Philanthropy: The Business of Changing the World

Nonprofits bridge the gap of what businesses can’t afford to do as the financial returns are too small and that it may not be government’s job to do. In challenging economic times nonprofits address a critical void, often without the tools they need to fulfill their mission.

Panelists:

• Brent Christopher: President & CEO, Communities Foundation of North Texas
• Charlotte Keany: Director of Consulting, Center for Nonprofit Management
• Robert Wright: President: Executives in Action, Co-founder: Dallas Social Venture Partners

The world of nonprofits is evolving, emulating business best practices. This evolution incorporates different models including: venture philanthropy, social enterprise and proactive hands-on involvement from business leaders who bring business management and leadership advice to nonprofits.

Involved in different aspects of this new evolution, each of our panelists brings a fresh perspective to the world of philanthropy.

What’s changing in this world and what needs to change? Bob Wright, says, “we’re seeing a blurring, a combination of best practices of some of these sectors; business moving into nonprofit sectors with social enterprise, nonprofits emulating business practices as they try to become more accountable… We need to measure charities by their impact and effectiveness.” Bob joined us about 10 years ago on a program talking about the then fairly new concept of Venture Philanthropy. To date Bob has helped start 27 Social Venture Partners around the country.

Charlotte Keany, who started the Social Enterprise Alliance – Dallas chapter, talks about social enterprise, a model which helps nonprofits strengthen their business by taking a product or service they may already have and selling it to the public, thereby creating for themselves an unrestricted earned income stream. The earned funds can be used for much needed research, product development and revenue to run the nonprofit and grow the organization. The Center for Nonprofit Management has spearheaded over two dozen such entities.

We learn from Brent Christopher that there are over 700 Communities Foundations around the country, with Dallas being one of the largest. Communities Foundation was initially called the Dallas Community Chest Trust Fund, yes just like Monopoly. Today Communities Foundations nationwide serve the charities in their community, “helping donors who are ambitiously compassionate make tomorrow better” by making grants on their behalf that give back to the community they live and work in. Or a donor can choose to be more involved through donor advised funds.

Dan Pallotta, author of Uncharitable: How Restraints on Nonprofits Undermine Their Potential, joins in via a previously taped interview and addresses the controversial question of charities being more business oriented in how they operate.  His response:

“There’s been a popular admonition in the last 15 years; we want charities to act more like a business. What we mean by that is we want to draw more blood from the stone. We want them do even more with less. That’s the opposite of how businesses succeed. Apple didn’t succeed by spending less researching the multi touch screen for the iPhone and iPad. I take tremendous issue with this advice to charities; you should start acting more like business. We’re not for a moment ready to allow charities to act more like business. We get upset when they pay their people the kind of money we pay in business… we get upset when they want to spend money on advertising… or take risks… Please stop telling charities to act more like a business when we won’t give them permission to do that. It’s abusive.”

There is no question that many charities, the great majority of which have budgets under $500,000, need to look at different ways of doing business to fulfill their mission. As the economy tightens and government cuts impact social services, nonprofits fill the gap. Yet we penalize the many for the egregious and public mistakes of the few and put restraints on charities, handicapping their ability to do their best work. To continue the work that charities do- new ways must be explored, current practices examined and decidedly more conversations like this one must take place.

We challenge you to get involved in your community by volunteering and writing that check. Investigate the nonprofits that resonate with your personal and corporate mission, jump in and change the world. It is your world after all.

Thanks for joining us as we talk about what really matters with people like you who really care.

Niki Nicastro McCuistion, CSP
Co-founder/ Executive Producer
Leadership and Nonprofit Consultant/Speaker
nikin@nikimccuistion.com
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