Large Foundations Fall Short in Supporting Vulnerable Groups
Washington, D.C., March 4, 2009 — The nation's largest foundations only gave $1 out of $3 to benefit the economically and socially disadvantaged, according to the Criteria for Philanthropy at Its Best: Benchmarks to Assess and Enhance Grantmaker Impact, released yesterday by the National Committee for Responsive Philanthropy.
The Criteria for Philanthropy at Its Best is the first ever set of measurable guidelines that foundations and other institutional grantmakers can use to maximize their contributions to society and to make a positive difference in the world today. One of the benchmarks emphasizes support for underserved communities.
"Especially now, when every foundation dollar is at a premium due to the recession, where the money goes becomes an even more critical issue." said Aaron Dorfman, executive director of NCRP. "So we are asking our nation's foundations to renew their commitment to help our nation's underserved men, women and children. We all benefit when foundations invest in helping vulnerable populations."
Interwoven throughout the Criteria is the concept that foundation assets are partially public dollars due to their tax-exempt nature.
"Taxpayers have rewarded [foundations] for being there for America," said Representative Xavier Becerra (D-Calif.) at yesterday's unveiling. "At the same time, those of us at Congress have an obligation as the representatives of the people to make sure that their money-taxpayer money-are being well invested."
Rep. Becerra is a senior member of the House Ways and Means Committee.
NCRP analyzed the giving trends of more than 800 of the country's largest foundations from 2004 - 2006 based on a dataset developed with the Foundation Center.
Results show that less than $5 billion out of nearly $15 billion in foundation grants from 2004 - 2006 were given to nonprofits in support of marginalized population groups.
Many foundation leaders believe that their dollars are "private" funds and object to being told how to spend "their" money. There are, however, those who see the important role the sector plays in strengthening the country's democracy.
"Philanthropy certainly has the resources and potential to help tackle the deeper, structural causes of inequality and injustice," said Luz Vega-Marquis, president and CEO of the Marguerite Casey Foundation. "NCRP's criteria are exactly what foundations need to transform our institutions and grantmaking in ways that serve lower-income families and contribute to a just and equitable society."
The Criteria for Philanthropy at Its Best focuses on values, effectiveness, ethics and commitment. It tackles hotly contested issues like payout, general support vs. program grants, board composition, compensation and disclosure. It also looks at multi-year funding, partnerships, administrative requirements and mission investing.
The Criteria for Philanthropy at Its Best is available for free download at NCRP's website, where you can also view the list of endorsers and order your copies. An online self-assessment test for foundations also will be available in the coming weeks.