Why the Nonprofit World Needs 2 Groups to Press Its Agenda

December 21st, 2015 | Posted by admin in Uncategorized

Cross-posted from the Chronicle of Philanthropy

A proposal to merge two of the nonprofit world's major associations -- Independent Sector and the Council on Foundations -- is getting a lot of attention even though it's a wrongheaded solution to a very big and urgent problem.

Emmett Carson, chief executive of the Silicon Valley Community Foundation, suggested the idea of an alliance because he was rightly concerned that neither organization is providing the leadership and vision essential to advancing the views of nonprofits.

That solution, however, is not in the interest of nonprofits or those it serves, especially the poor and other marginalized people.

A merger would leave intact the current weaknesses of both associations and would seriously limit the participation of nonprofits in playing a leadership role.

While Mr. Carson was careful to say his proposal is not a critique of either organization, implicit in his suggestion is that neither the Council on Foundations nor Independent Sector has done a very good job in pursuing public policies and mobilizing influence that could help nonprofits meet today's social and economic challenges.

He notes that both groups have been primarily engaged in talking "to their members about themselves" and focusing on narrow issues such as the tax code and regulations that govern the sector's operations.

His diagnosis of the problem is sadly quite accurate.

The council, which has been on a downward slide for many years, had an opportunity a couple of years ago to select an impressive new CEO. It could have appointed Jeff Clarke, a former vice president of the Rasmuson Foundation, who had been serving as an interim leader and by all accounts had done a great job.

Instead it turned to Vikki Spruill, who had been heading the Ocean Conservancy when she was selected to lead the council in 2012.

So far, neither she nor her staff has demonstrated the qualities and skills needed to resurrect the council into an influential association with a vibrant vision, a strong financial structure, and an enthusiastic membership.

Nor has the association been involved in any efforts to bring about even the mildest philanthropic reforms within its membership -- not saying anything about how foundations can become more innovative or criticizing them for paying excessive trustee fees or pressing them to put more people on their boards who are lower or middle class.

Several of the council's constituencies have been alienated by the new leadership, notably community foundations, thereby leaving the institution less influential than it might have been.

Independent Sector, which under its founder and first chief executive, Brian O'Connell, grew to about 1,100 members and played an important public advocacy role in support of antipoverty policies, now represents about 500 organizations. Of these, more than 100 represent foundations and corporations.

Not surprisingly, those groups have exercised a disproportionately large influence on the organization.

John Gardner, Independent Sector's founding chairman, wanted the membership to be limited to nonprofit groups. He feared that if the organization also represented grant makers, nonprofits would be overshadowed by foundations and would lose power and influence within the organization.

Mr. O'Connell, on the other hand, believed that dual memberships would be a positive way to increase communication and cooperation between the two factions.

To the detriment of nonprofits, Mr. Gardner eventually accepted Mr. O'Connell's position.

In recent years, Independent Sector has remained wedded to the notion that self-regulation is the answer to all the problems in the nonprofit world, despite the evidence that this approach has never succeeded. It has not worked to strengthen or create new regulations or lobby for additional funds to support national and state charity regulators. It has focused much too much attention on maintaining the current level of the charitable deduction at the expense of far more significant issues such as the federal budget, anti-poverty efforts, and the lackluster way nonprofits and foundations operate. It has had a "do-nothing" board that has depended on a strong executive director to set the agenda.

To deal with the problems that Mr. Carson and others have identified, it's time to restructure Independent Sector.

It should be transformed into the entity that Mr. Gardner envisioned, an organization composed solely of nonprofit organizations, large and small. Such an association would no longer depend on the views of grant makers; it would be able to voice the needs, concerns, and policy views of nonprofits, which are often different from the perspectives of grant makers. That approach would allow it to have greater influence with our policy makers and government officials.

There is always a danger that such a potentially powerful group could become undemocratic, overshadowing the interests of smaller or less vocal nonprofits. Serious checks and balances should be built into the organization. A structure that resembles that of the League of Women Voters, with local, state and regional offices, could help ensure some sort of institutional public accountability and democracy.

As for the Council on Foundations, a total makeover is probably necessary.

Perhaps a few leaders of major foundations, large and small, could convene a general assembly, composed of representatives of private, public, community, and corporate foundations, to discuss the problems facing philanthropy and how the Council on Foundations might be reformed or reconstructed to meet the needs and aspirations of the foundation world.

It is difficult to imagine the current council leadership holding such a meeting or series of meetings that might shake up the institution and result in drastic changes. But, painful as it might be, such an effort could mark a new bold step by the council. Whatever happens, something must change or the organization could well be in danger of running out of steam or money or both.

While Mr. Carson's suggestion of a merger is neither wise nor advisable, it is an alarm bell that warns us that not all is well in the nonprofit world. It is a call for introspection and change. And, above all, it speaks to the need for inspired new leadership.

The challenge of finding that new leadership is up to all of us -- nonprofit leaders and foundation executives as well as board members.

It is a challenge we can't afford to put off until tomorrow.

Pablo Eisenberg, a regular Chronicle of Philanthropy contributor, is a senior fellow at the Center for Public and Nonprofit Leadership at the McCourt School of Public Policy at Georgetown University. His email address is pseisenberg@verizon.net.

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