May 5, 2010
Good afternoon.
Let me begin by saying thanks to Greg Chaillé and Mary Wilcox for your leadership of the community foundation and for your invitation to the Council on Foundations to be here today.
As you know, Steve Gunderson was originally scheduled to be here and very much regrets being unable to join you today. His niece has put up a heroic battle against cancer, but unfortunately has begun to quickly lose that fight. Steve has stayed east to be near his family. And while I see them as big shoes to fill, I am humbled to step in on his behalf.
As I look out on this large gathering, I also want to thank all of you for being here. This is a remarkable crowd, gathered in the name of celebrating the power of Oregon philanthropy. It is great to be in Oregon. As I’ve told my friend Joyce White who I believe is in the audience today somewhere, I always look forward to being here. It is a place where resilient individuals, strong values, a spirit of adventure, a sense of place and an appreciation for the assets of this great state have combined to forge progress and conquer obstacles as a community.
And the Oregon Community Foundation is a striking example of what a community – a state – like Oregon can do together. OCF is a leader and an example for the entire nation. I know that you all must be proud of what the foundation has become since it was created 37 years ago. In that time, it has grown from a $63,000 initial investment to over $1 billion in assets.
It has reached out across the state to serve communities, to grow philanthropy and to engage Oregonians. Whether by targeting education, regional action, the Latino Partnership, and other key issues, the foundation has demonstrated its unique leadership across the state.
And as we come together in celebration of the foundation’s future, we have plenty of reasons to be optimistic and excited. Not that there isn’t still a hard road ahead - for all of us - but the raw material, the sense of place, the can do spirit and you, the people, are poised and ready to forge ahead.
There are a couple of key ideas I wanted to touch on briefly today with these remarks. What the Council can often do best is to step back and give a national picture, so I’d like to share a little about what we see in the national landscape, how that’s shaped the foundation landscape and how community foundations and OCF in particular are poised for the future.
Let me begin by offering three major forces as a backdrop for my remarks:
1) The economy
2) Complexity
3) Our democracy
The Economy
The last year witnessed unprecedented turmoil, private sector failures cascaded out into communities, waves of foreclosures, unemployment and debt. Last March, we saw the Dow hit bottom of 6547.
I don’t know where you were on December 31, 2009 or what you thought at the stroke of midnight, but my sense is that never have we been so glad to turn the page and get on with a new year.
I know that Oregon, like other states across the country, felt firsthand the sense of loss, pain, and turmoil as our economy bottomed out in 2009. If the first waves of economic crisis were in the private sector, the aftershock is hitting the public sector: states, cities, school districts and townships face growing deficits, declining tax base while the need for basic human services and public works grows exponentially.
The impact was certainly felt in foundations. According to the foundation center, in 2009, foundation giving fell by 8.4 percent; assets and endowments feel by about 17%. Across the country, community Foundations faced a slightly greater reduction in giving: 9.6% decline, first decline reported since 1994.
While these numbers seem bad, it could have been worse. In 2008 and through 2009, foundations made shifts and changes so that their work, their mission to serve community, could continue in spite of the economy.
When the economic crisis became apparent, COF sent a letter encouraging everyone to do all they could in response. We asked foundations to take a leadership role in not only doing what they could to meet needs. The Oregon Community Foundation is one of those foundations that not only held steady, but actually achieved a record level of giving in 2009.
Across the country, quarter by quarter, one board meeting at a time, foundations made difficult choices, between right and right: whether to make smaller grants or fewer grants; whether to cuts to operating budgets or to cut staff; to stick with longstanding priorities or to shift resources to invest more deeply in basic human needs.
In part, for community foundations, the economic decline was mitigated by structure of those foundations, because there is continual growth and outreach to new donors. We also saw them tap fuller range of resources. Community foundations have an incredible convening capacity, and across the country we are seeing more foundations in collaboration with each other. Community foundations are on the front lines and they have, most importantly, a long term view – towards growing philanthropy, and building the cumulative impact of their work .
Nonprofits are also facing critical challenges. A recent survey from Nonprofit Finance Fund shows us the challenges nonprofits are facing in this economy:
• 18 percent expect to break even this year
• 31 percent have less than 30 days cash on hand. Of those, 12 percent reported having no cash on hand
While nonprofits are dealing with decreases in funding, they are also experiencing increases in demand.
• Nonprofit Finance Fund’s survey found that 80% of nonprofits are expecting more demand for services in 2010
• Nearly two-thirds of lifeline organizations in the survey do not expect to be able to keep up with the demand for services this year
These facts are not out of line with the findings from Oregon Giving study that showed parallel trends: an uptick in service requests and decline in resources.
Looking ahead, Foundation Center research suggests that most expect 2010 foundation giving to remain flat—a less pessimistic outlook than respondents anticipated a year ago. If the economic rebound continues, foundation giving may show positive, if modest, growth in 2011. What’s more: the vast majority of foundations don’t expect additional changes to their strategy. Many made shifts in 2008 and 2009 that will remain stable and predictable, more or less, going forward.
I will return to what this means for the future in a moment. But first, let me turn quickly to the other two ideas:
Complexity
One of other main ideas that make up this landscape is complexity:
Problems we are facing are profoundly complex – and by complex I don’t mean complicated, hard or even multifaceted. I mean interrelated and integrated. Problems today are full of repercussions and unintended consequences. Because we are all so connected, they also accelerate faster than before and honor no boundaries. No need to look further than the economic meltdown for evidence. Or the environment. Whether it’s in our oceans or our air or our water, the problems of our climate are complex and exponential. What this means is that problems take more to solve, more thinking, more partners, more time.
This has drive profound changes in our sector. We see migration across public, private and philanthropic lines: new public philanthropic partnerships, adoption of philanthropic practices in government, opportunity to scale good ideas that have been incubated in communities and invested in by philanthropy for decades.
One thing is for sure. No one person has the answer. Convening power has never been more important. Public, community, private sector, government and civic participation must be brought to bear to design solutions that work and to engage all those who are essential for those solutions to be adapted. Period.
Democracy
And finally a word about the state of our democracy.
As we face these complex problems, as a nation, we have never before been so polarized or paralyzed in the public sphere. We find that the interest in keeping up the debate overshadows the desire to convene, to connect, to occupy common ground. Civil discord seems to have more energy than civic engagement.
Let me say: I share these observations not just to cheer you up! It frames an important backdrop to the work that community foundations have underway across the country and should illuminate why and how the work of the OCF is so important at this moment.
Jim Joseph, an extraordinary statesman, ambassador and one time president of COF shared the following observation:
Make no mistake about it. These are dangerous times for our world and difficult times for our field. This can, thus, be a time to retreat into safe little boxes and lower the voices and visibility of … philanthropy or it can be an opportunity to think outside the box, to refocus the mind and to revitalize the soul of philanthropy. You are a part of a great moment in history. Don’t be afraid to demand more of yourself, your colleagues, your foundation and those with whom you collaborate.
This is a mandate for our time. To be bold. To reach out rather than hunker down. To speak up when necessary rather than stay quiet when that would really be easier. To refocus. To catalyze the people, communities and resources required to find root causes and to attack complex problems.
And today, I think we would agree that the powerful course charted by the Oregon Community Foundation takes up this mandate.
The Power of Community Philanthropy in Complex Times
As a sector, we see community foundations across the nation embracing the idea of community leadership and if ever there was a time for this movement, it is now. The national agenda for community foundations calls for them to move beyond the traditional building of assets to the building of communities.
In their support of community leadership, we see community foundations, such as OCF, playing two important roles. First, they are a catalyst. Community Foundations have unparalleled ability to galvanize private giving toward the public good around community needs.
As a catalyst, Community Foundations:
Galvanize resources: steady growth of community foundations, the spread of this movement across the country proof of this power. One of every 10 grant dollars in this country comes from a community foundation – even though community foundations make up only 1% of all foundations.
They galvanize people: community foundations engage a wide swath of volunteers, donors, partners, advisory boards, and nonprofits and aim all of that engagement towards solving the community’s most pressing needs.
I have the honor of traveling, speaking to lots of foundations, and I have never seen such a strong model of engagement as you have here. It is extraordinary to learn that Oregon CF has 1800 volunteers, actively engaged across the state. That the thousands of donors and individual givers and corporations are touched, engaged and powered by the philanthropic engine of the community foundation.
The Regional Action Initiative seems a powerful model for this work: identifying key problems, engaging community leaders, putting money on the table to help address needs while deepening civic engagement at the same time. If we are serious about solving complex problems and strengthening democracy, this is surely one way to do it.
Community foundations galvanize attention: because they are on the front lines of the community, community foundations are able to bring resources where they are needed the most. Using their philanthropic leadership, they can also spotlight key issues, bring others by the table and, as Jim Joseph stated: refocus.
One example of this that I know you’re familiar with is the Chalkboard Project is one great example of this. It took a bold goal: make this state’s system one of the top in the nation, and combined it with the power of advocacy, knowledge, people and resources to begin to advance school reform.
We’ve just heard about the new strategic plan of the community foundation. The key goals are to focus on root causes, to prioritize three issues: jobs and the economy, education, and children and families. The vision is to convene, to learn, to partner and to focus on addressing these core issues. This is what philanthropic leadership looks like in action.
There’s a parable that I’ve heard since I first got into the philanthropic sector, and I want to share it with you. I hope there are a few people in the audience who have not heard it yet. There are three men walking in, on a beautiful day along an embankment that runs next to a river. As they’re walking and talking they see, much to their horror and surprise, a baby come floating by in the river. It’s struggling, endangered clearly and one man jumps in to catch the baby and get it out. As he does, another baby comes by, floating, struggling and the second man jumps right in to rescue it. Behind it, they see a third, a fourth, a fifth infant bobbing dangerously in the river. The first man jumps back in to grab another child, as does the second. Then they notice the third man walking up the embankment, upstream. “Where are you going,” they yell. “Get in here and help us save these babies!” The third man continues to walk quickly upstream, calling back over his shoulder, “someone has to figure out who is throwing those babies in the river.”
When OCF talks about directing focus and attention on root causes, this is what it means: it’s one thing to focus on one person, one scholarship, one charitable act at a time. It’s another to look for the cause and deal with it – to find out why there are babies in the river.
Community Foundations also galvanize innovation: bringing creative ideas, strategies and different voices to the fore. The public sector today is looking to philanthropy as a source of innovative solutions to our nation’s social problems. That is a significant shift and a great opportunity. We should not dismiss in its significance. We recently heard from over 130 community foundations who endorsed the concept of the social innovation fund coming out of the White House, and who are also ready to find innovation solutions and help them scale and spread.
Community Foundations Are Also an Important Bridge
A second role that community foundations play is as a bridge. Here in Oregon, the foundation is a platform bridging rural and urban communities across the state; bridging a divide between rich and poor communities. Between new and old immigrant communities, whether migration happened across in a wagon train or across continents. In this way, they contribute to shaping our civic discourse and democracy. This platform gives voice and visibility to people and ideas that may otherwise be silent or out of view.
Looking ahead
In conclusion, I want to share a vision for the future.
A week ago at our Annual Meeting, Steve Gunderson declared that the Philanthropic Recession was over, and that it was time for us, as a field, to start building for the future of philanthropic growth. Now we were in Denver, and there was limited oxygen, but we stand by this forecast. We are optimistic about the future.
Consider this:
Today foundation giving is $43 billion, that number was $23 billion in 1999 and $7.9 billion in 1989. Foundation assets were $137 billion in 1989 and they are $583 today. The total number of U.S. foundations has more than doubled in that same 20 years.
In other words, we are still a growth industry. No matter how hard the last year, the trajectories of these numbers means that the growth of the past has left us resilient for today.
Not that there isn’t a long, hard slog ahead. But we have everything we need to come out stronger on the other side. A bold vision. The ability to take the long view. Platforms to engage ideas and connect people.
Most importantly, what compels philanthropy in the end is our most important asset. It is not strategy or logic models or advisory committees or even money. Philanthropy is an expression of hope and values. It comes from an impulse of generosity and service. It is an act of love.
That is why we have faith that philanthropy will endure, that it will grow in size and in service.
And because it is such a powerful example of philanthropy’s promise, that is why it has been my honor to join you in celebrating the Oregon Community Foundation.
On behalf of the Council and on behalf of Steve Gunderson, who sincerely wishes he could be here today, thank you for allowing me to be a part of this meeting, thanks to the Oregon Community Foundation for being a part of the Council’s family, and most importantly, thanks to all of you for what you are doing for Oregon today and tomorrow.
Kristin Lindsey is the Executive Vice President and Chief Operating Officer of the Council on Foundations.