Philanthropists need to focus on reason for grants

Philanthropic leaders are in Atlanta this week at the Council on Foundations’ annual conference to map out how to marshal our resources for the common good. I am attending as the head of the Southern Partners Fund, an Atlanta-based foundation serving the rural South.

In a time of crisis, it is heartening to remember that America is a country rich in charitable giving, home to more than one million nonprofits and 100,000-plus foundations given tax-exempt status in recognition of their role in promoting the public welfare. The urgent need to address the recession is an opportunity to look with fresh eyes at the rights, responsibilities and role of the philanthropic sector.

Debate and controversy over how to respond has already started. In March, the National Committee for Responsive Philanthropy issued a report challenging grant makers to do more, arguing for specific benchmarks to maximize our contribution to the common good.

The most controversial benchmark is the goal of steering 50 percent of grant dollars to benefit disadvantaged communities. Broadly defined, these include women and girls, the disabled, rural communities, people of color and low-income populations. They vary from place to place. In Atlanta, African-American children growing up in lead-contaminated housing projects are one. In Appalachia, rural white families trapped in cycles of generational poverty are another.

The report was met with a virulent backlash, including accusations of “Orwellian” language, red herring warnings about racial and gender quotas (the report calls for neither) and impassioned defenses of “foundation freedom.”

These criticisms represent an extreme. Most philanthropists believe they have an obligation to society. That is why they became grant makers in the first place. While I believe taxpayer-subsidized philanthropies have certain responsibilities to the public, I don’t think this is the best argument for funding disadvantaged communities. The best argument is that it makes a difference.

We shouldn’t invest in marginalized communities because it’s politically correct or because public subsidies obligate us to do so. We should invest in disadvantaged communities because it has the greatest impact on the things we care about.

You can’t fight breast cancer without addressing the fact that the highest mortality rates are among African-American women, who tend not to seek out early treatment that would catch the disease early. You cannot stop the “pipeline to prison” for minority youth without investing in economic revitalization in low-income neighborhoods. You cannot conserve the beauty of the rural South without addressing the disproportionate dumping of toxic waste in impoverished areas, including Georgia’s Taylor County where a quarter of the population lives below the poverty line.

The Rev. Dr. Martin Luther King said: “Philanthropy is commendable, but it must not cause the philanthropist to overlook the circumstances of economic injustice which make philanthropy necessary.”

Today, this is truer than ever. Philanthropy must be more than commendable. It must be accountable to the communities we serve and to the common good goal of achieving the most impact for the most people. It is my fervent hope that my colleagues in the foundation world are ready to explore the root circumstances of the current mess and engage new ideas to solve it.

Janine Lee is CEO of Atlanta-based Southern Partners Fund.