What Needs to Change in Canadian Philanthropy?

Think Philanthropically

Last month this column left readers in suspense. We suggested that some things need to change in order for philanthropic efforts to shift into a 21^st century mindset and that a number of traditional charitable practices were ineffective in addressing the needs that exist today. It is important to note that the practices I am addressing are focused on actions that respond to complex social concerns like poverty or homelessness. The thoughts that follow are less applicable to the philanthropic practices of large philanthropic foundations that support universities, hospitals or international aid organizations.

“Is it wise to delegate the care of the most vulnerable in our society to a collection of under-resourced and ill-equipped community service groups?”

So what needs to change? Here are two major suggestions.

Establish clarity of problem ownership – A problem needs to have an owner. In order to resolve a problem someone must own it. They must be responsible for responding to it and accountable for outcomes. Who is responsible for poverty reduction, emergency housing services, or food insecurity? In the absence of a clear owner of problems like these, a diverse group of well-meaning people tend to step up and try to help. This has been the pattern for charitable efforts for more than 100 years. It is an uneven approach that tends to offer little more than temporary fixes. We seldom ask ourselves an important question. Does it make sense to download major social problems to philanthropic organizations? Is it wise to delegate the care of the most vulnerable in our society to a collection of under-resourced and ill-equipped community service groups?

As an example, food drives and food handouts can never resolve the root causes of food insecurity. They are a highly inefficient form of charity. And those who distribute free food on the island of Montreal can never get enough food or keep up with the increased needs. The correct response isn’t to hold more food drives or open more food banks. It is to question who should own the problem and then design efficient policy-driven solution-oriented approaches that reduce the number of people who need free groceries.

“Boards need to exist to focus on governance and policy oversight.”

Revolutionize governance – A major challenge of almost every philanthropic organization is that a philanthropic organization’s board either misunderstands its role or is populated by many of the wrong kind of people. Boards are often too large and are constructed on the assumption that board members will tap into their respective networks to drum up financial support for the organization. Boards need to exist to focus on governance and policy oversight. If boards are ticket sellers and rainmakers the organization may raise money but it will suffer from significant gaps in oversight that inevitably show up in a crisis. Carver has written that non-profit boards need to justify having more than 7 board members. That may be a bit lean, but having more than 12 board members, or functioning with multiple boards, is a recipe for unhelpful busy work in any non-profit organization with revenues below $50 million annually. Board members themselves need to understand that they are there to exercise oversight – not to offer unsolicited operational advice to the senior leadership team of the non-profit.  There has been an increased focus on ensuring the professionalism of corporate boards and I contend that similar scrutiny in the philanthropic sector is long overdue.

Lastly – a provocative idea.  What about reforming the tax advantages of specific philanthropic donations? Should a donation to a social objective like poverty reduction receive more advantageous tax treatment compared to other donations? Could governments work with philanthropists to liberate funds and channel them more strategically towards actions that address the most urgent social concerns?

Sam Watts serves as the CEO of Welcome Hall Mission  www.welcomehallmission.com  He serves on several non-profit boards and is an appointed member of the National Housing Council of Canada.  He is the author of Good Work…Done Better www.goodworkdonebetter.com