Philanthropy is at a Crossroads
posted on: Monday, February 05, 2007
We are beginning to see attempts at reforming the nonprofit sector on a number of fronts. Books are being written, new principles are being promulgated, and governments are starting to regulate it. As a consequence, we are seeing entrenched methods of nonprofit business being challenged and the mission of the sector becoming a bit foggier.
There is conflict. Some interested parties have asked for the involvement of the federal government while others have strengthened their will to stop such intervention. We are starting to see the culture of yesterday beginning to crumble today.
The quiet voice for change was suppressed for decades until the recent elite charities began to show their frailties and corrupt practices. A few newspapers, including the Boston Globe, Washington Post and the New York Times, doggedly uncovered, in expose form, some of the weaknesses of a number of the nation’s leading nonprofits.
Over the years, however, most other publications would not publicize instances of fraud. Nevertheless, systemic mischief forced smaller venues such as the Palm Beach Post and the Sun News to uncover agency deceit of huge proportions. Nonetheless, few in the nonprofit sector, as well as most contributors, have any familiarity with what is happening and, to date, most media won’t inform them.
There is undoubtedly a need for reform, but mere bandages are not going to be sufficient. Increasing attention is focusing on the billions of dollars in fraud and the hundreds of agencies affected and thousands of clients that went without because of abuse. In his book, The Foundation: America’s Great Secret, Joel Fleishman shares in detail the maddening practice of over the top perks to foundation officers. He notes that in spite of a tradition of altruism and self-discipline, leadership tastes are too rich for the nonprofit culture. Resisting accountability and transparency, they remain insular and secretive.
The current situation craves for leadership to fill the void. They need someone willing to pushback the compromised course of the sector. Currently, the default leadership has landed squarely with those in privileged positions. Those powerful forces want self-regulation or status quo. Deals are being cut on behalf of the industry with little or no input from eighty percent of the agencies most affected.
There is a lot at stake. Best estimates put the nonprofit sector at 1.85 million organizations with cash revenues at $1.1 trillion. This is about 10% of the U.S. domestic product. Some 65.4 million Americans are volunteering annually. There is a great deal on the charitable table.
The sector is in flux. We losing between 30 to 50 percent of the executive staff of nonprofits through retirement or resignation* with over three million nonprofit board seats vacant each year.**
There is declining trust. Despite the current leadership’s efforts, the polls are plummeting with only one in ten Americans strongly believing charities are honest and ethical in the use of their donated funds. Another survey indicated that 73% of the increasing loss of confidence in the nonprofit sector is due to scandals.***
We are a crossroads. Will these investigations, new principles, and fresh regulations produce new realities that are not obscured? Has anyone thought about the consequences of the suggested reforms?
The initiatives under consideration demand thoughtful deliberation, but few have addressed the implementation phase and the demands on the sector. There needs to be dialog between those affecting reform and those being affected. An agenda for reform must be instituted. All factions must be included, all fences torn down, all jealousies eliminated, all arrogance put to the side, and all discourtesy removed. The current regime needs change---nonprofits and donors deserve someone who will provide leadership that will take them out of the current fiasco and brave enough to step up and act in the sector’s best interest not their own. This is for the benefit of those to who the sector is committed.
Change may well be the top priority of the charitable sector for this decade. Without a viable sector, what do we have we left?
*Annie E. Casey Foundation, the CompassPoint/Meyer Foundation, and the Bridgespan Group studies
** Booz Allen and the Volunteer Consulting Group study
*** Harris Interactive and the New York University's Organizational Performance Initiative; GuideStar survey (August, 2006)
Gary Snyder is managing director of Nonprofit Imperative and the author of Nonprofits: On the Brink (iUniverse, February, 2006). He can be reached at: gary.r.snyder@gmail.com or 248.324.3700. His website is www.garyrsnyder.com
There is conflict. Some interested parties have asked for the involvement of the federal government while others have strengthened their will to stop such intervention. We are starting to see the culture of yesterday beginning to crumble today.
The quiet voice for change was suppressed for decades until the recent elite charities began to show their frailties and corrupt practices. A few newspapers, including the Boston Globe, Washington Post and the New York Times, doggedly uncovered, in expose form, some of the weaknesses of a number of the nation’s leading nonprofits.
Over the years, however, most other publications would not publicize instances of fraud. Nevertheless, systemic mischief forced smaller venues such as the Palm Beach Post and the Sun News to uncover agency deceit of huge proportions. Nonetheless, few in the nonprofit sector, as well as most contributors, have any familiarity with what is happening and, to date, most media won’t inform them.
There is undoubtedly a need for reform, but mere bandages are not going to be sufficient. Increasing attention is focusing on the billions of dollars in fraud and the hundreds of agencies affected and thousands of clients that went without because of abuse. In his book, The Foundation: America’s Great Secret, Joel Fleishman shares in detail the maddening practice of over the top perks to foundation officers. He notes that in spite of a tradition of altruism and self-discipline, leadership tastes are too rich for the nonprofit culture. Resisting accountability and transparency, they remain insular and secretive.
The current situation craves for leadership to fill the void. They need someone willing to pushback the compromised course of the sector. Currently, the default leadership has landed squarely with those in privileged positions. Those powerful forces want self-regulation or status quo. Deals are being cut on behalf of the industry with little or no input from eighty percent of the agencies most affected.
There is a lot at stake. Best estimates put the nonprofit sector at 1.85 million organizations with cash revenues at $1.1 trillion. This is about 10% of the U.S. domestic product. Some 65.4 million Americans are volunteering annually. There is a great deal on the charitable table.
The sector is in flux. We losing between 30 to 50 percent of the executive staff of nonprofits through retirement or resignation* with over three million nonprofit board seats vacant each year.**
There is declining trust. Despite the current leadership’s efforts, the polls are plummeting with only one in ten Americans strongly believing charities are honest and ethical in the use of their donated funds. Another survey indicated that 73% of the increasing loss of confidence in the nonprofit sector is due to scandals.***
We are a crossroads. Will these investigations, new principles, and fresh regulations produce new realities that are not obscured? Has anyone thought about the consequences of the suggested reforms?
The initiatives under consideration demand thoughtful deliberation, but few have addressed the implementation phase and the demands on the sector. There needs to be dialog between those affecting reform and those being affected. An agenda for reform must be instituted. All factions must be included, all fences torn down, all jealousies eliminated, all arrogance put to the side, and all discourtesy removed. The current regime needs change---nonprofits and donors deserve someone who will provide leadership that will take them out of the current fiasco and brave enough to step up and act in the sector’s best interest not their own. This is for the benefit of those to who the sector is committed.
Change may well be the top priority of the charitable sector for this decade. Without a viable sector, what do we have we left?
*Annie E. Casey Foundation, the CompassPoint/Meyer Foundation, and the Bridgespan Group studies
** Booz Allen and the Volunteer Consulting Group study
*** Harris Interactive and the New York University's Organizational Performance Initiative; GuideStar survey (August, 2006)
Gary Snyder is managing director of Nonprofit Imperative and the author of Nonprofits: On the Brink (iUniverse, February, 2006). He can be reached at: gary.r.snyder@gmail.com or 248.324.3700. His website is www.garyrsnyder.com
posted by Gary at
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