|
 Dear
Colleague,
I hope this message finds you well. I am particularly
pleased to share with you the second issue of our e-newsletter,
Effective Matters, because this issue coincides with the
release of our major new report, Beyond Compliance: The Trustee
Viewpoint on Effective Foundation Governance.
This report brings to light the perspectives of foundation trustees, revealing a broadly shared conception of effective foundation governance. We seek, in its pages, to identify the practical implications of this conception of board effectiveness for trustees, board chairs, and CEOs.
The release of this report marks the end of Phase
II of our Foundation Governance Project. But our research is ongoing
and, just as important, so is the discussion of its implications.
We want this report to help prompt a discussion of foundation governance
that goes beyond the recent focus on minimum standards and establishes
a more ambitious objective – one that relates to the board's
role in contributing to foundation effectiveness and impact. It
is clear from our research that this wish is consistent with board
members' and CEOs' definitions of board effectiveness.
Please let us know your thoughts on this and on
the other efforts described in this newsletter. Our work is dependent
on the active participation and support of foundation staffs and
trustees. Our goal, as always, is to provide comparative data and
insight that enables higher-performing foundations. Let us know
how we are doing – and how we can improve.
Sincerely,
Phil Buchanan
Executive Director
 In
a study of boards of a broad range of large foundations, CEP reveals
the perspectives of those ultimately responsible for the significant
charitable assets those foundations control. Beyond Compliance:
The Trustee Viewpoint on Effective Foundation Governance is
based on a survey of nearly 550 trustees of 53 large grantmaking
foundations that collectively control approximately $43 billion
in assets. The report highlights the steps these boards have taken
to implement governance reforms on the basis of recent scrutiny
and discusses how trustees' definitions of effective governance
go well beyond compliance with minimum standards.
CEP's study, which is cosponsored by BoardSource
and Grantmakers for Effective Organizations (GEO), shows that foundation
trustees see board effectiveness as related to utilization of board
members' capabilities and skills and board involvement in key areas,
such as strategy development and assessment. The report was coauthored
by CEP's Phil Buchanan, Ellie Buteau, Sarah Di Troia, and Romero
Hayman.
"Our research indicates that trustees take
compliance seriously but also want to be centrally involved in developing
strategy, assessing impact and performance, and contributing their
capabilities," said Di Troia, who leads CEP’s governance
work. "Understanding trustees' conception of effective governance
is of crucial importance in ensuring that the significant charitable
resources foundations possess are most effectively used."
Buchanan said, "In this study, we endeavored
to understand the views of a group whose perspectives and motivations
have been a source of much discussion and speculation, but whose
voices are surprisingly rarely heard in the debate on foundation
governance: the trustees themselves. This study does not provide
all the answers, but we hope it spurs productive discussions and
reflections in foundation boardrooms."
CEP's analysis of survey responses revealed that there
is a common sense of what constitutes board effectiveness among foundation
trustees. The trustee definition of board effectiveness is comprised
of five key characteristics:
- Appropriate mix of trustee capabilities and
utilization of those skills
- Engagement in strategy development and impact
assessment
- Focus of discussions on important topics
- Positive relationship with the CEO
- Opportunity for influence and respectful dissent
in board meetings
The report outlines a number of specific implications
of these findings for foundation CEOs, board chairs, trustees, and
staffs, including ways in which foundation staffs and boards can
better manage trustees' contributions of their capabilities, time,
and insights.
In addition, the report also describes important
ways in which dynamics differ among different types of boards, exploring
questions related to compensation, family, and race, as well as
exploring the fundraising role of community foundation trustees.
To download or order Beyond Compliance: The
Trustee Viewpoint on Effective Foundation Governance, click
here.
Foundations care a lot about the perceptions of
key constituencies: grantees, policymakers, donors, and key influencers.
Many foundations routinely get feedback on their performance from
these groups as part of their efforts to assess overall foundation
performance.
But foundation leaders often have been less likely
to recognize the importance of formally seeking out the candid perspectives
of the people who know the foundation best because they do the foundation's
work each day: the staff.
In spring 2005, CEP piloted a comparative survey of staff perceptions with six large, private foundations. This effort, led by CEP's Kevin Bolduc, Ellie Buteau, and John Davidson, was designed to help foundations improve their performance through a more thorough – and comparative – understanding of the unique perceptions of their staffs.
The resulting Staff Perception Report (SPR) received
by each foundation explored staff job satisfaction and perspectives
on issues such as foundation effectiveness and alignment in pursuit
of key goals. From the 305 confidential responses received from
these staff members, we identified seven distinct characteristics
that describe perceptions about their jobs and their foundation
employers:
- Employee empowerment and utilization of skills
- Relationships between supervisors and subordinates
- Staff performance evaluation/review process
- Foundation's internal culture
- Foundation's relationship to the external environment
- Foundation's tolerance of risk
- Grantmaking and interactions with grantees
We invite you to commission an SPR and participate
in our ongoing research. For more information, please contact Kevin
Bolduc, Associate Director, at 617-492-0800 ext. 202 or click
here.
In an issue paper to be released in December, CEP will identify the key components of effective communication of foundation goals and strategy to grantees.
The issue paper, based on analyses by CEP's Judy
Huang, builds on the findings presented in CEP's 2004 report, Listening
to Grantees: What Nonprofits Value in Their Foundation Funders.
It will explore the relative value grantees place on different types
of foundation communications – from individual interactions
with program officers to funding guidelines to annual reports –
and discuss best practices shared by highly rated foundations.
The forthcoming issue paper is the first in a series
of CEP publications that address discrete topics with a focus on
case examples and practical, actionable implications. Issue papers
complement CEP's larger research publications, which report findings
of major, grant-funded research initiatives.
The Comparative Board Report (CBR), which was received
by more than 50 foundations when it was piloted earlier this year,
presents comparative data on board structure and practice, as well
as board member perceptions on a range of questions related to board
focus, effectiveness, and group dynamics.
"Our board just concluded one of its most successful
planning retreats, due in no small part to the review of its data
in the Comparative Board Report," said Norm Smith, president of
the Ford Family Foundation. "In consultation with CEP's Sarah Di
Troia, we lifted up some curious information to the light, discussed
its implications, and suggested ways to better focus on more strategic
matters in regular board meetings."
The data in the CBR is gathered through in-depth, confidential surveys of a foundation's CEO and trustees and is presented in a comparative context against two cohorts: all foundations surveyed and a selected cohort of similar foundations. The CBR provides a basis for CEOs and trustees to have informed and guided conversations about their own performance.
Boards have made significant changes based on their discussions, including expansion of a board to bring on needed, relevant skills; refocusing of agendas to free up time in key areas, such as strategy development, where boards frequently want more engagement; and re-examination of board dynamics in the face of evidence of a lack of comfort opposing staff and/or other board members.
"It has been my observation that boards of directors
often struggle with identifying helpful instruments to assist in
evaluating self-governance," said Douglas Patino, board member at
the Marguerite Casey Foundation. "The CBR was a very helpful instrument
that identified and prioritized topics for the board to further
strengthen its governance resulting in a focused, non-personalized
discussion."
The CBR process takes approximately 10 weeks and
can begin at any time. Individual CEO and trustee responses are
confidential and are presented in the aggregate. To learn more about
the CBR, please contact Sarah
Di Troia, Associate Director, at 617-492-0800 ext. 212 or
click here.
 Performance
assessment and governance are among the issues to be addressed by
CEP staff at a series of upcoming speaking engagements. Phil Buchanan
will discuss overall performance assessment at the Grantmakers of
Western Pennsylvania's Distinguished Speaker Event in Pittsburgh
on December 1, and Sarah Di Troia will present findings from CEP's
new report, Beyond Compliance: The Trustee Viewpoint on Effective
Foundation Governance, at a series of events in 2006, including
the Council on Foundations Family Foundations Conference in Honolulu,
Hawaii on January 30 and the Grantmakers for Effective Organizations
National Conference in Atlanta on March 10.
For a complete listing of events, click
here.
Effective Matters
is a quarterly newsletter published by the Center
for Effective Philanthropy (CEP), a nonprofit organization focused
on the development of comparative data to enable higher-performing
foundations. Based in Cambridge, Massachusetts, CEP's mission is
to provide management and governance tools to define, assess, and
improve overall foundation performance.
If you have questions about this newsletter or
would like general information about CEP and its activities, please
contact CEP Communications and Programming Coordinator Alyse d'Amico
at alysed@effectivephilanthropy.org
or 617-492-0800 ext. 206.
Permission to use, copy, and/or distribute this
document in whole or in part for noncommercial purposes without
fee is hereby granted provided that this notice and appropriate
credit to the Center for Effective Philanthropy is included in all
copies. |
