This is a guest post by Tony Wang, a current JD/MBA candidate at Duke University and former philanthropy researcher at Blueprint Research & Design, the William and Flora Hewlett Foundation, and Stanford University.
By Tony Wang
Every sector, including the nonprofit sector, needs transparency AND a healthy marketplace of ideas to combat corruption and inefficiency; transparency so that we can identify problems sooner and a marketplace of ideas to brainstorm solutions. But as a myriad of corporate scandals demonstrate, the information marketplace, like any other market, is vulnerable to market failure. What philanthropy and the nonprofit sector need are better policies to support critical discourse.
What is causing the information market failure?
Take for example the recent Three Cups of Tea scandal. I imagine staff members at Central Asia Institute (CAI) didn’t speak up because they worried how raising a fuss might damage their organization and their individual careers. Additionally, anecdotal evidence suggests several people were aware of the problems at CAI before the 60 Minutes exposé was released. The issue isn’t that we’re unaware of the problems, but rather, people aren’t speaking up.
Although our sector does have its fair share of discussion, I worry about who’s participating. Here on Tactical Philanthropy, for example, the majority of guest posts are authored by consultants and senior executives at foundations.
However, what I find most alarming is the trend of topics discussed here and elsewhere. Consultants and program officers tend to discuss topics like measuring impact, field building, and impact investing because these topics are less likely to offend and are important channels for business development for consultants and help program officers gain visibility for themselves and their foundation. Conversely, more critical and controversial topics like wasteful grants, abuses of power, dysfunctional feedback loops, and poor grantee communication are rarely touched on and do not receive the same level of attention.
(See the spreadsheet I built on Tactical Philanthropy guest posts here. I used my personal judgment to categorize the posts by their degree of criticism.)
In addition to a dearth of financial incentives, there are significant, personal disincentives for critical discourse. If a program officer raises her voice about poor practices in philanthropy, her colleagues will suspect, perhaps correctly, that her opinions draw from her experience at the foundation.
I’m familiar with this issue personally. As a consultant, I became deeply concerned whether current and potential clients frowned upon my blogging and how it affected the reputation of my firm, to the point I abandoned blogging altogether after strong encouragement to do so.
Despite First Amendment protections and the availability of Internet anonymity, feelings of institutional allegiance and desires to avoid conflict, especially with colleagues that we respect and work with every day, cause many of us not to speak up on controversial topics. And because of the unique structure of our sector, where foundations enjoy the power of the purse, criticism of our sector is even harder to come by.
How do we fix our sector’s information marketplace?
A number of actors do play a key role in covering philanthropy’s blind spots. My favorites include academics like Rob Reich and journalists like Stephanie Strom who often play the critic’s role. Philanthropy, in recognition of this issue, even funds watchdog groups like the National Center for Responsive Philanthropy. But all of these actors are external to the organizations that desperately need radical transparency and discourse.
In addition to the critical outsiders, we need the perspectives of critical insiders. We need to support and heed the voice of individuals with critical perspectives, lest philanthropy fall victim to mediocrity.
First, all organizations need to create predefined guidelines on permissible discussion. Instead of a presumption of secrecy that requires an individual to awkwardly ask for permission to express her view, we need a presumption of transparency that shifts the burden to the organization to request individuals not to disclose information and allows an individual to exercise her discretion. Foundations should also provide employees, grantees, and consultants with safeguards to ensure funding is not dependent on an individual’s views.
We also need to openly solicit feedback. Some of the most critical guest posts were in response to the Social Innovation Fund, which actively sought public comment. Sometimes, we also need to solicit feedback in a way that’s anonymous, untraceable, but verified to cover our blind spots. For example, we need forums like TheFunded where grantees are free to criticize foundations in their funding practices and forums that allow program officers to criticize nonprofits and their grant applications, to prevent repeats of Three Cups of Tea. And we need all members of our field, not just senior executives and consultants, to participate in discussion forums like Tactical Philanthropy.
But most importantly, we all need to embrace humility as a virtue, stop thinking we deserve immunity from criticism, and actively listen to those who have the courage to speak out on tough issues.