge area.

How Can We Know What Others Know?

And to continue building a bigger and bigger brain trust that truly represents the shared knowledge of our labors, the redesigned IssueLab also makes it easier for anyone to upload, find, and freely share research by providing metadata and links to original documents on publishers' websites.

New features include:

  • An improved interface that makes it easier and faster to upload research to IssueLab and share items via a website, blog, or on social media.
  • Filtered search, the ability to curate user libraries, and "what to read next" suggestions for related research.
  • The ability to use Digital Object Identifiers (DOIs) to increase a document's long-term accessibility across the Internet and on archival sites like WorldCat, the world's largest library catalog.
  • Metadata such as keyword search, date published, geography, and language to facilitate powerful searching and browsing capabilities.

Visit IssueLab to start collecting, connecting, and sharing knowledge, and just maybe collectively moving mountains.

--Janet Camarena

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
    directed to:

    Janet Camarena
    Director, Transparency Initiatives
    Foundation Center

    If you are interested in being a
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