By Mike Flynn
Mike Flynn & Associates

Wall Street, Walmart and WAMU notwithstanding, the public’s view of business is improving. Those who measure such things say that’s largely because of the way businesses of all sizes have struggled to continue their support of non-profit and community causes despite the bleakest of financial times.

Walmart, which now faces a massive lawsuit for alleged sex discrimination, joins the above trio, which obviously could include many others, after being burned by what may well come to be known as the Tiger Woods Rule: If your marketing folks create an inflated you, then you’ll be pilloried when the real and deflated you emerges.

The fact that the public’s attitude toward business is creeping up has been highlighted several times in recent months, most visibly early in the year with the release of the 2010 Edelman Trust Barometer.

The survey by the international public relations firm, which made presentations on the survey around the country, showed what it called “a modest rise in trust for business” after the trust-index level the previous year had shrunk to historic lows.

The growing trend among corporations to engage stakeholders, rather than just focus on shareholders, and to take roles in solving major social challenges were cited as reasons for that blip up in public regard.

The most recent indication of that improving view of business by the public came at the 2010 International Corporate Citizenship Conference in Boston earlier this month.

The 10th annual conference, put on by the Boston College Center for Corporate Citizenship, got little visibility beyond Boston despite the importance of the topic and the audience it attracts.

Tim Wilson, who is with the Center, told me “corporate America is bouncing back faster than some other sectors in how they are viewed by the public. That’s a big change from merely lobbying against what might hurt us.”

One of the interesting findings at the conference was that “more CEOs are saying they need to be involved in public policy issues,” Wilson said. “The point is the feeling of CEOs that no one prospers in a bad neighborhood and that this world is a big neighborhood and corporations need to be involved in finding solutions.

If concern about “the neighborhood” represent a big change for major corporations, many would suggest such concerns have long been the stuff that helps drive smaller, local businesses.

Rich Simmonds, co-founder of Seattle wealth management firm Laird Norton-Tyee and, since his retirement, entrepreneur in residence at the family business center at Seattle University, says “research shows that family owned businesses spend more on community and non-profit causes than other businesses. And they’re less likely to turn off the spigot in tough times because they’re more likely to think long term.”

Stanley W. McNaughton, CEO of Pemco Insurance, puts it this way: “Because we’re a local company, our philanthropy is local.” He adds that while the company has maintained its commitment to corporate citizenship through the downturn, it has “made us more selective in what we support, but more committed to our traditional causes.”

Carol Lewis, CEO of Seattle-based Philanthropy Northwest, agrees the image of business is improving as more and more companies understand how community involvement contributes to success. “Corporate citizenship is on a steady increase,” she says.

She says the declines in corporate giving that have taken place in a bad economy “aren’t permanent. In fact, there’s not only evidence of a rebound but an ever-expanding number of businesses engaged in philanthropy.”

As that expansion occurs, a key part of the evolution of corporate citizenship is going to be ever-increasing focus on the convergence of corporate citizenship and corporate strategic goals.

Part of the “convergence” inevitably will relate to image impact, a factor that has come to top the list of reasons for how companies choose their involvements. And visibility is the key of reward for corporate citizenship recognition events, like the Business Journal’s Corporate Citizenship Awards Luncheon next month.

“It’s increasingly true that aligning your charitable efforts with your business goals advances both,” says Steve Mullin, president of the Washington Roundtable, the 27-year-old nonprofit public policy organization comprised of chief executives representing the state’s major private-sector employers.

One of the compelling moments at the International Corporate Citizenship conference in Boston apparently was an observation by closing keynoter Kathryn Brown, Verizon’s senior vice president for public policy & corporate responsibility.

Brown noted that despite Wall Street’s disastrous mismanagement of consumers’ money, the most recent Edelman corporate trust barometer is going up and optimism seems to abound and wondered aloud how that could be.

“I think it’s because we all faced the abyss and then we walked back from it and rediscovered our core shared values – as a society, as a political body and as corporate citizens,” she told the audience.

Originally published on the Flynn’s Harp blog.

Philanthropy Northwest CEO Carol Lewis gave the first public presentation of the new Trends in Northwest Giving report last week, at a Reflections on Philanthropy from Today’s Leaders event.

(Click here to view Carol’s presentation slides. Skip to the second video for the main presentation of the data.)

Introduction to Philanthropy Northwest and the Trends in Northwest Giving report:

Presentation of Trends data:

Q&A:

Thank you to our series co-sponsors: Social Venture Partners, the UW Evans School’s Nancy Bell Evans Center on Nonprofits and Philanthropy and Washington Women’s Foundation.

By Carol Lewis
CEO
Philanthropy Northwest

I read this the other day in the daily update from the Chronicle of Philanthropy. I wonder what our membership thinks about it:

“Charities and foundations are lobbying Congress to maintain the estate tax at current levels, reports Dow Jones Newswire.  Nonprofit coalitions such as Independent Sector and the Council on Foundations are urging members to press lawmakers to keep the 45-percent rate and $3.5-million exemption. Because charitable bequests lower the taxable value of estates, a higher tax rate provides an incentive to make such gifts.”

Please leave your comments. There are a few different proposals to retain the estate tax now before Congress, but lawmakers are expected to approve keeping the tax in place next year. I’d like to know how you feel about it.

The Seattle Times published a special Community Giving section Wednesday, November 4, featuring an introduction by Philanthropy Northwest CEO Carol Lewis and highlighting several Puget Sound nonprofits.

The section was made possible by sponsorships from Philanthropy Northwest members Bank of America, The Boeing Company (which highlighted member United Way of King County), Comcast and Microsoft, and by Children’s Hospital.  As Carol wrote in her introduction:

“At times like this, it is important to reaffirm the value of nonprofit organizations and to redouble our efforts to protect them. It is also worth recognizing that corporate philanthropy plays a critical, and frequently under-appreciated role in sustaining community assets. At Philanthropy Northwest, we see first hand how our corporate members assume essential leadership roles in the nonprofit community – sitting on boards, chairing fundraising campaigns, offering support in untold ways. Often, their participation can make the difference between success and failure for the organizations they steward.

Philanthropy Northwest is proud that its corporate members, Bank of America, The Boeing Company, Comcast and Microsoft, have underwritten the cost of this publication, allowing these dynamic nonprofits to share their stories with you. Their work will impress and, maybe even, inspire you. Certainly, we can all be grateful for their heroic work to make our community stronger and more just.”

David B. Smith, Executive Director of the National Conference on Citizenship (NCOC), gave the first speech in our 2009-2010 series, Reflections on Philanthropy from Today’s Leaders.

Check out the video to find out more about indicators of civic engagement, and how the recent election and the the millennial generation affected results in NCOC’s 2009 Civic Health Index.

*Click here to view David’s Power Point for reference.

Thank you to the Henry M. Jackson Foundation for underwriting David’s presentation, and to our series co-sponsors, the UW Evans School’s Nancy Bell Evans Center on Nonprofits & Philanthropy and Social Venture Partners.

By Kevin Walker
President & CEO
Northwest Area Foundation

As always, the latest official poverty and unemployment reports, compelling as they are, provide an incomplete view of both the challenges and possibilities we face. The Northwest Area Foundation recently sponsored a national poll that reveals how the hardships of the recession are playing out in American households. Here are a few highlights:

· 61% say they’ve cut back on spending.

· 24% have had a friend or family member stay with them due to lack of funds.

· Nearly half say they don’t know where to turn in their community for help.

· 32% have had trouble affording medical care.

· 51% say the government is doing too little to help.

· Most say elected officials have responsibility for: attracting and keeping businesses that offer good-paying jobs, increasing access to affordable health care; affordable post-secondary education; and housing security.

· A majority said they are willing to volunteer, and over half said they would be willing to pay $50 more in taxes, to help reduce the number of people struggling to make ends meet within their communities.

These national findings are complemented by state-level data for each of the eight states served by the Northwest Area Foundation:  Minnesota, Iowa, North Dakota, South Dakota, Montana, Idaho, Washington and Oregon. The poll, designed and administered by Lake Research Partners, provides advocates and nonprofit organizations with data they can use in their work within communities, as they approach policymakers, and as they work with the media. We’ve also assembled communications tools to make it easier for organizations to incorporate this information into their work.

I invite you to take a look and to share this information freely with peers and the organizations you support. You can find all the material here.

By Carol Lewis
CEO
Philanthropy Northwest

Originally written for and published in the Puget Sound Business Journal, September 25, 2009.

When the economy collapsed last fall, charitable assets were hit hard – in some cases harder than other investment portfolios because philanthropic endowments were overweighted in equities. According to a national survey of 430 foundations, 82% saw their endowments decline in 2008. The recent market rebound is unlikely to make up the damage, even if it continues through the year. In many cases, endowment losses have already been absorbed by foundations.

A new study from Philanthropy Northwest and the Council on Foundations offers insight into what these declines may mean for Northwest communities. The survey’s most striking finding: half the foundations in the nation report that their giving will decrease in 2009 by more than 10%. The picture for Northwest foundations is only slightly better, with 42% reporting they will trim their grant making by more than 10%.

The news is sobering, to say the least. But hidden in the national data are a few hopeful signs, particularly for Northwest communities. Forty-seven percent (47%) of our region’s foundations report that they will maintain or slightly increase grant making in 2009. And during this time of high unemployment and life-changing economic hardship, 70% of Northwest foundations intend to maintain or increase their grants to help low-income families and individuals in 2009.

The study results are consistent with what we see at Philanthropy Northwest. Last fall, several of our King County members, led by United Way of King County and the Seattle Foundation, moved quickly to set up new funds specifically designed to strengthen the social safety net for families bearing the brunt of the economic collapse. To date, United Way has raised more than $3.7 million dollars for its new fund, much of it directed to basic issues of food and housing. Similarly the Seattle Foundation’s “Building Resiliency” fund has raised almost $1.5 million dollars with donations still coming in.

In order to minimize cuts to grantees, a majority of foundations are reducing their operating costs. Hiring freezes, staff cuts and reduced travel are common. (Travel to national conferences is most curtailed, while travel to local and regional events appears less affected.)

Even more interesting, local foundations are stepping up their communication with grantees, working closely with them to ensure they are directing dollars to the most pressing needs. College Spark Washington reports that they have gone so far as to arrange for early disbursement of dollars to a grantee with a cash flow problem created when another funder was unable to make its pledged payment on time.

2010 is certain to be another tight year, due in part to the formula that foundations use to build their annual grant making budgets. In turn, nonprofits will continue to face challenges even as the region pulls out of this recession. They will still scramble to fill holes in their 2010 operating budgets. Some of them will find new donors because, even in hard times, new donors emerge. Some will trim services and focus on their core activities, becoming even more effective and efficient. But all will struggle with the frustration of the limitations they face in delivering services to families in need, and a few may even have to close their doors.

In addition to these threats to the safety net, the reduction in resources available to philanthropy are certain to erode financial support for many of our community’s most important institutions—our schools and universities, libraries, arts organizations and environmental groups. These organizations are critical contributors to our quality of life.

The immediate challenge for funders is, of course, to deploy scarce dollars wisely. But many in our field argue that more than money is required, making the case that organized philanthropy has the opportunity, indeed the responsibility, to convene and champion broad-based partnerships to address key questions facing civil society: How can we strengthen our nonprofit partners and help them to become more resilient? How do we protect and promote social justice? How do we create sustainable economies? What are the implications of living in a global society?

The answers to those questions will not come easily. Disagreements about the respective roles of private and public sectors, and about personal and collective responsibility for meeting these challenges, are just as prevalent within the philanthropic community as they are in society at large. But there does appear to be a growing consensus within philanthropy that barriers between individual foundations; between grantors and grantees; between public and private sectors; and between communities of privilege and communities at risk, are getting in the way.

Bold initiatives to break down those barriers are worth watching. For example, the Medina Foundation has taken the lead with other funders to create a new credit union to serve low-income populations. Meanwhile the Bill & Melinda Gates Foundation continues its work to collaborate with state government around early learning and housing. The Gates Foundation is also exploring a new partnership with state government and other local funders to help working families gain access to the public benefits for which they are eligible.

One of the great privileges of my job is working with almost 200 foundations and corporations in this region who are committed to improving their communities. I know that philanthropy is, at its best, highly adaptive and courageous. The test today is for our field to summon those qualities to meet the challenges that hard times are bringing into focus.

By Alaina Smith
Communications Manager
Philanthropy Northwest

I promised the conference blog would be short on jargon – which might seem like a small goal, until you realize that here in the philanthropy world, we LOVE jargon. We like to use the kind of words – strategic initiatives, cross-sector collaboration – that tank your Flesch score. Philanthropy literally translates as “love of mankind,” but our jargon seems to veer particularly toward euphemism when we talk about the people we are trying to help.

Last night’s keynote speaker, Jessica Jackley of Kiva.org, tackled that tendency when she admitted that she spent the majority of her life feeling guilty, uncomfortable and shameful when she saw or thought about poor people.

Jessica’s personal inspiration was Muhammad Yunus, who delivered a speech about microfinance that filled her with admiration and curiosity about the entrepreneurs receiving loans from Grameen Bank. “For the first time,” she said, “I was encountering the poor from a place of hope and dignity.”

Jessica was the last of many speakers I heard yesterday who began her presentation exploring the definition of resilience. Jessica’s definition: “the ability of a body to regain its shape and size after it has been put under a lot of pressure.”

But I resist the definition of resiliency as a quality that allows us to return to or maintain the status quo. I keep coming back to a comment from Luz Vega-Marquis, CEO of the Marguerite Casey Foundation. “I think it’s hard to talk about our success in building the resiliency of foundations or even grantees when we have 67 million people living in poverty in this country.”

Few foundations lack the resiliency to weather this crisis. But as we know, the people we seek to help – 1.3 million Oregon workers who make less than $10/hour, 15,000 students in Seattle public school system who won’t graduate from high school, Grace Asingwire’s group of vegetable sellers in Uganda – don’t have endowments.

The events of last year created a sense of urgency among foundations; yet, in the face of the global financial crisis and legislation dedicating unfathomable amounts of money to recovery, we seem more aware of the limitations of philanthropy than ever.

I hope we aren’t frozen by this paradox. Instead, I hope we take this opportunity to leave the safety of the “third sector” (aka private money) and join the national and global work to empower the communities, organizations and people we care about.

Ken Gordon, executive director of Potlatch Fund and fantastic 2009 Annual Conference Planning Committee member, talked up the conference on his blog:

“The Philanthropy Northwest (PNW) conference, which is happening in Skamania on September 14th – 16th,  is very exciting, as PNW has a strong commitment to diversity.  There will be two major sessions devoted to Philanthropy and Indian Country. The first will focus on Urban Indian communities and the second will focus on the lessons that foundations have learned from their past involvements.  There is also a session on racial disparities and several sessions on how foundations can use their investment resources to achieve even greater community impacts.  This is an important opportunity for Potlatch Fund as we need to work on both the supply and demand side of the giving equation in order to meet our mission of expanding philanthropy in Northwest Indian Country.”

Thanks Ken! (Read Ken’s full post…)

By Megan McNally
Public Policy Consultant
Philanthropy Northwest

The Corporation for National & Community Service administers programs like AmeriCorps through state commissions, each with an executive director appointed by and working for the governor. In Washington state, that’s Bill Basl, and recently we’ve been learning from him about some of the challenges of delivering on the intent of the Serve America Act. Three of the Act’s most anticipated new programs – the Social Innovation Fund, the Volunteer Generations Fund, and the Nonprofit Capacity Building Program – have yet to be fully funded. More interestingly, Bill’s anxiety is growing that these competitive funds will be awarded out of synch with the Act’s expanded volunteer programs and without the expertise of the state commissions already working on the ground.

That could be bad news for rural communities that need help building their infrastructure to leverage resources like volunteers. This got me thinking about how philanthropy could – or should – partner with the state commissions to help position them competitively for these funds.

So today I swung into Helena to hear the perspective of Jan Lombardi, Montana’s newly appointed director and Bill’s peer. Six weeks into the job, Jan’s already running into some of the same questions and thoughts as Bill. Montana is a rural state, so ARRA and Serve America gave it a “booster” of additional AmeriCorps resources. But that’s not necessarily going to have the positive impact everyone hopes for if there isn’t equitable access infrastructure and capacity funds for rural nonprofits.

In Jan’s estimation, Montana isn’t likely to emerge on the radar in competition against more urban states for these dollars. Federal dollars require private matches – so if these federal dollars are lining up to go to urban states, couldn’t that effectively widen the philanthropic gap between rural and urban communities rather than help narrow it?

What if, instead, we brought all six Northwest governors and their community service directors together with philanthropic and nonprofit leaders to develop a competitive regional strategy? Could the Northwest become a Serve America powerhouse with the highest leverage and widest impact? Is such bipartisan, cross-sector collaboration pure folly, or are we on to something?

Read all of Megan’s Dispatches from Montana…