Most of foundations' efforts 'beyond the money' make little difference to grantees, according to a new report released today by the Center for Effective Philanthropy. More than Money: Making a Difference with Assistance Beyond the Grant reveals that only when foundation staff provide assistance in one of two ways do grantees report a substantially more positive experience with their funders.

When grantees receive a comprehensive set of assistance activities or a set of field-focused forms of assistance, they do have a different — and more positive — experience. "But foundations rarely provide this kind of assistance," says CEP's Senior Research Officer, Ellie Buteau, PhD, the lead author of the report. "Just 10 percent of grantees receive assistance in these ways that make a meaningful difference."  

More than Money describes what is entailed in providing assistance in ways that really matter to grantees. The study finds that while foundation staff believe that assistance beyond the grant is important for helping grantees achieve their goals, they know little about the actual results of the assistance they provide.  

"In the current economy, funders need to look hard at the effectiveness of everything that requires resources," says report co-author and CEP President Phil Buchanan. "Our analysis raises some tough questions about foundation practice today."

The report profiles three foundations that provide exemplary assistance beyond the grant: Hartford Foundation for Public Giving, Winter Park Health Foundation, and The Wallace Foundation. These foundations provide comparatively high proportions of their grantees with comprehensive or field-focused assistance. "We hope other funders can learn from their example," says Buteau.

More Than Money also reveals that newer foundations are taking a more active, engaged role with their grantees than older foundations. Of the more than 140 foundations in the study's data set, 35 were formed in the last 10 years. These younger foundations provide a higher proportion of their grantees with assistance beyond the grant and are giving more of their grantees assistance in the manner that the CEP research shows to be effective. "Our data suggests that the new foundations really do take a different, more active stance with their grantees than the older foundations," says Buteau.

The implications of this new CEP report are far-reaching. "We hope that these findings will help foundation CEOs and program officers take a more intentional approach to assistance beyond the grant," says Buchanan. "They should determine whether the assistance they are providing contributes to the achievement of their programmatic goals. They should be selective in choosing which grantees to provide with assistance, since doing it effectively requires significant investment. And, finally, foundation staff should assess the impact of the assistance they provide."

The research was supported by the Fidelity Foundation and Lumina Foundation for Education.

Jim Berk, CEO of Participant Productions, is among the latest additions to the program for CEP's conference, Aligning for Impact: Connecting the Dots, March 31-April 1 in Los Angeles. Participant's films and documentaries include An Inconvenient Truth, Fast Food Nation, Syriana, The Kite Runner, and Charlie Wilson's War. Berk will address the potential of social media to create positive change.

The conference, which is co-sponsored by Southern California Grantmakers and supported by generous grants from the Conrad N. Hilton Foundation and a number of other funders, is designed to help foundation leaders align their resources and staff to achieve maximum positive impact on the issues, communities, and people they serve.

CEP invites you to join a growing community of CEOs, trustees, and senior executives from the largest philanthropic organizations to confront your most pressing issues, exchange ideas, and share best practices.

Conference sessions will cover many of the key challenges foundation leaders face today:

• The promises and pitfalls of taking successful nonprofits to scale
• How business thinking helps or hinders philanthropy
• Assessing overall foundation and CEO performance
• Collaborative foundation funding
• When and how foundations should share what they know
• How to provide assistance beyond the grant to strengthen grantee organizations
• Improving foundation governance

The conference program will feature keynote speaker Jim Collins, best-selling author of Good to Great, Build to Last, and Good to Great and the Social Sectors. Other speakers include incoming CEP Board Chair and Rockefeller Brothers Fund President Stephen Heintz; Stupski Foundation Founder and Chairman Larry Stupski; Greater Cincinnati Foundation President Kathy Merchant; California Endowment President and CEO Robert K. Ross; and CEP President Phil Buchanan.  In addition to the Hilton Foundation, support for the conference is being provided by the James Irvine Foundation, California Community Foundation, Stupski Foundation, S.D. Bechtel, Jr. Foundation, Jewish Community Foundation of Los Angeles, and California Endowment.

CEP's conferences always sell out, and space is limited. To register, go to www.regonline.com/CEP09

Improving Philanthropy One Data Set at a Time

CEP's work "has the potential to dramatically change the way many grantmakers operate," Hewlett Foundation President Paul Brest says in a William and Flora Hewlett Foundation newsletter article.

The article, which profiles CEP, describes the organization as "unique in producing data that allows foundations to compare their operations with their peers."

"The data [CEP] collects is proving increasingly crucial in clarifying good practices and exposing both the successes and failures of foundations," says Jacob Harold, the Foundation's Philanthropy Program Officer.

Published in the Foundation's October 2008 newsletter, "Improving Philanthropy One Data Set at a Time," also notes the importance of CEP's ongoing research on foundation strategy. "The belief that an articulated strategy creates greater social impact is starting to grow in the philanthropic world," says Brest.

Robert Hughes, Chief Learning Officer at the Robert Wood Johnson Foundation, also praises CEP in the article. "Although their work can help individual foundations, in the long run it will help all of us—it will help the field in general." 

One of CEP's major funders, Hewlett has used the Grantee Perception Report^® twice and has also surveyed its staff using CEP's Staff Perception Report. To read the full article, click here.

In Defense of a Distinct, High-Performing Nonprofit Sector: Buchanan on "Philanthrocapitalism"

"Philanthrocapitalism" is the latest term du jour in the philanthropic sector, and a new book by that name, co-authored by Matthew Bishop and Michael Green, received positive reviews in the Wall Street Journal and Financial Times last month.  But is the way to increase philanthropic impact simply a matter of applying business practices to the nonprofit sector? 

In a review published in the Chronicle of Philanthropy, CEP President Phil Buchanan cautions against equating nonprofit effectiveness with a "business approach. "He argues that the push for higher levels of performance within philanthropy is essential, but that the distinctions between the sectors are important. 

"Nonprofit performance cannot be judged simply based on universal measures, like profit, found in financial statements," he writes. "That doesn't make performance assessment less important; indeed, it makes it more important — but a lot harder."

"We're better off acknowledging the differences rather than creating a word — 'philanthrocapitalism' — that is essentially an oxymoron. If businesses and government could successfully solve all our challenges, or meet all our needs for association and expression, we wouldn't need nonprofit organizations."

At CEP's conference, Aligning for Impact, Mr. Bishop will join Michael Edwards, former Director of Governance and Civil Society Unit at The Ford Foundation and author of Just Another Emperor? The Myths and Realities of Philanthrocapitalism, to debate the issue of business thinking and philanthropy. Joining Bishop and Edwards will be Carla Javits, President of REDF, Gara LaMarche, President and CEO of Atlantic Philanthropies, and moderator Steven Heintz, President of the Rockefeller Brothers Fund.

To read Buchanan's review of Philanthrocapitalism: How the Rich Can Save the World, click here.

Funders Becoming Less Reticent

Foundations are using their Grantee Perception Report^® (GPR) results to demonstrate accountability and transparency, according to an article by the Communications Network. "As a nod to greater transparency, a growing number of foundations are sharing grantee feedback from these surveys on their Web sites for the public to see. Oftentimes these postings include discussions about improvements foundations are making spurred by comments from their grantees."

Communications Network quotes a number of its members that have both used the GPR and shared their results with grantees. According to McKnight Foundation President Kate Wolford, sharing GPR results is an important part of the assessment process. "Any foundation might benefit by simply paying attention to and quietly acting on the CEP survey findings. But to truly leverage the information to strengthen valuable relationships, we also need to share the results and our commitment for change."

CEP assures foundations that participate in the GPR process of the confidentiality of their findings and foundations are free to decide for themselves whether or not to make them public.  

To read the full article, click here.

Greater Impact Tomorrow Requires Better Data Today

The tough decisions necessitated by the economic downturn require data. There's still time to sign up for CEP's next round of assessment tools and to receive results by mid-2009. 

Join funders such as Robert Wood Johnson Foundation, The Assisi Foundation of Memphis, and Resources Legacy Fund in assessing your effectiveness so you can use your limited resources for maximum impact.  Get in touch with us this month to find out more.

CEP Joins Forces with UK's Association of Charitable Foundations

CEP has entered into a partnership with the UK's Association of Charitable Foundations to promote the use of CEP assessment tools.  The arrangement, similar to CEP's relationship with the US-based Grantmakers for Effective Organizations (GEO), will offer ACF members a discount on CEP assessment tools. The Pears Foundation has already signed on to participate in the Grantee Perception
Report ^® (GPR) process in 2009, becoming the first UK foundation to use CEP's assessment tools.

The partnership with ACF comes at a time of increasing interest in CEP's tools among foundations outside the U.S. "We have now provided assessment tools to foundations based in Canada, Ireland, and Israel, and have surveyed grantees everywhere from Sub-Saharan Africa to Vietnam" says Vice President, Assessment Tools Kevin Bolduc.  The grantee survey has been translated into seven languages both for international foundations and U.S. foundations doing international grantmaking.

"We find that the tool is applicable across geographies and languages and are excited about our increasing international work," says Bolduc.

About this Newsletter

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. CEP's mission is to provide data and create insight so philanthropic funders can better define, assess, and improve their effectiveness and impact.

If you have questions about this newsletter or would like general information about CEP and its activities, please contact Kathryn Sherman at 617-492-0800 ext. 230.

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.