March-April 2005

Dear Friends,

I would like to take this opportunity to update you on an important national effort that is underway to strengthen the independent sector, which includes organizations as diverse as art museums, food banks, schools, public policy think tanks, religious institutions, and others that share a common mission of serving the public good. As a private philanthropy, the Irvine Foundation is an active member of the independent sector, as are the grantees we are privileged to support to advance our mission of expanding opportunity for the people of California to live in a vibrant, successful, and inclusive society.

In recent years, for a variety of reasons, there has been growing interest in how the independent sector should be governed and how its organizations should report their activities to the communities they were created to serve. In 2004, as a result of this interest, the U.S. Senate Finance Committee initiated a legislative process with the goal of helping to strengthen governance, ethical conduct, and accountability throughout the independent sector. Senator Charles E. Grassley of Iowa, Committee Chairman, and Senator Max Baucus of Montana, Ranking Member, encouraged the largest national association representing our sector as a whole, Independent Sector, to convene a panel to recommend actions that could help the Committee to achieve its goals. Accordingly, the Panel on the Nonprofit Sector was formed late last year, including two California members: my colleagues Paul Brest, President of the William and Flora Hewlett Foundation, and Gary Yates, President of The California Wellness Foundation.

In addition, five work groups were formed, and I was asked to participate in one of them, the Work Group on Governance and Fiduciary Responsibility. As one of more than 100 executives of charitable organizations contributing to this collaborative effort, I have been tremendously impressed by the thoughtful interest of the Senate staff in enhancing the effectiveness of charitable organizations and improving our accountability to the public. I have been equally impressed by the dedication of my colleagues in helping lawmakers to understand the complexities and challenges of our work and in crafting meaningful suggestions for how to achieve the objectives set forth by the Committee. Through our work together, we are reaffirming our shared goals of strengthening the capacity of our organizations to carry out our important work and enhancing the public's trust in our sector.

The Panel on the Nonprofit Sector has created a separate Web site at www.nonprofitpanel.org to keep all stakeholders informed of its progress and actions. I would recommend that you visit this Web site to learn more about this important effort and to participate in the public comment processes that have been designed to ensure broad participation from all corners of the independent sector.

As always, I welcome and appreciate your comments and suggestions about this update or any aspect of our work.

Sincerely,

James E. Canales
President and CEO

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