May 29, 2008 | Read Time: 6 minutes
The announcement by the Bill & Melinda Gates Foundation that it had chosen a Microsoft millionaire to succeed Patty Stonesifer as its chief executive was simultaneously “rounding up the usual suspects” and a radical departure from the way in which big foundations have traditionally chosen leaders.
Jeffrey S. Raikes was one of the usual suspects because the path to the leadership of a family foundation has always rambled through the corporation with which the family made its fortune.
The decision to appoint him was, however, significantly different because Bill and Melinda Gates eschewed another hoary foundation tradition, that of naming as their leader a gravitas-exuding university president or a power-brokering chief executive who, capable though he or she may be, knows little about grant making and less about foundation management.
Instead, the Gateses actually hired a man who has been around the philanthropic block.
This matters because the Gates foundation has succeeded the Ford Foundation as — in Dean Rusk’s memorable characterization when he was president of the Rockefeller Foundation — “the fat boy in the canoe.”
Will the foundation’s sheer heft make the Gateses’ respect for relevant experience seem important or will other big foundations continue their tendency to hire leaders with no experience at foundations?
History, the muse that novice leaders in the foundation world rarely seem to hear, offers some noteworthy tales.
Foundations, in their modern form, have inhabited the United States for more than 14 decades, but it was only after the turn of the 20th century that they grew to a size that compelled notice.
The earliest big foundations, such as John D. Rockefeller’s General Education Board, chartered in 1903, had little choice but to hire as CEO a person with no foundation background.
Rockefeller’s choice, Wallace Buttrick, proved that experience was not an absolute prerequisite to excellence.
Mr. Buttrick’s leadership was characterized by a rare balance of strategic brilliance and tactical flexibility. The man who meticulously planned complex campaigns that improved educational opportunities for African-Americans also proclaimed: “Our one policy is to have no policy. When a thing is worth our doing, we can always find a reason.”
Mr. Buttrick is unjustly forgotten today, but his clear-sighted leadership set the bar for all foundation leaders who followed him.
As the years passed, other inexperienced foundation hires managed to clear that bar. Raymond Fosdick at Rockefeller, John Gardner at the Carnegie Corporation of New York, and Mr. Gardner’s successor, Alan Pifer, all distinguished themselves for their vision, their ability to translate vision into action, and the ability to share the lessons they had learned.
During those same years, however, as foundations grew in scale and in significance, it became progressively harder to effectively take their leadership without previous experience in grant making.
In 1961, J. George Harrar, having risen through the ranks at the Rockefeller Foundation, was promoted to president. His tenure was solidly successful — it was during this period that the seeds of the “green revolution” were literally planted — but some Rockefeller trustees felt that the foundation needed “new blood.”
In 1972, when Mr. Harrar retired, they got their transfusion in the person of John H. Knowles, former CEO of Massachusetts General Hospital. Dr. Knowles little knew nor long remembered the past achievements of the Rockefeller Foundation; his aim, in his own words, was “to rejuvenate it.”
There followed seven years of bitter infighting, which left the foundation, in the words of the scholar Waldemar Nielsen, “a rudderless hulk.” The “new blood” provided by Dr. Knowles, it seems, ended up mainly on the floor.
The Ford Foundation offers a similar cautionary tale of inexperienced leadership. In June 1979, Ford chose a recently appointed member of its Board of Trustees, Franklin Thomas, to succeed McGeorge Bundy as its president.
Mr. Thomas, a lawyer and leader of community-development organizations by trade, inherited many problems from the tempestuous Bundy years, including the erosion of the foundation’s finances and involvement in withering controversies outside its walls.
Confronted by foundation work at its most challenging, Mr. Thomas essentially withdrew to his office, inaccessible to all but a handful of close staff members. Whether it was a crisis of self-confidence, as his detractors said, or a careful top-to-bottom review of the foundation’s programs, as his defenders maintained, it was indisputable that for nearly two years, the Ford Foundation drifted under a leader who simply was not ready for the reins.
This story, unlike that of Dr. Knowles, has a happy ending. Mr. Thomas emerged from his self-imposed isolation in mid-1981 and began to lead with a vigorous hand and a clear direction. By the time he retired in the mid-1990s, Mr. Thomas was one of the most widely respected foundation chief executives. And, perhaps mindful of the events of nearly two decades previously, the Ford trustees decided that Thomas’s successor would be Susan V. Berresford, a longtime executive at the foundation. Her extensive grant-making and foundation-management experience jump-started her largely successful tenure.
What does this history tell us about how foundation leaders are chosen today?
Sadly, it tells us that Edna St. Vincent Millay was right when she said, “It’s not true that life is one damn thing after another; it is the same damn thing over and over.”
Although foundation work has become ever more complex and demanding, most boards still evince an unfortunate tendency to hire as CEO’s people who have never darkened the employees’ entrance of any foundation, anywhere.
Ignoring countless examples of those inexperienced new hires failing outright, or at least flailing for months before finding their sea legs, foundation boards apparently believe — and continue to act — as if any intelligent person can learn grant making and foundation administration effortlessly while on the job. Sometimes, the trustees get lucky and hire an Alan Pifer. Far more often, they hire a Dr. Knowles.
Which brings us back to the new fat boy in the canoe.
When you are the chief executive of a foundation that distributed more money in a year than the total assets of all but the 25 biggest foundations in the country, who you are and how you were selected should matter to everybody in philanthropy.
Cynics may object that Mr. Raikes never would have been considered for his philanthropic experience alone, that his tenure at Microsoft gave him the inside track. Even if true, that does not change the fact that Mr. Raikes has chaired a United Way campaign, served on the board of a university fund-raising foundation, and managed his own $126-million private foundation.
Mr. Raikes is clearly no novice, and thus has a better chance of succeeding at the Gates foundation than someone who thinks that the “public-support test” occurs during a presidential primary.
If we are fortunate, his appointment will nudge foundation leaders toward a greater respect for a good track record in the nonprofit world when choosing top leadership. All things considered, that sounds like an infinitely better outcome than new blood on the floor.
Joel J. Orosz is a professor of philanthropic studies at Grand Valley State University, in Allendale, Mich. He is the author of Effective Foundation Management: 14 Challenges of Philanthropic Leadership — and How to Outfox Them (AltaMira Press, 2007).
