2012 Trends in Philanthropy – Political Advocacy

As promised this post is going to continue to examine some of the trends for 2012 highlighted in Philanthropy and Social Investment Blueprint 2012 – the annual industry forecast produced by Lucy Bernholz.  In my last post I looked at the first of three major shifts identified in the Blueprint, today I’ll be moving on to trend number two: the implications of the US Supreme Court‘s Citizens United ruling on philanthropy and social investing.

There is no doubt that grantmakers here in Australia have a lot to learn from philanthropy overseas. I am often reminded however that much of how and why we practice philanthropy is unique.  By constantly casting an eye towards North  America and Europe we risk failing to recognise and value the innovation taking place in our own backyard. So what can we here in Australia possibly learn from examining the potential implications of the Citizens United US Supreme Court decision?

Before I address that question in detail, it probably serves to give a quick rundown on what that Supreme Court decision actually amounts to. In short Citizen United removed prior restrictions on spending by corporations on election campaigns; in essence allowing these bodies the similar first amendment rights to free speech as everyday American citizens. These newly available dollars will certainly come into play in 2012, the first presidential election year since the ruling was handed down. Rather than promoting and opposing political candidates or parties directly, much of the funding from corporations is likely to flow via non profit organisations advocating on issues that serve their purpose. It is the implication of that funding process has some interesting cross over with Australia.

Around the same time that Citizens United was taking it’s case to the US Supreme Court, here in Australia an international aid watch dog called Aid/WATCH was taking its fight to hold on to its charitable tax exemptions to the High Court. In Australia, like in the US, the judges ruled in their favour. The decision asserted that Aid/WATCH, as an independent watch-dog examining how aid is distributed, may well be involved in political advocacy.  Because the generation of public debate created by Aid/WATCH through their advocacy focused on the relief of poverty through foreign aid, the Judges ruled that it should not be excluded as a charitable activity. This ruling opened up direct funding of political advocacy by charitable trusts and foundations, ensuring that neither the donor, or the non-profit they were supporting, put their charitable status at risk. The Eggs have posted previously on the new place for advocacy in the Australian non-profit sector, but perhaps we have not explored the potential implications for donors in full.

In an environment more open to political advocacy from our non-profits, what are the potential implications on donors and ultimately donations? In the US, it’s likely that the Citizens United decision will lead to not only more political advocacy from non-profits but also more non-profits being created with a focus on raising money for or against their preferred candidates and issues.  Here in Australia, the likelihood is that we’re gong to see a greater intensity of out and out advocacy.  For some funders, the thought of seeing their long supported charities engaged in the political might be too much to bear.  For other funders it will open up spheres of influence like never before.

I’ve spoken with people on both sides of the advocacy fence, those that find philanthropic support of political advocacy unseemly and those that see it as critical vehicle in mission based philanthropy. Not all philanthropic organisations in Australia believe or want to be mission driven, the warm heart of benevolence for many is still the greatest motivator. There will always be a place for both. I do sense however, that the new wave of youth and online philanthropy in this country will drive a new era of donor funded advocacy.

Should you wish to learn more about the trends in philanthropy and social investment for 2012, I’d encourage you to get your hands on a copy of Blueprint 2012:

  • Hard copies from Lulu
  • PDFs at Scribd
  • Kindle version from Amazon
  • eBook from Smashwords. Also available for Amazon Kindle, B & N Nook and others.

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


Blueprint 2012 – Looking at the new social economy

Religious readers of this blog (my parents) know that more than once I’ve spruiked the value of Lucy Bernholz’s Philanthropy 2173 blog. It’s a great read for those interested in emerging trends in philanthropy and social investment. Lucy, a self confessed philanthropy-wonk and  visiting scholar at the Stanford University Center on Philanthropy and Civil Society, also publishes a much anticipated annual industry forecast.  I got my hands on a copy of the Philanthropy and Social Investing 2012 Blueprint just before Christmas and it was a great way to both end 2011 and prepare for 2012.

The 2012 Blueprint is ultimately aimed at assisting “donors, investors and enterprise leaders address three big shifts in 2012”.

  1. Finding your way in the new social economy in which philanthropy and impact investing now operate
  2. Considering the implications of the Citizens United decision on philanthropy and social investing
  3. Making sense of data as a public good

On initial reading you’d be forgiven for thinking points 1 and 3 are the only ones that could possibly relate to an Australian context, but interestingly the potential implications of the Citizens United Supreme Court decision in the Unites States provides a couple of ‘ah-ha’ moments around the potential future of Australian philanthropic investments in light of our own High Court’s Aid/WATCH ruling (more on that later). I’m going to explore all three big shifts on this blog a little further over the next week. Today I’ll be taking a peek at the first of the identified big shifts; Finding your way in the new social economy.

One of the big statements of the 2012 Blueprint concerns the need to shift our traditional perspectives on non-profit/donor interactions to a much broader frame that encompasses the multiplicity of ways private resources are today being used for public good. This is a shift to the social economy frame and acknowledges a greater diversity of players, stakeholders and influencers in the resourcing of the ‘public good’. Lucy lists three main ‘galaxies’ as being at play within the social economy: impact investing, political giving, and charitable giving. Here in Australia are we too focused on exploring charitable giving without consideration to the role of those two other galaxies?

It’s fair to say impact investing in Australia is lagging well behind the United States and UK, but 2011 was a big year for the sector (think SEDIF, Hepburn Wind & the NSW Government Social Impact Bonds* announcement). While political giving may not be natural space of play within our system, the Australian High Court’s Aid/WATCH ruling has the potential to change traditional interactions between political parties, donors and non-profits (if donors and non-profits can cope with the cultural change required in this sphere of influence).

In short the interactions between these galaxies within the Australian context are happening at a growing rate and the influence each is expelling on the other needs greater examination.  The 2012 Blueprint helps to explore this beautifully:

Donors today are choosing between and among philanthropy, impact investing and political giving to pursue their goals…the line between the galaxies are clear, other times they are blurry.

As an example, a donor today may choose to pursue their interests in protecting the environment by funding direct landscape restoration & maintenance.  Alternatively they may decide to invest in a community wind farm project or support direct political advocacy with the aim of removing cattle grazing from a national park.

Lucy’s exploration of the social economy and the different galaxy of players has me thinking more and more about who is in the room when conversations about funding and tackling social and environmental problems are actually being had. Are we (donors & doers) actively excluding each other and if so, why? Lucy once again sums it up best:

It is not enough to focus only on philanthropy and nonprofits; rather we need to understand the changing dynamics of the whole economy over time…..The key to our future is accepting that our old assumptions about “which sector does what” may no longer hold.

It’s fair to say that despite opening with a statement on American political giving in the 2012 presidential campaign year, the Blueprint is packed with an enormous amount of content that will be of interest to Australian social investors. For those interested in where the shifts are happening, what the buzzwords of 2012 are likely to be, as well as a prediction on where the social economy is heading, then a copy of the 2012 Blueprint is a must.

You can get your hands on the 2012 Blueprint the following ways:

  • Hard copies from Lulu
  • PDFs at Scribd
  • Kindle version from Amazon
  • eBook from Smashwords. Also available for Amazon Kindle, B & N Nook and others.

*Interestingly Social Impact Bond is on the 2012 Blueprint Buzzword Watch List


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

Verbal reporting… the next step in effective philanthropy?

Louise Kuramoto is a Grant Researcher at the Myer Family Company. She works with families, foundation and corporates providing philanthropic research, administration and strategic advice with regard to their philanthropy.

Engaging effectively with grantees is something that many philanthropists and philanthrocrats alike strive to achieve but are we really getting it right? And when I talk of ‘engaging effectively’ I am not talking of post application feedback but rather the day-to-day relationships you hold with your grantees.

So, where do you sit on the spectrum? Think of a program you have funded and ask yourself three questions;

1. Do I have the direct contact details of the person managing or responsible for the program and have I had a conversation with them?

2. Can I explain the program’s three main challenges to achieving its objectives?

3. Am I aware of the program’s progression (or otherwise!) in the last six to twelve months?

For those of you who could not confidently answer ‘yes’ to each of the above questions you may want to give verbal reporting further consideration.

Otherwise known as face-to-face reporting, verbal reporting is a tool that some foundations have been using to varying degrees as a way to truly understand the organisations they fund and the complexities and challenges of the areas in which they work. Foundation staff cite that the reduction of paperwork for both the funded organisation and the philanthropic body is a bonus, but the real benefits of verbal reporting lie in the face-to-face interactions they have with their grantees. It is these face-to-face meetings they state, that have proved to facilitate a more open and honest dialogue between the two parties, consequently enabling the foundation to form a true partnership with its grantees and in turn, yield better results.

The Myer Family Company, in collaboration with The Portland House Foundation, held a forum late last year to explore this topic further, specifically focusing on The Portland House Foundation’s reporting model which encompasses:

  • A high trust, low documentation process;
  • The CEO or leader of the funded organisation committing to attend at least one face-to-face reporting meeting per year (this meeting would also include a number of other funded organisations who verbally report on their projects); and
  • Supplementary documentation (such as financials etc.) is requested as needed.

The organisations represented at the forum also described the verbal reporting process as highly beneficial to their work because it provides a ‘safe’ environment whereby their organisational and project challenges can be offered for discussion and brainstorming with the donor and other attendees. This point is especially pertinent for us philanthropists/crats, who have a tendency to focus on financial giving and at times underestimate the value of the non-financial support we are able to offer. Whether it’s as a sounding board to discuss program design or harnessing the skills, knowledge or networks of board members, the value these links and expertise can leverage is often much more than any monetary figure the donor could provide.

So next time you seek an update on a particular project or receive an application in the mail, think about picking up the phone and organising a meeting with your grantee, it might change your outlook entirely.

You can follow Louise on Twitter @LouKuramoto or the Myer Family Company via @MF_Philanthropy

Australian Philanthropy in 2011 – A review

Welcome to 2012 philanthrocrats. On behalf of the Eggs, I hope you had a safe and wonderful festive season.

Apart from the occassional overindulgence in food and frivolity I often find my festive season filled with reflections on the year past. Dinner conversations quickly turn to the ‘best of’ lists; movies, albums, theatre and so on. 2011 is certainly a year worth reflection in terms of philanthropy in Australia. The year, in my mind at least, marked the beginning of what is going to be a period of tremendous change in the non-profit sector in this country.

Over the next few blogs we’re going to reflect on the 2011 year that was and look at what 2012 has in store for the philanthropic and grantmaking sector in Australia. We’ll be taking a look at Philanthropy and Social Investing: Blueprint 2012, the annual industry forecast released by Lucy Bernholz, philanthropy wonk and visiting scholar at Stanford University’s Centre on Philanthropy and Civil Society. The Blueprint presents some interesting Australian parallels with what is happening in the charitable and philanthropic sectors in the United States.

But before we kick off 2012, perhaps it’s time to undertake a ‘best of’ type list for philanthropy in 2011. Rather than focusing on the best of 2011 it might be more useful to look at the big movements, moments and changes of 2011. What happened that really influenced the way philanthropy was and is working in Australia? What were the important gifts? The most talked about projects? The most influential policies? Please feel free to share your comments, views or even your own list in the comments sector below, as it would be a terrific resource to revisit at the end of 2012.

So here it is, in no particular order, my Top 10 list of big movements, moments and changes in Australian philanthropy in 2011.

1. Disaster and Emergency relief: It’s hard to believe that a year has passed since the Queensland and Victorian Floods devastated both States. Unfortunately, those floods set the scene for what was a year of natural disasters in our backyard, with Japan and New Zealand both devastated by earthquakes. Giving at all scales was greatly influenced by these events and there is much to learn about how best to manage this outpouring of philanthropy in the future.

2. Statutory Definition of Charity Announcement: The 2011/2012 Federal Budget announcement on the implementation of a statutory definition of charity was met with mixed views from within the non-profit sector. Many in philanthropy have applauded the commitment as it will assist in providing greater clarity around what and who can be funded in the wake of the AID/Watch and Word Investment High Court decisions.

3. Research into Philanthropy: Two significant inaugural annual pieces of philanthropic sector research were launched in 2011 and initial results from both proved hot talking points. Research into Australian philanthropic funding for women and girls was conducted by the Australian Centre for Philanthropy and Nonprofit Studies at Queensland University of Technology for the Australian Women Donors Network while the Leading Learning in Education and Philanthropy (LLEAP) research project was launches by the Australian Council for Education Research and The Ian Potter Foundation. It’s great to see greater attention going into how we give and where the money goes and to what end.

4. Public Ancillary Fund Guidelines: One of the big legislative changes for the philanthropic sector in 2011 was undoubtedly the drafting and passing of new Public Ancillary Fund Guidelines that, according to Treasury, aim to improve the regulatory framework and ultimately the integrity of these public philanthropic funds. The Guidelines also provide direction on minimum distribution rates, brining Public Funds into line with their Private Fund counterparts (albeit with a slightly lower distribution rate).

5. The establishment of the Australian Charity and Non-for-profit Commission (ACNC): While the impact will be felt more keenly in the years to come, the establishment of the ACNC must be seen as one of the most significant moments for the non-profit sector in this country. The ACNC will be responsible for determining the legal status of groups seeking charitable, PBI and other NFP benefits. It will also serve to greatly reduce and streamline the current exhaustive red tape process faced by many non-profits. The ACNC has potential to do much good but there are important lessons to be learnt from its counterparts in Europe in North America.

6. A decline in giving: The 2008-2009 tax statistics released in 2011 showed a decline in giving by Australians for the first time in a decade. These results come on the back of a year where some of Australia’s most prominent wealth advisors and philanthropists courted controversy by dismissing as a myth, the common perception of Australian generosity. Time will tell whether this decline in giving is merely an apparition or a new reality.

7. The Sidney Myer Creative Fellowships: The Myer Foundation and Sidney Myer Fund have a long and prestigious history in supporting the Arts in Australia. So when it was announced that the Myer would no longer be supporting arts organisations and instead would focus its support on individual artists, a few eyebrows were raised. In short, it was a gutsy move by a Foundation that has a history of driving innovation with its grantmaking. In December the Foundation announced its first 12 winners of The Sidney Myer Creative Fellowships, providing artists with $80,000 a year for two years to pursue their artistic endeavours. For me, it was a one of big grantmaking innovations of the year that created a healthy level of debate around how best to build the capacity of the arts in Australia.

8. Global Fundraiser of the Year: Melissa Smith, currently Director of Development at RMIT in Melbourne, was named both Australian Fundraiser of the year and Global Fundraiser of the year in 2011. Melissa received the awards for her role in securing a $25 million gift from Dr Chau Chak Wing’s to the University of Technology Sydney in 2010, where she was a development manager at the time. The gift ranks in the top ten of largest ever single donations in Australia philanthropy. It’s great to see Melissa professionalism and passion rewarded, but equally it’s wonderful to see Australian gifts of this magnitude recognised globally.

9. The closure of Rio Tinto Aboriginal Fund: After nearly 16 years of innovation in support for aboriginal projects in Australia, Rio Tinto’s decision to close its Aboriginal Fund was a shock to many in philanthropy and the boarder community. The fund was particularly supportive of urban aboriginal projects that do not benefit from mining royalties. While Rio Tinto has defended the decision arguing the over $100 million annually will continue to flow to remote and rural aboriginal communities via mining royalties annually, the loss of the fund is blow to Indigenous philanthropic giving in Australia.

10. The launch of 3eggPhilanthropy.com: It’s ok to be a bit self-indulgent isn’t it? Ok, the launch of this blog isn’t one for the top ten 2011 moments but it is reflective of a significant philanthropy communications boom that is taking place at the moment. Australian philanthropy is being discussed on blogs, Twitter and in the media like never before. Long may it continue.

So that’s my list, what did I miss that you think should be there? What does your list look like?

I hope 2012 is a big one for Australian philanthropy. All the best to you in this year ahead.

You can follow the musings of Caitriona Fay on Twitter via @cat_fay or the Blog via @3eggphil