Working for change

Foundations struggle with role in shaping public policy.

By Ret Boney

While foundations work hard to make change happen on issues they care about, granting more than $26 billion last year alone, they generally don’t push for the systemic changes that could produce even greater progress, industry watchers say.

“From our research, when you look at the broad picture, there doesn’t seem to be a well-thought-out or visible relationship” between philanthropy and public policy, says Jeff Krehely, deputy director of the National Committee for Responsive Philanthropy, an advocate for philanthropic accountability.  “It seems to take second or third place to grant work or endowment work.”

Some experts believe many foundations don’t understand how they can affect public policy, the rules and regulations designed to guide society, without running afoul of legal limitations that would threaten their charitable status.

“Foundations can’t fund a lobbying campaign, or can’t give money to work on a specific piece of legislation,” says Krehely, “but there are so many things they can fund related to the policy process.”

Conservative foundations have cleared those hurdles by providing flexible operating grants that cannot be linked to lobbying or advocacy efforts, according to a recent report by the National Committee for Responsive Philanthropy.

“Conditional grantmaking locks the money up,” says Gary Bass, executive director of OMB Watch, a government watchdog group, yet that is the approach mainstream foundations have traditionally used, he says.

“In general, I think there’s a sense that foundations don’t understand how the public-policy process works,” he says.  “They think a one- or two-year grant will work.  That defies the way the public-policy process works – it’s a longer-term process.”

Moving from that historical focus on funding for specific programs would require a shift in priorities for many foundations, calling for additional dollars, which are hard to come by, or a shift of resources from the critical programs they now support or the services they provide.

“I think among a smaller number of foundations, there is a recognition there is a need for philanthropic support of public policy,” says Bass.

Some in the philanthropic community say foundations are affecting progress in critical ways.

“With a nation facing so many different policy changes, the role that philanthropy plays is more important than ever,” says Michael Dahl, director of planning and evaluation for the Pew Charitable Trusts in Philadelphia.  “At Pew, our core mission is to inform and advance the debate.”

Providing education and research is an appropriate role for the philanthropic community, and one that it is fulfilling, he says.

“I tend to view our work in terms of public education, where we see a compelling need for reform,” he says.  “We can help translate what we know into pragmatic policy options.”

A strength of the philanthropic community is its diversity of approaches, says Dahl, with some foundations choosing to focus on grants to support programs and services, and others focusing on education and research.

Interest in public policy among foundations is on the upswing, says Tom Ross, executive director of the Z. Smith Reynolds Foundation in Winston-Salem, N.C.

“For a foundation like ours, we see that work around policy change as a way to make the biggest impact,” he says.  “My sense is that we’re seeing an increase in attention to more strategic, systemic work by foundations, especially since resources have shrunk.”

Convening stakeholders to discuss issues and solutions, supporting groups that provide quality research and providing educational opportunities for policymakers are all appropriate activities for foundations, says Ross.

The Z. Smith Reynolds Foundation recently contracted with an expert in domestic violence and sexual assault to help it think through its role in bringing about systemic change, says Ross.

Depending on the findings, he says, that role could include making additional grants in the area, finding ways to increase fundraising capabilities, increasing funding streams to local programs, or producing information that could help people better understand the issue.

“There is quite a large toolbox available to foundations,” says Ross. “It’s about helping the mechanisms already in place to do a better job.”

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