When To Lead and When To Get Out of the Way

The press pays scant attention to foundations except when trumpeting mega-grants or reporting on scandals involving bad management or the exorbitant sums paid to some foundation officials and trustees. These are undoubtedly important issues. Philanthropy is a public trust, and some individuals in the field have undeniably abused it. But those cases are the exceptions, and the true leadership gap in philanthropy has very little to do with professional ethics as they are normally construed. The greater problem has far more to do with what we might call public ethics: how foundations confront societal challenges.

Foundations must lead with more than their dollars. They and their key executives and board members must also lead with their voices. Many foundation leaders have spoken out forcefully about Congressional review of the rules governing the foundation-payout rate and other issues that primarily affect the grant makers themselves. But few foundations that are leaders in supporting public-policy and social-justice groups have said much about a series of tax cuts that have steadily enriched the most wealthy Americans while curtailing the ability of government to provide for the welfare of all citizens.

Obviously, there is a relationship between whether a foundation spends 3, 5, or 6 percent of its assets on grants — or how much of its administrative expenses can be counted against that total — and its ability to carry out its mission. But draconian tax and budget cuts that leave arts groups and youth programs reeling, threaten prospects for welfare reform, and cut critical social services have a far greater effect on demands for scarce philanthropic dollars and on whether grant makers can possibly begin to fill the subsequent needs.

Some foundations are reluctant to speak out about such social-justice issues, even as their grants support important work in that area, for fear that they may be seen as competing with, or drowning out, the voices of their grantees. That reticence deserves respect, as humility by foundations is still too rare, and it is important to acknowledge that those who are most directly affected should lead social movements.

However, elite voices also play an important part in the interdependent ecosystem of advocacy and social change, and they always have. Think of the criticisms of the death penalty by Felix Rohatyn, the former ambassador to France, or the former secretary of state George Shultz’s questioning of the so-called war on drugs.

In a more recent example, when Attorney General John Ashcroft, in his December 2001 testimony before Congress on the Patriot Act, questioned the patriotism of those who opposed the Bush administration’s actions, we at the Open Society Institute were stunned at the return of such McCarthyite intimidation tactics. We waited a day or two for prominent voices — such as senators, former government officials, university presidents, or religious leaders — to condemn the outrageous equation of dissent with disloyalty. When no voices were raised, we decided to take out a full-page ad in The New York Times, and asked prominent people to subscribe to a simple statement, one that did not condemn increased surveillance, military tribunals, the mass questioning of Arab-Americans, detention policies at Guantánamo, or any other specific administration policy. The statement simply said that, whatever one thinks about the merits of such policies, the country is stronger for vigorous debate and questioning.

In those fearful days, however, we couldn’t procure a single signer. Many of the prominent people we asked, including former Republican leaders, said that they agreed entirely with the statement. But they found one reason or another for not lending their names, and the more candid among them told us that the administration would find a way to punish them for any public criticism along these lines.

So we took out the ad ourselves and signed the names of our trustees and principal officers. I say this not in the spirit of self-congratulation; in fact, it took little courage for those of us in such a privileged position to stick our necks out a little. But it would be nice to have more company in such matters, not because we are lonely, but because when the powerful speak out in solidarity with those who are marginalized it provides cover and validation for them.

One president of a major foundation, someone I admire a great deal, has said he looks forward to retirement so that he can speak out more on social and global problems. But why on earth should he wait?

It’s not only at the most senior level that more people must look for their voice — it is throughout the foundation world at every level.

When I accepted the Paul Ylvisaker Award on behalf of the Open Society Institute at last year’s Council on Foundations meeting, I challenged foundations to do more about the racism of the criminal-justice system. When blacks constitute 13 percent of drug users and 57 percent of those incarcerated in state prisons for drug-related violations, everyone should stand up and take notice. Perhaps we have not come as far toward achieving a colorblind society as many people like to think.

After I spoke, dozens of people came up to me in the next day or two, including virtually every person of color at the conference, to thank me for speaking out. If every one of those people and their institutions resolved to work together on this and other social-justice issues, the status quo would indeed change.

While they can, and should, raise their voices about unmet social needs, there are also times when foundations and people in positions of power should get out of the way. Meaningful progress and effective solutions rarely emerge from the top and trickle down. Grant making is more about an eye for movement, and a boost for the efforts of others, than it is about the “creation” of movements themselves. In his work to support civil society outside the United States, George Soros has called this process “seizing the revolutionary moment.”

Foundations should set public-policy goals and have a clearly articulated vision of social change. But they shouldn’t attempt to direct the fields they support by designing rigid models that groups must follow to receive grants, or run foundation-created programs that in effect compete with others in the same field.

Getting out of the way also involves identifying key groups that share a foundation’s goals in a given area of interest and trusting those groups, in a supportive relationship, to set their own course and make their own decisions about programmatic priorities. This is best done by providing general support that gives organizations needed flexibility, as well as multiple-year grants that allow them to plan and afford some relief from the seemingly endless cycle of fund raising and paperwork. This, in essence, is what anyone running a nonprofit organization wants, although many who cross over from tin-cup rattler to banker often lose sight of this principle.

One grant maker who subscribed to this principle was Paul Ylvisaker, who worked at the Ford Foundation from 1955 to 1967, a critical period in American life when Ford provided key support to the civil-rights movement.

Forty years ago he made remarks about foundations that still hold true today: “What we represent,” Mr. Ylvisaker said, “is the resilient margin of the industrial order, the most stretchable part of the world’s status quo. The program question for us is whether we are stretching our resources and ourselves as far and fast as the situation demands. Not our own immediate situation, which is but a cozy corner in the walled castle of industrial affluence. But the universal circumstance, which is the growing discrepancy between those inside ‘the system’ and those without.”

Gara LaMarche is vice president and director of U.S. programs at the Open Society Institute, in New York. This article is adapted from a speech he gave to the Donors Forum of Wisconsin.