Increasing Clout of Recruiters Stirs Debate Among Philanthropy Experts

Getting to the top at a foundation rarely happens anymore without the involvement of a headhunter.

Trustees often lack the time and resources to conduct a search themselves, so they ask search firms to help them draft job descriptions, identify and vet candidates, and act as intermediaries between job seekers and the hiring committee.

That influence has stirred a debate about the role of search firms—and in particular the four that typically conduct searches for large foundations—and whether they are doing enough to help philanthropy find the best people.

Some people argue that because headhunters have little incentive to find edgy or unusual candidates—their main objective is to please the board—they don’t bring forward daring choices.

“Search firms significantly limit the kinds of candidates that boards are exposed to,” says Aaron Dorfman, executive director of the National Committee for Responsive Philanthropy, a watchdog group in Washington. “They should be more courageous and more intentional about issues of diversity and experience when presenting boards with a pool of candidates.”

Others worry that headhunters are contributing to a trend of foundations hiring flashy candidates with big reputations, often from outside the grant-making world, who may not be a good fit for the institution and its mission. A related criticism is that many foundation leaders lack grant-making experience: A Council on Foundations study of 440 new chief executives appointed from 2004 to 2008 found that 67 percent did not come from a foundation.

“Being in the foundation field almost seems to be a disqualifier for choosing a foundation CEO,” says Joel Orosz, a retired professor of philanthropic studies at Grand Valley State University and a former W.K. Kellogg Foundation official. He and many others question why the grant-making world seems to think it so often needs to look outside itself to find new leaders and say the practice discourages the best foundation employees from staying in the field.

Casting a Wider Net

But other people don’t see a problem in the numbers. Jennifer Bol, one of the leaders of the nonprofit practice at the search firm Spencer Stuart, says she doesn’t believe the data support the argument that too many executives are plucked from outside philanthropy.

According to research conducted by her firm, 20 percent of the new leaders who joined one of the 25 biggest foundations since 2006 were promoted from within their organizations, 20 percent were hired from another foundation, 20 percent worked in academe, 20 percent came from business, and 20 percent came from other nonprofits.

That said, philanthropy may sometimes be better served by bringing in people from the outside, she says. A foundation program officer who has spent his or her career focused on a particular area of nonprofit work may not have the breadth of experience, or the management acumen, to lead an institution, she adds.

Lucy Bernholz, an adviser to foundations, says philanthropy is benefiting from casting a wider net for new leaders. “I would be much more bothered by a situation in which it was entirely a promote-from-within culture,” she says.

Another concern is that the way many search firms are compensated—they receive a third of the new hire’s starting salary—encourages them to put forward businesspeople and other candidates who command higher compensation. But Ms. Bol says that is not an issue: “Boards have a range that they can pay these candidates, and they don’t really deviate from that. It’s their choice, not ours.”

‘Dramatic’ Picks

Indeed, many observers of the foundation world point out that the main responsibility for hiring lies with boards and say they would like to see trustees change the way they approach the search for new leaders.

David Beckwith, executive director of the Needmor Fund, in Toledo, Ohio, says that many trustees suffer from the “Wonder Woman syndrome”: They have a long and often unrealistic list of what they want in a chief executive. He also says that foundations tend to want to hire a “vision rather than a person,” and then they’re captive to that vision even if it’s not a good fit. They also like to make “grand and bold gestures,” hiring people whose experience is completely unrelated to the task at hand.

“Oftentimes boards say, We have no ideas. We haven’t solved hunger. We haven’t ended poverty. Therefore, we have to do something dramatic,” he says. “It’s an illness in the field.”

People in philanthropy say search firms can help by listening a little bit less to board members and more to grantees, to other nonprofits working on the causes the grant maker supports, and to foundation staff members about what the organization needs in a new leader. Two search firms—Russell Reynolds Associates and Spencer Stuart—that have recruited CEO’s at some of America’s largest foundations, say that speaking with such people is a significant part of their process.

Still, Vincent Robinson, a former executive director of Social Venture Partners Bay Area and the founder of the San Francisco recruiting firm 360 Group, says he thinks the search process is too focused on finding “stars” and not enough on what is best for the foundation and the people it serves.

“For us,” he says, “the core of it is what the foundation as an institution needs, rather than what it wants its CEO to look like.”