What does philanthropy incentivise?

I was delighted to read Vanessa Meachen’s (Philanthropy Australia) most recent contribution to the Alliance Magazine Blog.  She tackled that not often talked about elephant in the room – the grantmaker and grantseeker power imbalance. The issue is an important one to highlight and one that we’ve only addressed in stealth on this blog.

One of the key issues Vanessa highlights is that the power imbalance creates a criticism vacuum, where few grantmakers, philanthropists or high net worth individuals are criticised for their giving practices (or lack thereof). As the satirical Scottish writer Thomas Carlye once said ‘the greatest of faults is to be conscious of none’. Without this criticism sectoral improvement is left to be driven by those who think it practical as opposed to those who know it to be a necessity.

I’ve noticed another interesting issue that appears to have its roots within this power imbalance. For funders it’s that proposal that just doesn’t pass the ‘smell test’.  It’s the application that may be beautifully written, with all the right language and yet something just doesn’t feel right. On many occasions these proposals tend to be for programs that have been dramatically changed to fit with the funder’s guidelines or created simply for the purpose of attracting resources. When I see this happening I begin to worry, not only about the power imbalance and hoops good organisations need to jump through to access funds, but also the practices philanthropy is incentivising.

Many nonprofits are forced to access administration monies for their ‘core’ activities by seeking funds for supplementary programs and placing operational costs within the budget. Does that behaviour mean that philanthropy, and grantmakers more generally, are left dictating through their funding objectives what programs the community most needs?

The latest Leading Learning in Education and Philanthropy (LLEAP) survey report shows some interesting connections between the priorities of philanthropy and nonprofits. There is a striking similarity between who philanthropy and nonprofits see as the top target audiences for support in education (they both see secondary school aged students and disadvantaged students as their number 1 & 2).  Yet, when schools were asked who they see as the most important audience for support, they responded primary school aged students (ranked 6th and equal 2nd by nonprofits and philanthropy respectively) and teachers (ranked 9th and 11th). So is this a case of nonprofits not listening to the needs of schools or are they being forced to prioritise audiences that are more likely to garner support from philanthropy? Who is influencing who in this instance? In truth, it could be a pattern we are seeing for a number of reasons but what LLEAP does provide us with is a conversation starter around incentives.

The grantmaker/grantseeker power imbalance exists. Grantmakers need to be aware of it when developing their programs.  The imbalance also highlights the need for philanthropy to stay connected to the broader nonprofit sector and to continually listen to the needs of those at the coalface. Good funders will reflect and review their grantmaking approaches and objectives regularly to ensure they are meeting a need as opposed to creating a market.

You can follow the musings of Caitriona Fay on twitter via @cat_fay or the blog @3eggphil


The LLEAP Survey Report: A conversation starter for education funders

It was exciting yesterday to see the release of the 2011 Survey Report for the Leading Learning in Education and Philanthropy (LLEAP) research study. The Report documents the responses to the inaugural LLEAP survey provided by 300 schools, non-profits and philanthropic bodies working in the education space.

The release of the Report marks the first real milestone for the LLEAP team and everyone involved in shaping the research program. Those organisations and individuals who have given their time generously to be involved in the interview phase, focus groups and in the completion of the survey have done so out of a commitment to finding better ways to work towards improving educational outcomes.

The LLEAP research is the first of its kind in Australia to bring together schools, non-profits and trusts & foundations to examine the role and impact of philanthropy in education.

For me, one of the more eye-opening aspects of the Report relates to the number of disconnects in priorities and target audiences among respondent schools, non-profits and philanthropic organisations. This is perhaps best demonstrated by schools clearly ranking teachers and teacher quality highly in terms of need for support and yet this need is not reflected in the highest priorities of philanthropic and non-profit respondents.

There are three main themes to come out of the Report with respect to the barriers faced by schools, non-profits and philanthropy.  For schools, it’s that their capacity to find and access philanthropic dollars is poor. For non-profits, the issue of short term funding and program sustainability is hindering their capacity to be as effective as they could be. For philanthropy the barriers are what the report refers to as “knowledge issues” (specifically the who, how and why of collaboration and best practice).

The great thing about the Survey Report is that it is a conversation starter.  The survey results are simply that; survey results. How we use and interpret the results however can potentially influence our practices and decision making. We’ll be exploring some of the issues the Report has thrown up on this blog in the coming weeks and would love you to join in the on the conversation.

Caitriona Fay is a member of the LLEAP Project Team. You can follow her musings on Twitter via @cat_fay and get the latest from the Eggs via @3eggphil