In January, Rachel's Network members joined Henry Berman, CEO of the Association of Small Foundations (ASF), for an informative teleconference call on how the current economic and political climate has influenced charitable giving and what philanthropists should keep in mind as they plan their funding in the coming years.
We followed up with Henry to learn more about the issues that keep him up at night, what philanthropic trends give him hope, and much more. Here's our Expert Q&A with Henry...
What about your work keeps you up at night?
A few pressing questions regarding the future of philanthropy that I think about-both personally as a trustee and on behalf of all ASF members-fall into the "keep me up at night" category, mostly because they are indeed questions for which there are no easy answers.
- The future of foundations: Will foundations continue to exist, given the five percent payout requirement for foundations and an environment of lower returns? How does one balance making prudent investments with the need to generate enough funds to distribute and operate, and remain in existence? Of course this begs a question about what constitutes perpetuity in the life of a foundation. Should they exist forever? Do the pressing issues of today supersede the unknown of tomorrow?
- Tax deductibility: Will Congress look (as they have hinted at with university endowments) at the "other" 95 percent held by foundations and decide something should be done with those funds? In the same vein, I keep waiting for someone to suggest that tax deductible donations made overseas, sometimes to organizations in countries at odds with United States foreign policy, be eliminated.
- A cap on deductions: Regarding personal giving, what effect might a cap on deductions have? Would people give less? Would nonprofits be hurt, or would there be a Darwinian effect where only the fittest survive? Would that be good or bad?
- Rating the "value" of grantees: I've heard conversations about somehow ranking grant recipients by some kind of level of value or importance. For example, a donation to a food kitchen might be considered more "valuable" than one to the opera. For me, this is extremely dangerous territory for the government - no matter which party is in control - to enter. The larger question involves donor intent and, of course, what one person sees as critical may be less so to another.
What about your work gives you hope?
Two things in particular make me believe the future of small-staff philanthropy is bright. ASF's work gives me a front row seat to progress in these two areas; and I'm excited by what I see.
- At the end of 2008, as the economic downturn began, I observed a "silver lining." When philanthropic assets were reduced, many donors increased the degree to which they aligned their giving with their passions and goals. There will never be enough money to address every issue, so the imperative to maximize impact cannot be understated.
- The interest, commitment and enthusiasm I see in young philanthropists. Their desire to go beyond writing a check and to support causes important to them with their time, ideas, and sweat equity is infectious. Their willingness to learn, share, and support one another - as they support greater society - give me hope for the future of our sector and the impact we can make together.
What organization do you support (other than your own) that is advancing issues important to you?
Cottonwood Gulch: For over 40 years I have been associated with Cottonwood Gulch, a summer program in New Mexico that takes young girls and boys on wilderness expeditions using the Southwest as a giant outdoor learning laboratory. Gulch programs foster scientific, historic, and cultural discovery, as well as personal growth and a knowledgeable environmental ethic. To this day I can easily trace my respect for land, water, and diverse cultures to my time in the forests and deserts, canyons and mountains, tents, cabins, and hogans of the Southwest. I've seen many lives - including my own - greatly influenced by the exposure to the natural world while also learning to be part of a group.
What woman leader or role model had an influence on your work or inspired you?
There are two women who've had an incredible influence on me. First, Edith Shoolman, the family friend who established a foundation of which I am the co-trustee. For close to eight years - when she was in her nineties - I learned from her about giving and receiving, speaking up and listening, and the importance of relationships. Edith also taught me about perspective. An avid gardener and nature lover, she would be inundated with large flower arrangements on her birthdays and holidays. Her response: "Why are they spending money on me? Isn't there a child who needs shoes or glasses or books?" I think of those words often, as her legacy has a large influence on my philanthropy as well as how I approach donors when asking for support of ASF.
At the other end of the age spectrum is Lindsay Hyde, a young woman I met when the foundation funded Strong Women, Strong Girls, which Lindsay established. Lindsay began SWSG as an undergraduate student, and today the program is thriving in three cities: Boston, Pittsburgh, and Miami. Their mission is: "to utilize the lessons learned from strong women throughout history to encourage girls and young women to become strong women themselves. By building communities of women committed to supporting positive social change, Strong Women, Strong Girls works to create cycles of mutual empowerment for women and girls." Lindsay's energy and enthusiasm captured my attention on an initial site visit and she continues to inspire me for her vision, leadership, and commitment to a strong future for today's young girls.
What should people know about your work, but they don't?
Most people define the ASF membership in quantitative terms, meaning foundations with few or no staff, yet a far more appropriate way to describe our members - and would-be members - is qualitatively. We know from our recently completed strategic planning process that ASF attracts philanthropists who share certain behavioral traits. Our members are rooted in their communities, whether that is geographic or programmatic. They are passionate about their wide-ranging causes and demonstrate nimbleness, responsiveness, and agility in their giving. As an organization, ASF is committed to supporting all who share these traits, regardless of their giving vehicle. Our commitment is to effective, high-impact philanthropy. We are not prescriptive about where one should give. We are, however, passionate that they give thoughtfully.
Henry Berman leads ASF in facilitating rich peer-to-peer exchanges and helping the organization provide members with insight and guidance on important issues, practices, and regulations affecting small foundations. Follow Henry at twitter.com/henry_asf.
Rachel's Network is a national nonprofit that harnesses the collective influence of women environmental philanthropists. This is a group of extraordinary women -- including foundation trustees, board directors, major donors, investors, and respected community leaders -- who put their values into action. Our monthly calls give Network members the opportunity to learn about important issues and trends from experts on the vanguard of the environmental and philanthropic sectors. Follow Rachel's Network at twitter.com/rachelsnetwork.