becoming wealthy

Issue 29 : June 2007 Jon Snow: prime time A quarterly e-letter for all those interested in the development of philanthropy Also in this issue: Barriers or opportunities: new research on giving Giving news: Sunday Times Giving Index doubles Cause & Effect: exploring issues in impact evaluation plus the latest philanthropy news and events Philanthropy UK Newsletter : Issue 29, June 2007 welcome welcome Welcome to the June 2007 edition of the Philanthropy UK Newsletter. First we would like to thank our readers for all your positive feedback on our new branding – launched last issue – and we look forward to improving the Newsletter further as an important resource for the UK giving community. Continuing our development, this summer we will launch our new website and our new e-bulletin. The website: We are excited about this, which will feature both new content and improved navigation. Stay tuned! The e-bulletin: This additional service will be a fortnightly online bulletin to keep you abreast of current philanthropy news. In addition to enabling us to stay in touch more regularly, it also will mean shorter Newsletters in the future. In this issue new research with professional advisors which will be published later this by the wealthy: concern about charity effectiveness and perceived negative media coverage. We encourage you to join the debate. Jon Snow, the Channel 4 broadcaster, offers his tips for new givers as guest author of this issue’s The top Peter Scholten is guest author of Cause & Effect, our column on impact evaluation. letters to the editor. As always, we are especially grateful to our guest contributors, whose efforts continue to enrich these pages. We thank you for your support, and urge you to further engage with us. If you would like to comment on this issue, or to contribute an original article, please contact me at editor@philanthropyuk.org. Best wishes, Susan Mackenzie: editor Philanthropy UK Newsletter : Issue 29, June 2007 contents in this issue 1 1 2 Barriers or opportunities: new research on giving Philanthropy UK research highlights barriers to giving Demonstrating impact: a two-way dialogue With expert panel: Daniela Barone-Soares, Impetus Trust; Kevin Ireland, London Housing Foundation; Tris Lumley, New Philanthropy Capital; Jeremy Swain, Thames Reach; and Karl Wilding, NCVO The British media: barrier or catalyst? With expert panel: Matthew d’Ancona, The Spectator; Alison Benjamin, Society Guardian; Stephen Cook, Third Sector; Alastair McCall, The Sunday Times Giving List; and John Prideaux, The Economist tips for giving Prime Time by Jon Snow 14 Letters (New!) 15 Giving news 15 Sharing the wealth: The Sunday Times Giving Index 15 Survey analyses giving trends by the wealthy 16 Think tank explores City as engine of growth for philanthropy show worrying signs 18 Giving by US corporate foundations rises by 6% 19 Government & regulatory watch 24 News from around the sector 27 Events and programmes 31 Cause & Effect: Exploring issues in impact evaluation Value creation in the philanthropic sector by Peter Scholten, Scholten & Franssen 33 What’s new in social investment by Adam Ognall, UK Social Investment Forum 35 Publication reviews and notices 35 Review: Mrs Russell Sage reviewed by Dr Helen Bowcock 36 Review: Carnegie reviewed by Beth Breeze 38 Notices by Diana Leat 42 Media round up: recent press coverage of philanthropy Dr Frederick Mulder, philanthropist Editor Susan Mackenzie Editorial Board David Carrington (Chair) Beth Breeze (Publications Editor) David Emerson Sue Wixley The purpose of the Newsletter is to disseminate information about new developments in philanthropy. To submit an article for consideration, please contact the Editor at editor@philanthropyuk.org. Please review our Guidelines for Contributors, available on our website. The secretariat for the Newsletter is being provided by ACF. To subscribe free of charge, please complete the subscription form on our website. Philanthropy UK c/o ACF, Central House, 14 Upper Woburn Place, London, WC1H 0AE, United Kingdom +44 (0)207 255 4490; www.philanthropyuk.org Design by www.sourcecoms.com Philanthropy UK aims to help develop new philanthropy by promoting and disseminating knowledge and best practice to all those involved in giving. An initiative of the Association of Charitable Foundations, Philanthropy UK publishes the Philanthropy UK Newsletter, the journal of British philanthropy, and A Guide to Giving, the essential handbook for philanthropists. www.philanthropyuk.org 7 Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 1 Barrier or opportunities: new research on giving Philanthropy UK research highlights barriers to giving by Susan Mackenzie perceived media cynicism continue to pose a barrier to giving, according to recent research by Philanthropy UK. to be published this summer – is that donors are very which charities will use their money, especially when of grant-makers and charities debate best practice in demonstrating impact. Press coverage of British philanthropy has increased noticeably over the past few years, as can be seen in the growing media round-up column in this Newsletter. Yet there remains a general perception that press coverage of charitable giving is poor, and particularly that giving by the wealthy is often portrayed negatively by the media. Whilst it is recognised that media coverage of philanthropy “is improving”, many still feel that the press can be cynical, assuming self-interest or other ulterior motives when a wealthy philanthropist speaks publicly about their giving. These perceptions are proving to be a barrier to giving publicly, leading to a lack of role models for new givers. In the article below (“The British media: barrier or catalyst?”), a panel of journalists from across the political spectrum respond The original research explores attitudes toward and experiences in giving by Britain’s wealthy, as well as the type of support private clients are seeking for their philanthropy, and what may have changed over the last Why Rich People Give (2004), the survey was conducted through in-depth interviews with professional advisors, including a number who participated in the 2002 research. To be please contact us at info@philanthropyuk.org. barrier to giving. As one advisor noted, whilst many donors have good experiences with charities, “a bad experience in giving is disproportionate”. Yet in donors’ quest for more information and transparency, a balance must be struck between the level and frequency of information provided by the charity and the resource requirements demanded in generating that information. In the next article (“Demonstrating impact: a two-way dialogue”), a panel Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 2 Demonstrating impact: a two-way dialogue What factors are most important for donors to consider when making an investment in a charity? Kevin Ireland: First and foremost, it’s important for the donor to be clear on what they are seeking to achieve from their grant-making. Then the key questions are: is there a good match with the grant-seeker’s proposals, and will the charity be able to deliver as proposed? Ability to deliver something sustainable will depend on underlying organisational capacity, and this needs to be assessed. It’s also important to understand the context within which the applicant organisation operates: how area? Donors should not make decisions in isolation from what else is happening. Daniela Barone-Soares: Ultimately it depends on what motivates people to ‘invest’. But in general I would look at (1) quality of leadership; (2) ambition for social change (i.e., for achieving its mission: what are their goals or targets, and do they seem realistic/ambitious?); (3) whether the charity is addressing a ‘cause’ or a ‘symptom’ (Litmus test: if widespread, would their way of addressing the issue achieve ‘system’ change, or is it more of the same? Would it change a paradigm, alter behaviour and/or perceptions towards resolving the issue?); and (4) what the gaps are to meet targets and how the charity plans to address them. Jeremy Swain: Donors are often attracted by innovation. Sadly, innovation is one of the most overused and tarnished words in the charitable lexicon. Much that appears innovative can be, in fact, a re-packaged service that the organisation is desperately trying to preserve. If I were a wealthy giver, the factors I would look for would be: (1) evidence of how the project will communities for their views on demonstrating charity effectiveness, and are delighted to publish their responses below. They discuss ways charities can best demonstrate their impact to donors, and challenge donors to commit their own resources to support charities in these efforts. The panel: Daniela Barone-Soares is Chief Executive of Impetus Trust. Impetus takes a venture philanthropy approach to the charities it supports, providing longcapacity-building support. Kevin Ireland is Executive Director of the London Housing Foundation. LHF specialises in providing grants and organisational capacity building support to voluntary agencies that tackle single homelessness in London. Tris Lumley is a Senior Analyst in the research team at New Philanthropy Capital. NPC provides independent research and tailored advice to donors on effective giving. Jeremy Swain is Chief Executive of the homelessness charity Thames Reach. Karl Wilding is Head of Research at the National Council for Voluntary Organisations (NCVO). Gordon Roddick, philanthropist Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 3 intends to have: (2) the track record of the organisation; (3) the sustainability of the organisation (i.e., how charity being able to manage its risks, and having the organisational capacity to continue to deliver results in future. NPC breaks risk into elements of evidence, other two key questions to ask are – what risks face the charity that might prevent it from delivering these results, and does the charity have the capacity to continue to deliver? How can charities best reassure donors that their contribution is having an impact? JS: At the outset, the charity should be able to explain how it intends to monitor and evaluate the progress of the project or service and be prepared to report honestly on how far targets are being achieved. However, donors kind of contact they wish to have. For example, Thames Reach recently responded to a major gift with regular email updates about the project the donor’s money was money linked to a single project, nor did he want an e-mail, but instead a general update in the form of “something that I can read in the bath”. Lesson to us: KI: This will depend on the nature of the proposal, in particular whether it is truly innovative or an extension of something that is tried and tested. In the latter case there is a track record to draw on, and it should be possible to demonstrate reasonable expectations of Karl Wilding: There are probably three sets of issues that donors need to consider: those of propriety, relevance transparency, not all individuals and organisations purporting to be charitable may in fact be all that they seem. Check the Charity Commission number, and then check it against the public register of charities. Second, Kevin Ireland activity either – for example, relevant organisations might only be those with a particular set of values, management, user engagement and, of course, outcomes. you prepared to trust that the organisation will do what it says and do it effectively, or do you want the assurance of detailed reporting and evaluation? Tris Lumley: Donors invest in charities to deliver results – to create real changes in the lives of the people consider: what are the results generated by the charity’s work? But the ability to deliver results rests on the Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 4 outcomes based on previous experience (from that agency or others). It is more tricky for genuinely innovative proposals. For these it is essential to be able to provide a convincing theory or model – and the onus is then on the they can make reasonable judgements on this. It’s hard to fund innovation successfully if you don’t know what TL: NPC believes that the most effective way for charities to communicate their impact is through a combination of numbers and stories, or quantitative and qualitative data. That means not only telling donors how many people they have helped, but also what the main charity A trained 400 people, of whom 350 went on to get jobs, and 300 were still in those jobs a year later. Or charity B, supporting 1,000 schoolchildren with counselling – 80% of them improved their academic performance, and 70% said it had helped them deal with their problems. DBS: Agreeing key performance indicators (KPIs) at the beginning of investment and reporting against the KPIs is key. Otherwise it becomes a moving target. KPIs should be a mix of qualitative and quantitative metrics, relevant to the mission of the charity – in tandem with their strategic objectives (so even if new measurements need to be established, they would not be onerous, as they will also help the charity measure its own progress against strategy). A one-page report every quarter on KPIs and milestones can be helpful. KW: The annual report and accounts are increasingly the source material for donor intelligence provided by GuideStar UK or Intelligent Giving. So, getting them right – accuracy, clarity, timeliness, utility – is critical. Views differ on what organisations should be reporting on, but one trend to highlight is reporting on the indirect outcomes of the organisation’s activities on the environment and wider society. Donors want to be reassured that they are having a positive impact, but also that they are not funding activities with a substantive negative impact in other areas. When will donors start to ask ‘What will be the carbon footprint of my donation?’ What main challenges do charities face in demonstrating their impact? TL: There are two main challenges. First, it is often people’s lives – of a charity’s work as opposed to its outputs, such as the activities or services it runs. Second, charities often do not have the resources – money, skills, or expertise – to work out what and how to measure. NPC believes these challenges can be overcome. Charities can start by taking simple steps to work out a few key factors to measure, instead of being overwhelmed by the challenge of measuring everything that describes their work. Karl Wilding Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 5 KW: There are many, including competing methods and approaches to impact measurement, assessment and reporting; a lack of tools to enable quick, easy collection of monitoring data at the point of delivery; over-emphasis outcome systems. It is said that funders (and donors) get the charities they deserve: until there is a serious debate about the cost of demonstrating outcomes, we shouldn’t expect in-depth reporting. KI: Measuring outcomes is part art, part science. First, though, it is important to be clear on what outcomes are expected – and here I do mean outcomes and not outputs. What changes will result from the interventions? One of attribution: did the changes arise from this agency’s intervention or from something else? Once again, the applicant needs to present to the donor – and the donor needs to be able to assess – the logic model. Does it present a reasonable case that the interventions proposed will stimulate the outcomes anticipated? DBS: Impact is super hard to measure. For example, charities dealing with ‘prevention’ or targeting policy changes may have a huge impact, but it is hard to quantify. Reality in the charity world is that the numbers alone do not tell the whole story, so charities have to invest in creating a picture of the whole that is credible. JS: Many charities work with people with complex and challenging needs where progress can be slow and rough sleepers, and last year one of our teams had great success in encouraging a homeless woman to come in off the streets after 15 years of rough sleeping. However, it took another two months before she was prepared to use a bed and a further three months before she was willing to use the dining area with other residents of the hostel. However, she is alive and the quality of her life is improving slowly through the patient efforts of staff. What role can donors play in helping charities more effectively deliver their mission? DBS: First, understand the charity funding environment. Currently it is fragmented, volatile and short-termist, so charity leadership spends more time fundraising than doing anything else. Many small-tomedium-sized charities live hand-to-mouth and in many makes them unfocused. Yet most donors are unwilling to fund charities’ infrastructure. Donors are not great at understanding that there are some costs they need to pay for as part of their giving: not everything can go directly Jeremy Swain unable to attract good people). This cycle needs to be broken: long-term core funding and expertise are what charities need (with milestones and targets, to make sure Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 6 TL: Donors can start by asking charities about their results, and by offering to fund a charity’s efforts to start measuring results. In NPC’s experience, many of the problems charities face in demonstrating their impact stem from donors preferring to fund projects and direct services rather than supporting the charity as a whole organisation. But donors can play a huge enabling role by providing unrestricted funding to charities – allowing them to develop themselves as well as delivering services. This can help them to work on demonstrating their impact and improving their communications, thus also help by asking the right question of charities: about the results their work creates. JS: The dream, of course, is that the donor does not want to be a passive contributor but wishes to become an ambassador for the organisation, enthusiastically telling their friends about their charity and urging them to join the cause. Donors are also able to create ‘freedom to This offers an opportunity to experiment. Yet, because of the risks associated with testing new models, it usually However, a challenging mission will only be achieved through the trialling of new ideas, and sometimes things will go wrong. Donors who are willing to take this journey with us are gold dust. We must show them that the ultimate return on their investment is the capacity to transform lives. KW: impact, being accountable and identifying need. The rise of social networks, Wikis and other forms of collaborative authorship on the Web point the way forward. Donors can be campaigning agents, using their social networks to build support for the causes they believe in and highlighting their impact. Charities often talk about building a relationship with the donor, but donors need to think more about building a relationship with the cause. By building more engaged communities around a particular cause, donors might address the concern that they are just direct-debit citizens. KI: I’m enormously impressed by the wide range of excellent work undertaken in the United States on organisational strengthening. For example, GEO (Grantmakers for Effective Organisations: www.geofunders.org) believes that it is essential to strengthen the deeper capacity of voluntary organisations, not just to invest in extending service delivery. We support a little of this in the UK but need to do much more. If we look to the commercial sector we can see that it’s the strong organisations that consistently perform well in delivering customer services. We should invest more in helping build strong voluntary sector organisations. left: Daniela Barone-Soares right:Tris Lumley Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 7 The British media: barrier or catalyst? British philanthropy has changed considerably journalists for their views on the role of the media in promoting a culture of giving in Britain, and are delighted to publish their responses below. They argue that media coverage of philanthropy is changing for the better, but say that, in an environment where human interest stories are what sells, the best way to increase coverage of giving is for more philanthropists to come forward, to “stand up and be counted”. The panel: Matthew d’Ancona is Editor of The Spectator Alison Benjamin is Deputy Editor, Society Guardian Stephen Cook is Editor of Third Sector Alastair McCall is Editor of The Sunday Times Giving List John Prideaux is The Economist’s political corresponden main trends? Matthew d’Ancona: The main trends are a growing consensus that Government cannot do everything, but a growing belief that the argument doesn’t stop there. Global awareness has been transformed by the Web and the proliferation of television channels. The rise of ‘ethical consumerism’ and CSR shows that people want to feel good about the goods they buy and the companies they work for or invest in. So the context has changed radically. John Prideaux: One good development has been the application of more a more business-like approach to Philanthropy Capital. On the negative side, I do not think we have seen an increase in the amount of philanthropy that is commensurate with the amount of wealth that has been created in Britain during the past Anna Southall, philanthropist and former Chair of Barrow Cadbury Trust Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 8 Alison Benjamin: People are becoming philanthropists much younger because younger people are making huge fortunes in the City or are selling their successful businesses for huge sums: mostly men in their 40s who don’t want to wait until they have retired to give away money to charity and who want a more hands-on role in philanthropy. They also take a more business-like approach to philanthropy, viewing it as an investment, leading to the rise in venture philanthropists who often want a stake in the organisations they are funding. Even inheritors of wealth – such as Sigrid Rausing and younger members of the Sainsbury family – want a more hands-on role in giving away their fortunes. Still, the rise in philanthropy represents the age of colossal wealth rather than the age of charity. Matthew d’Ancona Not only does this allow the funds to grow as the philanthropist’s business grows, but also it gives them a greater sense of ‘ownership’ of the charitable funds. Increasingly, today’s philanthropist does not want to hand over large sums of money for others to invest on their behalf. They want direct involvement in the process of giving and often want to put the giving itself on more of a business footing. Another means by which they can have more control over how their giving is directed is by setting up their own charitable trust. All of which presents a challenge to established charities seeking to attract large-scale donations. There is a widely held perception that giving by the wealthy is generally portrayed negatively by the media. Do you think that this is the case? Why or why not? JP: I don’t think that this is true any more. The negative attitudes to wealth in Britain. If you had lots of money, then you were supposed to keep quiet about it. But that is changing. There is more conspicuous consumption now. And people are more used to the idea that those who are very good at what they do will earn lots of money. AM: No, I think that we are moving away from the kneejerk media response to large-scale giving that is summarised best by “it must be some kind of tax dodge”. The media is keen to play its part in championing the global issues that face us today, whether it be AIDS, global warming or the nagging problems across much of Stephen Cook: A lot of relatively young people have become very rich in Britain in the last decade, and many of them have the kind of social conscience that makes them want to give something back to society. They don’t always want to give through established charities, and often want to do things their own way. This makes for a lot of new initiatives and ideas, and a sense of turbulence as well. One example which illustrates this syndrome is the Private Equity Foundation and the negative publicity it has attracted. Other trends are the growth in support and advice organisations for philanthropists. Alastair McCall: The main trend is towards ‘venture philanthropy’ – the ring-fencing of money to be spent charitably within the business of the person donating it. Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 9 the Third World. The Sunday Times has placed the Giving List on the opening pages of the Rich List for the past two years (and conducted the survey for six years in all) as an indication of how important we believe it is for us as a newspaper to give a lead in encouraging philanthropy – not just among the wealthiest, but across society in general. Md’A: I certainly hope that is not the case. Giving by the wealthy is obviously, on principle, a very good thing. What may be true is that – as trust in political behaviour has plummeted – so exploration of motive has become more central to journalism. We are more inclined to ask: why did s/he do that, say that, give that? But I do not think that most journalists regard philanthropy as suspect. Quite the opposite. AB: Giving by the wealthy may be perceived as generally portrayed negatively by the media because journalists like myself put the giving in context. For instance, studies by the Charities Advisory Fund and the Institute of Fiscal Studies show that the richest 10% give less than 1% of their income to charity, compared to the poorest 10% handing over 3%. So the super-wealthy are also the super-tight. We also ask whether charities should be dependent for funding on the whims, vanities and values of the super rich. However, an interview I conducted with Sigrid Rausing a few years ago about her foundation was very positive about its interesting and important work, and shows that, at its best, philanthropy can fund risk-taking or unfashionable projects that democratically elected governments or corporates may be wary of supporting. SC: There is a sense that rich givers are damned if they do and damned if they don’t. If they seek or agree to publicity, then they run the risk of being portrayed by the media as vain and egotistical. If they keep quiet about what they do, they can be portrayed as shadowy and secretive. Also, rich people may have good reasons for not wanting to attract attention to the fact that they are rich. It’s a cultural question which plays differently in different countries. Perhaps things are changing a bit here, to become more like the US. The awards run by the Beacon Fellowship may be making it easier for givers to ‘come out’ more safely. Sir Tom Hunter has managed to do publicity without being damaged by it. Philanthropy UK promotes charitable giving as a positive act of civic participation. What role can or should the media play in supporting a welcoming environment for givers of all wealth levels? AM: The media needs human interest stories and charities need the oxygen of publicity. Charities and the media, therefore, can help each other. I read countless stories in the local and regional media of people from all walks of life raising money for good causes, whether it be through completion of fun runs, abseils and other Alison Benjamin Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 10 sporting endeavours, or by using their ingenuity to raise cash for a cause. By highlighting their efforts, the media helps stimulate giving to the charities concerned. Many media outlets also champion their own chosen charity at Christmas, with newspapers regularly raising in excess of £1m or match-funding the charity of their readers. AB: The media could be receptive to running positive stories about giving – but only if the stories have a strong human interest, are innovative and allow the media to examine the giving in context. The media’s role is not to boost the ego of wealthy givers by running public relations-style puff pieces. Alistair McCall to do this is to give generously. Perhaps charities should be think more about getting coverage in Grazia than in the broadsheets. What would encourage the British media to increase its coverage of philanthropy? SC: Various media will approach the subject in their way, according to their own lights and the perceived interests of their readers. I wouldn’t see it as the job of the media to either support or not support a welcoming environment for givers. Increased coverage of philanthropy would result from helping the various with their approach and readership – horses for courses, from the FT to OK magazine. Md’A: The media operate in an environment that is competitive in a way that would have seemed impossible noisy marketplace! So journalists are always looking for stories that make impact. Where philanthropy is concerned, association with celebrities, though often treated with scepticism, always attracts attention: never visually. Pop stars are more trusted as brands than are politicians. Seasonal appeals remain very popular as the Daily and Sunday Telegraph show year after year. Ultimately, however, what makes the difference is always Md’A: I think that the media has to be cheerleader and watchdog. It is entitled and has a duty to keep an eye on charities and how they spend their money. At the same time, titles which are philosophically supportive of charitable giving can also do a lot to raise awareness. It’s a balance. The Spectator, for instance, has run articles that are cautious about particular charities. But – to take an example – I conducted a long interview with Jeffrey Sachs earlier this year which was very positive about his work and menu of proposals both for individual givers and government donors. JP: The media isn’t very good at supporting. Journalists don’t generally see it as their role to prop things up. That said, there are plenty of wealthy people who would like to be seen in glossy magazines. In America, one way Philanthropy UK Newsletter : Issue 29, June 2007 new research on giving : page 11 of a moral argument and brings it to life. Statistical stories will make a page lead in a broadsheet, but it is the narrative of an individual affected by charitable giving that sticks in the mind. AB: If more philanthropists with interesting stories who are giving away their money in innovative ways were willing to be interviewed, it would encourage more coverage. In my experience they are very wary of coming forward because they don’t want to have to answer any questions that examine/probe/challenge/raise issues about philanthropy. A journalist’s job is to challenge and to raise the questions the reader wants answered. It’s not enough that a wealthy person is giving away a few million pounds. That in itself is not of interest. The human interest is the motivation, their background, how they are giving it away and to whom. AM: Traditionally, the sort of coverage I have described in response to question 3 above falls down when it comes to philanthropy among the wealthiest in society, which is often due to the reticence of many of those involved to go public. Charities need to persuade some of their big givers that their civic duty extends beyond the act of giving, to encouraging others to do likewise – at all levels of society – through talking about it and identifying themselves with the causes they support. In a media world that is often personality-driven, the more people in the public eye who are willing to stand up and be counted for their charitable activities, the more publicity their actions will generate. Anonymous giving prompts anonymous coverage. JP: Better data would be a huge help. Journalists like new trends, and it is hard to have a new trend without any decent numbers. At the moment it is sometimes impossible to know what is actually going on out there. above: Stephen Cook below: John Prideaux Philanthropy UK Newsletter : Issue 29, June 2007 : page 12 tips for giving tips’ for giving. This issue Philanthropy UK is delighted to welcome Jon Snow, whose experience as both a fundraiser and a philanthropist has underscored that truly successful giving requires commitment from both the charity and the donor. Says Jon: “It is a prime time to be a philanthropist.” Prime Time by Jon Snow As someone who has been fundraising for a charity - the New Horizon Youth Centre – for 37 years it’s an unusual I worked as Director of the project – a drop-in advice and day centre for homeless teenagers in London from 1970 to 1973. I have been on the Management Council ever since and Chairman since 1986. Surprisingly, homeless teenagers remain an incredibly hard group of people around whom to fundraise. We represent a relatively inexpensive intervention in the harrowing journey from the care system to prison: annual running costs of the Centre are roughly equal to what it costs to keep ten men in jail for a year. 1. Core Funding. So many funders balk at much of a commitment to core funding. So many want to fund new initiatives that they can chart and identify with, and I understand that. But the base costs of a project are what keep it alive, and many of the ‘new projects’ that applicants come up with have been extrapolated from existing work and dressed up purely for the purpose of new funding. This clearly wastes the time of both the funder and the recipient. It funders’ interests or it doesn’t; contorting it to do so does neither party much good. What we need is core commitment. The record of the bigger trusts is impressive in this regard and has become more so in recent years. Understandably it is smaller funders who Philanthropy UK Newsletter : Issue 29, June 2007 : page 13 2. Feedback and maintaining a relationship. At New Horizon we have enjoyed some wonderfully fruitful relationships with funders of all sorts. It seems to me to be rewarding for both parties. The funder derives a sense of accountability and can see how their money is of both reviewing the project and of explaining it to an outsider. I feel strongly that projects that fail to keep their funders updated should never have funding renewed. An inability to abide by a disciplined feedback poorly managed. 3. Finding the right balance between short and long-term commitment. Flexibility seems to me to be the watch word. There are times when voluntary projects need bridging funds or short-term funding to enable them to get through to a next phase of funding – such as when a small project is battling to secure European funding which can be extremely worthwhile but cumbersome to secure. But there are other times when a project requires a genuine long-term commitment. I think that this should never be more than three years without wholesale review, but I annual renewal, take stock and report the effect of the funding to the award giving trust. 4 Transparency. I think it extremely healthy for projects and funders to be open and honest with each other at every turn. It is useful for a project to understand precisely why a funder did or did not fund their work. It is equally healthy for the funder to know why the project applied to them in 1970-73 he was Director of the New Horizon youth centre director of the Tricycle Theatre in Kilburn, North 5. Pro-active funding. This is potentially the most exciting and rewarding area of funding for both donor and recipient projects. City Bridge Trust has blazed a trail in the area that I know most about. Looking at a developing social need, or a developing issue, they have hatched schemes for addressing what is happening. The City Bridge knives initiative did precisely this in response to escalating knife crime. This remains an exciting and challenging time to be either a funder or a voluntary project. I would go even further: it is, I think, the most exciting time in our sector in the last three decades. It is a prime time to be a philanthropist. The role of the welfare state is evolving; tax structures are being reviewed, and ambitions for provision in response to need are rising. Philanthropy UK Newsletter : Issue 29, June 2007 letters : page 14 Letters UK philanthropy’s greatest achievements? Dear Editor, I recently read with great interest the article UK Philanthropy’s Greatest Achievements. I found it exciting to think that individuals could, through their vision, leadership and personal funding of the issues, be credited slave trade, and fostering a universal education system. The article inspired me. It made me realize that we in Canada know little about the role of philanthropy in Canada’s social history. In my role supporting our bank’s private clients in their strategic philanthropy, I thought what better way to encourage and support them than through some Canadian role models. The Bank of Montreal has consequently commissioned Canada’s equivalent of the Institute for Philanthropy to undertake research into our history of philanthropy. We have lots of data on how much Canadians give annually (about Can$9 million last year) and the causes we support, but surprising little information about what philanthropy has accomplished. In order to celebrate philanthropy in this country, we need to know more about its impact. Dear Editor, I read UK philanthropy’s greatest achievements in the last issue of your newsletter with a sense of amazement. I have no doubt that the achievements of philanthropists are many - so there is no need to start going round cherry-picking every major social innovation as the achievement of philanthropy. One example of this appropriation of other people’s achievements is the abolition of the slave trade. The movement to abolish the slave trade was neither started campaigners who used all the campaigning techniques at their disposal. Donations were needed and used, but as “Government wants to encourage a culture where giving money and time is the norm, where all citizens Ed Miliband MP, Minister for the Third Sector I am grateful to the Institute for having planted the seed for this project. I hope our research uncovers as many Marvi Ricker Bank of Montreal, Canada much for the ill-fated resettlements in Sierra Leone as the abolition campaign itself. philanthropy itself. Surely philanthropy is about major and proactive gifts of money, not small-scale and reactive gifts (let alone the work of individual volunteers and campaigners). If philanthropy is now about a donation of any size or even the donation of time as well as money then surely the strategic focus needed to grow philanthropy is being lost. Joe Saxton nfpSynergy Philanthropy UK Newsletter : Issue 29, June 2007 giving news : page 15 Giving news Sharing the wealth by Susan Mackenzie Britain’s wealthiest are becoming more generous. According to the Sunday Times Rich List Giving Index, sponsored by CAF, the top 30 most generous rich people gave over £1.2 billion last year, more than double the £450m given in 2006. The Giving Index ranks Rich List members by the proportion of their total wealth donated to charity over the preceding 12 months. The average Giving Index was 9.36 in 2007, almost triple that of 3.61 last year (the median was 4.33 versus 2.93). Now in its sixth year, the Giving Index has doubled the size of its coverage for 2007, from the top 30 to the top 60 givers. The average Giving Index for all of these individuals was 5.11, still up substantially year-onyear. The most popular causes were education and medical, followed by youth, humanitarian, social and cultural charities - largely unchanged from the previous two years. Clinton-Hunter Development Initiative, which supports agriculture, healthcare and education projects in Rwanda and Malawi; and Johan Eliasch’s £20m donation to help protect the Amazon rainforest. Alastair McCall, Giving Index editor, commented: “Combining the reformist fervour of philanthropists from the Victorian age with the business acumen and toughness of the 21st century world of commerce, these latterday Carnegies are seeking to make lasting change.” http://extras.timesonline.co.uk/rlgiving.pdf. The overall aim of the survey was to understand the giving behaviour of wealthy people, to assess their views to giving. The study, commissioned by HM Revenue & Philanthropy UK’s research published in Why Rich Survey analyses giving trends by the wealthy by Nicola Hill A recent UK survey involving in-depth interviews with year) found that they want an element of control over the timing and destination of their donations. This led many to make donations through charitable trusts or Charities Aid Foundation (CAF). Some also gave more easily to local or small charities where they could exercise more control, often sitting on the board. committed donors, large ad hoc donors, small committed givers, infrequent donors and non-donors. Large committed donors tended to be landowners or self-made business people who made planned but not necessarily regular donations of up to £250,000 per year. They usually did this using CAF or personal charitable trusts. They were also often involved in charities by being a trustee. Large ad hoc donors responded to requests from “familiar” charities – usually giving one-off payments of around £15,000-20,000 a year. Small committed givers made more regular payments of between £100 and £2,000 each year. This group tended to have more mortgage. They also earned less than £500,000 a year. Infrequent donors were also less likely to earn more than £500,000 and more likely to give through sponsorship or door-to-door collections. Non-donors either preferred not donations include a £510.6m pledge by Anil Agarwal’s to build Vedanta University, the “Harvard of India”; a further investment of £28.7m by Sir Tom Hunter in the Philanthropy UK Newsletter : Issue 29, June 2007 giving news : page 16 to give out of principle or had lapsed into not giving. less committed givers because they felt they already gave enough through taxation. One solution was emphasising the role of tax incentives. In general these were viewed very positively. Simplicity and convenience were key factors in their take-up, with Gift Aid and Payroll Giving the most popular methods. However, there was little awareness of tax incentives for giving shares, securities, land or buildings to charities. Often participants had accountants or tax advisers who handled their affairs so were one step removed from knowledge about tax incentives. None of the participants had used Self-Assessment giving. Some were motivated by tax relief. The research suggests that a shift in focus to encourage company tax relief would be successful. Overall, the research found that wealthy participants were more focused on giving by cheque or direct debit than has been found in previous research among the general population, who prefer to give by cash. Generally, donations tended to be a small proportion of income. Participants were reluctant to specify an amount or proportion that people should give to charity. charity, faith or upbringing, perceived worthiness of the cause, satisfying a social conscience or offering a sense of wellbeing to the donor. Barriers included concern about administrative costs, survey included more publicity about the simplicity of payroll giving and promoting tax reliefs as a single recognisable package. The research, Charitable Giving by Wealthy People, was carried out by Ipsos MORI for HM Revenue & Customs. http://www.hmrc.gov.uk/research/report29-giving-bywealthy.pdf” http://www.hmrc.gov.uk/research/report29giving-by-wealthy.pdf The project will analyse the existing philanthropic market and structure in the UK, compare it to models in other countries and assess market drivers through analysis, interviews and targeted polling. Outputs of the research will include proposed policy reforms, including the development of a philanthropic market infrastructure and increased giving particularly from and entrepreneurs. Louisa Mitchell, Policy Exchange research director, explained: “We recognise that experts have done much research in this area and hope we can build on that work by bringing it into our public policy research programme as a focus topic, with the aim of making policy recommendations to increase philanthropy and social investment in the UK”. Policy Exchange launched its new research project with a packed and lively seminar on the 3rd May. The panel – comprising a philanthropy consultant, a philanthropist and a politician – were asked to discuss how the City of London, with its growing number of wealthy employees, can play a bigger part in creating a vibrant philanthropic sector in the UK. between the City and giving has deep, historic roots, from the establishment of Bart’s Hospital in the twelfth Think tank explores City as engine of growth for philanthropy by Beth Breeze and Susan Mackenzie Centre-right think tank Policy Exchange, rated as ‘Think Tank of the Year’ by Prospect magazine, has launched a project to investigate ways to increase philanthropic giving and social investment in order to further develop a philanthropic capital market in the UK. The research will have a particular focus on the UK Philanthropy UK Newsletter : Issue 29, June 2007 giving news : page 17 century to new approaches to philanthropy embodied by ‘venture capitalists’. However, Lloyd spoke of many wealthy” and “can’t afford to give”. Lloyd concluded that active encouragement, a positive media and more role models are a better solution than either compulsion or naming-and-shaming. The City would produce more philanthropists once high-earners realised “it’s not a hair-shirt thing to do but part of being a complete person”. Sir Peter Lampl, Chairman of the Sutton Trust, provided a philanthropist’s perspective. He argued that donors want to see results and expect to see philanthropically funded projects run on similar lines to successful businesses. Finally, Conservative MP Boris Johnson claimed there’s a need for “psychological reconditioning” of the British people to see philanthropy as virtuous rather than vulgar. He felt the wealthy would respond to praise, including more transparent use of the honours system to reward philanthropy. The report will be published in late 2007. To contribute to the research, contact Louisa Mitchell on louisa.mitchell@policyexchange.org.uk or Rob John, lead researcher for the project, rob.john@oba.co.uk. www.policyexchange.org.uk show worrying signs by Laura McCaffrey Millionaire US householders increased their giving by 20% last year according to research by the Northern Trust. However, the researchers found that giving is expected to be lower this year because of uncertainty regarding estate tax laws and family care obligations. 27% said they plan to increase their charitable donations in 2007, compared with 44% the year before. There was also a noticeable decline in enthusiasm for giving between 2005 and 2006. Fewer millionaires now make charitable donations part of their household budget (59% in 2006 compared with 70% in 2005). Fewer HNW households view donations as an important tax reduction strategy (28% in 2006 as opposed to 44% in 2005), and there has been a decline in the importance they place on donating during their lifetime versus giving from their estate (60% agreed it was important in 2005, but only 43% agreed in 2006). The largest increase this year was among the ‘decamillionaires’, those with over $10 million liquid assets to invest, where donations increased by an average of more than 50%. Deca-millionaires make much more frequent use of all types of giving vehicles than other wealth segments. Deca-millionaires are roughly three-to-four times more likely to use private foundations (25% vs. 9%), charitable gift annuities (18% vs. 5%), donor-advised funds (16% vs. 5%) and charitable lead trusts (12% vs. 3%). The survey, Wealth in America 2007, asked 1002 HNW households about their attitudes to philanthropy, investment and beliefs about wealth and personal success. It found that the so-called GenX millionaires (aged 27 to 41) tend to be more generous than their older counterparts. 26% of GenX gave in excess of $20,000 last year compared to 15% of Baby Boomers (aged 42 to 60) and 12% of older millionaires. The survey also found that less than half of those surveyed (41%) consider themselves knowledgeable about various vehicles for giving, such as charitable remainder trusts, private foundations, or donor advised funds. http://northerntrust.com/pws/jsp/display2.jsp?TYPE=i nterior&XML=pages/nt/0605/1147987494825_694.xml Philanthropy UK Newsletter : Issue 29, June 2007 giving news : page 18 Strong emphasis on wills and academia Meanwhile, another recent survey of some of America’s wealthiest individuals found that the most common philanthropic activity is a charitable bequest through a will. 42% have made this commitment, whilst 27% have set up a charitable trust or family foundation. Charitable gift annuities and donor-advised funds are used by one in The prepared for the US Trust Company interviewed people with an ‘investable’ net worth greater than $5 million, not including primary residence. It also included a subsample of ultra-HNW individuals with total assets of $25 million or more. Only 33% cited tax considerations as a motivation for giving. 68% said they would give to an academic institution and 66% to a health-related organisation in their will. Meanwhile, only 36% said they would consider leaving money to a charity related to public issues, such as the environment or politics. A high level of trust in the leadership of a charity was a key motivator. Others said they were more likely to give if they have access to increased information on the performance of the charity. The study also looked at their views on the economy, investment behaviour, wealth management, philanthropy and intergenerational wealth issues. www.ustrust.com/pdf/SurveyXXVI_Report.pdf Giving by US corporate foundations rises by 6% by Laura McCaffrey Corporate foundations in the US gave a record $4.2 billion to good causes last year, according to a report published by the Foundation Center. This follows an exceptional year in 2005, when giving rose by 16.5% in response to the Gulf Coast hurricanes and the Asian tsunami. On top of this, pharmaceutical manufacturers gave nearly $3.2 billion through operating foundations, which are counted separately from corporate foundations. Most of this was in-kind donation of medicine. Steven Lawrence, Senior Director of Research at the Foundation Center, said: “At the current rate, in-kind giving through corporate operating foundations may soon match standard corporate foundation giving.” Key Facts on Corporate Foundations: • Corporate foundations accounted for 11% of all foundation giving, but more than 20% when combined with giving by corporate operating foundations. expect to increase giving in 2007. • Corporate foundations targeted nearly half of their giving to education (25%) and public affairs/social • While corporate foundation giving has grown in actual terms, it has declined as a percentage of companies’ 2005 it was 1%. The research is based on information from more than 80,000 foundations, corporations, and public charities. The report can be downloaded for free from the Gain Knowledge area of the Foundation Center’s website. www.foundationcenter.org. Meanwhile, UK companies are still giving less than 1% Directory of Social Change. The Guide to UK Company Giving found average donations over the last 10 years kind were included. The research showed that none of the small companies, including Dyson, donated 10%. www.dsc.org.uk/acatalog/Grant_making_Trusts. html#a205 Philanthropy UK Newsletter : Issue 29, June 2007 government and regulatory watch : page 19 Government and regulatory watch Tax cuts provoke mixed reactions on Gift Aid by Nicola Hill and Laura McCaffrey Changes to the tax rates announced in Gordon Brown’s last Budget as Chancellor will have a negative impact on the amount of money received by charities in Gift Aid when they come into effect in April 2008. According to analysis by the Charities Aid Foundation, this could result in a loss of £71m to the sector. The 2p cut in the basic rate of tax means that charities will only be able to reclaim 25p per pound donated, rather than the current 28p. The difference of 3p is because of the way Gift Aid is calculated. NSPCC has estimated that it could lose £1-2m, while Macmillan may lose half a million pounds. The announcement has provoked much debate in the sector about how best to respond to the changes. It has broadly welcomed the accompanying commitment to a consultation in June on the administration of Gift Aid – an estimated £600 million goes unclaimed each year. At a recent policy forum in London, fundraisers said the biggest problem with Gift Aid was the bureaucratic agrees – some say it is as straightforward as tax legislation can be and works perfectly well. In the meantime, some charity chief executives are calling for a transitional period to overcome the loss in income. Other suggestions include giving donors a taxfree allowance to donate to charities and better ways to collect Gift Aid on donations in-kind. The Charity Finance Directors’ Group (CFDG) wants those who pay higher-rate tax to donate all their tax relief to charity. Other solutions are rather less plausible. Some are others want the Government to allow fundraisers access to HMRC’s taxpayer register so that they could identify and exclude non-taxpayers from Gift Aid claims. Meanwhile, the Association of Chief Executives of Voluntary Organisations (ACEVO) says charities should be able to assume people are taxpayers unless they indicate otherwise to reduce administrative burden. “We welcome the announcement of a consultation on the administration of Gift Aid,” says David Emerson, Chief Executive of the Association of Charitable Foundations (ACF). “However, we think it less certain whether the Brown has previously demonstrated his support for increasing charitable giving and, while this budget impact on charities in its present form, it may offer us a good opportunity to open a dialogue with Government about how the proposals might be amended, and particularly around the possibilities of implementing additional measures to support philanthropy that are practical as well as acceptable to the Government.” Further consultation on unclaimed assets by Nicola Hill The Treasury and the Minister for the Third Sector, Ed Miliband, have jointly launched a second consultation document on the development of a UK unclaimed assets scheme. It sets out proposals for the distribution of assets and follows the initial consultation on the scheme which was published on 20 March 2007. Philanthropy UK Newsletter : Issue 29, June 2007 government and regulatory watch : page 20 The document proposes using The Big Lottery Fund (BIG) as the main UK-wide unclaimed assets distribution body. In England, it suggests the money should be spent primarily on youth services as well as development of the social investment market to help contribute to the long-term sustainability of the third sector. facilities, youth clubs, places to participate in activities such as dance and drama, and mobile youth centres. Ed Balls, Economic Secretary to the Treasury said: “The Government sees youth services as a priority. Young peoples’ lives can be greatly enhanced with good quality places for them to go to, together with support and activities. “The Big Lottery Fund has the expertise, know-how and experience to distribute unclaimed assets funds across the UK and we hope the devolved administrations will decide to share our funding priorities of youth services, The devolved administrations of Scotland, Wales and Northern Ireland will determine their own priorities for distribution. Sir Ronald Cohen, Chairman of the Commission on Unclaimed Assets, added: “We are delighted that the Treasury has emphasised the need for increased social through a portion of the unclaimed assets, to deliver more sustainable funding to the third sector. Our proposed Social Investment Bank would provide such a response to addressing these needs.” • Third sector support – Helen Stephenson, current Head of Strategic Policy and Partnerships, Big Lottery Fund. • Communications and Strategy will temporarily be headed by OTS Director Ben Jupp until a new person is found. He will also continue with his current duties. Campbell Robb, OTS Director General, said the Third Sector by Laura McCaffrey The appointment of four Deputy Directors has been performance and delivery, as well as drive forward new, innovative ideas, building on our early policy achievements”. He continued: “Using this structure the OTS aims to play a stronger overall leadership role across Government, and act as a better link between the sector and Government as a whole. In addition, we want to build on and develop our communication and partnership work, as well as strengthening communities and campaigning for social change themes arising from the Third Sector Review. Finally, we want to more fully Government’s work with social enterprises and the voluntary and community sector.” releases/070521_appoint.asp The new appointees will each lead a core team within the restructured OTS. They are: • Participation (including charitable giving and volunteering) – Sarah Benioff, current Chief Executive, Community Development Foundation (CDF). • Public sector partnership – Pat Samuel, current Head of Charity and Third Sector Finance Unit, HM Treasury. • – Hilary Norman, current Deputy Director of the Social Enterprise Team, Philanthropy UK Newsletter : Issue 29, June 2007 government and regulatory watch : page 21 New guidance on transactions with donors by Laura McCaffrey HM Revenue & Customs has issued new guidance for charities that have transactions with substantial donors. Transactions could include letting a property to a donor, commissioning them to supply services, or investment by a charity in the business of a donor. Such donors are These transactions may be treated as non-charitable expenditure, resulting in a restriction of the charity’s tax exemption. The guidance goes into more detail on what constitutes a substantial gift and outlines how to account for them in donations qualify for tax reliefs and what kind of transactions may be caught by legislation. It also explains circumstances when charities need to be aware of the legal position of transactions with donors through the use of case studies. www.hmrc.gov.uk/charities/guidance-notes/annex2/ annex_ii.htm#11 Geraldine Peacock, former Chair of the Charity Commission Philanthropy UK Newsletter : Issue 29, June 2007 news from around the sector : page 22 News from around the sector ARK fundraiser breaks own record by Laura McCaffrey Absolute Return for Kids (ARK) broke all its own records at its sixth annual gala dinner on 11th May by raising £26.6m to “transform children’s lives”. This exceeds last year’s impressive total of £18.5m. All core costs are covered by ARK’s trustees and patrons, so all money raised will go directly to the causes supported. including Jemima Khan, Bob Geldof and Liz Hurley attended the lavish dinner at the historic Marlborough House on Pall Mall. An audience with former US President Bill Clinton, a private concert by Prince and an appeal by Madonna encouraged their generosity. Deputy Chairman of Sotheby’s UK Lord Dalmeny ran an auction, which included lots such as dinner with exSoviet Union President Mikhail Gorbachev, and a day on in the Great Rift Valley of Kenya fetched £480,000. ARK also used the occasion to announce the launch of the Clinton-ARK Initiative for Mozambique through a strategic partnership with the Clinton Foundation HIV/ AIDS Initiative (CHAI). The partnership will support the delivery of rapid and high-quality care and treatment for HIV/AIDS in Mozambique. www.arkonline.org up. “I’m not doing this to be an apologist for the private equity world,” Ghosh told Third Sector. “I wouldn’t work here if I hadn’t been convinced that these guys are in it for the best possible reasons. They want to create social change.” www.privateequityfoundation.org Charity chief exec moves to Private Equity Foundation by Laura McCaffrey Former Chief Executive of Crisis Shaks Ghosh has been appointed Chief Executive at the Private Equity Foundation (PEF), the charitable vehicle for the European private equity industry. The Foundation was launched in January with a £5.1 million fund to support charities serving children, community support and education in the UK and Europe. It will also use the expertise of its members to provide free legal, accounting The Foundation has attracted controversy about the Goldman Sachs funds Ashoka’s European expansion by Karina Holly A grant of $1.1 million from the Goldman Sachs Foundation will kick-start Ashoka’s UK social entrepreneur programme and build on its existing work in France and Germany. The donation will be used to launch the association’s inaugural programme in the UK, aimed at supporting social entrepreneurs operating entrepreneurs working to achieve systemic social Philanthropy UK Newsletter : Issue 29, June 2007 news from around the sector : page 23 services and access to Ashoka’s global network of alumni and resources. Ashoka has been present in Europe since 1995, where it began operating in Central and Eastern Europe, before launching initiatives in Western Europe in 2005, where it now has Ashoka fellows in France, Germany, Spain, Ireland, the UK. The award by the Goldman Sachs Foundation, which made grants totalling over $10 million in 2005, demonstrates the foundation’s commitment to promoting the development of excellence amongst young people worldwide. www.ashoka.org www.gs.com/foundation sports, all share a common passion for philanthropy and have come together to “Pass the Passion” and ignite a movement for giving back. By connecting with professional athletes and educating them about their philanthropic options, Athletes for Hope will equip them with the tools to effectively give back to their community, educate their peers, and inspire many others to support charitable causes. The 12 founding Athletes to date have raised over $500 million for charitable and health-related causes. Ivan Blumberg, Athletes for Hope’s CEO, commented: “By bringing together athletes, fans, charities and corporations through programs focused on education, connection and recognition Athletes for Hope is starting a philanthropic movement that has the potential to inspire millions of people to positive change.” www.athletesforhope.org the natural skin and hair product company. The investment will be used to re-brand the company, increase its product range and expand its distribution. people or the environment. Whitni Thomas, Triodos Bank Investment Manager, commented: “Deals like this one prove that values-driven businesses don’t have to sell their ethical roots and attract the right kind of investment to grow.” www.triodos.co.uk Impetus Trust partners with Fairtrade by Paul Glinkowski Impetus Trust, the venture philanthropy charity, has formed a partnership with The Fairtrade Foundation, Britain’s leading independent authority on Fairtrade. The Foundation works to improve the lives of poor farmers in developing countries by promoting more equable forms of trade. Currently 580 producer groups from 58 countries, representing over 5 million people, Athletes unite for charity by Roxanne Clark Athletes for Hope, a charitable organisation to help athletes, their fans and the corporate community help make the world a better place has been launched by an elite group of professional athletes including Andre Agassi and Muhammad Ali. The 12 founding athletes, coming together from different Triodos goes barefoot by Susan Mackenzie Triodos Bank’s venture capital fund, the Triodos Innovation Fund, has invested in Barefoot Botanicals, Philanthropy UK Newsletter : Issue 29, June 2007 news from around the sector : page 24 Impetus will support The Fairtrade Foundation through its strategic planning process over the next 16 months, with a view to making a longer-term investment at the end. www.impetus.org.uk sector in Europe, which included a poll of wealthy performers were: 1. Coutts 2. UBS 3. Citigroup 4. HSBC 5. C Hoare & Co Wealth-Bulletin found that only a small group of private banks provide philanthropy services. It says there are two basic approaches that can be adopted – banks can establish an in-house team specialising in philanthropy, other route is partnering with organisations like New Philanthropy Capital or the Charities Foundation, and tapping into their specialised knowledge. Coutts was also voted ‘Best for Philanthropy Services in the UK’ in the Euromoney Private Banking Survey 2007 for the second year running. Recently Coutts has launched a loyalty scheme for its credit card holders, which clients can use for donations. The chosen charities are the Alzheimer’s Research Trust, Rainbow Trust Children’s Charity, and the Woodland Trust. www.coutts.com www.wealth-bulletin.com/article_detail.php/211/ philanthropy New research on mission-connected investment by Laura McCaffrey The think-tank, New Economics Foundation (nef) is compiling an inventory of investment opportunities in the UK and EU for charitable foundations to connect investment of their endowment to their charitable mission. The research will focus on the opportunities that may exist (or that could be created) for investment in companies, activities and products that can be directly connected to foundations’ charitable purposes or mission or very near to ‘mainstream’ investment returns alongside an acceptable level of risk. The inventory will evaluate these investment products and classify them according to a framework that will Coutts tops philanthropy survey by Nicola Hill Private bank Coutts came top of a survey of European institutions for the philanthropy services it provides. The study also found that many banks are still not doing enough in the area. Coutts was commended for its strategic partnering with philanthropy organisations, such as The Funding Network, and the fact that it regularly holds one-to-one conversations with individuals to understand their objectives for giving. The bank also runs ‘Forums for Philanthropy’, day-long events bringing together private clients with bankers and philanthropy specialists to have discussions and share experiences. Wealth-Bulletin, a news and analysis service covering charitable mission. The research will consider possible solutions to the challenges to such investment that continue to exist. Regulatory restrictions, practical issues of risk and liquidity, the lack of a market place, trustee by foundations. Philanthropy UK Newsletter : Issue 29, June 2007 news from around the sector : page 25 The report will be launched in September 2007. To contribute to the inventory, please contact Jessica Brown Jessica.Brown@neweconomics.org. report published in November 2005. Its £2m funding Trust, Scottish Executive and Economic and Social Research Fund. CAF launches free ethical investment guide by Laura McCaffrey The Charities Aid Foundation (CAF) has launched a new guide detailing the range of socially responsible investment options available to charities. It outlines the risks involved and discusses how charities can exert power in the investment market. Ron Green, Senior Manager, Charity Financial Services at CAF, said: “In the past, ethical investing has been a performance in order to ensure they are not investing in and beliefs? “But the situation today couldn’t be more different. Stewardship Income and Growth Funds have historically been less volatile than the FTSE All-Share Index.” Ethical investments have grown from just under quarter of this year. Invest today for a better tomorrow: a guide to ethical investing for charities is available free of charge. To request a copy, visit www.cafonline.org/ethicalguide or call the CAF Investments Team on Tel: 08702 643 296. Delayed philanthropy research centre seeks new leader by Nicola Hill The National Research Centre on Charitable Giving and Philanthropy is recruiting a chair to oversee its future strategy. The chair needs to be someone who combines the respect of the academic research community and the voluntary and community sector. The opening of the research centre has been postponed by six months after a series of regional consultation events. Diana Leat, Director of Creative Philanthropy at the Carnegie Trust, who is coordinating the launch, said: “It would have been quite wrong and foolish to carry on with our old timetable without taking into account the results of the consultation meetings.” The discussions focused on simplifying the governance structure of the centre. The idea for a research centre stemmed from a recommendation in the Government’s A Generous Society Institute gives money back to government by Nicola Hill The Institute of Fundraising has returned £4m of an £8.3m grant intended to encourage small and mediumsized businesses to set up payroll giving schemes. It blamed employer apathy. Although the initiative encouraged 3,380 employers to create schemes, many did not promote the match-funding element. This guaranteed to match any gift up to £10 by an employee for six months. About 18,000 employees took advantage of the match-funding offer but the Institute failed to claim the grants of between £300 and £500 that they were entitled to as a reward. Sector and will be allocated to volunteering, rather than charitable giving, projects. Philanthropy UK Newsletter : Issue 29, June 2007 news from around the sector : page 26 New guide on accountability for global funders by Laura McCaffrey New guidance has been published to encourage funders to be more accountable in pursuing international missions and objectives. The European Foundation Centre (EFC) and the US Council on Foundations (COF) have published Principles of Accountability for International Philanthropy to provide a framework to assist more foundations to get involved internationally. The Principles are the result of a two-year collaborative effort of a 14-member EFC-COF working group. With international philanthropy growing rapidly in both Europe and the US, along with other forms of crossborder cooperation, it was designed in response to donors’ search for guidance on how to ensure that their international philanthropy is conducted in an accountable, transparent and responsible manner. Download the Principles free of charge from www.efc.be/4795. The Principles are also available in hardcopy format. New magazine for European foundations by Nicola Hill EFFECT, the European Foundation Centre’s (EFC) new magazine for and about European foundations, focuses on the challenges for global philanthropy and has a special feature on the Spanish foundation sector. The magazine will be published three times per year. It plans to cover trends in the sector and foundations work. It will also showcase examples of how foundations carry out their work, both at individual and collaborative levels of engagement. Philanthropy UK Newsletter : Issue 29, June 2007 events and programmes : page 27 Events & Programmes reports Philanthropy in the City: Breaking new grounds by Susan Mackenzie 31 May 2007 This year the Beacon Fellowship’s annual forum highlighted the growing role of the City in both wealth creation and philanthropy in Britain. Almost 200 people packed the room at the Woolgate Exchange – the London home of the University of Chicago’s Graduate School of Business – to hear four Beacon Fellows share their experiences and learning. through the lens of philanthropy in the City”, it was not surprising that ‘leverage’ emerged as a common theme. Indeed, a key objective of the forum, according to Beacon Chairman Martyn Lewis, was to “highlight individual contribution to philanthropy through leadership, innovation, passion and dedication” – role models providing leverage to attract new donors. The speakers also picked up on this theme. Fred Mulder, founding chair of giving circle The Funding Network (TFN), talked about how TFN members pool resources from many smaller, individual donations to achieve a much greater impact by giving as a group. TFN’s London group has raised over £1m for charity to date. learned very early on that it was good to have a peer group of givers. And it saved me from a lot of problems and made my giving a lot more interesting and a lot more fun.” On the other end of the grant-giving scale, Jamie CooperHohn, chief executive of The Children’s Investment Fund Foundation (CIFF), explained that her £50m foundation is seeking a “very large degree of change”. A critical factor is the opportunity for leverage beyond the direct investment: Is it replicable? Can it change policy? Who will co-fund the programme with CIFF? Clare Mackintosh, founder and chief executive of ShareGift, talked about the leverage the charity offers its founders and supporters. ShareGift is a charity share donation scheme for small shareholdings that would cost more to sell than they are worth. The mechanism has already generated over £11m for charity, and is being replicated around the globe. The Blackstone Group’s John Studzinski emphasized the importance of role models in inspiring new philanthropists: “It’s hard to explain to people who don’t give money that charity is not about money; but that it’s about a way of life and a way of looking at your parlance, he referred to philanthropy as a “permanent asset” to explain what inspires him: “When I see the market and asset values go up and down, when I see life changes and friendship changes, the one thing that noone can take away from me are the things I’ve already given away to others.” Philanthropy UK Newsletter : Issue 29, June 2007 events and programmes : page 28 reports from Alliance magazine The Philanthropy UK Newsletter is grateful to Alliance magazine for its permission to reproduce the following summaries of its event reports. The full reports can be accessed at www.alliancemagazine.org. 4th Skoll World Forum on Social Entrepreneurship by Caroline Hartnell 27-29 March 2007, Oxford Where is innovation happening and how do we get more of it, was the question this year’s Skoll World Forum on Social Entrepreneurship aimed to answer. Held in Oxford in late March, it attracted nearly 700 people from more than 40 countries. Does social entrepreneurship focus too much on individuals? Innovation comes from every quarter, Geoff Mulgan of the Young Foundation reminded us. Behind every individual is a team, and much social change is driven by movements. While Bill Drayton of Ashoka insisted that “everyone’s a changemaker”, John Elkington of SustainAbility cautioned against focusing too much on a “few heroic individuals”. There was much talk of a blurring of the sectors. Mark Kramer (FSG Social Impact Advisors) foresees a towards this. But Lester Salamon (Johns Hopkins Center for Civil Society Studies) favours cooperation rather than merger and fears that the blurring of sector organisations face decisions as to whether to pursue better-off paying customers or poor clients. A similar blurring is taking place among donors, argued management guru Charles Handy. New philanthropists can be seen as “seedlings of a changing type of capitalism”, happily combining self-interest and sympathy. Muhammad Yunus, too, spoke of the need for a “new kind of business”, social business, citing Grameen Danone and the Aravind eye-care hospital as two examples. They will need new kinds of investors, happy to get back the money they have invested but to receive no dividends. While the Forum highlighted the development of a range remains a huge problem for social entrepreneurs. Whatever scale the new humanistic capitalism achieves, though, it will have its limitations. “The best way to want and what they’re prepared to pay,” said Jacqueline Novogratz of Acumen Fund. But, she added, “‘some may not be able to pay at all. We need philanthropic money still.” 6th Annual Global Philanthropy Forum by Olga Alexeeva 11-13 April 2007, Mountain View, California, USA This year’s Global Philanthropy Forum in early April headquarters of Google. The location inspired keynote speaker Judith Rodin of the Rockefeller Foundation to describe the history of US philanthropy in dot.com terms, starting with Philanthropy 1.0. Philanthropy UK Newsletter : Issue 29, June 2007 events and programmes : page 29 This, she said, involved the ‘fathers’ of modern American philanthropy, Rockefeller, Mellon and Ford. Its focus was on literacy, health and the building of infrastructure, but it also looked outside the USA and thus had a global aspect. Philanthropy 2.0 emerged after World War II. It focused on the emerging states of Africa, South America and Asia. With the end of the Cold War and the onset of globalisation, Philanthropy 3.0 began. It is characterized, she said, by new ideas and the greater involvement of Larry Brilliant, CEO of Google.org, highlighted two aspects of ‘new’ philanthropy – that it involves living benefactors and pays greater attention to topics such as climate change and global health. Philanthropy has broadened, he said, to include new forms of social investment and much greater collaboration across sectors. But he noted the continuing importance of policy, pointing out that not all problems can be solved through social investment. In fact, the numerous presentations that showcased examples of blended private and social enterprises were not always as impressive in their results as their presenters claimed. But the audience, enchanted with ‘new giving’, did not pay attention to detail. Disappointingly, the so-called global forum was not global at all. Only 40-50 out of the 600 guests came from outside the US, and these were mostly from Canada and Western Europe. Hopefully, Philanthropy 4.0 will have a global reach and a global face, and the next Global Philanthropy Forum will live up to its name. Philanthropy UK Newsletter : Issue 29, June 2007 events and programmes : page 30 notices Futurebuilders England 2nd Learning Conference 4th July, London The conference will debate the role of the third sector in delivering public services and how well the Futurebuilders investment model is working. Speakers include Julia Unwin, Director, Joseph Rowntree Foundation; Michele Giddens, Director, Bridges Community Ventures; and John Kingston, Founder Director of Venturesome. Tickets cost £80 inc. VAT for third sector organisations and £195 inc. VAT for public or private organisations. www.futurebuilders-england.org.uk/content/Events/ IsFuturebuildersworking.aspx UnLtd Learning Journey to India 24th November – 9th December UnLtd’s ‘learning journeys’ to India take a group of change-makers and leaders on a two-week expedition tackling some of the country’s most acute social and environmental challenges, with the aim of mutual learning, idea sharing and international cooperation. There are only two places left on the 2007 trip, but further journeys will take place in the Spring and Autumn of 2008. www.unltd.org.uk/learningjourneys European Venture Philanthropy Association third annual conference 25th October, Madrid, Spain The European Venture Philanthropy Association (EVPA) will hold its third annual conference on 25th October in Madrid at the IESE Campus. The event, sponsored by Natixis Private Equity International, is aimed at venture philanthropy funds, private equity to see philanthropy have greater impact”. Break-out sessions cover topics such as adding value through noncountries, and programmes focused on young people. To learn more, contact EVPA at conferences@evpa.eu.com. www.evpaconferences.eu/madrid2007.asp Philanthropy UK Newsletter : Issue 29, June 2007 interview : page 31 Cause & Effect: exploring issues in impact evaluation This regular column explores issues civil society organisations and their funders face in assessing impact. It is not a practical ‘how-to’ guide – there is already much of this literature – but, rather, addresses broader themes and challenges of impact evaluation. Through these articles, we aim to share learning and promote a dialogue measure ‘success’ – and, importantly, how we can most effectively support those people and organisations on the front lines in achieving our mutual objectives. Value creation in the philanthropic sector by Peter Scholten “Value, like beauty, is in the eye of the beholder.” It is the same with products and services, whether foris determined by its stakeholders. Something can have high value for one stakeholder, and at the same time have little value for another. Therefore we have to make sure that we know our stakeholders, and what aspects of our organisation add value for them. Yet not the whole world is our stakeholder: a development programme in the Philippines may have high impact for the Philippine people, but has very little – if any – impact on people in Latin America. The latter are not stakeholders in this case. A good performance measurement system will stakeholders, and what value it creates for them. But what is value? And how can we measure it? To understand value, it is helpful to look at marketing Peter Scholten Philanthropy UK Newsletter : Issue 29, June 2007 interview : page 32 So can we monetize image? Yes! service, they need to establish an appropriate price for it. They start by determining what target groups (i.e., stakeholders) have an interest in the new service. Then to pay. In the literature this is known as the ‘contingent valuation method’. Here we are confronted with a major difference between philanthropic organisations) are not aiming to make a the cost price as possible. They are not looking at the contrast, tend to seek the maximum price people are willing to pay. So their research targets the customer’s ‘perceived value’, and they will set their prices as close to this perceived value as possible. Now let’s look at a philanthropic organization that is creating awareness about, say, poverty, or social cohesion, or employment, or higher self esteem. Can we monetize these issues? Not if we focus only on cost price. Almost invariably, the cost price will give us the totally wrong perception of the value we create. If we are changing people’s lives, then we are changing concrete issues: change in behavior, change in attitude, change in income. And, yes, we can measure the value of all these changes, as long as we understand that we are not only measuring ‘costs saved’. Moreover, we need to research and measure the value created – the perceived value for the customer. But how do we do that? Just as stakeholders what their perceived value is. Of course, it is not always simple. You cannot just go to someone, tell him you changed his level of self-esteem and ask him how much he is willing to pay for it. But there are ways. For example, there is the Price-metermethod, widely used in marketing research. First you someone’s life or behavior (the ‘theory of change’). Then you start asking questions about what they think is a far-too high price for this. And what would really be too cheap. Because if it is too cheap, then it probably has no value. Next you ask the stakeholder when is the service ‘acceptable-expensive’ and ‘acceptable-cheap’. Between marketing this is the level of the sales price; for nonNow we know the perceived value. But can we cash it, like Nike? No, not always. But it depends… things can If we can demonstrate the value we are creating, then people may be more willing to donate, or to donate more. But if we continue to showing only our costs, then people will continue to view us as only a cost-centre. But we are creating value; we just have to show it! Peter Scholten is the co-founder of Scholten&Franssen, a European-based consultancy specialising in performance measurement tools and in assessing an organisation’s European Social Return on Investment Network and an advisor to the department for Social Venturing at value – that is, the perceived value for the customer, their major stakeholder. For example: a nice pair of Nike shoes costs only a few dollars, pounds or euros to manufacture. But the sales price can be over $100. Why? Because when Nike interviewed their stakeholders – young people who want to have a good, trendy image to show off – they found that young people are willing to pay for this image. And the perceived value of this image is worth $100! Philanthropy UK Newsletter : Issue 29, June 2007 what’s new in social investment : page 33 a brief round-up of developments in the social investment world Prepared by the UK Social Investment Forum (UKSIF) by Adam Ognall What’s new in social investment? Charity Bank plans to double size to Charity Bank has announced plans to more than double in size by 2012. This follows the announcement of its Futurebuilders England announces increased funding The Futurebuilders fund has been increased by £25m, to Third Sector (OTS). Separately, the OTS has announced that it will be inviting bids to allocate the remaining £65m of the fund from April 2008 until March 2011. www.futurebuilders-england.org.uk Opportunity International launches new branch of its bank in Ghana HRH The Princess Royal opened the newest branch of Opportunity International Savings and Loans Ltd. Opportunity International UK based in Oxford raises an unprecedented increase in loan enquiries, topping www.charitybank.org Group co-operatives. The charity recently received an £8m donation from the Bill and Melinda Gates Foundation. Opportunity International reports that 97% of all loans it makes are paid in full. www.opportunity.org.uk House of Commons hosted by Andy Love MP. Speakers included Stephen Timms MP and Sir Ronald Cohen. www.cdfa.org.uk Philanthropy UK Newsletter : Issue 29, June 2007 what’s new in social investment : page 34 Big Invest to launch social venture buyout fund Big Invest, which is owned by the Big Issue Company, order to transform them into social enterprises. Contact enquiries@biginvest.co.uk. FSG publishes analysis of mission investing by US foundations Compounding Impact: Mission Investing by US Foundations by FSG Social Impact Advisers analyses the mission investment activity of 92 US foundations with combined investments of $2.3 billion. www.fsg-impact.org Slow Money scheme announced in the South West of England The scheme, led by Wessex Reinvestment Society, provides small community enterprises with a simpler way of accessing funds and provides local investors with an opportunity to invest locally. www.wessexrt.co.uk If you require further information on these stories or have a social investment news item, please contact Adam Ognall, UKSIF Deputy Chief Executive, at Adam Ognall Ecos Fund share subscription for sustainable building projects in South West The Fund enables small investors to support the building of sustainable and zero carbon housing at a series of projects across the South West of England. www.ecostrust.co.uk Philanthropy UK Newsletter : Issue 29, June 2007 publication reviews and notices : page 35 Publication reviews & notices reviews Mrs Russell Sage: Women’s Activism and Philanthropy in Gilded Age and Progressive Era America by Ruth Crocker Bloomington & Indianapolis: Indiana University Press, 2006. 552pp. Cloth. ISBN: 0-253-34712-2. www.iupress.indiana.edu $49.95 considers a more conventional view that only through paid employment could women engage in public life at the turn of the twentieth century. She demonstrates that it was only when Olivia was freed from the ‘distraction’ of earning a living could she concentrate on public causes. And, in turn, Crocker leads her reader to anticipate Olivia’s freedom to pursue fully her One of the great strengths of Crocker’s narrative is the way in which she builds up to the culmination of Olivia’s career and to ‘the extraordinary charitable works’ promised in the later years. The author divides the with a description of Olivia’s relatively humble beginnings and the emergence of her activism. Then, through her marriage to Russell Sage she begins to realise her ambitions for charitable giving, most notably to the New York Women’s Hospital, within the constraints of her husband’s ‘miserliness’. Finally, in the context of The Progressive Era and at an advanced age, Olivia is widowed and it is at this point that she suggests that at last she was ‘beginning to live’. Crocker’s account provides precise detail on the breadth and scale of Olivia’s philanthropy. She describes her commitment to Native American reform, for example, in which white Christian women sought to evangelise and domesticate Native Americans, effectively acting as missionaries in their own land. She also describes Olivia’s gifts to her own city, region and, with growing nationalism, to her country. With the establishment of the Russell Sage Foundation and its subsequent pioneering social investigation on issues of child poverty in American welfare prior to the New Deal. And an important feature of her philanthropy was the way in which she endeavoured to make her donations conditional upon the admission of women to the boards of the colleges, schools and hospitals that she funded. Although, as Stanley N Katz has pointed out, there biography, Crocker has performed, in his words, ‘a stunning job’. Her meticulous research reveals, for example, the voluminous ‘working materials’, the reports, pamphlets and correspondence from schools and hospitals, that enabled Olivia to ensure that her giving was well informed. reviewed by Dr Helen Bowcock If history holds some important insights for modern day philanthropy then Ruth Crocker’s meticulous biography of Mrs Russell Sage is highly informative. It is Crocker’s purpose to ensure that we should not underestimate the charitable investment but also for her political activism. One of the primary aims of this historical biography is to demonstrate that, for Olivia, ‘spending was a form of speaking’. The author seeks to challenge what she Philanthropy UK Newsletter : Issue 29, June 2007 publication reviews and notices : page 36 If there is a disappointment in this story it is that although Olivia’s charity could be considered After Russell’s death her philanthropy appears constrained and compromised by her advisors and she capitulates to the more powerful claims for charitable investment. For this reason, she gives far more to male than to female colleges despite a lifelong ideological commitment to women’s education and suffrage. And this is surely a disappointment that Crocker shares with her readers, suggesting that Olivia is shaped by the prejudices of her class and race. For this reason she uses and, in particular, to ‘sanitise’ the tarnished reputation of her deceased husband. Crocker begins her biography services this biography raises some important considerations. It is in many ways a fascinating case study on the elusive subject of philanthropic motivation, highlighting a perceived need to give respectability to rapidly acquired wealth. Its continuous theme is the use of philanthropy as a form of activism and a central thesis the idea that ‘spending is a form of speaking’. Yet it presents the double-edged sword that when philanthropists are also activists their own beliefs and prejudices may be at work. And it is perhaps a cautionary tale for modern philanthropists demonstrating that the political nature of giving means that they cannot assume that their money will speak for them. Helen Bowcock is a fundholder with the Surrey Community Foundation and a member of its Grants Carnegie by Peter Krass Hoboken, New Jersey: John Wiley & Sons, 2003. 624pp. Paperback. ISBN: 978-0-471-46883-7 www.eu.wiley.com £13.50 reviewed by Beth Breeze Whenever popular commentators reach for the name of a philanthropist, chances are that it is Andrew Carnegie, the Scots-born US steel magnate and originator of beyond his nationality, source of wealth and scale of giving, how much is actually known about the man who is the poster boy for modern philanthropy? And how might his personal life story account for the subsequent Janus-face of philanthropy in the public imagination – admired and reviled in seemingly equal measure? Peter Krass does a thorough and impressive job of reconstructing the complicated life of this titan who came to power in America’s Gilded Age, exploring the contradictions in the man who rose from lowly bobbin boy the world. towards the end she describes the way this pioneer aviator ends her life in poverty, relegated to working in domestic service as her relationship with Olivia falters. This seems to serve as a metaphor for the way Olivia’s activism is constrained and her philanthropy falls short of transforming the institutions that she supported. As Crocker points out, philanthropy as an investment necessarily represents choices among competing and prejudices. At a time when searching questions are being asked about the use of private wealth in the provision of public Helen Bowcock Philanthropy UK Newsletter : Issue 29, June 2007 publication reviews and notices : page 37 Krass clearly believes that clues to the man’s achievements lie in his boyhood as he dwells at length on the dozen years Andra (as he was then known) spent in his native Dunfermline before poverty drove the family to seek a better life in the USA. An exhaustive account is provided of Carnegie’s career trajectory, where patronage and charm propelled him ever upwards, before the reader encounters any insight into the practice and philosophy of his giving. In 1889 Carnegie’s treatise on philanthropy, published as ‘Wealth’ in the North American Review, argued that all surplus funds must be considered as community. His belief that giving should occur during a person’s lifetime is emphasized in his wry comment on legacies that “Men who leave vast sums in this way may fairly be thought men who would not have left it at all had they been able to take it with them”. the public baths in his home town to his well-known the Carnegie Institute are interwoven with accounts of his life as a hard-nosed industrialist. The author’s great grandfather worked in one of Carnegie’s “hellish” mills, where frequent industrial accidents, long hours, low pay and intolerance of union activities combined to create appalling conditions. The employees responsible for ensuring that he became the world’s richest man when he sold the Carnegie Company to JP Morgan in 1902 for act of retirement when he created the Carnegie Relief Fund to support retired employees and their widows and dependents. Whether this act was proper recognition of the shoulders he had stood on, or ‘too little too late’, is a typical quandary facing anyone seeking to assess Carnegie’s legacy. Objectivity rightly demands that the author give due weight to describing and explaining both the ‘robber left to reconcile these two distinctive aspects of Carnegie’s life. Krass’ triumph in this book lies in his adept handling of Carnegie’s notorious reputation in the workplace in parallel with his development of the greatest philanthropic career yet known. Philanthropy UK Newsletter : Issue 29, June 2007 publication reviews and notices : page 38 notices A Research Handbook Research Handbook has been published in 1987. This new edition is thoroughly updated and includes two chapters of particular interest to people working in the philanthropy sector. Paul G. Schervish, John J. Havens and Mary A. O’Herlihy’s chapter on ‘Charitable Giving: How Much, by Whom, to What and How?’ uses US data but provides an analysis that is of wider interest. A subsequent chapter, ‘Why do People Give?’ By Lise Vesterlund reviews a range of motivational theories in search of practical conclusions that enhance understanding of giving behaviours. Viewpoints 2007: Intervening Maximilian Martin (Ed) This stimulating document contains a range of articles written by experienced and new philanthropic commentators who share a belief that global philanthropy is on the verge of a qualitative shift in said to exist where “the old strategic picture dissolves and gives way to the new”. Not dissimilar to the idea of a ‘tipping point’, the authors argue that well-timed and skilfully designed philanthropic interventions can help us face the massive global challenges that humanity currently faces. The argument is illustrated with diverse examples including family foundations, social entrepreneurship and cultural philanthropy. Hard copies of this publication are available free, please email your request to maximilian.martin@ubs.com. Where the Green Grants Went 3: Patterns of UK Funding for Environmental and Conservation Work Jon Cracknell and Heather Godwin The report analyses the funding provided to environmental causes, looking at the grants of 176 trusts and foundations. It also includes a section where experienced fundraisers provide feedback on what they thought would make the grants market function more effectively. There also is an overview of the funding for 75 leading environmental organisations in the UK, looking at the income streams that were most important to them, how much of their funding was restricted, and how income is distributed across the sector. New Haven & London: Yale University Press, February 2007. 659pp, Hardback. ISBN 978-0-300-10903-0. www.yalebooks.com £40.00 London: Environmental Funders Network, May 2007. 45pp. Download freely available at www.greenfunders.org/wp-content/uploads/ UBS Philanthropy Services, 2007 Philanthropy UK Newsletter : Issue 29, June 2007 publication reviews and notices : page 39 The Legitimacy of Philanthropic Foundations: United States and European Perspectives Kenneth Prewitt, Mattei Dogan, Steven Heydemann and Stefan Toepler Though privately controlled, foundations perform essential roles that serve society at large. They spearhead some of the world’s largest and most innovative initiatives in science, health, education and addressed adequately in the marketplace or in the public sector. Still, many people have little understanding of what foundations do, what their goals are and how they continue to earn public endorsement. The Legitimacy of Philanthropic Foundations provides a thorough examination of why foundations exist and the varied purposes they serve in contemporary democratic societies. The book is a joint project of the Mattei Dogan Foundation, Russell Sage Foundation and Social Science Research Council. Contributors are largely US-based but include academics based in the UK, Germany, Italy and Denmark. New York: Russell Sage Foundation, October 2006. 294pp, Hardback. ISBN 978-0-87154-696-8. www.russellsage.org $45.00 Terms and Concepts concepts that have been found useful in past research the importance of philanthropy as well as associations, management, volunteer administration, leisure, and needed; clarity regarding basic terms and concepts is the collaborated with international colleagues in an effort to make the dictionary useful outside North America, though it retains a US-centric outlook. More than 60 pages of bibliography provide an excellent resource for Indiana: Indiana University Press, April 2007. 320pp, Cloth. ISBN-13: 978-0-253-34783-1. www.iupress.indiana.edu $35.00 Philanthropy UK Newsletter : Issue 29, June 2007 publication reviews and notices : page 40 Diana Leat In each newsletter, Philanthropy UK tell us what books have most inspired and shaped their approach to philanthropy. book The Big Foundations published in 1972. This was Diana Leat, Research and Development Director of the Carnegie UK Trust. She can be contacted at Diana@carnegieuk.org. Diana says: “My approach to philanthropy has been shaped by people as much as books, and those people have not been philanthropists themselves but rather those sometimes maligned individuals who have the tricky, and often thankless, task of translating donors’ good (and less good) ideas into contributions to sustainable social change. Having said that, two authors stand out for me: Waldemar Nielsen and Paul Ylvisaker – both rebels and creative thinkers with a passion for the potential of foundations. Nielsen started off working in government, disseminating information about the Marshall Plan. Later he directed domestic and overseas programmes at the Ford Foundation. However, he is best known for his the big foundations, which he portrayed as secretive and timid, but potentially a force for public good. Among many other insights, Nielsen’s remarks on annual reports are worth remembering. He noted that foundation annual reports require mastery of the art of writing tautologies and truisms, and a special view of the world in which all efforts always turn out for the best. The Big Foundations was followed in the mid 1980s by The Golden Donors. It was in this book that Nielsen wrote, “…in the great jungle of American democracy and capitalism there is no more strange or improbable are virtually a denial of a basic premise: aristocratic institutions living on the privileges and indulgence of an egalitarian society; aggregations of private wealth, which contrary to the proclaimed instincts of Economic Man, they could not possibly exist, but they do”. Despite being described by Pablo Eisenberg (in the Chronicle of Philanthropy 11/08/05) as a ‘searing Diana Leat Philanthropy UK Newsletter : Issue 29, June 2007 publication reviews and notices : page 41 intellect and integrity’, Nielsen was a loner, shunned for what many foundations saw as a breach of etiquette. But he is acknowledged by many today as having shaken the US foundation world into greater accountability and action. My second choice, Paul Ylvisaker, wrote the chapter on foundations in the classic 1987 volume edited by W. W. Powell, handbook. Ylvisaker also worked in government and then at the Ford Foundation during the 1950s. In his impatience at the foundation’s timidity and lack of imagination. As well as playing a major part in the creation of Head Start, VISTA and children’s educational television, Ylvisaker was responsible for inventing the Gray Areas programme, which became the blueprint for Presidents Kennedy and Johnson’s War on Poverty. Ylvisaker’s insights in this programme are worth recalling today. One was the need for coalitions within and across sectors; another was the importance of language. The phrase ‘gray areas’ came from his search for neutral language to replace the terms ‘civil liberties’ and ‘race relations’ which were seen as overly radical in some quarters. In addition, he noted that a term not tied to old descriptions of problems was also not tied to old solutions - the new term in effect provided a creative space for fresh thinking. The Gray Areas programme attempt to address an issue holistically and inter- sectorally. Later Ylvisaker was involved in producing the research papers for the Filer Commission in which he outlined a series of issues for philanthropy which could well stand as the modern agenda. Two of Ylvisaker’s favourite sayings are: “Follow both routes to understanding, the compassionate as well as the analytical. No one can comprehend the universe who does not understand and care for the sparrow”; and “Day by day we knit this life, this environment, and we’re each carrying a thread that makes the tapestry. If it’s going to be a good tapestry – the whole cloth that is your home, your street, your city, your state – you’d better take part in the weaving of it. Don’t wait for a master weaver to design your life”. novels. His analysis of the institutional roots of social problems and the perils of doing good and ill - and both together - remain relevant. Mrs Jellyby in Bleak House; the analysis of power, wealth, ‘civil society’ and change in A Tale Of Two Cities; and of solutions to social problems - and their effects - in American Notes are just some of Dickens’ very modern insights. Philanthropy UK Newsletter : Issue 29, June 2007 media round-up : page 42 recent press coverage of philanthropy by Laura McCaffrey Media round-up: • An article in The Telegraph (The New • Nature magazine carries a special series of features on philanthropy in science in its latest edition (Philanthropy in science, May 2007). The majority is available to subscribers only, but an interesting news feature focuses on donations to science and looks at foundations and philanthropists and that by government and industry. It is based mostly on the situation in the US but also cites the experience of the Wellcome Trust in the UK – (“Biomedical philanthropy: State of the donation”, 16 May 2007) www.nature.com/news/2007/070514/full/447248a. html • Magnus Grimond in The Times reports on the Philanthropists, 21 April 2007) looks at giving by the super-rich, and the motivation and expectations behind their giving. It concludes that passion for the cause is but a starting point, and those with money and time on their hands want to be involved and to consider their donations as investments, to be earned and accounted for as in business. It cites individuals such as Adrian Beecroft of Apax Partners, Scottish entrepreneur Sir Tom Hunter and Arpad ‘Arki’ Busson, the driving force behind ARK (Absolute Return for Kids). www.telegraph.co.uk/arts/main.jhtml?xml=/ arts/2007/04/21/smphil21.xml motivations of people wanting to set up a trust (A that giving might allay the worries of some newly money can adversely affect their happiness. It cites GivingWorks, a charity promoting philanthropy that enables anyone with as little as £2,500 to set up a “mini-trust”. CAF has been running a similar scheme for some time, with a minimum threshold of £10,000. http://business.timesonline.co.uk/tol/business/money/ consumer_affairs/article1714480.ece Philanthropy UK Newsletter : Issue 29, June 2007 media round-up : page 43 • Third Sector reports on a three-fold increase in the money distributed to charities by clients of New Philanthropy Capital over the past 18 months (Philanthropy group now advises on £1m a month, 30 May 2007). It says that NPC attributes the increase largely to improved reporting about how money is spent by the charities it recommends to the rich. The article quotes Philanthropy UK Director Susan Mackenzie as saying that anecdotal evidence suggests giving is increasing, but only among the wealthiest. “There is much more still to be done,” she concludes. www.thirdsector.co.uk/channels/Fundraising/ Article/660378/Philanthropy-group-advises-1m-month • The £5 million donation to Tate Modern by John • Charity Finance carries an interview with Daniela Barone Soares, Chief Executive of the Impetus Trust (Soares above with impetus, May 2007). In it she describes her background in the private equity industry, her transition into the charity sector and how Impetus brings the two worlds together. “Private equity is about bringing a combination of money and expertise to improve performance. Impetus provides long-term money to charities as well as a capacity building element, hands-on support to enable change,” she says. cfdanielabarone.asp Studzinski, the American-born London-based banker and philanthropist, provokes considerable coverage. It is the largest private gift in the gallery’s history, and The Telegraph (£5m donor leads Tate Modern appeal to rich, 24 May 2007) reports that it has led Tate Modern to appeal to major City earners to donate £100 million towards the cost of the giant glass “Cubist” extension which is due to open in time for the 2012 Olympics (“£5m donor leads Tate Modern appeal ). www.telegraph.co.uk/news/main.jhtml?xml=/ news/2007/05/23/ntate23.xml • The relationship between philanthropists and the • Andrew Jack of the Financial Times uses the occasion of the 2007 Skoll World Forum on Social Entrepreneurship to focus on social enterprises (Beyond charity? A new generation enters the business of doing good, 5 April 2007). He talks to leading social enterprise supporters and critics and concludes that: “Without greater rigour, social margins to the mainstream”. http://search.ft.com/ftArticle?queryText=Beyond+ch arity%3F+&y=6&aje=true&x=17&id=070405000697 charities they support comes under the spotlight in an article in VS magazine (Doing business with philanthropists, April 2007). It looks at the increasing demand by donors for charities to meet agreed performance targets, and the arguments for and against such an approach. Philanthropy UK Newsletter : Issue 29, June 2007 media round-up : page 44 • In February The Times had carried a piece on new philanthropy, based largely on an interview with fashion heiress Renu Mehta (The new face of philanthropy, 24 February 2007). The launch event of her charity, Fortune Forum, raised £1 million for four developing world. Its guests of honour were Bill Clinton and Michael Douglas. The article examines how involvement of major donors is “changing the face of British giving”. It quotes Theresa Lloyd, former Director of Philanthropy UK, as saying this is a “ http://women.timesonline.co.uk/tol/life_and_style/ women/the_way_we_live/article1419016. ece?token=null&offset=0 • President of the Ford Foundation Susan Berresford writes an opinion piece on GuardianUnlimited to mark the opening of the European Foundation Centre’s annual conference in Madrid (Raising the bar, 31 May 2007). In it, she argues that philanthropy must set its own standards for transparency and accountability and abide by them. She praises the work done thus far in both the US and Europe to establish principles of accountability and good governance, but argues that “a far broader coalition should take ownership in and responsibility for these efforts”. Philanthropy UK c/o ACF, Central House, 14 Upper Woburn Place, London WC1H 0AE, United Kingdom t:+44 (0)20 7255 4490 info@philanthropyuk.org