This entry to the One Post Challenge comes from Jeff Tuller. Jeff started his career in the very private sector, with over a decade at financial firms Bear Stearns and State Street Bank. In 2001 he made the leap of faith into the non-profit sector, beginning at the SIFEE Educational Foundation and most recently at The Atlantic Philanthropies. He recently supplemented his MS in Computer Science with an MPA from NYU’s Wagner School for Public Service.
By Jeff Tuller
PreScript: I was just about to send in this entry to the One Post Challenge when I saw today’s earlier entry from the clever yet mysterious blogger behind DontTellTheDonor. In the name of full disclosure, my name is Jeff Tuller (jeff a-t socialmarkets d-o-t org), I am President and Chairman of socialmarkets, and I hereby pledge to offer the following in response:
If my post wins the contest, I will donate not just the $500 prize to the nonprofit which gets the most votes, but an additional $.01 for the first 100 posted comments (a penny for your thoughts??) So if you want to get the best results to the best nonprofit, work those contacts and get those posts rolling in!
We now return you to our regularly scheduled program… let the games begin!
Sleeping With The Enemy
At the recent housewarming for our new nonprofit and the other start-ups that share our co-op workspace here in NYC, we got lots of love for our novel take on the donor-charity relationship. Amid the general enthusiasm, someone suggested it might be burdensome for some nonprofits to adopt the outcomes-based model we champion. This sobering idea was put to bed to seemingly unanimous satisfaction by one of our fans offering this rationale: “Hey, nobody likes being subjected to airport security either, but that’s the reality of today’s world, so you have to just comply or you could get us all blown up…” At the time I didn’t argue the point, but the statement clearly didn’t go down easy, since it’s several weeks later, and there’s a question that’s still dogging me: In the analogy between nonprofit transparency and bomb screening, who are the terrorists?
I just want to know who the bad guys are, whose threat necessitates the humiliating screening process in the first place. Is it me? I like to think not, at least not with my socialmarkets hat on. In a nutshell, socialmarkets is a marketplace which views donations as investments of social capital, and non-profits’ success in meeting stated goals as the basis for the return on that investment. It should be as appealing to nonprofits looking for donors who will appreciate their work, as it is for donors looking for nonprofits who offer the most bang for their buck. Even beyond the funding issue, the measures of success or failure in meeting their goals are hugely valuable for a nonprofit’s own internal management. With all that on tap, I should be in the clear, no?
But I’ve worn several other hats over the years, from under which I’m not sure I as easily dodge the bullet. I’ve worked at a large foundation, where it was easy to call the grantee relationship a ‘partnership’, but less so to divorce that relationship of the inevitable dysfunction when one party is writing checks and the other is waiting by the mailbox. I’ve also worked on Wall Street, where I made a lot of money and gave a little of it away, mostly to assuage the guilt that accompanies being a have in a world increasingly efficient at reminding you how outnumbered you are by have-nots. When I find myself missing the days of fat paychecks and zero-balance credit cards, I console myself with a truly macro-economic perspective: somewhere out there in the cosmic accounting system, I’m carrying far less debt… and guilt.
I also take consolation in that much of what I learned while sporting my Wall Street hat is still applicable today. To wit, I think an investment approach to donating is more than just possible, it’s smart. However donors looking for objective data to help them evaluate their nonprofit investment options currently have no place to turn. For lack of alternatives, they might go to sites like GuideStar and Charity Navigator, which can tell them something about what a nonprofit spends, but nothing about what all that spending accomplishes. That’s like offering half a balance sheet, a pretty pitiful basis for evaluation of an investment in any context.
It was also while wearing my Wall Street hat that I would have agreed with the majority of American donors, whose confidence in nonprofit’s ability to spend their donations wisely is polling at historic lows. Ten years, two non-profits and one MPA later I am happy to report I am whistling a different tune, but sorry to report there are more people who think like I did then out there now. I actually know some of these people, and for the most part they’re not evil, they’re just lazy. An occasional highly publicized nonprofit scandal is all they need to reinforce the convenient image of the nonprofit sector as poorly managed across the board.
So the fickle finger of blame may point back to me, but I share it with a conspiracy of guilty parties. The people giving money as well as those taking it bear some responsibility for the mistrust which sustains the status quo. I’ll buy the analogy that philanthropy wants to fly, and with a little poetry, even soar – but unlike the real flight industry, there are actually no players in our game invested in bringing the plane down. Both charities and their supporters are co-invested in the successful execution of the missions which specify their particular vision of a better world. That’s a pretty powerful starting point for re-examining the way we see ourselves, including the recognition that the thing we’re so afraid of might just be our own reflection.
Jeff Tuller wrote; “In the analogy between nonprofit transparency and bomb screening, who are the terrorists?”
GREAT question! I’d like to change it just a bit … “of whom are we afraid?”
I’m afraid of the people in charge … the ones REALLY in charge (at least in theory and law), the volunteer Boards of Directors.
It doesn’t take a terrorist to crash a plane. It can happen as the result of amateur pilots flying jumbo-jets, the same amateur pilots trusting auto-pilot, quasi-trained flight controllers (who only show up when there is no conflict with a personal engagement), or so many pilots on board that each is convinced there is someone else flying the plane.
Volunteer directors are lovely people, smart people, rich people, committed people, etc. But they are often uninformed about their role, their power, and — most importantly — their social responsibility, what I refer to as the “ethical imperative” of stewardship.
As long as volunteer boards have no one to whom they MUST answer for their decisions, actions and impact on the community, (however “community” is defined), as long as there are really no fundamental certifications required for election/appointment to a voluntary leadership position, as long as there are no consequences for letting the plane drift or crash, I say, “Be afraid … be VERY afraid.”
Okay, that might be overly dramatic, however, all the universities, think tanks, trade associations, consultants, watchdogs, Sarbanes-Oxley threats, and, yes, even charity mavens such as myself, are whistling into the wind as long as voluntary boards
continue to exercise their crucial roles as they currently do.
After 25 years in this sector, I firmly believe that until the issue of un-accountable voluntary leadership is addressed, the sector will make but tiny advances in changing the world.
In my home community, not a terribly large one, there are over 250 charitable organizations meeting vital, and some not-so-vital, needs. What a force for community impact!
Nearly three thousand volunteer leaders hold the reins (and the pocketbooks) that could change this corner of the world. And I can guarantee that virtually none of them have been touched in their leadership work by the many studies, conferences, books, blogs and blue-ribbon commissions, cooperatives, collaboratives, and white papers that our sector so highly values and respects.
Until that breach is somehow addressed — or until community changemakers move away from a board-meeting mentality — each of us as donors has the burden of assessing whether any given board is comprised of individuals whom we trust as dearly as we do our family’s financial advisory team.
You can call this approach tactical, strategic, philanthropreneurial, or any other nifty term. I call it common sense, smart generosity, and minding the Ps and Qs that matter.
I hesitate to get on a jetliner flown by amateurs and guided by untrained controllers who have nothing to lose. Every donor and funder should hesitate, too.
Jeff, thanks for asking a great question!
It seems that many potential donors are disheartened over the way money has been spent in recent years by major nonprofits in a variety of fields. When a donor gives their hard earned $20 to a national charity, they want to know that it’s going to do some good somewhere. But, donors are now learning that money given to HSUS for Katrina or in for helping the pit bulls in the Vick case was not spent properly.
Transparency in donation reporting may help. Sadly, it’s hard to build a relationship with a donor if the charity has to spout facts and declare all decimal points of previous spending.
Should donors only give money to local organizations where they can see the effects? Consider it an investment for their own community, creating an endowment of sorts to make the greatest impact in their own neighborhoods. At least the donor would be able to keep closer tabs on their investment and see the cause and effect relationship take hold.
Jeff said “The thing we’re so afraid of might just be our own reflection.”
No mirror bright
begging transparency delight will help me see
the percent that goes to thee justifiably. ErnestO
I vote for Coalition For The Homeless
I vote for New York’s Coalition for the Homeless
I vote for New York’s Coalition For The Homeless.
I vote for Coalition for the Homeless
I vote for New York’s Coalition For The Homeless
Pride at Work better be watching this post…
I vote for the Coalition for the Homeless.