[Editor’s note: The following is an excerpt from a presentation in November at the annual conference in Asheville, N.C., of the Southeastern Council of Foundations.]
Foundations make our society a better one.
You have, from time to time, stuck your neck out for a salient idea that somehow you have endorsed as worth the investment.
You have stuck your neck out by taking significant risks in what you fund where the return on investment isn’t all that secure.
Such activities as supporting an initiative that will raise eyebrows, or strongly supporting grassroots initiatives addressing emerging issues in a rapidly changing and often tumultuous world, or even supporting a seemingly crazy idea that, if correct, could have seismic positive effects on the overall health of a community.
Truth be told, and overwhelmingly so, the foundation world doesn’t go to the places that I have just mentioned.
It doesn’t fund risky ventures. It doesn’t wish to raise community eyebrows. It doesn’t want to get very dirty dealing with grassroots organizations that might be stirring things up a bit.
And it avoids – like the plague – ideas that may be a bit “crazy” – those that, if correct, could have seismic positive effects on the overall health of a community.
By so doing, foundations all too frequently fall short of being effective agencies of change in our society.
I would hope that foundations, in general, might rethink some of those “safe stances” it often takes.
The place of craziness in the world of ideas and innovation is not to be underrated.
Why is it that foundations are very often so risk adverse when they have a unique degree of accountability that affords them unusual freedoms?
Of course all of you are accountable to the federal government’s tax laws, you are accountable to the communities that you fund and are accountable to your own board’s policies.
However, the accountability of any foundation is generally less restrictive than that of the majority of the nonprofit sector.
Why then such cautious behavior?
Barbara Goodman, president of the A.J. Fletcher Foundation in Raleigh, N.C., says not taking risks fails to keep foundations safe and secure. The real liability for foundations comes from not taking risks.
So, summing up, foundations should consider:
*Engaging in strategic thinking about how you might more actively engage in significantly and overtly impacting your area of grant-making.
*Revising your mission if you are able, or at least probe the latitude that your present mission might give you to become more proactive in your work.
* Discussing within your foundation the basis of your fears about “sticking your neck out” and discern whether they are based in fact or perception.
*Finding an aspect of your community that needs leadership and consider vigorously embracing that leadership role.
* Considering- just considering – allocating perhaps 5 percent to 10 percent of your funding portfolio to funding truly “crazy” proposals. What divides us is whether it is crazy enough to have a chance of being correct.
* Cultivating a culture in your foundation that accepts that funding a project that fails is worth it because it gives you valuable information.
Foundations should be the passing gear for society. No other social agency is positioned to fulfill that role.
Don Wells, former director of the certificate program in nonprofit management at Duke University, is the principal of Don Wells Consulting in Cedar Grove, N.C.