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Decline and Fall of the Vanguard Foundation
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Once acclaimed as a pioneer in philanthropy and an important force for social justice, the Vanguard Foundation is no more. The full story will take years to emerge, but we report here on some of the clues to its sorry demise:
In San Francisco, the Vanguard Public Foundation is out of business, its nonprofit status suspended by the California Secretary of State, its website down, its assets apparently gone. Federal and state court lawsuits involving donors, investors, staff and trustees question what happened to millions of dollars that flowed through the foundation to progressive causes.
But nonprofits and foundations go out of business all the time, particularly in this nonprofit-devouring recession. What makes the Vanguard Public Foundation worth special inquiries? Is it because of the celebrities associated with Vanguard -- Danny Glover, Harry Belafonte, and United Farm Workers co-founder Dolores Huerta, among others? But the glam factor is not the story.
The Vanguard Public Foundation (not to be confused with the Vanguard Charitable Fund related to the for-profit Vanguard), was lauded in its heyday as a new wave of philanthropy, a generational shift, an exemplar and a model.
The famous people associated with the foundation are neither the story nor the cause of the foundation's demise. Rather the story may be one of organizational hubris, board narcolepsy, and the disease of our time: the siren song of the get rich investment plan which . . . read more »
> Read moreTake a 3-Minute Vacation with Fireworks
We wanted to start 2009 with a pyrotechnic display . . . here are three ways! read more »
- Create your own on-screen fireworks display.
- Buy a scented candle and light it in your cubicle, office, lobby . . . instant aromatherapy!
- Watch fireworks artist Cai Guo-Qiang create a painting through fireworks (he did the fireworks for the Beijing Olympics opening).
Switching Careers at the Worst Possible Time
Edie Boatman left a for-profit career for fundraising just as the economy crashed. With irony and humor her First Person Nonprofit essay reflects on her sense of timing and what she's learned so far.
August of 2008: Just one month before the economic meltdown . . . my first day begins on my new job as Director of Fund Development for a small nonprofit focused on arts and literacy with inner city kids. At 43, after a career in corporate marketing and publishing, I had to ask myself: What did I know about raising money? Nothing, outside of managing a few appeal letter projects. What did I know about the economy? Nothing, other than having a belief things would start to change for the better after the election.
If I had known then what I know now, would I have jumped into a job with no experience during the worst slump in the economy since the 1930s? . . . read more »
> Read moreTeach for America: Icon with Feet of Clay?
Why does Teach for America (TFA) attract so much adulatory praise, so much vitriolic criticism, so much government and foundation money, and so much jealousy/resentment from other nonprofits? And did we mention so much money? Held up as the exemplar of social innovation and civic engagement, the TFA model merits closer attention as to what it really means for public education, to the nonprofit sector, and to society at large. TFA's positive press is so well known that this article focuses on the less-heard concerns and questions about the model:
It's hard to imagine a nonprofit entity that encapsulates the emerging definition of social innovation more than the Teach for America juggernaut. Founded in 1990 by young Princeton graduate Wendy Kopp, TFA now needs no introduction; it has nearly the same brand recognition enjoyed by nonprofits like the United Way and American Red Cross. But as the nation moves toward defining social innovation and handing over the federal Social Innovation Program to private foundations, it cannot hurt to recognize TFA and other vaunted models for what they are: read more »
> Read moreSeven Ways to Reduce Your Audit Costs
Too many of us think of audit costs as an expense to suffer, not to manage. CPA Dennis Walsh tells us differently:
Executive Director Blair Benson of the Mental Health Association of Greensboro, North Carolina, was hoping her audit costs wouldn't go up much. With a budget of $340,000, there isn't a lot to spare. But although she had expected an increase, she was stunned when her auditor said he would be increasing his fee by 40%. "An increase like this is something you just can't build into your budget," said Benson.
Audits are getting more expensive -- have you noticed?
A survey of 160 community-based nonprofits in Guilford County, North Carolina, showed recent average audit fee increases of 9%, and noted that audit costs remain a significant burden to organizations.
Under the new risk-based audit standards (Statements on Auditing Standards (SAS) Nos. 104-111), effective since 2007, your auditors must obtain a deeper understanding of your organization, its environment, and your internal control systems. "The burden for documentation, combined with . . . read more »
> Read moreTen Things I Learned About Leadership from Women Executives of Color
While executive director of CompassPoint Nonprofit Services, Jan participated in the Women Executive Directors of Color network, conducted a study on nonprofit women executives of color, and experienced life through her lens as a Japanese American woman.
Here are some lessons I've drawn from from listening, observing, and laughing with other executive director comrades over the years. Not all women EDs of color will agree with me of course . . .
1. Note to funders: Give us (unrestricted) money. Give us the chance to experiment, to make mistakes, to sleep at night, to take the time to nurture leaders within our organizations. At one meeting of about 30 women executive directors of color, we talked about what we might ask for as a group. Should we ask a foundation for a special speaker? For a weekend at a retreat center? For a facilitator? For tuitions to expensive leadership development programs? After a long pause, one woman spoke up: "Give us money."
One of the biggest challenges that leaders face is . . . read more »
> Read moreVolunteerism Public Policies Can Hurt Nonprofits
Amidst the predictable praise for volunteerism and the Serve America Act, we at Blue Avocado detect the mooing of a sacred cow. Cow hunter and policy analyst Rick Cohen lets us know the four things we should be worried about with public policy and volunteers:
Is your heart warm from last week's combo of National Volunteer Week and the anniversary of Serve America? Eyes wide open:
- Bounty paper towels announcing the "Make a Clean Difference" volunteer campaign
- Kohl's department stores supplying employee "volunteers" to youth organizations
- Pepsi announcing 32 Pepsi Refresh grants
- Virgin Mobile's program where Lady Gaga fans enter a raffle for tickets in exchange for volunteering at homeless youth shelters
- Oh, and $1.15 billion in federal funds for Serve America
Yikes! Who wouldn't be inspired?
But we're worried. Not about volunteerism. Not even about . . . read more »
> Read moreRockefeller Foundation and NY Times Win "Just Awards"
Other industries have their "Worst Dressed" awards, the "Golden Fleece" awards for public waste, and the Ig Nobel Prizes for dubious science-related achievements that "first make people laugh, then make them think." Until now, the nonprofit sector has lacked its own such award program. The new Just Awards have announced the "winners" for the first year's awards: one for Abominable Press Coverage of the Nonprofit Sector, and the other for Narcissism in Philanthropy.
Award for Abominable Press Coverage
For Abominable Press Coverage of the Nonprofit Sector, The Just Awards panel of judges chose Stephanie Strom's November, 2009 article in the New York Times: "Charities Rise, Costing U.S. Billions in Tax Breaks."
The article reported that the I.R.S. approved 99% of applications for charity status last year, and picked some easy targets to suggest that there are too many nonprofits, and that many or most of them are frivolous. The article asserts that the U.S. government lost $50 billion in taxes due to the amounts given to nonprofits . . . making the false assumptions that a) donations to the nonprofit sector would remain the same without the tax exemption, and b) the government could ignore the enormous financial impact of demand for services (such as emergency room visits) that would inevitably follow from fewer nonprofit programs. A better headline: "Charities Rise, Saving U.S. Billions." Furthermore, the article neglected to provide, as a basis for comparison, information on the many billions more in tax breaks provided to the private sector. The article can be found here.
In making the Award, the judges did praise the New York Times for covering the nonprofit sector, and Stephanie Strom as "generally a very good reporter." But judges felt this story was the "worst story of the year" and that its lack of research led to "bad journalism".
Award for Narcissism in Philanthropy
For the much-anticipated Narcissism in Philanthropy Award, the Just Awards panel of judges chose . . . read more »
> Read moreEight Strategic Mistakes with Memberships
If you have members (whether those members fit the legal definition of member or not), chances are you're making at least one of these strategic mistakes identified by Ellis Robinson. With striking clarity she points the way not only to building your membership rolls, but to understanding your membership as your constituency:
There's always someone who says, "We need to increase our membership from 5,000 to 10,000 in the next three years." But too often nobody really knows what our target membership should be, and nobody really knows how to do "smart growth" in membership. Here are the eight strategic errors I see all the time in clients and the organizations to which I myself belong:
Strategic Mistake #1: Encouraging people to become members. This is a mistake because it's based on the idea that people . . . read more »
> Read moreWho is Responsible for the Board Doing a Good Job?
Despite the importance of the nonprofit board, there's strikingly little clarity about who is responsible for its performance. The answer in this Board Cafe article might surprise you:
Who is responsible for the board's doing its job? And a related question: who's responsible for improving a board that's asleep, weak, or gone amok? One answer might be: the board is responsible for the board! Or possibly, it's the board chair who is responsible for the board. Or sometimes: it's both.
We agree with Peter Drucker: The responsibility for the board's effective work -- both governance and support -- is ultimately the responsibility of the executive director.
This can sound paradoxical (or even depressing) at first, but veteran successful executives know the truth of this statement. Executives take on their shoulders the responsibility for the success or failure of the organization -- every part of it. If there were any other part of the organization that was under-performing, no executive would shrug, do nothing, and . . . read more »
> Read moreAngry Activist Gets Old & Wise: A First Person Nonprofit Story
Brenda Crawford is known as a fierce activist and relentless advocate for African Americans, for poor communities, for women, for lesbians and gays, and against all forms of oppression everywhere. As she turned 63 she came to some reflections and conclusions that surprised her; we think her comments will start a conversation for you:
I'm 63 now and how am I going to spend the rest of my life?
I'm retiring from the activist movement. I'm finished with in-your-face lobbying and sign-carrying activism. I don't want to go to Sacramento again unless it's to see a basketball game. I'm done talking to our elected officials. I'm done with confrontational politics.
I'm going to take up senior line dancing and dominoes. I have to re-learn how to play bid whist. My new activism is about building community, talking more with people I don't agree with . . . read more »
> Read moreTreasurers of All-Volunteer Organizations: Eight Key Responsibilities
More than half of the nonprofits in the United States are estimated to be all-volunteer organizations. Here is a wonderful, succinct guide for the 600,000 + treasurers of such organizations:
My time as treasurer of a faith-based nonprofit was a labor of love. Starting out as an all-volunteer organization with a $20,000 budget, we developed financial systems, workable budgets, and demonstrated accountability. We served families affected by incarceration and there's no greater personal reward than seeing people realize they have real hope for a better life. In just three years the budget grew to over $330,000.
However, there was stress as well. As a CPA I found myself the recipient of unnerving deference at times. I frequently fell short in communicating financial information to board and staff. But the outcomes made it all worthwhile.
This experience helps me appreciate one of the many unsung heroes of our time: the treasurer of the all-volunteer organization (AVO). AVOs are among the most important and most invisible building blocks of our communities. Members of all-volunteer organizations read to children, care for the dying, get clean water legislation passed, serve as . . . read more »
> Read moreFive Internal Controls for the Very Small Nonprofit
Segregation of duties, checks & balances . . . difficult to implement in the organization that has perhaps three or fewer staff, or only a few active board members in an all-volunteer organization. We asked CPA Carl Ho, who works with dozens of small nonprofits, what would be the five most important, most do-able controls for small groups:
1. The first and most important consideration is to set the control environment, that is, to let everyone know, from the top down, that there are policies in place and everyone has to follow the policies. In so many organizations the top person makes exceptions for himself or herself about policies, which sets a sloppy or even unethical tone. Then other people don't think they have to follow procedures, either, and they start cutting corners. The top person can't ask for reimbursement for anything for . . . read more »
> Read moreOur Executive Director is Embezzling
It's the phone call no board member wants or ever expects to get: word that the organization's executive director is being investigated by the police for embezzlement. In this First Person Nonprofit article, Vernon Waldren, board member of the Nonprofit Association of the Midlands in Omaha, Nebraska, talks candidly about how the story unfolded:
We got a call from someone at a different nonprofit letting us know that our executive director was probably going to be arrested for embezzlement at their organization, where he was on the board. Our [board] president got that call on a Monday morning, and she called a meeting of the executive committee at 5:00 that evening. What we learned was . . . read more »
> Read moreNonprofit Job Sites Directory
December is famously a bad month in which to look for a job, and a
bad month
in which to bring on someone new. Get a leg up on January with Tom Battin's guide to nonprofit job sites:
In this article, we review 33 websites for people seeking nonprofit jobs, and of course, for nonprofits seeking to hire new staff. Job sites serve two audiences: job seekers and employers. Job seekers can look for potential positions as well as upload their resumes so that employers can seek them out. For employers, such job sites allow them to search posted resumes to find people with specific characteristics.
This is not a complete list. We have focused on sites that are exclusively for nonprofit jobs, or that have a substantial number of nonprofit jobs. We have not included the hundreds of websites such as those of nonprofit associations where members can post openings, nor have we tried to find all the listservs and association newsletters where members post openings. Instead, we focused on sites that are primarily about job seeking: that are updated daily, that have features such as being able to search only for executive jobs, and so forth. Be sure to ask people in your chosen field or geographic region or the sites, listservs and newsletters that they know.
For each of these 33 job sites in this Directory, we include the number of jobs that were posted on our test day as well as the key features . . . read more »
> Read moreThe Zen of Handwashing
Quotes from an emergency room nurse, a Buddhist monk and a rapper adorn this original Zen of Handwashing poster made for Blue Avocado by Keiko Rosenstiel of Curry Senior Clinic and Center. You might be surprised, too, by how we don't wash our hands effectively. Print a few out and post in your office, clinic, and restrooms! Click below for the pdf (it looks blurry on screen but prints perfectly).
read more »
Amaze Your Friends with these Nonprofit Factoids
When we believe something to be true but don't have the data to support that idea, what happens when we do find the hard evidence? Two things: either we find out we were wrong after all or . . . we were right and now we have the facts to put into a grant proposal.
Rick Cohen mined metric tons of data to bring us some newly published, meaningful facts about the nonprofit sector that we should be aware of . . . and use.
1. It's official: we're underpaid.
Nonprofit managers make $34.24/hour on average, compa
red with $36.18 in comparable state government positions, $39.75 in federal government, and $41.86 in private sector positions, according to the Bureau of Labor Statistics National Compensation Survey. Office and administrative support staff in the nonprofit sector also come up short: average hourly earnings of $15.46 compared to $15.53 in the for-profit sector, $15.92 in state government, and $16.76 in local government. On the other hand, the relative gap among positions is smaller in our sector. So . . . should we be demanding more from our funders -- not because we're greedy but for the sustainability of our work?
2. Maybe I should look for a job in local government: Nonprofit human services workers are paid about the same as in the for-profit sector, but considerably less than in government. So . . . With so much of nonprofit human services supported by government money, why don't government contracts . . . read more »
> Read moreSix Ways to Know If It's Time to Leave
Are you tired, a bit listless? Maybe the demands of the job seem ever more burdensome, or the board seems increasingly dissatisfied, or the retirement clock is ticking. Do you need more than a megavitamin? Even better is this advice from Tim Wolfred, a pioneer and leader in the field of nonprofit executive transitions, as he helps executives weigh both the organization's needs, and the needs of their own heart:
Executive directors don't have term limits. Although some executives are fired or forced out by boards, most executives make the determination themselves of when and how to leave. Like other life decisions, it takes awhile to come to the decision to leave, or arrive at the decsion to stay.
So how can you tell if it's time to leave? Based on research and consulting with hundreds of nonprofit executives struggling with this question, we've developed six indicators -- each with some follow-up steps -- to help you with your thinking process.
Do one or more of these statements resonate with you?
1. I keep returning to this thought: the organization needs to go in a new direction (or to a new level) and I'm not the right person for it.
This is the most common reason given by executive directors who have . . . read more »
> Read moreFundraiser Edie Boatman Shares Career-Switching Tips
In the last issue (9.1.09) of Blue Avocado, we heard from Edie Boatman about Switching Careers at the Worst Possible Time. In addition to the comments that readers posted to her article, one sent a job-seeking question straight to Edie, and her thoughtful answer is worth sharing with everyone, especially people who are uncertain about raising money:
Dear Blue Avocado: "A friend sent me a copy of your newsletter, and I greatly enjoyed it, especially the article by Ms. Edie Boatman about switching from a for-profit position to a nonprofit position. I have an 18+ year history in for-profit Marketing, and would dearly like to get involved with a nonprofit here in Idaho. What can I do to make the same change? Sincerely, K."
reply from Edie Boatman:
Dear K: . . . read more »
> Read moreShould Board Members Be Required to Give?
Are board giving requirements a best practice or a bad idea? We report on trends and explore the real questions:
Few debates can rile up board members more than the question, "Should our board have a giving requirement?" Many of us know from firsthand experience that responses to this question are often characterized by frustration, bewilderment, sarcasm, absolute certainty, or even anger.
Unfortunately, there's no definitive answer to the question, because having a requirement for giving does work for some boards, but not having a requirement works just as well for others. There are substantive, valid arguments to be made on both sides of the debate:
Proponents of required giving believe it signals board member commitment, at the same time giving board members a sense of investment and shareholder stake in the organization.
Institutions such as universities, operas, museums, and others whose board members are recruited mostly for fundraising are where one sees required giving most frequently, at levels ranging from $500 to $2,500, $10,000 and so forth. And in the stratosphere of board giving, one major university expects (requires) trustees to make personal gifts of $20 million each during the period of their trusteeships.
Reflecting frustration dealing with her board, an executive recently exclaimed in anger and disgust . . . read more »
> Read more
