The 2018 Yale Philanthropy Conference: Adaptive Philanthropy, Resilient Sector

This year’s Yale Philanthropy Conference centered on the theme of Adaptive Philanthropy, Resilient Sector. Much of the conference focused on the challenges and opportunities facing philanthropy in the current social and political climate. Conversations were deeply colored by the turbulence the United States federal government has experienced since President Donald Trump’s election, which generated significant uncertainty around government funding and policy for social issues. Charged with keeping the social sector resilient and effective in the face of external challenges, philanthropies are providing the patient and reliable capital that enables nonprofits to continue protecting the rights of the communities they serve. 

Keynote Address by Andrea Levere

Andrea Levere (SOM ’84), President and CEO of Prosperity Now, opened the conference with a keynote address in which she broadly defined a philanthropist as anyone solving complicated problems by building resilience into their work and community. Levere began her career as an organizer of community clinics in the American south. The management challenges the clinics faced inspired her to pursue an MBA. Levere says the lessons she learned at SOM have carried her through a career focused on advancing social and economic justice. They are also, she says, what enabled her to lead Prosperity Now through the recession, when her challenge was two-fold: keeping her organization afloat and helping people who were hurt by the economic downturn across the United Sates. And they guide her now, as the nation experiences profound demographic, environmental, and economic change.

One SOM lesson that influenced her is the idea that markets are shaped by policy and leave many people behind. Philanthropy exists to solve the problems the market cannot solve, she said, and challenged the audience to question why markets create problems that require a philanthropic response in the first place.

According to the Prosperity Now Scorecard (a source of financial security data that can inform policy decisions), one in four jobs in the US is low-wage and doesn’t provide even a poverty-level income.  37% of households are “liquid asset poor,” meaning they could not exist at the poverty level for three months if their main source of income were disrupted by job loss or illness. The statistics are even starker in New Haven, where 51% of households are liquid asset poor and 38% are unbanked or underbanked. Levere believes the wealth gap was shaped by decades of racist policies like redlining, and today is driven by the tax code, which saves low-income families just $60 per year and increases the national deficit. She shared one stark indication of how racially segregated wealth is: a recent Prosperity Now study found it would take black families 228 years to achieve wealth parity with white families.

But there’s hope for the future and philanthropic organizations have a large role to play. Levere has found that the same financial products, capacities, and policies that enable organizations to be effective workplaces can be adapted to help households and communities thrive, and she works towards both as the head of Prosperity Now. No sector has a monopoly on good management, she argues, and by adapting funding strategies from the private sector – and by understanding managerial accounting – nonprofits can operate more effectively. She also asserted that equity drives growth in every organization, regardless of sector, and recalled a speech by former President Barack Obama in which he declared equity fundamental to the future of the American economy and democracy. In this way, Levere placed philanthropy in a broader conversation about shaping policy and opportunity.

Panel highlight: Thinking Outside the Box: Fostering Creativity and Experimentation in Organizations

The conversation about how philanthropy can be leveraged to shape the future continued in several conference panels, including those on Making Strategic Shifts and Realignments, Building Operational Capacity and Organizational Effectiveness, Marketing to the Activated Donor, and Advancing Responsive Philanthropy. At Thinking Outside the Box: Fostering Creativity and Experimentation in Organizations, panelists discussed the state of innovation in philanthropies. Neela Pal (SOM ’13), Senior Consultant at Fiscal Management Associates, argued that every social sector organization is inherently innovative because it questions the status quo and solves problems. Swapna Reddy, Co-Founder and Director of the Asylum Seeker Advocacy Project (Yale Law ’16), agreed that in her job innovation is about bringing a fresh perspective to problems that feel entrenched.

Elena Matsui, Strategy Associate at the Rockefeller Foundation, noted that innovation is necessary but difficult, because the system is structured to ensure that organizations use money judiciously and don’t waste resources. Pal agreed, saying that there’s a tension between the people who distribute resources and the people who allocate them, who often have a clearer view of programmatic realities. Her work, she says, is trying to bring these people together. Matsui said one of philanthropy’s strengths is that it “brings risk-tolerant capital to the table that makes possible learning and potential and responsible failure.” She also noted that the Rockefeller Foundation strategically directs its resources towards programs where it thinks it can take risks that others cannot. Reddy emphasized that part of taking successful risks is being honest about her work. “People don’t often say, ‘I don’t know what works but I do know it’s not this,’” she says, “But you need to know what didn’t work so that you can use that to be more innovative.”

Palak Shah, Social Innovations Director for the National Domestic Workers Alliance, reiterated Levere’s belief that many of today’s policies are based in historically racist legislation. She underscored that marginalized communities must have a seat at the table when organizations innovate, and that innovation should not come at a marginalized community’s expense. Matsui noted that philanthropies can lead innovation and scale exciting ideas, but should then transfer responsibility to the people being served. She’s excited to use behavioral science and human-centered design principles to build feedback loops that manage relationships between funders and beneficiaries in a way that shares power.

Concluding Keynote: Aaron Dorfman

Many of these themes were echoed by Aaron Dorfman, President and CEO of the National Committee for Responsive Philanthropy (NCRP), in his concluding keynote address. He challenged audience members to ask themselves five questions that will help them be more deliberate and impactful when advocating for social issues. First: Are we dreaming big enough? Dorfman pointed to marriage equality, which seemed a far-off goal twenty years ago. But thanks to the commitment of the Evelyn and Walter Haas Jr. Fund, which made a $2.1 million commitment to the marriage equality movement, other large donors like the Ford Foundation, Johnson Family Foundation, and Horizons Foundation were mobilized. The early support of these organizations was integral to the landmark Supreme Court ruling in 2015.

Second: Are we doing enough to intentionally benefit and empower vulnerable and marginalized communities? The National Committee for Responsive Philanthropy’s Pennies for Progress Report found that less than one third of grant dollars are intentionally designed to benefit marginalized communities like people of color, women and girls, people with disabilities, and the elderly. Ninety percent of philanthropies don’t meet the NCRP’s benchmark of devoting half of their grant dollars to underserved communities, and only 10% of large philanthropies give their money to social justice strategies. There’s also geographic inequality, with some regions like the southern US starving for philanthropic dollars. Dorfman argued that to make real impact with limited dollars, donors need to prioritize vulnerable populations and empower the organizations that serve them with operational and management support.

Third: Is our privilege making us overly cautious? Dorfman hypothesized that philanthropies don’t invest in marginalized communities because they incorrectly doubt the capacity of these communities and don’t do the diligence required to overturn these biases. He also recognized his own privilege, and said that in order to use privilege to advance our society, we need to share power with people who are different.

Fourth: Are we giving in ways that promote the health, growth and effectiveness of our grantee partners and those they serve? The NCRP recommends grant-givers provide multi-year funding and giving half of all funding to operational support. It is difficult for nonprofits to serve effectively when their funding is uncertain, inconsistent, and program-restricted. Especially when government funding is unreliable due to changes in administrations, philanthropies should act on their unique position to fill the gap.

And finally: Are we wielding our power and all the tools at our disposal to build the world we envision? Dorfman believes that good philanthropy is about more than grants. Beyond capital, philanthropies must deploy social, moral, and reputational power to influence equitable, long-term change. He believes that neutrality is overrated, and philanthropies should exercise their power to stand for the communities they support. Philanthropies can ensure that marginalized communities aren’t excluded from the planning process, that organizations wield their collective bargaining power, and that funders support politicians who advocate for positive change.

Dorfman closed his address by encouraging SOM students to act now. Students should ask hard questions and force established philanthropies to wrestle with important issues. “What else are we here for in this world?” he asked. “We live in urgent times, and the future of our democracy and our planet are at stake. There’s no limit to what we can accomplish with good philanthropy. It’s up to everyone in the room to make sure philanthropy plays a role in building a more just and fair society.”

By Jesse Dubow, SOM ‘19