/ Social Sector / by Ute Volz

The One Thing All Philanthropists And Foundations Should Do

In the end it's all about perspective: When people become philanthropists or start a foundation, they often put their egos first. However, to be taken seriously with their money, they should turn their focus – and their aspiration – towards the world outside, to realities, unanswered questions and effective solutions.

Philanthropists should first see, hear, read, think, learn, inquire, reflect, comprehend, write, publish, discuss. And then, they can decide and act. That is what our guest author, Jake Hayman, tells us in his text republished below: Philanthropy, the giving of money, is a very different act than caring about someone and helping that person or than simply wishing that things were better. It requires hard work and dedication. It is not enough to pick a favorite topic, form a “funding strategy” around it and renew that strategy every two years with more “strategic considerations”. – So, what is the answer? What should we do?

The One Thing All Philanthropists And Foundations Should Do
by Jake Hayman

Philanthropists and foundations simply do not have the resources to prop up state services at scale. If they want to make a lasting difference, they need to contribute to thinking and knowledge. 

If there is one thing and one thing only that every foundation and philanthropist should do, it is to publish and republish what they think, iterating that thinking based on what they learn through grant-giving and from challenge from service users, charities, policy experts, data, front-line workers, communities, business, researchers and peers.
The charity sector is unfortunately overflowing with organizations funding what they “like” – the causes, geographies, models, communities or fields they are attached to – without ever taking the time to think about the how money does and could affect those areas.

Philanthropy is a specific act – the giving of money. It is not the same as caring about something, it is not the same as wishing things were different, it is the commitment of financial resource to deliver social aims (however intangible, indirect or long term they may be).

Most philanthropists and foundations move straight to “form” (what type of organizations do I want to support through what type of gifts), without ever thinking about “function” (what am I trying to change in the world, what is needed to bring about that change and what role can I play with the resources I have).

The philanthropist or foundation that has a commitment to educational disadvantage and has £250,000 to give away each year has two choices: to start with form, or start with function.

Starting with form you might decide that you like supporting a number of different organizations in order to limit risk and spread the “good.” You might decide to give £25,000 per year to 10 different organizations. You might think that you don’t want to give to big organizations because you don’t want to be a “small fish.” You might decide to target organizations that are less than £1 million in turnover. You might be worried about organizations not being professional and require three years of audited accounts to indicate reliability. You might then try to post-rationalize the arbitrary decisions above by prefixing them with “we believe we can make the biggest difference by …”
Alternatively, starting with function you would likely first talk to people about what the problem is. If it is that schools are “failing” is that because the buildings are falling down, poor leadership, unmotivated teachers? Is it that schools are in fact doing great, but that people from the most disadvantaged backgrounds are not accessing this great education because it is not inclusive? Is it that people from poorer backgrounds enter school far behind and never catch up despite great schools. Or is it that they enter at the same level and fall behind during long summer holidays? You would speak to charities and service users, policy makers and front-line workers, academics and data experts and you would write down everything you think you know and evolve it.

You would focus within this on two areas: 1) where there is evidence, but practice does not follow and/or 2) where there are questions that everyone agrees are important but no one has an answer to. You would then look at whether the right kind of investment is already being made by someone else to the sufficient levels to cover off those areas and whether replicating or adding to that will make any difference.

You then sit very carefully and look at how philanthropy of the size and scope you have access to has successfully answered questions like this before. What are the precedents for success that you might like to replicate? Is it supporting sub £500k organizations with £25k grants on the basis that one in 10 will “rise to the top” proving a new model or is it sponsoring research, advocacy or putting £2 million over eight years into a single new idea that you want to model and test? Is the precedent that in fact the best new practice in this space has come from big organizations not small? Through this process you would come to be able to articulate the precedent for success that you are basing your cash allocation on.

The reason you write it down and publish it is so that people can challenge you. You become accountable to what you think. You give ownership to stakeholders because they can see what you think and learn from it or disagree with it. You improve practice, not just in your own organization but across an entire field.

It might take a bit more effort, but those that publish their “why” and then iterate it based on what they hear, see, fund and learn, will always make a greater difference than those who just “do.”

About the author: Jake Hayman is a philanthropic advisor and CEO of the philanthropy education firm Ten Years’ Time. He started – and worked for – several social enterprises and creative businesses. In May 2015, we republished Jake’s text “Not fit for purpose: why I’m done with the foundation world”. Luckily for us, Jake stuck around with his critical view towards the landscape of philanthropy and funding.

Reprinted with permission of Jake Hayman. Originally the article was published here.