How does the Foundation think about “risk” in the context of its grantmaking strategies?

What is the proper role of government in social innovation?

In an interview last week on the Social Velocity blog, Irvine President and CEO Jim Canales discussed these and other questions with Social Velocity President Nell Edgington. The interview is one in a series of monthly discussions that Edgington conducts with leaders in the nonprofit sector. The interview is reprinted here:

Nell: One of the four grantmaking principles of the Irvine Foundation is “Invest in Organizations,” meaning that you are committed to providing grants to build nonprofit organizations (evaluation, operating support, infrastructure). This is a pretty radical idea for most foundations. What do you think holds other foundations back from this kind of investment and what will it take to get more of them to embrace the idea of organization building as opposed to just supporting direct programs?

Jim: This question of general operating support versus project support has been an ongoing debate in the nonprofit sector, and I’d like to suggest that we may be creating for ourselves a false dichotomy that may not be helpful. I’d suggest we focus on the end goal, not the means. Let’s start by asking the question: How can we maximize impact toward the shared goals of a foundation and its grantees? By asking the question in that way, we naturally have to explore whether we are investing sufficient resources, in the right ways, so that our grantee can have the impact we both seek.

We are pleased to share with you our 2011 Performance Report in a new online format. While it includes many of the features of a traditional foundation annual report, our aim with this publication is to go beyond that approach and give you a deeper look at the Foundation’s progress toward its long-term goals.

This report is based on the Annual Performance Report that we make each year to Irvine’s Board of Directors as a way to measure our impact and hold ourselves accountable. It examines the progress we’re seeing in our core grantmaking programs, as well as other areas that we believe contribute to our impact as an institution. If you’re interested in reading this longer, more detailed document, it is available on our website.

This year we are experimenting with a new online format that we think will prove more inviting and accessible to our readers. At the heart of the report is the Program Impact section, which offers highlights of key developments in each of our three grantmaking programs and Special Initiatives. In the Leadership section, we describe ways we have used Irvine’s voice to enhance the work we’re supporting through grants. And finally, we look at Irvine’s financial and organizational health using a variety of quantitative measures.

This online publication represents the latest evolution in our approach to reporting on our impact. In that sense, it is a work in progress, and we welcome your thoughts and ideas about how to make it better.

On June 5, the Aspen Institute featured Irvine CEO Jim Canales as part of their Foundation Presidents’ Series of roundtable discussions. The luncheon was hosted by the Aspen Institute’s Program on Philanthropy and Social Innovation, which seeks to maximize the impact of the social sector by encouraging collaboration between grantmakers, nonprofits and social enterprises. The Institute hosted Jim in their Washington office for a discussion with over 40 nonprofit leaders and policy experts. In discussion with the Aspen Institute’s Jane Wales, Jim covered some of the key trends and developments in philanthropy. The discussion covered performance assessment, transparency and developments in Irvine’s grantmaking programs. The full 90-minute discussion can be viewed below.

Our 2010 Annual Performance Report represents a new approach to our reporting on the work of the Irvine Foundation. While it provides many of the features of our traditional annual report, such as a complete listing of 2010 grants, it aims to improve on that approach by providing more detail and analysis about the Foundation's progress across various dimensions of our work.

This publication is based on a report that we make each year to Irvine's Board of Directors as a way to measure our progress and hold ourselves accountable to our long-term goals. Although we have made that report publicly available in the past, this year we have combined it with our traditional annual report into a single online publication targeted at a broader audience of the Foundation's stakeholders. It includes an introductory video by our President and CEO, Jim Canales.

Our report looks at Irvine's performance in two broad areas that we believe are important to understanding our impact:

From the Center for Effective Philanthropy blog, April 26, 2010

Fueled by new technology and a change in mind-set, foundations have become more transparent about their activities and operations in recent years. This has been heartening, given the responsibilities and privileges inherent to our tax status, and the fact that we must work in partnership with many constituents and stakeholders in order to achieve our goals.

Just recently, there has been a major contribution in this regard by the Foundation Center’s Glass Pockets website, which provides a look at best practices in foundation transparency and which encourages the field to move further in this direction. The number of foundations and array of practices reflected on that site is impressive, and Irvine’s work on performance assessment, the subject of these blog posts, has sought to contribute to this movement. 

In the first three posts of this series I described why we developed a performance assessment framework, outlined some of the challenges we’ve encountered in assessing Irvine’s performance, and shared feedback from our board, the primary audience for the Annual Performance Report. In this final post I want to argue that robust performance assessment activities — and the transparency they encourage — serve to make philanthropy more effective.

View the full blog post.

From the Center for Effective Philanthropy blog, April 22, 2010

In an earlier post on this blog, I pointed out that the audience for the Annual Performance Report (.pdf)is Irvine’s board of directors. As we delivered the fourth of these at our annual board retreat last month, we devoted some time to learning more about the board’s perspectives on the report.

There were two key themes that emerged, related to the value of context, and the appropriate frequency of the report. Regarding context, board members expressed in numerous ways how much they value the contextual information that the report provides.  Two sections stood out in this regard: first, a table that describes how Irvine’s funding compares to other funders in our program areas, and second, a section on program context indicators, where we provide broader indicators related to our programs, such as per capita public spending for the arts across the U.S. or data on high school drop-out rates in California. This latter section is not meant to suggest that our work will necessarily affect those numbers, but rather to expose the board to broader data sets that help contextualize our program work. 

The positive reaction to these sections of the report underscores for me how important it is to help our boards gain a deeper understanding of the environment for the Foundation’s activities. We can explain our goals and strategies and describe grants aligned with them, but there will always be a missing piece if the board is not able to contextualize our foundation’s work. The board’s feedback encourages us not only to consider other ways to use the report to provide such context, but also to explore how we can shape other board materials and meetings in ways that expose them to the broader environment for our work.

View the full blog post.