The Local Impact of Global Philanthropy

Gara LaMarche, President and CEO of The Atlantic Philanthropies, participated on a panel of The Settlement Summit: Inclusion, Innovation, Impact. He shared his thoughts and six suggestions on the responsibility of American foundations when working abroad, which are also applicable to grantmaking in other places in the U.S.

I’m delighted to be invited here this morning to provide some initial thoughts on the sensitive subject of how American foundations act globally.  The colleagues you have assembled here to share this panel with me, Brad Smith, Urvashi Vaid, Cris Doby and Alejandro Villaneuva, are experienced philanthropy and civil society veterans who have a lot to share, and we all have a lot to learn from the rich diversity of participants in this amazing gathering.  So I will be as brief as I can in the role I have been assigned, to draw on some of my experience in two of the largest global foundations in the world, in the interest of stimulating a good discussion about a set of important and under-examined issues.

I want to start by talking about foundations’ limits.  They can innovate, demonstrate, spur, fill in gaps, foster knowledge, identify talent and do many other things that contribute to the betterment of society.  But they cannot through their own funds alone begin to feed the hungry, care for the sick, and educate many millions of young people for participation in contemporary society.  By definition, their role must be catalytic.

Those of you who are in the settlement house movement are in a better position than almost anyone to get this concept.  You often see both government and philanthropy at their worst – you see inefficiency, unresponsiveness and arrogance in both places.  Yet you know, because you are grounded in communities, and see urban challenges up close, dealing with families, schools, health care and job programmes – because you have the perspective and the credibility for advocacy, because it is grounded in service – that charity has its role but also its very sharp limits.

I have observed with admiration the spectacular institutions that are settlement houses and their many modern-day successors by different names, in different communities and countries, but all united by a common mission and vision.  There is almost nothing settlement houses don’t do:  after-school programmes, job training, citizenship education, AIDS prevention, home meals for older adults, arts instruction and on and on.  We’ve been privileged at Atlantic to support, among others, United Neighborhood Houses (UNH) in New York through our Community Experience Partnership to foster civic engagement for older adults, and in the past to support family child-care networks and emergency meals for homebound elders after the September 11 attacks.

I like the expression in UNH literature that those served by settlement houses are “neighbours, not clients.”  It reinforces a shared humanity and interdependency – that is essential to all meaningful social progress – from Social Security and other New Deal programmes to the civil rights, women’s rights, and lesbian and gay rights movements of more recent decades.

The launch of the settlement houses around the turn of the last century coincided with the first wave of significant social welfare legislation committing the government to steps holding up its end of the social compact, from child labour laws to the regulation of workplace safety, immigrant housing, and consumer production, not to mention democratic reforms like the civil service system and women’s suffrage.  There is no better illustration of the interdependent roles of strong social movements that couple service delivery with social action – from the “case to the cause,” in Jane Addams’ memorable words – and no better inspiration for a reinvigoration of the vital relationship between government and the frontline institutions of civil society.

Back, then, to foundations…My aim is to say a little bit about the ways in which foundations choose to act abroad and the kinds of things they focus on.  Finally, I will offer a few personal thoughts to guide how I think they ought to act.

Here, by the way, is what these reflections will not cover.  I’ve been told there is no need to address the large but woefully insufficient amount of foreign multilateral and bilateral assistance, though that of course sets a context in which anything private foundations do takes place.  Neither am I focusing on the massive amount of financial assistance that comes through family and individual remittances – $338 billion in 2008 alone.  When we speak about philanthropy, we usually have in mind large amounts of money from wealthy benefactors.  But the reality, whether you are talking about charitable contributions in the United States or remittances from relatives abroad, is that the predominant philanthropy is carried out by ordinary people, who are relatively much more generous than all but a handful of billionaires.  And finally, I am focusing on American foundations, about which I can speak with the most direct knowledge.

It’s also important to note that the vast majority of American foundations have no involvement abroad, or for that matter, outside their immediate communities.  Most foundations are small and focus on matters close to home.  Global philanthropy is the province, with very few exceptions, of large foundations, and not even all of those.  Ford, Carnegie, Gates, Rockefeller, the Open Society Institute, Atlantic, Mott, Kellogg, Hewlett, Packard, the Rockefeller Brothers Fund – that’s practically the whole list right there.  It’s therefore hard to talk about without getting very specific, and probably getting myself into trouble.  So I will focus on the few I know best.

What are the ways in which U.S. foundations work abroad?  There are at least five, as I count them, with some overlaps.  First, there are foundations like the Carnegie Corporation, whose original charter from Andrew Carnegie required it to spend at least 7 per cent of its endowment for work in “the former dominions.”  Right off the bat that tells us that the origins of global philanthropy, however well intended, lie in the residue of colonialism.  Carnegie’s current global priority is a Partnership for Higher Education in sub-Saharan Africa, also joined by Ford, MacArthur and Rockefeller foundations, but Carnegie maintains no office abroad.

Other funders, like the Packard Foundation, whose population health programme focuses on India, Ethiopia and Pakistan as well as sub-Saharan Africa and South Asia have a country advisor in each place they work, along with several regional advisors whose jobs are characterised as vetting projects and conducting due diligence.

A step further is the model employed by the Ford Foundation, which despite some recent downsizing, maintains over a dozen field offices around the world that serve as regional grantmaking hubs.  These offices are prominent civil society actors in places from Cairo to Johannesburg, usually headed by expatriates from the United States, England and elsewhere but also employing some local staff.

Further variations on that model are offered by the John D. and Catherine T. MacArthur Foundation, whose offices in India, Mexico, Nigeria and Russia are staffed by local residents.  As a colleague at the Mott Foundation, which has supported the development of civil society and local philanthropy in Eastern Europe and South Africa put it, “Lines are less blurred because the staff themselves are local – they’re not guests in the country.”

Atlantic’s seven offices outside the U.S. that focus on grantmaking – we have another, in London, which oversees our investments – are also staffed by people who come from, live in and intend to stay in the countries in which they are leading philanthropic investments.   We are excited about a change we are making in the way we operate, which is worth discussing for a minute.

Atlantic, like most large foundations, is very focused on any given day on its own strategies, and highly concerned about their impact.  This, ideally, should be coupled with a dose of humility, and it is easier to maintain it when you have come to philanthropy from the other side of the checkbook.  When I was a grant seeker, I didn’t worry too much about foundation strategies, except to the extent I could parrot them in order to get money for the things we wanted to do.  But it is hard when you are on the foundation side not to have a foundation-centric view of the world, and so it came to pass that once Atlantic emerged from the fog of anonymity in the 1990s, it adopted a set of global programmes and strategies on youth, ageing, health and human rights, and organised itself around global teams in those areas, with members from New York to Belfast to Johannesburg.

This had many benefits, not least of which was the forging of connections among social movements in the diverse countries in which we work:  ex-combatants in Northern Ireland and South Africa, migrant advocates in California and Cork.  The global teams have been very good vehicles for learning and cross-fertilisation, and we are keeping many elements of them in the new organisational structure we will have in place by 1 January 2011.  But we came to realise, as a foundation spending down its assets with an imperative to make every dollar count now, that over the next decade the work of preparing to leave the countries in which we will have worked for 20 years or more – most often as by far the dominant private funder – has to be directed by and informed by local knowledge and conditions.

A global programme is a useful frame but often an artificial one.  But a local frame, within the context of the foundation’s larger mission and values, is the best for determining what our priorities should be in Belfast or Cape Town, where the failure of governments to deliver on the promises of peace has led to massive youth unemployment and disengagement, and its attendant social and human consequences.

So Atlantic is changing.  But an even more devolutionary approach than ours is best exemplified – perhaps uniquely exemplified – by George Soros’s Open Society Institute’s network of foundations.  In Soros’s giving, which over the years has sought to respond to what he calls the “revolutionary moment” – Eastern Europe after the fall of the Berlin Wall, South Africa at the end of apartheid – he invites a range of local leaders to form a foundation board which chooses the local staff (with input and veto authority from the foundation’s centres in New York, London and Budapest) and in turn selects the local priorities within the broad frame of Soros’s open society interests.  This allows for substantial variation, from community radio projects in South Africa to school construction in Romania to public health work in Mongolia.  The budgets are set and controlled by the centre, but the grantmaking decisions and priorities are local.

This is not problem-free, from accountability, transparency and legitimacy issues in some places to the vulnerability even of locally-led foundations in tense political situations when their funds come from abroad, particularly from a large and internationally-engaged single donor, not to mention investor.  But it is the most prominent example we have of international philanthropy giving up at least some control in deference to local direction.

A final and promising variation is the support of public charity foundations which raise money from big and small donors to make grants in certain regions and subject areas.  These include the Global Fund for Women, the Global Greengrants Fund and the Global Fund for Human Rights.  At their best, these efforts are guided by boards that reflect the communities in which they are working, and the funds can go to small and sometimes new organisations that would never be on the radar screen of large global funders.

With the power that large private foundations have when they work abroad comes a heavy responsibility.  Funding can be distorting or even destructive, and the injunction to first, do no harm, should never be far from an international donor’s mind.  In that spirit, I have six suggestions to make, keeping in mind that most, while applicable to U.S. funders working abroad, are also relevant to almost any funding power relationship.  The issues, for instance, raised by a New York- or California-based foundation running a number of “demonstration projects” in other cities and states tracks this dynamic quite closely.  In much of the second half of my career, I’ve been in international organisations based in New York, but in the first half of my career I worked for national organisations based in New York, and I believe that anything I’ve learned about Port Au Prince and Ha Noi applies as well to Buffalo and Dallas.

Here are my suggestions for funders:

• Within the context of your values framework and your fundamental aims, make sure your strategic priorities are determined by those in the countries and communities in which you are working.

I’ve touched on this already, but an absolute necessity for working in countries that are not your own is to find a way of letting go enough to make sure that a diverse group of local stakeholders, to use a foundation-y word, is able to honestly guide the choices that you make.  One size does not fit all, and surely one American or European approach to advocacy looks different at the other end.  In my time at Human Rights Watch, I saw the organisation evolve from a classic missionary approach – with even the language of intervention the same – to one in which strong local partners are in the lead and the role of the international NGO is to help connect them and amplify their voice in international fora, from the New York Times to the United Nations in Geneva, that they have less access to themselves.

• Don’t pretend there isn’t a power dynamic at work when a big U.S. foundation works in another country, particularly in the developing world.  Acknowledge it openly and work with the tension.

As I cautioned, this advice applies to philanthropy in almost any context.  The language of partnership is beautiful, but often a fiction that serves the interest of the funder, not the grantee, since it is an odd partnership in which my ability to work with you is dependent on your largesse.

This is a good moment to come back to the settlement houses, heirs to a movement launched in the late 19^th century.  In some respects the settlement house movement, particularly, in its early days, mirrors many of the issues I am speaking about with respect to global philanthropy, as its origins involved people of some privilege and stature going into communities of workers and the poor.  In Louise Knight’s fine new biography of Jane Addams, she cites the exhortation of Anglican clergyman and leader of London’s East End settlement house, Samuel Barnett, who exposed Addams to settlement house work, that the movement must  work “with, not for” the objects of its attention.   “But British class relations could not be so easily restructured,” she writes.  “Those who met at the settlement house still felt, on one side, benevolent noblesse oblige and, on the other, strategic deference.”  In the settlement house movement, you have made, over the years, much progress toward the transition I believe is an important one for philanthropy.

• Make sure that everything you do takes account of systemic barriers to the change you are seeking.

One of the most profound debates in philanthropy in recent years is about this very point.  Foundations from Edna McConnell Clark to Bill and Melinda Gates have often chosen a preventable disease and devoted massive resources to its eradication.  There is no question these aims are humane and important, and in thousands of ways literally life-saving.  But the critique of it – and I am oversimplifying here, for Gates in particular, at the massive scale at which it operates, has multiple strategies and is constantly learning, listening and changing – has been perhaps most sharply posed by Laurie Garrett in a 2007 Foreign Affairs article:

“Today, thanks to a recent extraordinary and unprecedented rise in public and private giving, more money is being directed toward pressing health challenges than ever before. But because the efforts this money is paying for are largely uncoordinated and directed mostly at specific high-profile diseases – rather than at public health in general – there is a grave danger that the current age of generosity could not only fall short of expectations but actually make things worse on the ground.”

Atlantic has the advantage of working in only a few countries where we have deep roots and many years in which to operate.  For that reason, in the several countries in which we work to improve the health of populations, including Viet Nam and South Africa, we have long-term partnerships with government and civil society aimed at addressing the structures which determine health, from the training and retention of professionals like nurses and doctors, to the management of district health systems, to broader governance issues.

Any change which is lasting involves not only engagement with deep systems and structures but support for social movements which can exercise civil society power to hold those systems and structures accountable. The significant turnaround of what was not so long ago a benighted, death-dealing policy on HIV-AIDS in South Africa owed much to the aggressive, often in-your-face advocacy of the Treatment Action Campaign, an Atlantic grantee.

As Jane Addams said, “Social advance depends as much upon the process through which it is secured as upon the result itself.”

• Recognize that learning and impact flows in two directions.

This ought to seem obvious, but U.S. foundations work in other countries sometimes have the patronising attitude toward their “subjects” that was all too common in the early settlement house movement, as I was reminded when I recently read in an 1899 edition of the Pratt Institute Monthly the observation that:

“Every person’s thought, his vocabulary, is made up out of his personal experience.  The thought and vocabulary of less educated people lack the scope which comes from much reading and are largely built up around the objective events of their lives.  Unless one is to some extent in the midst of these events it is extremely difficult to understand the type of life which they go so far to produce.”

A good example of learning from those you support is Atlantic’s work in Cuba, not an easy place for a foundation to operate given the insane U.S. trade embargo, but we are able to make certain grants licensed by the U.S. Treasury.  Cuba, a poor country with first-world health care and literacy, has a lot to teach not only other poor countries but the United States, and Atlantic has supported the Latin American Medical School, where poor students from around the world, including inner-city Americans nominated by the Congressional Black Caucus, learn the profession in exchange for a promise to use their skills in their home communities.

• Understand that it’s not just the money you provide, it’s the kind of money and how you provide it.

By this I mean give much thought, if you are a donor, to how institutions can be most effective with the funds you provide, and as you think about it, put yourself in their shoes.  Much, if not most, foundation funding, particularly abroad, tends to go for specific projects, often with short time horizons.  But big problems do not tend to fall neatly into the boxes of many foundation guidelines, they are by definition interconnected and require multiple strategies and constituencies – again, why Atlantic is moving in our reorganisation to break down the programme silos we created.  It should also go without saying that big problems take time to address, and an NGO that has a number of years of steady funding is in a far better position to plan and adapt as necessary.

This will lead a bit into my final point, but I found it poignant, when George Soros, in expanding his foundation network eastward and southward some ten years ago, began to pull back from some of the early countries in which he had worked, like Poland, Hungary and the Czech Republic, which were then in the process of joining the European Union, to hear my Eastern European colleagues say that it was not just the funds they would miss, but the way the funds were deployed, with so many fewer strings than are usually attached to foundation and government aid.  Grants that encourage civil society to stand up to and be independent of government – in the words of Inez McCormack of Derry, Northern Ireland, an Atlantic grantee and human rights and trade union activist – funds that fuel the politics of challenge, are extremely hard to come by.

• If you take the trouble to start grantmaking in another country, stay the course and when you leave, leave thoughtfully and well.

One aspect of the power dynamic between donors and those who get their funds, anywhere in the world, is that in addition to what the money is given for and what conditions are attached to it, there is enormous power in deciding whether to fund and when to stop not only a grant but an initiative or a presence in a given country.  I am not in a position to second-guess the decisions of other funders, which are usually driven by a combination of strategic shifts over time and sometimes, as in the last few years, financial exigency.  I understand, having worked in foundations that have left some fields over the years, that nothing lasts forever.  But in funding abroad, U.S. funders have a particular obligation, it seems to me, to be very careful in this respect.  We all know there are flavours of the month or year – sometimes driven by momentous political change, as in South Africa in the mid-90s or Eastern Europe a few years before, and sometimes driven by urgent humanitarian considerations, as with Haiti and New Orleans.  But in all these cases, the work goes on after the spotlight shifts, and the funders I most admire – the funders that civil society most admires – are those who stay the course after the spotlight has moved on.

And when you leave, you need to do it in close consultation with civil society, with much notice, and with thoughtful informed attention to the best way of preserving the work that has been built so it has a chance of being sustained indigenously.  This is the way Atlantic is handling a years-long winding down of our funding for lesbian and gay rights in South Africa, with multi-year exit grants and a burgeoning partnership with other donors to create an LGBTI community foundation that will be around long after we are gone.

I don’t have the time to address much more the relationship between international philanthropy and indigenous philanthropy, but I note that a key strategy of some of the most engaged global funders, like Ford and Mott, and certainly this is the case for Atlantic, has been to promote a culture and a legal system in the countries in which they work that is conducive to local philanthropy.  Brad, Cris and others on the panel will have much more to say about that.

As you’ve seen, I’ve had Jane Addams on the brain preparing to speak with you today, but I’ve found that this remarkable woman had much to say that is still hugely relevant to the challenges we face at this moment.  I’ll close, then, with her words:

“We have learned to say that the good must be extended to all of society before it can be held secure by any one person or class; but we have not yet learned to add to that statement, that unless all [people] and all classes contribute to a good, we cannot even be sure that it is worth having.

“We slowly learn that life consists of processes as well as results, and that failure may come quite as easily from ignoring the adequacy of one’s method as from selfish or ignoble aims. We are thus brought to a conception of Democracy not merely as a sentiment which desires the well-being of all [people], nor yet as a creed which believes in the essential dignity and equality of all [people], but as that which affords a rule for living as well as a test of faith.”