Author Archive

Three Attributes That Are Vital for Effective Philanthropy

Thursday, May 12th, 2011

As I leave a conference marking the 10th anniversary of the Center for Effective Philanthropy (CEP), I find myself reflecting on our progress as a field in understanding what exactly constitutes “effective philanthropy.” At the heart of CEP’s approach has been collecting data to learn more about the practices that may contribute to effectiveness. Through various research reports and survey instruments, CEP has helped many foundations, including ours, to understand our work better and, we hope, to make us more effective.

This emphasis on data collection is both commendable and necessary. However, we ought to consider what other attributes, often not grounded in data, may contribute to effective philanthropy. Let me propose three attributes that, while not lending themselves to easy measurement and far more subjective , strike me as vital to the success of any philanthropic enterprise:  listening, synthesizing, and sharing.

Listening: Because of the resources at our disposal, we can meet with just about anyone we’d like to and obtain about any knowledge that is available. This access provides us with a unique platform for learning, but it also requires us to be active and authentic listeners. The power dynamic inherent to philanthropy makes it critical that  we  resist the temptation to talk more than listen, precisely because people will always listen politely to anything we have to say, regardless of its utility.

CEP’s Grantee Perception Report® has helped many foundations listen to their grantees, and its confidentiality helps overcome some of the power dynamic. But foundations’ attempts to listen must go deeper.  How can we listen  effectively and authentically? Here, social media can play a useful role for philanthropy. Twitter and other social media platforms are  powerful tools to  stay attuned to the broader environment and spot trends that can inform our work. We can listen to what others are talking about and participate in and learn from those exchanges. We can integrate ideas from the field into our work. Moreover, these new applications accelerate our ability to learn in real time..

Synthesizing: Precisely because of our access to information, one of the most powerful roles philanthropy can play is to synthesize the large volume of information at our disposal. We can make a valuable contribution to our field if we reflect back what we are hearing, frame the emerging themes and issues, and offer hypotheses about the opportunities before us.

For example, a number of years ago here at the James Irvine Foundation we published a report on critical issues facing the arts in California. The final product reflected more of a synthesis of what we were learning from the field rather than unveiling new ideas.  What surprised us was how valuable the arts community found this synthesis. The community’s eager reception of the report speaks volumes about this valuable, and often underused, role of synthesizer that we can play as foundations.

Sharing: Every foundation has  accumulated a great deal of knowledge about what works and what doesn’t. Now, we need to  share this learning more broadly. Doing so requires us to be as comfortable in sharing our mistakes and shortcomings as we may be in pointing to our successes.

Several  years ago we published a report about one of our major initiatives that was, in retrospect, flawed in both its design and initial execution. We learned a great deal from this experience and wanted others to learn from our mistakes as well. The fact that this report is still cited – four years later – speaks to the reality that philanthropy as a field remains uncomfortable sharing its mistakes and even failures, although there are recent commendable examples, such as a report from the Northwest Area Foundation, that suggest this may be changing.

I don’t know of any foundation that does not want to be effective. CEP has made enormous contributions in the past decade in helping us understand ourselves, and that should be celebrated. Still, we can’t be complacent as a field, and that is why I believe that listening, synthesizing, and sharing must animate our work.

At the heart of these concepts lies our need to embrace humility: the humility to know that working in philanthropy does not automatically confer wisdom upon us; the humility to recognize that the partners we are privileged to support face the much harder task; and the humility to acknowledge that we have a great deal to learn and an obligation to share that learning. This embrace of humility, in all of its forms, ultimately contributes to effective philanthropy. Now, if we could measure and track that, what a contribution that would be.

Jim Canales is president and CEO of the James Irvine Foundation

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The Case for Foundation Performance Assessment

Monday, April 26th, 2010

Fueled by new technology and a change in mind-set, foundations have become more transparent about their activities and operations in recent years. This has been heartening, given the responsibilities and privileges inherent to our tax status, and the fact that we must work in partnership with many constituents and stakeholders in order to achieve our goals.

Just recently, there has been a major contribution in this regard by the Foundation Center’s Glass Pockets website, which provides a look at best practices in foundation transparency and which encourages the field to move further in this direction. The number of foundations and array of practices reflected on that site is impressive, and Irvine’s work on performance assessment, the subject of these blog posts, has sought to contribute to this movement. 

In the first three posts of this series I described why we developed a performance assessment framework, outlined some of the challenges we’ve encountered in assessing Irvine’s performance, and shared feedback from our board, the primary audience for the Annual Performance Report. In this final post I want to argue that robust performance assessment activities — and the transparency they encourage — serve to make philanthropy more effective. 

Based on our experience over the past five years in developing a performance assessment framework and reporting on it annually to our board, I am persuaded that our work has been enhanced by the discipline and rigor that this process has imposed upon us. We focus each year on providing thoughtful and thorough answers to the six central questions at the heart of our approach to performance assessment: 

  • Where are our grants going?
  • Are we achieving what we set out to achieve?
  • How do lessons from our program work improve our approach?
  • How is the Foundation exercising leadership in the field?
  • How do key stakeholders perceive us, and how do their perceptions inform our work?
  • How are we performing along measures of financial health and organizational effectiveness?

By focusing on these questions explicitly and reporting on our answers annually, I believe we are stretching ourselves in ways that ultimately advance our mission and goals.  As a private foundation, making grants is a key tool for us — indeed the primary tool — but absent clarity of goals and objectives, ongoing reflection and refinement, and purposeful evaluation and assessment, such grantmaking may not reach its full effectiveness. 

These six questions may not be the right ones for everyone, and they may even evolve for us, but the process of clarifying the questions at the center of how we think about our foundation’s performance has been useful as has the process of reporting on our annual progress.  But more than the process, I hope our ability to have positive impact has been accelerated, and I’m eager to hear what others might think in this regard. 

Finally, at the same time as I advance this argument, I’ll quickly add that we need to be cautious that exercises in performance assessment do not lead us to become so internally focused and metrics obsessed that we lose the bigger picture. This remains in my view one of the primary tensions inherent to this work that we need to balance consciously at all times. 

I hope this set of posts on our approach at Irvine can stimulate a broader dialogue that ultimately advances our field’s understanding and improves our practices. In the end, we need to be  concerned principally with the advancement of our respective missions, which I believe is enhanced by the presence of a well-considered approach to performance assessment. 

Jim Canales is President of the James Irvine Foundation 

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Disclaimers and Disclosures: The views expressed in the CEP blog by guest bloggers are entirely their own and do not necessarily reflect the opinions of the Center for Effective Philanthropy.

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Our Board’s Perspective on Performance Reporting

Thursday, April 22nd, 2010

In an earlier post on this blog, I pointed out that the audience for the Annual Performance Report is Irvine’s board of directors. As we delivered the fourth of these at our annual board retreat last month, we devoted some time to learning more about the board’s perspectives on the report.

There were two key themes that emerged, related to the value of context, and the appropriate frequency of the report. Regarding context, board members expressed in numerous ways how much they value the contextual information that the report provides.  Two sections stood out in this regard: first, a table that describes how Irvine’s funding compares to other funders in our program areas, and second, a section on program context indicators, where we provide broader indicators related to our programs, such as per capita public spending for the arts across the U.S. or data on high school drop-out rates in California. This latter section is not meant to suggest that our work will necessarily affect those numbers, but rather to expose the board to broader data sets that help contextualize our program work. 

The positive reaction to these sections of the report underscores for me how important it is to help our boards gain a deeper understanding of the environment for the Foundation’s activities. We can explain our goals and strategies and describe grants aligned with them, but there will always be a missing piece if the board is not able to contextualize our foundation’s work. The board’s feedback encourages us not only to consider other ways to use the report to provide such context, but also to explore how we can shape other board materials and meetings in ways that expose them to the broader environment for our work.  

The second main theme from our board discussion related to timing. The board questioned whether it is possible to report on foundation performance in such a comprehensive way within a 12-month period. My earlier post described the tension between reporting on activities and describing impact and outcomes, and the timing question became a related point. The board encouraged us to consider a more streamlined Annual Performance Report that might be complemented by a comprehensive report that examines a multiyear period. The discussion led us to recognize a potential mismatch in timing between annual reports and longer-term program goals that operate on a three- to five-year timeframe. 

The discussion with the board also encouraged us to revisit the question of audience. We developed this performance assessment framework with the board as the primary audience, but now that we are committed to posting these reports on our website, we also need to give further thought to what other audiences might want to learn. With more foundations providing online grants databases and with the broad adoption by foundations of websites as the primary communications tool, traditional annual reports may be less relevant. With all of this in mind, we are considering how we could integrate more elements of the Annual Performance Report to the board into our traditional annual report to the public. 

Most of these ideas are still in development, and we have not yet settled on answers. In fact, we are still digesting the board retreat discussion and its implications. I welcome your thoughts on these subjects. 

In my final post I will make the case that, various challenges and difficulties notwithstanding, performance assessment is a vital part of being an effective foundation.

Jim Canales is President of the James Irvine Foundation 

*****

Disclaimers and Disclosures: The views expressed in the CEP blog by guest bloggers are entirely their own and do not necessarily reflect the opinions of the Center for Effective Philanthropy.

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Challenges to Good Performance Assessment

Tuesday, April 20th, 2010

In my last blog post I described why we started assessing our performance as a foundation and how we developed an Annual Performance Report that balances analysis of our grantmaking with tracking of overall institutional effectiveness. As we have engaged in institutional assessment work, we have encountered three broad challenges I will explore in this post: 

  1. The need to distinguish between reporting on activities and describing outcomes and impact
  2. The difficulty of summarizing complex social change
  3. The inherent conflict of assessing the past in a forward-facing enterprise   

Activities vs. Impact

We are always looking for quantitative ways of describing and analyzing our work. Since the grants we award (and the ways we track those grants) are clearly quantifiable, they have become a prominent part of the Annual Performance Report. For example, we examine trends and changes in our grantmaking over time, explore the geographic distribution of our funds, and examine the populations served by our grants. While this provides an easily quantifiable way of examining our grantmaking, we realize that describing where our resources go is not the same as conducting an assessment of impact.

The same challenge applies to other sections of the report, where we describe financial and investment performance, summarize reports we have published, or discuss how we have refined our strategies based on what we are learning. While all of this together provides a comprehensive picture of our activities in a given year, it may or may not provide a complete assessment of institutional performance.

We have, of course, focused explicitly on the impact of our grantmaking reporting on evaluations of specific initiatives or clusters of grants focused on a common strategy or goal. In the Annual Performance Report, we summarize current evaluations and provide one-page descriptions of key findings and next steps we are pursuing. This section of the report probably comes the closest to an assessment of impact, and we continue to grapple with ways to report comprehensively on activities that we believe contribute to our impact as an institution while ensuring that the report goes beyond the descriptive. 

Summarizing Complex Social Change

The very notion of a single report intended to describe an institution’s performance over one year suggests that it is possible to distill and to present such information concisely. We have not yet landed on the right formula here, but we are eager to keep trying and learning as we do. 

We are certainly not the first foundation to confront this challenge, especially given the range of social problems that many of our institutions have chosen to address. The particular challenge we face in our performance assessment work is reporting on progress within a one-year period on a set of broad and aspirational goals that have a longer time horizon. 

For example, within our California Democracy program, we support efforts that aim to improve our system of governance at the state and local levels. This is a long-term goal, requiring us to collaborate with a range of partners and stakeholders and acknowledging a dynamic political context that is ever-changing. It is unlikely we can summarize effectively all of the complexities, nuances, and challenges of carrying out this work, as we aim to deliver a report that is concise and accessible. 

And yet, this particular challenge should not keep us from trying. We are looking at ways to focus our reporting on our performance related to shorter-term objectives and measures of progress that we articulate at the start of each year. 

For example, two such indicators for 2010 in our Youth program are the establishment of ten certified Linked Learning pathways and the development of new integrated curriculum in key industry sectors. We will report back to the board at the end of this year on achievements against these indicators in a much more concise format than the full-blown Annual Performance Report. 

As we do this work, we will also continue to explore how to present complex information concisely without sacrificing the richness and nuance of the content. Here again, we are not the first foundation to confront this challenge, so we are interested to learn from others. 

Assessing the Past in a Forward-Facing Business

The last challenge relates to understanding the core business of a private foundation, which is to make grants. As a result, the nature of our enterprise continually focuses us on looking forward to the next set of grants, while there are far fewer incentives to look back. To respond to this reality, we have placed a high premium on evaluation, both to understand our impact, but also to inform grantmaking. Fortunately, our board holds this value as well. 

A related structural challenge can be dedicating resources to performance assessment. Foundations generally focus most of their staff resources on grantmaking programs and related administrative functions, which means that there are additional costs to doing evaluation and foundation-wide assessment. 

The question for each institution to consider is whether these additional costs enhance the foundation’s ability to achieve its mission. I would argue that the more evaluation and performance assessment is weaved into the culture of the foundation and viewed as an essential ingredient for social impact, then the costs can be viewed accordingly. Of course, that’s not an excuse to avoid making hard choices about resource allocation, but we must acknowledge the costs of doing this work and the related benefits.   

I sought here to outline some of the broad challenges we have encountered in assessing our foundation performance, and some of the solutions we’re exploring. I would welcome your perspectives on all of this, including other challenges we should be considering as well as potential solutions to address these. 

My next blog post will describe feedback we recently received from our board about our 2009 Annual Performance Report. 

Jim Canales is President of the James Irvine Foundation

 *****

Disclaimers and Disclosures: The views expressed in the CEP blog by guest bloggers are entirely their own and do not necessarily reflect the opinions of the Center for Effective Philanthropy.


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Assessing Foundation Performance

Thursday, April 15th, 2010

At last year’s CEP conference in Los Angeles, I presented on the Irvine Foundation’s approach to assessing foundation performance, joined by David Colby from the Robert Wood Johnson Foundation. I think it’s fair to say that David and I were presenting approaches used by our respective foundations that remain works in progress – Irvine’s even more so than RWJF’s given its focus on this area for many more years.

In view of the interest in this topic at the conference, and my own desire to share what we are doing at Irvine in an effort to improve upon it, I appreciate the opportunity offered by CEP to write a series of blog posts on the subject of assessing foundation performance.

 I plan to do this in four parts, addressing the following topics:

  1. Why we developed an approach to foundation performance at Irvine
  2. What we have found particularly challenging about assessing foundation performance
  3. How our board has engaged with us on this subject
  4. Why assessing foundation performance is both important and necessary

In reflecting upon Irvine’s experiences, I hope to stimulate readers’ contributions to deepening our collective understanding of this important subject and to improving our efforts to measure and understand our performance as foundations.

The focus of these blog posts is Irvine’s Annual Performance Report, which informs Irvine’s board about impact in our three program areas and our overall institutional effectiveness. I include links throughout this post and hope readers might take time to scan those related documents. 

We developed our current performance assessment framework after a strategic planning process in 2002-2003 that led to our current focus on three grantmaking programs (Arts, California Democracy, and Youth). As we embarked on this new focus, we wanted a plan to assess the foundation’s performance, both within the grantmaking programs, and across the foundation as a whole. 

A group of board and staff members worked together for several months and, as part of that, explored best practices in foundation-wide assessment. Two examples that stood out at that time were assessments done by the RWJF and the Rockefeller Brothers Fund. 

From those models and our discussions about what the board wanted to learn about the foundation’s performance, we created a framework that balances an assessment of grantmaking impact with ways to track overall institutional effectiveness, which are the two broad areas that organize Irvine’s approach. 

We also felt it was critical to look at our performance through different prisms, so within these two broad areas, we examine specific grantmaking statistics and progress, evaluation results, broader institutional effectiveness beyond the grantmaking programs, and a range of other categories. This framework is the basis for our Annual Performance Report. 

The primary audience to date for these Annual Performance Reports has been our board of directors. This focus has enabled us to be clear about the report’s purpose, ensuring that we are providing the information that is most relevant for that audience. 

Once we created the first report for the board in 2007, we then published it on our website, as a manifestation of our commitment to transparency and as another model for others to draw upon as they explore their own approaches. Throughout, I have also been interested in the critiques and questions that our approach has generated so that we might improve upon it going forward. 

This description of our process for creating Irvine’s Annual Performance Report sounds very straightforward. The reality, of course, is a bit messier, and my next blog post will focus on some of the challenges we’ve experienced and how we have refined our approach based on what we’ve learned. 

I’ll conclude with a final, personal observation: We have invested a great deal of time on this subject because I am persuaded that my obligations as CEO include developing an approach to rigorous foundation performance assessment. Given the autonomy that private foundations enjoy, and the occupational risks of complacency and insularity, creating a framework for foundation assessment and then reporting to our board in some regular interval has kept us focused on how we apply our finite resources for greatest impact. That goal has motivated us to date and it remains why we are keenly interested in improving upon and refining our approach to foundation performance assessment. 

There are undoubtedly other perspectives, however, including those that might disagree with this premise and/or our approach. I hope you’ll take a few minutes to share your thoughts, and I would especially value any comments or questions that will push us as we continue to grapple with this important work. 

Jim Canales is President of the James Irvine Foundation 

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Disclaimers and Disclosures: The views expressed in the CEP blog by guest bloggers are entirely their own and do not necessarily reflect the opinions of the Center for Effective Philanthropy.

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