I have been thinking lately about mindset in the practice of philanthropy. This is a major theme in a new book that I recently reviewed, Control: Why Big Giving Falls Short by Glen Galaich, a prominent foundation leader in the United States. Galaich makes an interesting point about the consequences of what he calls the prevailing mindset of control in so-called big philanthropy. The control he speaks of is control over the money, resources, governance and decisions of giving vehicles such as private foundations or donor-advised funds (DAFs). In his view, the mindset of control has narrowed and constrained the aspirations and contributions of philanthropic giving, no matter how generous its intentions. He makes a strong argument for changing this mindset, faced with the urgency of the current moment.
Mindset in this case is a shorthand term for a way of thinking about your work in philanthropy. Donors, foundation board members and staff members all take their cue from a dominant approach or mindset to the work they do. In the mindset of control, to paraphrase Galaich, the donor or funder controls the money…..and many decisions flow from that: the choice of what to fund, how to access funds, how to shape what is funded, how and when to track progress and who gets recognition. Galaich extends the application of the control mindset beyond giving to investing philanthropic funds: what and how to invest, when and how to take returns on investment, and what time frame to apply.
It is true that most foundation donors and their boards and staff function within this mindset partly, as Galaich points out, because they continue to believe that it is their money even if it is given to a foundation. Even if it was never their money, they believe they owe a duty to manage (or control) it on behalf of the donor or foundation. There is no argument that good governance is founded on fiduciary duty or a responsibility to steward an organization with prudence. But what if that duty, combined with a sense of continued ownership, leads to a mindset of control that impedes rather than advances philanthropy? When you add the fact that foundations with money hold power over fundseekers who need that money, that mix of stewardship, ownership and power can pose quite a barrier to the practice of effective philanthropy.
The mindset of control is not inherently bad. Depending on a foundation or donor’s philanthropic purpose, it may be appropriate to put guardrails or conditions on giving, to ensure that it is going to the cause or issue that is important to the donor. But control can be applied in unnecessary or unjustifiable ways: overly rigid application or reporting requirements, too short time frames, inflexible goal setting or program intervention. The mindset of control when taken too far inhibits imagination, elevates risk aversion, prevents innovation and limits impact.
The rising interest in trust-based philanthropy and collaborative philanthropy indicates that some funders are breaking away from the mindset of control. Galaich has steered the foundation he leads (the Stupski Foundation of San Francisco) towards a mindset of what he calls community engagement. The purpose of the Stupski Foundation is to “work toward the day when our health, food, and postsecondary systems collectively promote well-being and abundance for everyone.” The Foundation works with communities in the San Francisco Bay Area and in Hawaii. The logic of Stupski’s approach is that it is the community not the foundation that understand best what the challenges are for that community and how to determine where funds will make a lasting change. Following on that logic, Stupski is going all in and is committed to transferring all its resources to the communities by 2029. This spend down approach and the way in which Stupski is doing it make sense in relation to their overall philanthropic purpose.
This is a point made by a second book which I reviewed recently, Please be Good At Philanthropy by Jen Ford Reedy, who runs the Bush Foundation in Minnesota. Reedy makes the case for a “competency-first mindset” in practicing philanthropy. In her words, “I believe that we as a field are under-oriented toward being good at what we do. We tend to focus on the impact we hope to have without equal focus on what it takes to do the work well. Bringing a competency-first mindset could dramatically increase our individual and collective impact as a field while dramatically reducing our chances of causing harm.” Reedy asserts that funder control over impact is only an illusion. In most cases, unless they are operating foundations, funders are dependent on their grantees, partners and third parties to create the impact that they wish for. She suggests that rather than achieving or retaining control, funders focus on being competent at making their choices of partner and aligning their purpose and their approach. She provides many practical examples of what competent alignment looks like. In the end it comes down to being thoughtful and diligent. With discipline, funders can competently manage the decisions they make around approach, which she identifies as making trade-offs around targeting, sourcing ideas, innovation, intent, proximity, duration, dosage and flexibility.
Both Galaich and Reedy are helping us see how important it is to be conscious of the underlying mindset that we adopt in practicing philanthropy. And both are believers that we can be better givers. It starts with being aware of how our mindset shapes our choices. Mindfulness, as in most disciplines, is what leads to better outcomes.