THE POWER OF ELEVATING COMMUNITY THE UPSIDE OF

Stanford Social Innovation Review

LETTING GO AUTHORITY IN COLLECTIVE IMPACT CONFLICT

By Dan Honig By Byron P. White, Jennifer Blatz By Alan Fowler, Elizabeth Field
& Mark L. Joseph & Joseph McMahon

SUMMER
WINTER 2019
2018
VOLUME16,
VOLUME 17, NUMBER 3
1

Philanthropy
Philanthropy in the Service of Democracy / The Upside of Conflict / The Power of Letting Go / Elevating Community Authority in Collective Impact

in the
Service of
Democracy
Plutocratic biases
are baked into the
policies that structure
charitable giving and
big foundations.
We must overhaul
philanthropy to make
it better serve
democratic ends.
BY ROB REICH

DISPLAY UNTIL FEBRUARY 18, 2019

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Winter 2019 / Vol. 17, No. 1
 NOW!
Our 5th annual Data on Purpose
conference will leverage the
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based insights to help nonprofit
leaders identify the best
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 Stanford Social Innovation Review / Winter 2019 1

Published by the Stanford Center

on Philanthropy and Civil Society

WINTER 2019 / VOLUME 17, NUMBER 1

F E AT U R E S ON THE COVER
Illustration by Doug Chakya

26 Philanthropy in the
Service of Democracy
BY ROB REICH

Plutocratic biases are baked into the policies that

structure charitable giving and big foundations. We
must overhaul philanthropy to make it better serve
democratic ends.

34 The Upside of Conflict

BY ALAN FOWLER, ELIZABETH FIELD &
JOSEPH MCMAHON

Too many organizations ignore or avoid addressing

internal conflict. A healthy perspective on disagreement
can increase resilience and spur needed innovation.

42 The Power of Letting Go

BY DAN HONIG

New research explores when top-down control works

best in international development work, and when
organizations should let employees in the field navigate
challenges by using their own judgment.

48 Elevating Community
Authority in Collective Impact 
BY BYRON P. WHITE, JENNIFER BLATZ & MARK L. JOSEPH

To achieve greater equity, we must yield to the decision-

making authority of the communities we seek to help.
StrivePartnership and other partnerships in the Strive-
Together national network are enhancing collective
impact to integrate and elevate the expertise and authority
of those closest to the problems we are trying to solve.
2 Stanford Social Innovation Review / Winter 2019

, “Throughout the social sector is a growing recognition of

the importance of being human centered—that is, of putting the
people we seek to benefit at the center of problem solving.”
— FROM TIME FOR A THREE-LEGGED MEASUREMENT STOOL P. 57

D E PA R T M E N T S

4 EDITOR’S NOTE 13 VIEWPOINT

Whither Big Philanthropy
57 Time for a Three-Legged
Measurement Stool
5 SSIR ONLINE Going beyond traditional monitoring and
evaluation to focus on feedback can lead to new
Power in Philanthropy / The Power
innovations in the social sector.
of Feedback / Podcasts BY FAY TWERSKY

59 The Hidden Costs of Public

6 W H AT ’ S N E X T Contracting
Capturing Emissions for Fish Food / Developing Nonprofits need a strategy to ensure that public
a More Diverse AI / Disrupting the Patriarchy / dollars don’t put them in the red.
Insuring Impact / BY MARY KATE BACALAO
18

61 The Four Principles of

FIELD REPORT Venture Funding
11 When History Lessons Aren’t Enough Whether someone is investing in a tech startup
NGO Aktion Courage spurs students’ activist or a grassroots advocacy organization, the same
rules of success apply.
energy to promote antiracist programming
BY TERRY WINOGRAD, JOCELYN GOLDFEIN &
across Germany. ROBERT BANK
BY PAUL HOCKENOS

13 Schools’ Most Untapped Resource 63 R E S E A R C H

Turning concrete into lush landscapes, Green
Misremembering to Feel Better / The Private
Benefits of Corporate Social Initiatives / How a
Schoolyards America connects ecological inno-
59
Janitor Put a Man on the Moon / Choosing the
vation with education, equity, and community Best Charity
engagement.
BY ADRIENNE DAY
BOOKS
15 The Difference Curve 67 Not Quite Everything
Auticon aims to change society’s perception of Nathan Schneider’s Everything for Everyone
people on the autism spectrum for the benefit REVIEW BY GAR ALPEROVITZ
of businesses and employees alike.
BY ALICIA CLEGG 69 Making Economic Sense of Religion
Sriya Iyer’s The Economics of Religion in India
REVIEW BY KAVITA N. RAMDAS
18 C A S E S T U D Y
Clean Energy by the People, 71 Digital Bookshelf
63
for the People
After the 1986 Chernobyl disaster, the “energy 72 LAST LOOK
rebels” of Schönau, Germany, launched a Colonialism Meets Climate Change
grassroots revolution in the Black Forest to take
control of their community’s power. Their SPECIAL SUPPLEMENT
creation, EWS, not only triggered the country’s BETWEEN PAGES 62 AND 63

transition to renewable energy but also demon- Finding, Funding, and Scaling
strated the need for grassroots democratic Perspectives on large awards, open competitions,
control of energy production. and new directions in philanthropy
BY PAUL HOCKENOS
4 Stanford Social Innovation Review / Winter 2019

Reich believes that the most important

role that private foundations can play is to
take risks and fund nonprofits and programs
that are experimenting with new approaches
to solving social problems. Because private
foundations are accountable only to them-

Whither Big Philanthropy

selves, it is much easier for them to take risks
than it is for the government, he argues.
The role of government, says Reich, is to
scale up programs initiated by philanthropy
ver the last decade, there Philanthropy in a New Gilded Age, is another; once they have been proven to work and

O
has been a sharp increase and Rob Reich, author of Just Giving: Why have the support of the public. He points to
in the number of ex- Philanthropy Is Failing Democracy and How It the national 911 emergency response system
tremely wealthy people Can Do Better, is a third. and Pell Grants as examples of programs
around the world who are Reich is a professor of political science that started as experiments funded by
giving away substantial at Stanford University and codirector of the philanthropy, and that were later scaled up
amounts of money. And rather than wait- Stanford Center on Philanthropy and Civil nationally by government. Some foundation
ing until they are old, which was common Society, which publishes Stanford Social leaders will no doubt take issue with Reich’s
practice in the past, many are engaging in Innovation Review. He is also the author of argument, pointing out that the govern-
philanthropy at a much younger age. “Philanthropy in the Service of Democracy,” ment is no longer scaling up programs, and
Most people, I would guess, see this the cover story in our Winter 2019 issue. that foundations must take up the slack.
uptick in giving by the superrich as a In his article, Reich raises important Reich doesn’t stop with his critique.
good thing. After all, donations from the questions about big philanthropy. He points He also offers policy changes that he
world’s estimated 2,200 billionaires play out that the US federal tax code (particu- thinks will help improve philanthropy.
an important role in helping to tackle larly after the changes initiated by President He advocates having government impose
society’s pressing problems. Trump) provides many more financial ben- restrictions that would require all private
But not everyone is happy about this efits to wealthy people who give to charity foundations to be much larger, shorter
trend. There is a growing chorus of critics than it does to ordinary Americans. He also lived (no more operating in perpetuity),
who question whether big philanthropy is makes a compelling argument that private and subject to peer review to make sure
actually a good thing: Anand Giridharadas, foundations (which are favored by the rich) they focus on experimentation.
author of Winners Take All: The Elite Charade are in many ways plutocratic organizations I encourage you to read Reich’s article and
of Changing the World, is one; David Calla- that enable the wealthy to wield power over to join the debate about his ideas and pol-
han, author of The Givers: Wealth, Power, and society in perpetuity. icy proposals at www.ssir.org. —ERIC NEE

Stanford Social Innovation Review (ISSN 1542-7099) is

published quarterly by the Stanford Center on Philanthropy and Civil
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at Stanford University’s School of Humanities and Sciences: 559
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Paola Perez-Aleman, McGill University; Josh Cohen, Stanford University; Alnoor Ebrahim, Tufts University; Marshall Ganz, Review, Member Services, PO Box 426, Congers, NY 10920-0306.
Volume 17, Number 1, Winter 2019. Stanford Social Innovation Review
Harvard University; Chip Heath, Stanford University; Andrew Hoffman, University of Michigan; Dean Karlan, Yale University; Anita McGahan,
and the Stanford Center on Philanthropy and Civil Society are part
University of Toronto; Lynn Meskell, Stanford University; Len Ortolano, Stanford University; Francie Ostrower, University of Texas; of Stanford University’s tax-exempt status as a Section 501(c)(3)
Anne Claire Pache, ESSEC Business School; Woody Powell, Stanford University; Rob Reich, Stanford University “public charity.” Confirming documentation is available upon request.

STANFORD CENTER ON PHILANTHROPY AND CIVIL SOCIETY

Stanford Social Innovation Review was established in 2003 by
the Center for Social Innovation at the Stanford Graduate School
Faculty Codirectors Paul Brest, Woody Powell, Rob Reich of Business. The founding publisher is Perla Ni. The former academic
Executive Director Kim Meredith editors are Stephen R. Barley, James A. Phills Jr., Robert Scott, David
PACS Team Christina Alfonso, Lucy Bernholz, Danielle Carattini, Bhawna Chawla, Valerie Dao, Eloise Duvillier, Brady, and Chip Heath.
Palak Joshi, Heather Robinson, Laura Seaman, Christian Seelos, Priya Shanker

STANFORD CENTER ON PHILANTHROPY AND CIVIL SOCIETY ADVISORY BOARD

Chairman Laura Arrillaga-Andreessen
Members Herbert A. Allen III, Jean Case, Ted Janus, Shiv Khemka, Xin Liu, Carter McClelland,
Jeff Raikes (ex officio), David Siegel, Liz Simons, Darren Walker
 Stanford Social Innovation Review / Winter 2019 5

ssir.org

O N L I N E S E R I ES P O D CASTS

Power in Philanthropy
Presented in partnership with the National
Committee for Responsive Philanthropy, this
series explores popular concepts in philan-
thropy—such as risk, capacity-building,
and public leadership—through the lens
of power and equitable outcomes.
ssir.org/power_in_philanthropy
The Power of Feedback
Through a collection of articles,
videos, podcasts, and other mul-
Listen to conversations with speakers from our
2018 Nonprofit Management Institute confer-
ence, including:
■ Rashad Robinson, president of Color of
Change, who addresses his organiza-
tion’s approach to movement-building,
social change, and rewriting cultural
narratives
■ Kathleen Kelly Janus, social entre-
preneur, author, and lecturer at Stanford
University, who discusses how
to dismantle barriers to capital
“
AUTHOR REPLIED:
We need to think of the role
of the faculty member on
different terms to bring about
such a shift. Right now we are
rewarded primarily for A-level
academic publications, which are
focused on theory and often have
little bearing on real-world busi-
ness issues. Change in the curric-
ulum means change in the people
who design and deliver it.”
—Andrew J. Hoffman

timedia presentations, some of
the social sector’s leading voices
share tips, tools, and advice to
encourage nonprofits and foun-
dations to seek more constitu-
ent feedback—and to act on it. This
series is sponsored by the William
and Flora Hewlett Foundation.
ssir.org/power_of_feedback
R EA D E R CO M M E N TS
with Cheryl Dorsey, president
of Echoing Green; Pia Infante,
co-executive director of The
Whitman Institute; and
Robert K. Ross, president
and CEO of the California
Endowment
Listen to these and other conversa-
tions and talks: ssir.org/podcasts
same critiques as Giridharadas, current business models—they
but only in piecemeal form, are keen to preserve the status
“
READER RESPONDED:
One key piece of the puzzle
is a solid footing in core
philosophical and ethical con-
cepts (utilitarianism, equity,
etc.) that someone ‘called’ to
management needs to pick up
(hopefully) prior to the MBA.
I see them as foundational ele-
ments to leadership.”
—Dave Stangis, vice president of
corporate responsibility and chief
sustainability officer at Campbell
Soup Company

“
mostly privately, and certainly quo and hand out donations on AUTHOR REPLIED:

Are the Elite Hijacking
Social Change?
Mark Kramer, a former venture
capitalist and cofounder and
managing director of FSG, looks
inward in his Fall 2018 review
of Winners Take All, examining
author Anand Giridharadas’s
critique of the limitations and
without his depth and courage.
This book is a call for us to focus
more on the individuals and
institutions that enable or ben-
efit from inequality and environ-
mental degradation instead of on
innovator hero workshop.”
—Winthrop Carty, executive
director of the Melton Foundation
the side.”
—Ka Kui Tse
Read more: ssir.org/elite_change
Reforming Manage-
ment Education
In his September 2018 article,
“Management as a Calling,”
Andrew J. Hoffman, the Holcim
A solid core of ethics is
important here, but busi-
ness schools have been tinker-
ing with ‘ethics’ education for
decades and not doing it very
well. It is too often just bolted
onto the existing curricu-
lum when it should be infused
throughout.”
—Andrew J. Hoffman

hypocrisy of business elites pur-
suing social change. Kramer
reflects on his own position in
philanthropy and the impossi-
bilities of reconciling wealth and
social justice.
“
After retiring from the cor-
porate world, I was active
in promoting social innova-
tion in Hong Kong and China.
I founded a number of social
enterprises, but in 2015 I shifted
my focus to join the global B
(US) Professor of Sustainable
Read more: ssir.org/
Enterprise at the University
management_calling
of Michigan, calls for business
schools to reform their vision to
promote values of business serv- B O O KS
ing society.
Did you know that SSIR pub-
READER RESPONDED:

“
lishes excerpts of the latest
READERS RESPONDED:

“
What are you going to do
beyond ‘think long and
hard about my life’s work?’”
—Gawain Kripke, director of policy
and research at Oxfam America
Corporation movement, as I
felt that mainstream businesses
needed to change and change
fast. None of the big foundations
and corporate funders were
interested in challenging the
Who’s going to teach this
expansive curriculum when
B school faculty are primarily
rewarded for producing theory-
driven research?”
—Philip Mirvis
social innovation books on our
website? In our new Digital
Bookshelf section on page 71, we
highlight three recent works we
have excerpted online.
Read more: ssir.org/book_excerpts

“
As somebody who has been
in the social innovation field
since before it became a house-
hold name, I’ve made many of the
Follow SSIR Online SSIR in Your Inbox
View an e-book of this issue online Sign up for our free weekly e-mail news-
or download a complete PDF. letter: ssir.org/email
6 Stanford Social Innovation Review / Winter 2019
NEW APPROACHES TO SOCIAL CHANGE
ENVIRONMENT
Capturing Emissions
for Fish Food
BY ROSALIE CHAN
arious contraptions
V fill a cluttered lab in
Sunnyvale, Calif. On
one side, there’s a large blue
incubator filled with flasks. On
the center table, brine shrimp
swim in circles inside a large
cylindrical tank. In the back,
a bioreactor tosses and turns
a whitish brothlike substance,
which becomes increasingly
dense. These apparatuses drive
the research of NovoNutrients, a
startup that seeks to turn carbon
dioxide (CO2) into food and feed.
As catches from wild-capture
fisheries level off and demand
from the emerging global mid-
dle class increases, fish farms
are projected to produce two-
thirds of the world’s fish supply
by 2030.
For that reason, there’s a
large demand for fish feed,
says Heyward Robinson,
NovoNutrients’ vice president of
corporate development. Current
fish meal products are made
with anchovies, capelins, or
other fish closer to the bottom
of the food chain, which contrib-
utes to overfishing. Additionally,
the supply of these fish is sensi-
tive to climate patterns such as
El Niño. In recent years, this has
resulted in shortages and price
volatility for fish farmers.
“To meet the growing needs
of the growing aquaculture
market, we’re going to need
new sources of feed that don’t
rely on the wild capture of fish,”
says Monica Jain, founder and
director of Fish 2.0, a com-
petition for sustainable sea-
food and aquaculture startups.
“Solutions like NovoNutrients
that are able to create fish feed
and other products without tak-
ing seafood out of the ocean—
they’re going to be required for
us to grow our seafood supply
to what’s needed to feed the
world’s growing population.”
Finding more sustainable
ways to feed farmed fish is
critical, Robinson says. That’s
where CO2 comes into play.
“There’s a big push in the
aquaculture industry to find
these alternate proteins to fish
meal,” he says. NovoNutrients’
technology has the potential
to convert millions of tons
of CO2 waste into such prod-
ucts. The company is develop-
ing Novomeal, a high-protein
fish feed alternative, as well as
Novoceuticals, which are feed
additives.
Plants create food from
CO2; this fish feed works simi-
larly. The company captures the
greenhouse gas from smoke-
stacks, targeting industrial
sources such as cement, bioeth-
anol, iron, and steel produc-
tion plants. All gas emissions,
including sulfur and carbon
dioxide, are captured in pipes
that directly connect industrial
plants to an on-site bioreactor.
Heavy metals such as mercury
aren’t used, but plenty of indus-
trial CO2 streams do not con-
tain these materials.
NovoNutrients then uses
a microbial fermentation pro-
cess whereby the bacteria go
through the Calvin cycle—the
same chemical process used
by plants—to convert CO2 and
other gas molecules to food.
Instead of using sunlight, these
bacteria use hydrogen.
While other companies
create fish feed from bacte-
ria, NovoNutrients’ process is
unique, using multiple strains of
bacteria, which allow the differ-
ent microbes to work together
to convert CO2 into food.
“Plants have been doing this
for millions of years,” Robinson
says. “Microbes have been
doing it for longer. We’re just
taking ancient, billion-year-old
technology and bringing it to
industrial scale.”
The magic happens inside
the bioreactor, a large metal
cylinder with protruding pipes.
Bacteria process the CO2 , and
then NovoNutrients dries the
microbial meal.
“People have been looking at
these bacterial proteins as pro-
tein sources,” says CEO David
! NovoNutrients founder and Chief
Technology Officer Brian Sefton holds vials
of the feed products in the Sunnyvale,
California, lab.
Tze, who has a background in
aquaculture investing. “It’s only
recently that with the econom-
ics and the global situation, it
actually makes sense to produce
protein this way.”
Tze takes out two small plas-
tic cylinders of powder. One is
the whitish prototype of the
feed. The other is a reddish-
maroon powder, a prototype of
the feed additive. “It’s kind of
like dried dog food and cat food,”
Tze says. “Some of the ingredi-
ents are there to provide fat, and
some are to provide protein.”
While CO2 is a problem
gas, it’s also an untapped eco-
PHOTOGRAPH COURTESY OF PRINCETON UNIVERSITY OFFICE OF COMMUNICATIONS
nomic resource, Robinson says.
“We have the potential to put a
meaningful dent in the amount
of CO2 emitted and put that to
good use.”
Right now, NovoNutrients is
PHOTOGRAPH COURTESY OF NOVONUTRIENTS
continuing to develop its prod-
ucts. Jain, of Fish 2.0, believes
NovoNutrients’ idea is promis-
ing but says that until the com-
pletion of their pilot, questions
remain about scalability and
whether customers and regula-
tors will accept the product.

ROSALIE CHAN (@rosaliechan17) is a
reporter at Business Insider. Her work has
appeared in TIME, The Daily Beast, Inverse,
The Huffington Post, and other publications.
The company hopes to sell
feed to smaller-volume com-
panies and hatcheries by 2022
and move toward larger com-
panies two to three years after
that.
“We view this as a new dawn
for the way protein gets pro-
duced,” Robinson says. “The
more fish in the sea, the better
for everyone.” n
TECHNOLOGY
Developing
a More
Diverse AI
BY STEPHANIE WYKSTRA
n a hot August day in
O New Jersey, a group
of teenagers sat in a
classroom and watched a video
from the artificial intelligence
company DeepMind. Animated
figures danced around the
screen, “learning” to navigate
an obstacle course. The students
laughed, as any typical
16-year-olds would, before ask-
ing, “Can we see the code?”
The group of 32 high school
students were at Princeton
PHOTOGRAPH COURTESY OF PRINCETON UNIVERSITY OFFICE OF COMMUNICATIONS
University for a three-week
summer program organized
by AI4ALL, a nonprofit dedi-
cated to increasing diversity in
the burgeoning field of artificial
intelligence, or AI.
While sectors as diverse as
PHOTOGRAPH COURTESY OF NOVONUTRIENTS
health care and education are
adopting AI technology, the
field remains largely white and
male. Only 10 percent of those
working on “machine intelli-
gence” at Google and 15 per-
cent of Facebook’s AI research
group are women. Numbers for
STEPHANIE WYKSTRA (@swykstr) is a
freelance writer and researcher based in New
York. Her work has appeared in Slate, Vox,
Aeon, and elsewhere.
African-Americans and Latinos
are also low at both compa-
nies. This presents a real danger
that tools such as algorithms
will be biased, especially when
the teams designing them are
unrepresentative of broader
society, says Sarah Myers West,
a postdoctoral researcher at AI
Now—a New York University
research center. People working
on AI “create the ideas about
what these technologies can
do and the purposes they can
serve,” she says.
Recent examples of such
bias include search engines dis-
playing ads for arrest records
more often in searches for
distinctively black names and
surfacing listings for higher-
paying jobs less often for
women than for men.
“When we build an AI sys-
tem, we decide what problem
we’re going to work on and
how are we going to approach
designing a solution,” says
Olga Russakovsky, an assistant
computer science professor at
Princeton University. “When we
have a team that’s not diverse,
it’s not going to think as criti-
cally about all the parts of this.”
AI4ALL began in 2015 when
Russakovsky—then a Stanford
University PhD student in com-
puter science—pitched the
idea of an AI summer camp for
girls to her advisor Fei-Fei Li.
Li, a professor of computer sci-
ence at Stanford and chief sci-
entist of artificial intelligence
at Google Cloud, loved the
idea, and together they estab-
lished the first program. In
2016, the program expanded
to the University of California,
Berkeley, and then to Princeton,
Boston University, Carnegie
Mellon University, and Canada’s
Simon Fraser University in 2018.
Some AI4ALL branches are
open only to girls, while others
admit both boys and girls with a
focus on racial inclusion. Several
programs are free, while others
charge tuition (more than half
of the students receive finan-
cial aid). All programs include
computer programing training
and cover tech policy and eth-
ics. Participants meet professors
and graduate students, and visit
organizations like Google and
the National League of Cities.
Over lunch, Princeton
AI4ALL students discuss the
challenges posed by lack of
diversity in AI and in leadership
positions generally. “It’s tough
when you’ve come to expect
CEOs to be white men,” says
Inaaya Coleman. Her tablemates
agree: When they don’t see oth-
ers who look like them in a par-
ticular field, they’re less likely to
pursue such positions.
Youth initiatives like AI4ALL
are important for increasing
inclusiveness, says AI Now’s
Myers West, but recruitment,
Stanford Social Innovation Review / Winter 2019 7
! Students at the Princeton University
branch of AI4ALL receive both technical
training in computer programming and
learn about tech policy and ethics.
promotion, and compensation
are also critical.
After the program ends,
AI4ALL connects alumni with
industry mentors and offers
grants for AI-related research
or community projects. “We tap
into their existing talent and
passion,” says AI4ALL CEO Tess
Posner. “They’re going on to do
more creative things than we
ever could have come up with.”
Recent alumni developed a
natural-language-processing
algorithm to improve emer-
gency dispatch response times,
and conducted research on a
computer vision system that
monitors surgeons’ tool move-
ments to analyze surgical skill.
AI4ALL plans to branch out
to additional universities and is
building an online platform to
expand access to its curriculum
to teenagers around the world.
“High school students are
way more advanced, moti-
vated, smart, and capable than
people give them credit for,”
Russakovsky says. “They build
things that have impact in the
world.” n
8 Stanford Social Innovation Review / Winter 2019

PUJA CHANGOIWALA (@cpuja) is a , Female qazis listen as a Muslim woman

journalist and author based in Mumbai. describes her ordeal at the Bharatiya
She writes about the intersections of Muslim Mahila Andolan office in Mumbai.
gender, crime, social justice, and develop-
ment in India.

HUMAN RIGHTS “I refused to accept the bringing hope to Shaikh and

divorce, and walked out. But many other Muslim women.

Disrupting the Patriarchy my husband left me anyway,”

says Shaikh, who then filed a
But the judgment has done lit-
tle to hold clerics accountable
BY PUJA CHANGOIWALA petition attempting to invali- for other injustices against
very time her alco- whom she could not support on date the separation. Muslim women.

E holic husband beat her,

42-year-old Zeenat
Shaikh silently cowered in a
corner of her Mumbai apart-
ment. Shaikh attempted sui-
cide many times to put an end
to the consistent abuse over
two decades of marriage. But
her darkest moment, she says,
was in December 2016 when her
husband sent her a WhatsApp
message with the image of a
handwritten document abruptly
announcing their divorce. Her
thoughts went to her daughters,
her own.
Shaikh rushed to the local
qazi—a cleric in Islamic family
courts—who’d officiated the
breakup on paper. He told her
that under Muslim Personal
Law, a special statute that gov-
erns family matters such as
marriage, divorce, inheritance,
and custody of children for
Muslims in India, a man could
divorce his wife by pronounc-
ing “talaq” (the Arabic word for
“divorce”) three times before
a qazi.
Although India has a strong
judiciary and constitution, the
country’s family affairs are not
governed by a single, secular
law but by a system of legal plu-
ralism. Various religious groups
have their own parallel extra-
judicial systems, and for India’s
172 million Muslims, marriage,
divorce, domestic disputes,
and justice under Sharia law
are overseen by qazis, who are
historically men.The Supreme
Court of India recently held
triple talaq unconstitutional,
Bharatiya Muslim Mahila
Andolan (BMMA), a secular
women’s rights organization
led by Muslim women in India,
is working to change that. To
counter the male-dominated
clergy, BMMA is training
Muslim women in tenets of the
Quran, the Indian constitution,
and women’s rights law. After a
year of study, 15 women gradu-
ated as the country’s first female
qazis in April 2017. The clerics,
age 25 to 65, now work in seven
states across India. They have

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varying levels of education, from
primary school dropouts to col-
lege graduates, but are united by
a common desire to achieve gen-
der equality for Muslim women.
Noorjehan Niaz, cofounder
of BMMA, says many male
clerics hold “extremely patri-
archal” views that justify prac-
tices such as unwarranted
separations, polygamy, and
nikah halala, which requires a
divorcée to first marry another
man and consummate the mar-
riage if she wishes to remarry
her first husband.
“We’re trying to bring a
structural change, where female
qazis, who understand issues
plaguing Muslim women better,
are leading gender justice for the
community through progressive
and liberal interpretations of the
Quran. The motive is justice for
women by women,” says Niaz.
The new qazis have achieved
some success arbitrating per-
sonal issues such as domestic
violence and inheritance dis-
putes. But collectively, they’ve
overseen just one divorce and
have not yet officiated a mar-
riage. They say they have yet to
be approached with requests for
legitimate marriages.
Unlike many of their male
PHOTOGRAPH BY PUJA CHANGOIWALA
counterparts, the women qazis
refuse to honor marriages
without proper documents
and decline to perform child
marriages.
Before training more women,
BMMA is trying to make the
first cohort more consequential,
Niaz says. Her group is raising
funds and raising awareness
about their presence through
other women’s organizations
and social media.
“When we announced we’d
become clerics, male qazis cre-
ated a furor,” says Rajasthan-
based qazi Nishat Hussain.
“Male clerics stated that
women can’t become qazis,
that it had never happened
before. But we pointed out that
the Quran dictates no such
restriction,” she says.
Advocates cite the need to
move away from religion-based
personal laws and toward a
uniform civil code, but Audrey
D’Mello, director of the wom-
en’s rights organization Majlis,
says the diverse country isn’t
prepared for that yet.
“Gender justice and uni-
formity of rights should be
embedded in personal laws,
and have to come from within
communities, instead of being
passed as statutes from the
center,” D’Mello says.
Any step aimed at helping
vulnerable women, should be
encouraged, she says. “Qazis
are means of dispute resolution
for Muslim women, and any-
one who plays the role, male or
female, is important.”
Karnataka-based qazi
Nasreen Matai cites poetic jus-
tice each time she arbitrates
favorably for a woman. In 2011,
Matai lost her 23-year-old sis-
ter to hypertension after the
woman’s in-laws abandoned
her, leaving her unable to afford
treatment. Her sister had given
birth to a girl, and the family
wanted a male heir.
“I don’t know how success-
ful women qazis will be in my
lifetime—if we’ll have the accep-
tance male clerics enjoy—but
our efforts will benefit future
generations of Muslim women in
India,” Matai says. “Had I been
a qazi seven years ago, my sister
would’ve lived.” n
SOCIAL ENTERPRISE
Insuring
Impact
BY SARAH MURRAY
very year, Ninety Con-
E sulting’s board mem-
bers ask themselves a
difficult question: How much
annual profit should be distrib-
utable and how much should be
retained to support and develop
the company? The answer is
important. While UK-based
Ninety’s business is deliver-
ing innovation services to the
insurance industry, its pur-
pose—as its name suggests—is
giving 90 percent of its distrib-
utable profits to charities and
social enterprises in the devel-
oping world.
This means striking a bal-
ance between helping grow
the business and giving money
away. “We want to be true to
our promise of giving,” explains
Andrew Davies, a Ninety board
member. “But if we retain noth-
ing for investment or cash flow
buffer, we could be putting the
whole thing at risk.”
Stanford Social Innovation Review / Winter 2019 9
SARAH MURRAY (@seremony) is a
freelance journalist who writes regularly for
the Financial Times and the Economist Group.
She has also written for The New York Times,
the South China Morning Post, and The Wall
Street Journal.
The company’s founder, Dan
White, is ambitious. “The vision
I’m chasing is to generate and
give away a billion pounds over
30 years,” says White, who grew
up in Burundi and pursued a
successful career in the United
Kingdom in digital marketing.
After becoming disillusioned
with a life focused on wealth
creation, White decided to make
a change. And while he initially
imagined selling his house and
car and moving to Africa, he
realized that he could do more
by creating a company whose
profits could be given away.
“The scale of impact available to
me by using business as a tool to
generate finance became appar-
ent,” he says.
While this sounds simple, to
meet its goal of giving away £1
billion ($1.32 billion) in the next
three decades, Ninety—which
White founded in 2013 and has
given away £250,000 ($329,404)
to date—needs to become suf-
ficiently profitable. “We’re on
track on the timeline we’ve set
ourselves,” White says. “But
there’s a hell of a lot of growth
required to get there.”
So far, its business model—
using entrepreneurship prac-
tices and innovation techniques
to help clients take ideas for
products and services to mar-
ket rapidly—has enabled it to
attract global insurance compa-
nies such as Zurich, AXA, and
Allianz as clients.
And while the quality of its
services is what wins it business,
Ninety’s social purpose is also
attractive to potential clients.
“We don’t select business part-
ners because they’re charitable,”
says Mark Budd, head of inno-
vation for Zurich’s UK opera-
10 Stanford Social Innovation Review / Winter 2019
tions. “But when there’s equality
among suppliers, it is a real
differentiator.”
Generating sufficient funds
for Ninety’s ambitious giv-
ing goals will eventually mean
launching other companies in
sectors such as banking and
energy, White explains. Forming
a group of enterprises, these
companies would, as Ninety has
done, register as community
interest companies (CICs), a legal
designation for social enterprises.
The team is committed to
maximizing its social impact,
consulting charity evaluators
like GiveWell, plus getting input
from staff and clients, to identify
potential beneficiaries. “We’re
looking for organizations that
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can scale up in an impressive
way and where we can get sig-
nificant reach for each dollar,”
says White, who follows effec-
tive altruism principles, based
on evidence of where the most
impact can be made.
He cites Living Goods, whose
network of “Avon-like” commu-
nity health workers go door to
door to sell low-cost treatments
and products and teach fami-
lies in Africa how to improve
their health. Studies have shown
that Living Goods, which uses a
data-driven performance man-
agement approach, is reducing
child mortality for less than $2
per person, per year. “We want
to deliver high impact but at a
low cost, and that’s why the data
and performance management
is so important,” says CEO Liz
Jarman.
Ninety is not alone in
its approach. For example,
Newman’s Own, the food and
beverage company founded by
actor Paul Newman, gives all
its profits to charity. And, citing
Newman’s Own as its inspira-
tion, management consultancy
Impact Makers does the same.
For Ninety, social-impact
objectives were also behind the
decision to launch an insurance
consultancy. “When people
and business owners don’t have
access to insurance, that drives
instability, which keeps people
locked in poverty,” White says.
“Insurance provides a stable
underpinning for a developed
society—that’s a significant part
of why we chose this sector.”
The next step for Ninety is to
start using its insurance exper-
tise to take its impact beyond
charitable checks. White plans
to take the team to Africa next
year to offer free consulting ser-
vices to some of its beneficiaries
and provide them with innova-
tion training.
White argues that business
and social impact are not mutu-
ally exclusive. “The reason I’m
a social entrepreneur is that I
believe business is more sustain-
able than charity,” he says. “But
you can blend the two—they
don’t have to be at two ends of
the spectrum.” n

PROFILES OF INNOVATIVE WORK
When History Lessons
Aren’t Enough
NGO Aktion Courage spurs students’ activist energy to promote
antiracist programming across Germany.
BY PAUL HOCKENOS
B
erlin’s Leibniz High School, a
handsome art deco building
from the turn of the 20th cen-
tury, has a new imprimatur on
its facade: a black-and-white metallic plaque,
about the size of a large shoebox, that reads
“Schule ohne Rassismus, Schule mit Cour-
age” (“School without Racism, School with
Courage”).
The elite institution in downtown Berlin
is the latest in Germany—the 2,763rd, to be
precise—to feature such a tablet, expand-
ing the countrywide network that makes
School without Racism, or SoR, the largest
independent antidiscrimination school-ori-
ented program of its kind. Today incorpo-
rated into about 9 percent of all schools in
Germany, SoR arguably serves as a model for
extracurricular initiatives fighting against
identity-based discrimination in schools.
“The plaque is something that our stu-
dents see every day that they enter the
school,” explains Sanem Kleff, director of the
Berlin-based NGO Aktion Courage, which op-
erates the SoR program. “It’s not an award or
commendation, but rather it reminds [them]
that they’ve taken a pledge to strive to be a
discrimination-free school and to demon-
strate civil courage in the face of xenophobia.”
Aktion Courage was founded in 1995 as
PHOTOGRAPH COURTESY OF WIKIMEDIA COMMONS
School without Racism in response to a spate
of hate-fueled violence in then newly unified
Germany. Assaults, arson, and bombings
claimed the lives of dozens of people, predom-
inantly from minority communities. Several
of the nation’s leading figures discussed an
idea already in practice in Belgium—an initia-
tive that worked with pupils on school prem-
ises but was not part of the school system—as
a solution to this unrest. Like the Belgian
program, SoR was envisioned as a bridge be-
tween highly competent local NGOs working
on antidiscrimination and inclusion issues, on
the one hand, and students and teachers who
wanted to take more concrete steps to address
the prejudice in their schools, on the other.
By 2000, the network, renamed Aktion
Courage, had grown to 39 schools and was
looking to place a seasoned professional
educator at its helm. Kleff, born in Turkey
but raised in northern Germany, had taught
immigrants and refugees in German schools
for 20 years before managing the diversity
efforts at Germany’s main labor union for
educators. Her experience made her the per-
fect leader for Aktion Courage. Two years
later, the journalist Eberhard Seidel, author
of several books that analyze right-wing
extremism, joined her as Aktion’s director.
SoR has since burgeoned from a tiny,
all-volunteer outfit in a handful of secondary
schools in western Germany into a sizable
network that oversees and links a prodigious
amalgam of schools, NGOs, civic education
Stanford Social Innovation Review / Winter 2019 11
! Student members of
School without Racism
march in Perleberg, Germany,
to honor the victims of
National Socialism.
associations, and prominent personalities
devoted to acting against discrimination in
Germany. It offers students and teachers an
array of resources to aid them in combating
school-based prejudice—racism, sexism,
homophobia, anti-Semitism, hard-right rad-
icalism, and religious intolerance.
A FOUNDATION IN STUDENT ACTIVISM
Aktion Courage’s modus operandi is firmly
grassroots; it is democratic and highly de-
centralized and runs like a holacracy. The
students—not the educators or the SoR
coordination offices that exist in every one
of Germany’s 16 federal states—run its
school-based chapters. None of the chapters
follows any prescribed programming.
A longtime observer of youth culture in
Germany, sociologist Klaus Farin says that
SoR’s strength resides in its circumventing
the top-down, authoritarian structures of
schools that tend to preach and command,
thus often turning off young people. “SoR
introduces a very strong element of partic-
ipatory democracy into schools,” says Farin.
He notes that the Berlin office usually has
very little to do with the chapters directly,
and that even the statewide coordinators
exist primarily for the students to access
for resources, if they so choose.
“It’s all about the students. They’re the
ones who organize and do all the work,”
says Stefan Breuer, a pedagogy expert at
Dresden’s Technical University. “They’re
not consumers. They decide what they want
12 Stanford Social Innovation Review / Winter 2019
PAUL HOCKENOS is a journalist living in Berlin. He is the
author of Berlin Calling: A Story of Anarchy, Music, the Wall,
and the Birth of the New Berlin (The New Press, 2017).
to focus on and then carry out the projects
themselves, in their own schools. Essentially,
it turns them into activists.”
SoR maintains a supervisory role through
the teachers, school social workers, and local
partners affiliated with the chapters, many of
whom have been part of the network for years.
“They might get the ball rolling but then step
back,” explains 17-year-old Thilo Dieing, an
SoR member and student in Mannheim, a city
in western Germany. “They could jump back
in, if necessary, but they’re at the same level
as the students, not above us. They make sure
the spirit of SoR is accurately represented.”
In order to become part of the SoR net-
work, interested students must garner the
official support of at least 70 percent of the
students, teachers, and staff. A petition with
the requisite signatures commits the school
to act against discrimination, harassment,
and violence by creating an “environment of
tolerance.” The chapter must agree to hold at
least one antidiscrimination event per year.
The completed petition qualifies the
school as a network member and earns it a
black-and-white SoR plaque. But “the plaque
isn’t the end of anything,” Kleff underscores.
“It’s just the beginning. It’s a pledge to fill this
designation with content, to make it happen.”
Membership also ensures that the school
receives a coordination partner, usually a
local organization that Aktion Courage has
vetted. This arrangement automatically
connects the chapter to civil society outside
school and enables the students to tap the
partner’s expertise. In Frankfurt, for exam-
ple, the Anne Frank Educational Centre, an
NGO promoting tolerance, partners with lo-
cal SoR chapters. The chapters’ partners are
largely responsible for raising funds, some of
which come from the federal states in which
they are based, and can also link the school
chapter to other NGOs in the network.
The chapters’ projects vary widely, de-
pending on the school, the student personali-
ties, and topics that the students deem critical
issues of the day—from hosting fundraising
campaigns for World AIDS Day to setting up
the provision of diverse aid to refugees. In
2018, for example, the Niederzier Merzenich
Comprehensive School hosted workshops for
students in grades 5 to 13 on its annual Anti-
Discrimination Day. The 11th grade explored
ways to prevent homophobia in the school’s
everyday culture, while the 10th grade invited
university experts to address how to counter
the resurgence of hard-right radicalism. The
oldest students, in grade 13, took a day trip to a
documentation center in Cologne to examine
its collection of Nazi-era materials.
The Niederzier Merzenich chapter also
runs a weekly working group on antidiscrim-
ination practices, and its leading members
attend the annual SoR national conference.
The conference provides a venue for chapters
to share information and experiences; newer
chapters, in the greener stages of operation,
benefit particularly.
Kleff and Seidel emphasize that the pur-
pose of SoR is not to overload the pupils with
information but to inspire them to engage
with other students and partner groups. This,
they say, is what German schools are missing,
even though postwar Germany has under-
taken unprecedented measures to reckon with
its Nazi past. In all German schools, teachers
are required to address German fascism and
the origins of xenophobia. Still, racism per-
sists. “The roots of racial völkisch ideas in our
culture obviously run very deep, deeper than
many of us had thought,” says Seidel. “History
lessons aren’t enough.”
CAN RACISM BE ERASED?
SoR and other antidiscrimination initiatives
have never been more crucial in Germany
than they are today. In 2017, for the first time
ever, a far-right party called Alternative for
Germany, which considers refugees welfare
parasites and a blight on German culture,
won seats in Germany’s national parliament.
A fierce debate over immigration has raged,
and violence against refugees has spiked.
Meanwhile, anti-Semitism is on the rise;
many Jewish Germans are afraid to wear a
kippa in the street.
Regions of eastern Germany, where far-
right support runs particularly deep, are
tendentious terrain for SoR. So great is the
threat of repercussions that some chapter
leaders use pseudonyms when writing in
the SoR newspaper Q-rage!.
Saba-Nur Cheema, of the Anne Frank
Educational Centre, credits SoR’s structure
for being flexible enough to react quickly
to developments. The center organized a
series of workshops in immediate response
to a recent wave of anti-Semitic outbursts
because, says Cheema, “students wanted to
do something to understand what [is] hap-
pening now and why.” In contrast, it can take
years for new material to be introduced into
Germany’s school curricula, and arguably
even longer for the intellectual absorption
of that material to take effect.
SoR isn’t without critics. The title School
without Racism is misleading, says Ruhr
University of Bochum professor Karim
Fereidooni, because “there’s no such thing
as racism- or sexism-free spaces in our so-
ciety.” He continues, “By proclaiming this,
it can have the effect of silencing students
who experience racism in school.”
Fereidooni and others also charge that
some SoR schools become inactive but nev-
ertheless keep the plaque affixed to their
facade. He recommends regular evaluations
of the member schools and consequences
for those that don’t comply with SoR stan-
dards. Furthermore, he and others have
warned, the emphasis on quantity—the
thousand-plus network—can’t occur at the
expense of quality. They’d like SoR to take
a more hands-on approach by more closely
managing its chapters.
Aktion Courage has fielded these criti-
cisms and admits that an evaluation process
is complicated but necessary. As for criticisms
about quantity, Aktion Courage is pleased
with its growth but has never suggested that
it alone can conquer racism in Germany.
In times of crisis, new schools like Berlin’s
Leibniz High School will continue to seek
ways to address the rise of xenophobia across
PHOTOGRAPH BY PAIGE GREEN
Germany and its ramifications for the com-
munities of teachers, students, and families
that they serve. And this means that Aktion
Courage’s SoR impact will continue to grow,
as more and more schools proudly display
their black-and-white plaques. n

Schools’ Most
Untapped Resource
Green Schoolyards America connects ecological innovation with
education, equity, and community engagement.
BY ADRIENNE DAY
W
hat are we growing in our gar-
den?” Wanda Stewart asks a
class of third graders at Hoover
Elementary School in Oak-
land, California. The room erupts with a
garden medley: “Watermelon!” “Cherries!”
“Spinach!” “Eggplant!” Then someone yells,
“Mangoes!” and Stewart, Hoover’s gardening
teacher, holds up her hand. “Can we grow
mangoes in California?” she asks. “Mangoes
need to grow in a really hot place, like Cen-
tral America or Mexico.” Someone else yells,
“Sacramento!” and Stewart pauses. “Maybe
PHOTOGRAPH BY PAIGE GREEN
in Sacramento,” she considers. A twinkly-eyed
eight-year-old shares that his favorite place to
read is in the garden, adding that he tried mak-
ing a Hoover-grown eggplant-and-strawberry
smoothie in the school’s outdoor kitchen, but
that “it didn’t taste very good.”
Hoover may not grow mangoes, but it de-
votes 5,600 square feet to the cultivation of at
least 50 different kinds of fruits, vegetables,
herbs, bushes, and fruit trees. Even though
it’s a cash-strapped inner-city school, its gar-
den yields enough organic produce to merit
inclusion in West Oakland’s farmers’ market.
Sharon Danks looks to Hoover as a model
for other K-12 schools. Danks is the founder
and executive director of Green Schoolyards
America, a Berkeley, California-based, non-
profit that seeks to expand and strengthen
the green schoolyard movement currently
flourishing in cities such as Tokyo and Berlin
and beginning to take root in the United
States. The idea is to transform schoolyards
from a 1940s-era asphalt-and-grass model to
ecologically diverse landscapes that connect
nature and environmental sustainability with
place-based, hands-on learning while building
community and democratic participation.
Stanford Social Innovation Review / Winter 2019 13
$ Students at Hoover
Elementary School in Oakland,
California, tend to their
school garden, help to water,
and look for insects.
“The goal of Green Schoolyards America is
to use school land to improve the well-being
of children and the environment at the same
time,” Danks explains. “We’re equally inter-
ested in outcomes for children’s learning
and health and social-emotional well-being
as we are in watersheds, habitats, air quality,
and climate change.” Ultimately, the green
schoolyards movement is about modeling
ecologically rich cities of the future that we
might like to live in and, in the process, restor-
ing our relationship with the natural world.
THE POLITICS OF EQUITY
The gold standard for schoolyards in the
United States, especially in urban areas,
is a play structure grounded in cement or
rubber, encircled by a fence to keep students
on one side and community members on
the other. Danks sees this template as a
problem on many levels. “If something is
not funded enough, it’s easier just to lock
it up,” she says, pointing out that many
schools resemble prisons because asphalt
and chain-link fencing are inexpensive and
low maintenance. “But in an ideal world, the
public cares about public space. … There is an
underlying citizen-participation philosophy
in planning for a green schoolyard.”
This philosophy conceives of school land
as a community resource. Instead of expect-
ing school districts to try to manage all their
land without the requisite resources, the com-
munity assumes stewardship of the land and
decides what should be planted and where,
and in turn creates an infrastructure capable
of evolving over time to meet the commu-
nity’s needs and desires. The children also
have decision-making power, which effec-
tively deepens their knowledge about their
own environment. For Danks, this empow-
erment is an antidote to a culture in which
“environmental issues are so negative and the
way they’re portrayed can be scary for kids.”
Indeed, Hoover’s garden is a communal
effort. Members of a nearby church, students
from the University of California, Berkeley,
local nonprofits, and a few national brands
have contributed money, tools, and sweat
to the garden. And the garden gives back.
14 Stanford Social Innovation Review / Winter 2019
ADRIENNE DAY has written for The New York Times; 
Nautilus; New York; O, The Oprah Magazine; and ImpactAlpha,
among other publications. She is a contributing editor at 
Demand, a publication of the American Society of Mechani-
cal Engineers.
“No one who works in the garden goes home
empty-handed,” says Stewart, who adds that
they feed anyone who walks by, especially
the local homeless population.
A growing body of research indicates that
having access to green space at school has a di-
rect impact on student achievement. Research
by William Sullivan, a professor and head of
the landscape architecture department at the
University of Illinois, shows a correlation be-
tween urban design and well-being. One of his
projects involved giving high school kids men-
tally fatiguing tests in one of three environ-
ments: a room with no windows, a room with
a view of a “built space” but no vegetation,
and a room with a view of vegetation. In the
room with no windows, the students reported
the highest stress and made the most errors
on the tests, while kids in the room with the
view of trees reported the lowest stress and
made the fewest errors.
Marcella Raney and Bevin Ashenmiller,
both professors at Occidental College and
members of Green Schoolyards America’s
collaborating research team, examine which
schoolyard design features decrease surface
temperature and pollution levels; for exam-
ple, schoolyards covered with soil, rather
than cement, absorb rainwater and thus help
keep school grounds cooler while improving
the watershed. Raney and Ashenmiller also
study what features might promote physical
activity for children in poor areas. “In urban
low-income neighborhoods, children have
very few opportunities to engage in physical
activity outside the school campus,” Raney
observes. “Fortunately, substantial green
schoolyard programs are under way and
large-scale investments in school-ground
transformations are accelerating.”
Schoolyards are a vast resource that
most communities have barely begun to
tap, Danks says. Despite its ubiquity, the
exact amount of land public schools occupy
is unknown—even to city planners. “Cities
are essentially planning with gaping holes
in their maps where all the schools are,”
Danks notes. “They’re not talking to the
schools about it, because the land belongs
to the schools.”
Danks emphasizes that this movement is
hardly the sole domain of schools and their
local communities. Broad impact requires
buy-in not only from local school districts
but also from the county and state. She has
devoted a good portion of the past 20 years
to figuring out what’s needed to shift the
norms of school-ground design and use, and
to building a “partner network” of the people
required to enact policy change.
Green Schoolyards America has been
working across school, city, and state levels
to make this movement happen. For exam-
ple, it started a Principals’ Institute in 2016
to provide professional development for
principals to adopt and sustain green school-
yard programs, and to encourage the inte-
gration of schoolyards into lesson planning.
Danks is also forging partnerships with the
Trust for Public Land and school districts
like Oakland Unified to assist them in fram-
ing their school grounds as land that can
help mitigate the impact of global warming
and thus qualify for climate-related funds.
Which brings us to the elephant in
the room: How can a public-school sys-
tem pay for this? Danks concedes it’s not
cheap—$150,000 currently equals about a
quarter acre of redesign per schoolyard—but
indicates that the money is there, just in the
wrong “silos.” “Water agencies are trying to
protect the watershed, but they don’t have the
land, and schools have the land but no money.
So how do we match those two needs to have
water agencies unpave the ground to improve
the watershed?” Danks asks. There are urban-
greening grant programs and, at a state
level, a billion or so dollars of cap-and-trade
money to potentially tap as well.
“We need to think about this as park plan-
ning and apply infrastructure-scale budgets
that we would normally apply to a park or a
stormwater project,” Danks says, adding that
meeting this infrastructure need “could be
designed in a way to benefit children.”
FORGING CONNECTIONS
AROUND THE WORLD
Danks cofounded another nonprofit, called
the International School Grounds Alliance
(ISGA), which works to enrich children’s learn-
ing and play by improving the design and use
of school grounds. She was inspired to form
ISGA after traveling to different countries to
visit green schoolyards as part of her master’s
thesis research. The results of those travels are
now printed in an annually updated guide, to
which schools around the world contribute
ideas for outdoor educational projects.
Birgit Teichmann, a Berlin-based land-
scape architect and engineer who is also part
of the ISGA, credits Danks with turning it into
an international effort. “It’s a big movement
and very different in different countries, but,
in the end, many people are very concerned
about their cities and are into the same idea,”
Teichmann explains. She describes Berlin as a
model for other cities: Twenty-five years ago,
all of Berlin’s school grounds were paved, but
now, thanks to a law that says that any rainwa-
ter diverted to a public pipe needs to be paid
for, 60 to 70 percent of school grounds have
PHOTOGRAPH COURTESY OF GREY CORPORATE
been unpaved and transformed into “green
play landscapes.”
There’s also a US-specific edition featur-
ing schools across America, one of which is
Golestan Education, a Berkeley-based private
school that Ashoka recognized as a “change-
maker” school in 2016. Golestan cofounder
and executive director Yalda Modabber par-
ticipated in Green Schoolyards America’s
2016 Principals’ Institute, which, she says,
“helped us realize how regulated and inhib-
ited the educational system is in this country.
Things that are basic to our programming and
school environment are not the standard at
other schools.” 
Golestan is in the process of scaling up
to a larger facility, a former Catholic school
that needs a lot of work to transform it from
18,000 square feet of concrete “without a
single tree” to a lush landscape. Modabber,
who used some of what she learned at the
Principals’ Institute to redesign Golestan’s
school grounds, is eager to begin this work.
“Kids need to feel nurtured and loved and
respected and cared for,” she says. “If you cre-
ate an environment that reflects that, then
they are more likely to feel that way and can
pay it forward to other people.” n

The Difference Curve
Auticon aims to change society’s perception of people on the autism
spectrum for the benefit of businesses and employees alike.
BY ALICIA CLEGG
O
n a rainy afternoon in East
London’s Tech City, the British
capital’s fast-growing technol-
ogy district, Thomas Madar,
an IT professional with no fewer than three
master’s degrees, tells me about his lifelong
challenge with finding stable work as an
autistic person: “I didn’t fit into the team
very well and found it difficult to socialize,”
Madar recalls about his first job as a software
engineer. After two uncomfortable years, his
employer encouraged him to leave. Though
other roles followed, he was twice made re-
PHOTOGRAPH COURTESY OF GREY CORPORATE
dundant, suffered spells of unemployment,
and, in recruitment interviews, fared poorly
against more extroverted candidates.
Madar’s career, however, took a turn
last year when he accepted a position with
Auticon, an IT and compliancy consultancy,
all of whose consultants are on the autism
spectrum. Recently engaged on a project for
Virgin Money, he says that for the first time
in years he is among “people who understand
my condition”—and that makes a difference.
Thanks to Auticon, he has newfound secu-
rity, including the support of a job coach, a
regular salary, and opportunities to put his
skills to meaningful use.
Dirk Müller-Remus, a technology exec-
utive, started Auticon in Berlin in 2011. The
father of a teenager on the autism spectrum,
Müller-Remus was dismayed to learn that
many highly qualified autistic adults were
surviving on welfare benefits when they could
have been earning a living. He also recognized
that the strong abilities many autistic people
possess—in pattern matching, detecting er-
rors, and following complex protocols metic-
ulously—were ideally suited to IT.
Most of Auticon’s consultants, despite
their intellectual abilities, struggle socially.
Many are hypersensitive to stimuli such as
noise and bright lights, prefer set routines, and
struggle with prioritization. The majority, con-
Stanford Social Innovation Review / Winter 2019 15
$ An Auticon consultant leads
a strategy discussion meeting
on feedback with team members
at the London office.
sequently, have patchy résumés. “Around 80
percent of our consultants were [previously]
unemployed, often long-term, and of the 20
percent who were employed, over half were
in jobs that weren’t appropriate to their skill
set,” says Auticon UK CEO Ray Coyle, whose
London branch employs 23 consultants.
The waste of talent mirrors the wider pic-
ture of autism. According to 2016 research
by the UK’s National Autistic Society, only
16 percent of autistic adults have a full-time
job—yet 77 percent without employment
want work. Auticon aims to change that.
Founded with investment from the Ananda
Social Venture Fund, it seeks to improve au-
tistic people’s prospects, both as an employer
itself and by persuading other companies to
adopt autism-friendly practices. “We have
one obvious goal, and that is to create as
many jobs as possible for people on the autism
spectrum,” explains Kurt Schöffer, Auticon’s
Group CEO. “Then we have a second goal,
which isn’t so obvious: By sending our consul-
tants to work inside our clients’ IT teams, we
want to change how society perceives autism.”
Now numbering more than 100 con-
sultants across its operations, Auticon has
expanded to seven locations in Germany.
Having proven itself locally—with clients
that include BMW, Siemens, and Allianz—
it has opened offices in Paris,
London, and Zurich; more of-
fices, including a US launch in
summer 2018, are in the works.
Andrea Weierich, global head of
central functions platforms at
Allianz Technology, describes
her experience hiring an Auticon
consultant for a data project in
2014: “For us, it was really per-
fect, because his strength is
pattern recognition, which is
something that [many] people
get bored by and sloppy about
the more they have to do it.”
RESOLUTELY COMMERCIAL
Auticon could have organized
its workforce in many different
ways. It could have located its
16 Stanford Social Innovation Review / Winter 2019
ALICIA CLEGG (@aliciamargclegg) is a journalist based
in Britain. She writes about the workplace, enterprise, and
social justice.
consultants centrally and brought tasks to
them, or it could have used remote technol-
ogies to support employees working from
home. It decided to send its consultants out
to work with its clients, thereby reaping a
double benefit: The consultants get to work
inside blue-chip companies on innovative IT
projects, and the clients see how including
autistic workers can benefit their business.
“We want to give as many people as pos-
sible the opportunity to work with an autis-
tic person and to get an understanding that
this is something to be embraced and not
feared,” Coyle says.
Auticon’s model is resolutely commer-
cial. Müller-Remus could have established it
as a charity; instead, he founded a for-profit
business that would sink or swim, based on
its achievements. “Our belief is that we can
have a social impact long-term only if we’re
profitable long-term,” Schöffer explains, “be-
cause if we’re living on donations or govern-
ment support, the [foundation] on which we
build may not be stable.”
By turning a profit, Auticon challenges the
narrative of autism as a handicap and shows
other organizations the benefits of employ-
ing people who think, and sometimes behave,
differently. For one, it charges its consultants
out at market rates and pays them a salary in
line with the remuneration of IT profession-
als in similar-sized consultancies. To live up
to its own—and its clients’—high standards,
however, Auticon must offer support struc-
tures well beyond what a startup would nor-
mally provide. This begins with recruitment.
Applicants go through a rigorous assessment
that hinges on their demonstrating capabil-
ity by solving puzzles and coding challenges.
Those who do well take part in a multiday
workshop to determine whether they’re right
for Auticon and Auticon is right for them.
Once hired, the consultants are paired
with job coaches like Kirsty Wilson, who
works in Auticon’s London office. She de-
scribes her role as giving her colleagues “as
much or as little help” as they need to thrive
professionally. That might mean supporting
someone settling into a new assignment—
many autistic people do not adapt readily to
change—or negotiating with a client to adjust
an Auticon employee’s working environment.
Torsten Schindler, a senior IT consul-
tant in Munich, finds aspects of office life
overwhelming, dislikes switching between
tasks, and prefers e-mail to verbal discussion.
“Autism, in my case, makes me more suscep-
tible to stress, noise, [and] brightness and to
colleagues who talk on their phone, causing
my concentration to break down,” he writes
in an e-mail. With the support of his job
coach, he finds ways around these hurdles,
such as having a desk placed in a quiet cor-
ner of the office and wearing noise-canceling
headphones to filter out distractions.
The coaches also support Auticon’s cli-
ents, who may have little knowledge about
autism. At the start of each assignment, the
job coach explains to the receiving team how
the consultant’s autism might express itself
in behaviors that to others appear rude. For
example, many autistic people shy away from
small talk because they trip over its unwrit-
ten rules. “There are many nuances that [a
lot of] autistic people simply don’t pick up
on,” explains Richmal Maybank, lead job
coach at the London office. “Is it okay to ask
the CEO about their weekend? Why is the
weekend a topic for a Friday or a Monday,
but not a Wednesday?”
A more thoughtful approach to accom-
modating autistic difference might bring
wider advantages. When companies re-
spect autistic coworkers’ capabilities, says
Weierich, they send a message to people
who “feel pressured to conform to norms
that they find limiting” that they can be
themselves and still be valued for their work.
A BUDDING MULTINATIONAL
Though Müller-Remus started Auticon,
Schöffer led its expansion. An IT entre-
preneur by training, Schöffer invested in
Auticon’s launch through the Ananda Social
Venture Fund and, in 2013, accepted an
operational role. For the next three years,
the two men ran Auticon jointly. The phased
transition worked to the young company’s
advantage, allowing Schöffer to establish
its operations on a secure footing while
Müller-Remus honed the workplace practices
required to realize his passionate vision
for autistic employment. In 2016, Müller-
Remus stepped aside, though he remains a
shareholder and trusted advisor.
As CEO, Schöffer has sought investors who
believe in Auticon’s mission and have faith in
its ability to generate financial returns. He
found a kindred spirit in Richard Branson’s
Virgin Group, which became a shareholder
in 2016. “We tend to invest only behind com-
panies that we think can have the same re-
turn as a company without a social-impact
cause, because we believe there’s no reason
social impact should diminish return,” says
Edouard Muuls, an investment director at
Virgin Management who worked on the deal.
This willingness to put social goals before
quick returns characterizes all of Auticon’s
backers, most of whom, according to Schöffer,
have some kind of personal connection to
autism. As of midway through 2018, not one
backer has asked for a dividend or talked of
exiting. “For all of our investors, Auticon is
more than an investment,” Schöffer notes.
For the small team charged with growing
Auticon’s UK presence, the Virgin brand’s
backing has generated publicity and opened
doors—and the results show. “If you look
at the UK, it was cash-flow break-even well
before we expected,” says Muuls.
Yet even as it pursues growth, Coyle knows,
Auticon has responsibilities to its employees
and to society. “If we fail, there’s a danger
that people will look at us and think, ‘That’s a
business that tried to build financial success
on the basis of recruiting people on the autis-
tic spectrum, and it didn’t work,’” he explains.
While it’s less than a decade old, Auticon
is competing against mainstream IT consul-
tancies, winning repeat business, attracting
investors, and scaling up from a Berlin-based
experiment into a budding multinational
company. And as it does all this, market by
market, client by client, it is achieving its
goal. “When one of our consultants sits on
a team at BMW or Allianz, the people they
work with talk to their colleagues; they talk to
their families,” says Schöffer. “In that way, we
change the perception of autism in society.” n
 Exploring the What Lurks Behind Harnessing the SECRETS OF SUCCESSFUL
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18 Stanford Social Innovation Review / Winter 2019
AN INSIDE LOOK AT ONE ORGANIZATION
Clean Energy
by the People,
for the People
After the 1986 Chernobyl disaster, the “energy rebels” of Schönau, Germany,
launched a grassroots revolution in the Black Forest to take control of
their community’s power. Their creation, EWS, not only triggered the
country’s transition to renewable energy but also demonstrated the need
for grassroots democratic control of energy production.
BY PAUL HOCKENOS
eep in the Black Forest, not far from the French
D
and Swiss borders, the energy collective EWS is
one of Germany’s most storied clean-energy en-
terprises. In its offices and corridors, one term
crops up in just about every discussion: “Ener-
giewende” (“energy transition”), the moniker for
the country’s historic switch from fossil fuels and nuclear power
to sustainable energy. In the 1980s, the Schönau “energy rebels,”
as EWS’s founders originally branded themselves, trailblazed
Germany’s earliest grassroots initiatives to cut energy consumption
and grow renewables. Ever since, EWS has remained an idealistic pi-
oneer and unrelenting advocate of community energy projects, deter-
mined to help Germany meet, or even exceed, its climate-protection
pledges.
EWS, which stands for Elektrizitätswerke Schönau (Power
Company Schönau), is a one-of-a-kind, many-sided cooperative,
collectively owned and guided by 6,500 members, that not only dis-
tributes and produces green energy but also pushes technical and
market innovations. It functions as a multiplier for like-minded,
noncorporate clean-energy projects and as a tenacious political
lobbyist for the cause of citizen energy in the Bundestag, too. The
enterprise also looks beyond Germany’s borders—climate change
being, after all, a global phenomenon—to the rest of Europe, to
Asia and Africa, and even across the Atlantic to the United States,
where in 2011 EWS cofounder Ursula Sladek visited President Barack
Obama to tell him about renewable energy in Germany.
, The Rohrenpark wind farm in the
Black Forest near Gersbach, Germany,
is one of EWS’s many renewable
energy operations.
EWS members understand
the cooperative as a vanguard
not just of the Energiewende,
which is now German state pol-
icy, but also of a specific strain
of the renewables revolution
that favors highly decentralized,
democratic, and community-
led energy management. They
call it “citizen energy,” in which
burghers participate in the gen-
eration and supply of renewable energy, usually in their native
locality. Its practitioners, of which EWS is first among equals, share
a radically progressive vision of the energy transition—one not
everyone in Germany holds.
“The Energiewende can succeed only if it’s decentralized and
participatory, which is how it began,” explains 40-year-old Sebastian
Sladek, Ursula’s son and one of EWS’s four-person board of direc-
tors, which also includes his brother Alexander. “Many sizes of
energy producers will be needed all across Germany to balance out
an energy supply that is composed of different kinds of renewable
energies generated at different times and under fluctuating weather
PHOTOGRAPH COURTESY OF EWS
conditions,” Sebastian says, listing wind and solar power, biogas,
hydropower, synthetic fuels, geothermal power, and maybe hydro-
gen, too, as primary energy sources.
If citizen-energy proponents have their way, he says, Energie-
wende will turn Germany into a dense patchwork of energy “pro-
sumers”—producers of energy who are also consumers—connected

to one another through the Internet or high-tech intelligent grids,
or both. The technology’s mostly there, he says—the government
just has to throw its full weight behind it and finally abandon the
automobile manufacturers and coal-burning energy conglomerates
that still hold sway over energy matters.
PUSHING THE TRANSITION FORWARD
Germany’s Energiewende is a work in progress, the ultimate aim
of which is to wean the economy off fossil fuels and arrest climate
change. The country, including just about the entire political class
and most of the private sector, too, has pledged to significantly de-
PHOTOGRAPH COURTESY OF EWS
carbonize Germany’s economy by 2050 while hitting other targets
along the way, such as reducing greenhouse gases by 40 percent by
2020 (compared with 1990) and ramping up the supply of renew-
able electricity to 40 percent by 2030. The Energiewende’s main
pillars are adopting nationwide efficiency measures that reduce
consumption, phasing out nuclear power and dirty fossil fuels,
Stanford Social Innovation Review / Winter 2019 19
and expanding renewable energy. Germany currently garners 36
percent of its electricity supply from renewables, primarily wind
and solar power, almost all of which have entered the country’s
power supply in just the past 18 years—a stunningly rapid rollout
for an industrial economy of Germany’s size. During a few of the
early-morning hours of May 1, 2018, the country satisfied all of its
power needs from renewables alone—a first. The Energiewende’s
kudos, for which EWS enjoys a slice of the credit, are now recog-
nized far beyond Germany.
Yet a third of the country’s electricity is still generated by
coal, and most of its heating relies on natural gas. At the moment,
Germany is not on track to hit its 2020 emissions reduction targets
as they are iterated in the 2015 Paris Agreement on climate change.
By contrast, many other countries, such as France and the United
Kingdom, though slower out of the blocks than Germany, are likely
to do so. Germany’s oil-addicted transportation sector has a prodi-
gious carbon footprint that’s actually growing, thanks largely to the
20 Stanford Social Innovation Review / Winter 2019
PAUL HOCKENOS is a journalist living in
Berlin. He is the author of Berlin Calling: A
Story of Anarchy, Music, the Wall, and the
Birth of the New Berlin (The New Press, 2017).
muscular carmaker lobby financed by the big-ticket brand names
familiar to all of us, such as Volkswagen, Mercedes-Benz, and BMW.
This mixed record, say the EWS team and pro-renewables
allies, can be laid at the feet of Chancellor Angela Merkel and
her recent governments, which have slammed the brakes on the
Energiewende (after vowing to back it) and steered it away from
community-based energy in favor of traditional utilities. But EWS
has overcome an array of foreboding obstacles since its founding
25 years ago and is now on the offensive to help snap Germany out
of its current lethargy.
Today EWS counts nearly 200,000 customers Germany-wide who
pay for the highest-quality green energy. It owns wind and solar parks,
as well as electricity and gas grids. Moreover, its philanthropic arm,
a support program financed through revenues, has launched many
thousands of micro- and small-sized sustainable-energy projects, rang-
ing from household power generation and electricity storage units to
other, full-fledged energy collectives like it. The Schönau cooperative
prides itself on contributing to the whole range of the Energiewende,
not just one aspect of it, as do most of its competitors in the field of
clean-energy generation. EWS even has a special department devoted
solely to strategic innovation, which is currently experimenting with,
for example, electricity storage systems, such as noninflammable salt-
water batteries that use saline solution, rather than toxic chemicals.
The ESW staff underscore that the company’s ambition is not to
own ever more of the means of renewable-energy production, such
as wind and solar parks or biogas factories. Rather, it invests in new
production facilities together with upstart regional energy coop-
eratives and then, when the co-ops are ready for it, hands over the
operation to the locals. “A decentralized Energiewende means that
out-of-town investors don’t own and run production from far away
and then bring the profits back to wherever they’re based,” explains
Tanja Gaudian, who leads the solidarity program. “The burgher from
those localities should own and manage the parks, and also profit
from them.” EWS’s early participation in such projects with capital
and know-how can be the extra boost that a small co-op might need
to raise the funds for, say, a couple of wind turbines, which require
significant startup financing.
Despite facing a highly competitive energy market, EWS turns
over €43 million ($49.8 million) annually and has posted black
numbers annually since 1997. Sebastian Sladek explains that EWS’s
financial health depends on making citizen energy a reality. “But
our purpose isn’t to accrue profit. It’s to invest in more renewable
energy,” he explains, “to push the Energiewende forward.”
A DEMOCRATIC REVOLUTION
Michael and Ursula Sladek arrived abruptly to the world of energy in
1986, a time when climate change was nowhere on the horizon. The
couple, born in Catholic, southwestern Germany after World War
II, had known each other since childhood and moved to Schönau in
the early 1970s. Michael was the town’s general practitioner, a jovial,
, Left: EWS cofounders Ursula and
Michael Sladek stand in a field of solar
panels. Right: Ursula Sladek meets
President Barack Obama in the Oval
Office on April 13, 2011.
larger-than-life bear of a man with a bushy Grizzly Adams beard.
Ursula was a trained schoolteacher, warm and articulate, with in-
telligent, sparkling eyes. Although counterculture in the 1970s had
found a home in many West German towns, the Sladeks were neither
leftists nor firebrands.
But in April 1986, news of the meltdown of the Chernobyl nuclear
power plant in western Ukraine, then part of the Soviet Union,
reached Germany and jolted them into action. The disaster sent a
cloud of poisonous gases drifting over western Germany, contam-
inating farmlands, water supplies, and forests.
“It hit us like a bomb,” says Ursula Sladek. “We had no idea that
an accident 2,000 kilometers away could affect us in Schönau.” And
Germany, they quickly realized, had nearly 20 of its own reactors,
just a tiny fraction of the fleet across Europe, the closest of which
was 200 miles away in France, just across the Rhine.
The Sladeks had five children by then. Like many other German
parents, they were furious about the scant information on the
calamity and fearful about their children’s exposure to radioac-
tivity. Michael, as town doctor, did what he could do to field his
patients’ concerns, but for him, too, the threat was terra incognita.
In response, the Sladeks joined other inhabitants of Schönau to form
an NGO, Parents for a Nuclear-Free Future, which researched the
effects of radioactivity, staged local protests, started a newsletter,
and lobbied the local utility to forgo nuclear power in its mix.
By the time of Chernobyl, West Germany already had a vibrant,
sporadically militant anti-nuclear-energy campaign that gathered
protesters by the tens of thousands and eventually, by applying pres-
sure over four decades, forced the German government to commit to
exiting nuclear power. (The last active reactor is scheduled to switch
off the lights in 2022.) Schönau and the Sladeks weren’t initially
part of the countrywide mass social movement, but that changed
overnight in 1986, and they quickly became innovators within it.
“We had to do something ourselves, because neither the energy
companies nor the government were taking action,” says Ursula
LEFT: PHOTOGRAPH COURTESY OF EWS; RIGHT: PHOTOGRAPH BY PETER SOUZA FOR
Sladek. “[The energy companies] had their own vested interests,
which didn’t include our families’ well-being.” West Germany, they
concluded, had to abandon nuclear energy—it just wasn’t worth the
risk—and they set out to make it happen, starting in their community.
“We realized that we couldn’t just be against nuclear power; we
had to be for something, too,” says Ursula Sladek. Their first inclina-
tion was to explore ways to cut their own energy use, figuring that if
demand were lower, Germany could get by without nuclear power,
which constituted 40 percent of its power supply. They marched
door to door to collect and share efficiency tips and held monthly
seminars in town. Special meters measured energy usage, and prizes
were awarded to those touting the lowest numbers.
By then, elsewhere in the country, freethinking engineers and
backyard tinkers had already begun experimenting with DIY solar
panels, wind turbines, and combined heat-and-power units. (CHP,
also known as cogeneration, is a process that recovers surplus heat

from power generation to use for heating or electricity generation.)
But the Sladeks were the first to turn their attention to the means
of energy distribution: the electrical grid itself. They had tried to
interest the regional utility, the Stuttgart-based regional principal
KWR, in renewable energy, as well as in ways to scale back energy
consumption. But the company, heavily invested in nuclear power,
dismissed the Sladeks and their diminutive NGO as crackpots.
But they would not be denied. Over the course of the next decade,
Schönau’s 2,500 citizens took the utility to court and prevailed in
two popular local referendums, eventually winning EWS the right
to operate the grid for 20 years. “We were the only democratically
legitimated energy company in the world,” Ursula brags.
EWS’s end run in traditionally minded Schönau had a lot to do
with “the way they linked environmentalism and local patriotism,”
explains Patrick Graichen, energy expert and author of a book on EWS.
“The locals from the region are proud townspeople, conscious of their
independence from out-of-town authorities and companies. The idea
of doing it themselves, of being independent of KWR from Stuttgart,
appealed to them.” Graichen attributes the success of the long-shot
LEFT: PHOTOGRAPH COURTESY OF EWS; RIGHT: PHOTOGRAPH BY PETER SOUZA FOR
initiative to a core of about 20 fully committed people from Schönau.
The utility and conservative politicos rolled one boulder after
THE WHITE HOUSE, COURTESY OF THE GOLDMAN ENVIRONMENTAL PRIZE.
another in their path, including slapping a price tag on the high-voltage
transmission hardware of more than eight million German marks—
at least double its worth, the activists estimated. But by then the
Schönau rebels had turned their campaign into a national, even
international, cause célèbre. Experts from Germany’s finest engi-
neering faculties volunteered their services, developing professional
operational plans for the grid.
“We were all aware of what was happening in Schönau,” says Hans-
Josef Fell, an early antinuclear activist from Bavaria and former Green
Party member of parliament. “We were trying to do much the same, but
we didn’t pull it off. Schönau did, and achieved a kind of cult status.”
Donations poured in from across Germany and even abroad, facilitated
by the magnetic Sladeks, who hit the road peddling Germany’s first-
ever all-renewables power company. A nationwide campaign run gratis
Stanford Social Innovation Review / Winter 2019 21
by a friendly marketing agency raised millions of marks for buying the
grid hardware, attesting to how thoroughly the Chernobyl accident had
shaken ordinary Germans. It would be the tip of the spearhead, they
insisted, in breaking the monopoly of nuclear-wed utilities.
“The transition from campaign to proper business and man-
agement of a public good was rocky at times,” says Ursula Sladek,
who together with her husband stepped back from the operation
in 2014. “Even once we became a company, many of us were still
working unpaid and continued to. It was a proper company in terms
of legal status but still had a lot of the spirit of an NGO,” she says.
“The success of EWS is due in very large part to the Sladeks,” says
Stefan Adler, director of Freiburg University’s Center for Renewable
Energy. “They refused to be cowed, even though they went up against
large companies with teams of lawyers. They suffered defeats along
the way as well. They were laypeople who informed themselves about
complex laws and technologies and were unafraid to try things that
had never been tried before.”
ANYBODY AN ENERGY PRODUCER
The business of EWS was, from the very beginning, citizen energy.
But, given the utility-friendly legal framework and still-rudimentary
technology, renewable energy of any sort was hard to come by at the
time. Initially, EWS even had to purchase electricity from the very
same utility that it had just deposed from the grid.
Yet, starting with just five salaried staff, EWS immediately com-
mitted itself to developing clean-energy sources by helping finance
Black Forest community initiatives, small businesses, and individu-
als prepared to test the waters of renewable-energy production—at
first mostly through solar PV, small hydro plants, and CHP units. A
fraction of every pfennig of electricity that the company sold went
into a solidarity kitty to support Energiewende-related projects—a
practice that continues today. Moreover, EWS topped off the rates
that the startup producers received for selling electricity to the grid,
thus subsidizing the cost of generation and making certain that the
investments paid off.
22 Stanford Social Innovation Review / Winter 2019

! Demonstrators march in Berlin

on June 2, 2016, holding a banner with
the written slogan “Energiewende
retten!”(“Save energy transition!”)

Southwestern Germany is the country’s sunniest corner, which
made it a natural location for solar energy. Indeed, decades later, in
2018, Baden-Württemberg, the federal state home to Schönau and
Freiburg, would boast a supply of solar-photovoltaic generation equiv-
alent to that of about three nuclear power plants. Schönau became
known as the town with the densest concentration of solar power
in the country, garnering itself the title of Germany’s solar capital.
At the close of the 1990s, the Energiewende movement—not yet
official German policy—received unexpected help from the European
Union and the German government. In 1998, at the EU’s behest,
Germany broke up its energy sector’s rigid monopoly in gas and elec-
tricity markets. Since the postwar republic’s founding, Germany’s
entire energy market had been dominated by four giant utilities
(called the Big Four) and several dozen, much smaller, municipality-
owned power companies. Consumers had no choice whatsoever
when buying energy; the markets were closed to newcomers. EWS
was the exception—and it had taken 10 long years and a war chest
of money to do so. Opening up the market to competition dramat-
turned it upside down. Now anybody could be an energy producer,
and intrepid investors began to take advantage of new opportu-
nities. The legal developments mainstreamed the energy revolu-
tion begun in the Black Forest, setting off a flurry of clean-energy
production across the country. While the southern Germans concen-
trated on solar power, the northerners exploited their windy coasts
with ever more sophisticated wind turbines. Farms, homeowners,
collectives, and small- and medium-sized businesses began investing
in sustainable-energy generation, turning tens of thousands of indi-
viduals and small companies into energy producers. In Schönau, the
Protestant Bergkirche, a church just off the main square, mounted
421 photovoltaic panels onto its roof, becoming EWS’s biggest sin-
gle power producer. Where just a year before there had been little
more than the Big Four, suddenly there were tens of thousands.
One of the renewable energy act’s founding fathers was the Green
Party parliamentarian Hans-Josef Fell. He knew exactly what signals
the market needed in order to trigger the growth of renewables, and,
with surprisingly little fanfare in relation to the act’s consequences,

PHOTOGRAPH BY MARKUS HEINE VIA GETTY IMAGES

ically changed Germany’s energy landscape—in a way that played the Greens made it happen in 2000. “No one in all of Germany was
straight into EWS’s hands. better prepared to take advantage than EWS,” Fell says. The new
In Berlin that same year, a left-wing coalition of Social Democrats law “provided the foundation [for renewable-energy growth]; it was
and Greens stormed into the highest halls of power, entering the gov- up to environmentalists and entrepreneurs to build on it.” Not only
ernment in a “red-green” coalition, the first in history. The Greens was the grid now available to everyone and clean-energy generation
had emerged from the social movements of the 1970s and ’80s to handsomely subsidized, but renewables technology, which was in
push renewable energy and an exit from nuclear power. Moreover, its infancy, now had the support to reach economies of scale and
global warming was now on the world’s agenda, renewable-energy become competitive in price. This happened at the same time that
expansion an integral part of the strategy to slow it. the hardware steadily grew in efficiency and sophistication, thus
Two years into the new government’s tenure, the red-green bringing down the cost of clean energy.
coalition initiated a phase-out of nuclear
power—albeit over the course of sev-
eral decades, and thus not at all what
Schönau’s energy rebels had in mind.
Also, the Bundestag passed the Renewable
Energy Sources Act, a new law promot-
ing clean energy, in 2000. The act stip-
ulated that fixed surcharges on renew-
able energy, paid by grid operators but
passed on to consumers, would enable
energ y producers to cover invest-
ment costs. Moreover, transmission-
grid owners now had to accept and remu-
nerate the clean energy from wind, sun,
biomass, and water that the new class of
producers fed into the system. Last, the act
tweaked legal forms to encourage citizen-
energy enterprises—by enabling them
to apply for concessions, such as grid
operations.
These changes tore open Germany’s
tightly shuttered energy market and

EWS took off. It liberated itself from KWR and began buying and
offering renewable power to customers across all of Germany: By 2001,
it had 15,000 clients; in 2005, 30,000; and in 2010, more than 100,000.
As of 2005, it also offered biogas to German households. As its reve-
nues soared, so did the percentage it donated to citizen-energy projects
from its solidarity kitty, breathing life into thousands of new produc-
ers; locally owned grids; CHP units; and even green-energy projects
elsewhere in the world, including Ghana, the Philippines, and Georgia.
Contrary to some impressions, sustainable-energy clients in
Germany—those who sign up with, say, EWS—don’t have carbon-
free green energy piped into their living rooms. The same electricity
comes out of the sockets of renewables clients as does from their
neighbors’ walls: a mix that the conventional and renewable pro-
ducers in that region generate. Germany’s electrical and gas grids
are connected across the country, as well as to other grid systems
in Europe. Energy companies like EWS pay producers of renewable
power and gas, who feed it into the grid nearest them. In this way,
the supply as a whole becomes greener.
PHOTOGRAPH BY MARKUS HEINE VIA GETTY IMAGES
EWS wasn’t the only one to pounce on the opportunity to sell clean
energy, nor was it alone in the field of citizen energy. The Energiewende
that grassroots activists envisioned was taking off, driven forward not
by the prominent utilities—which remained convinced that renewables
were unworthy of their attention—but rather, overwhelmingly, by
citizen-owned energy enterprises, some very small, others medium-
sized businesses, and by individuals, municipalities, and others.
EWS stood out not only because of its historical cache but also
because, in addition to generation, it traded in gas and electrical grids,
such as the Schönau grid, as well as others in the Black Forest that it
bought up. Like-minded outfits with the Energiewende at their heart
have found it almost impossible to do the same. “There was a small
window that we exploited,” says Sebastian Sladek, about obtaining
regional grids. “Since then, politicians and the big companies have
made it nearly impossible to break into the transmission market.”
But so far experience has contradicted the establishment energy
sector’s contention: Commercial utilities and independent grid oper-
ators simply pocket the considerable profit that grids tend to pull in.
“It’s a lucrative business, for us, too. But they don’t invest the profits,”
Sebastian says. “When there’s no investment, the transmission hard-
ware gets old and breaks down, just when they need investment most.”
In the first decade after liberalization and the renewable-energy
law, solar PV and land-based wind power outperformed the range of
other renewables that qualified for subsidies. In 1997, Germany was
home to approximately 2,000 solar PV systems—all diminutive oper-
ations, some no more than a couple of panels on a barn. But between
1998 and 2002, this number soared to 40,000, owned largely by
smaller businesses, communities, farms, or private people. Through
the 2000s, the numbers doubled and tripled. In 2010 alone, Germany
smashed its own record of the previous years by adding an astound-
ing 250,000 PV systems to its energy mix, thus extending the world
lead in PV deployment that the country had grabbed from Japan in
Stanford Social Innovation Review / Winter 2019 23
2005. And by 2010, power generated by wind turbines, hydroelectric
plants, solar cells, and biogas digesters constituted 17 percent of elec-
tricity supply—an achievement that no one anticipated. And, just as
flabbergasting, citizen energy accounted for more than half of the
renewable-power supply—in total, 10 percent of Germany’s electricity.
THE COOPERATIVE BOOM
Until the mid-2000s, citizen-energy ventures took many forms:
collective companies (like EWS), privately owned small- and
medium-sized businesses, individual private ownership, and
the property of farms. Their common denominator, apart from
clean energy, was no corporate- or foreign-investor involvement. But
a 2006 change in the bylaws of Germany’s Genossenschaften, or co-
operatives, added an intriguing newcomer to the varied landscape.
The form of the cooperative means different things in different
countries. But for more than 170 years, Germany has nurtured its
own brand of cooperatives, which were first called to life in order to
strengthen the failing business prospects of independent craftspeo-
ple, traders, and farmers at the height of the industrial revolution.
The isolated artisans and traders often lacked access to banking and
thus had to rely on private moneylenders. Swamped with debt and
without recourse to capital, they often went under. The coopera-
tive rescued these types from destitution by, among other things,
increasing their creditworthiness as a group.
In German cooperatives since the 2006 law, decisions are made
on the basis of one person, one vote, regardless of the size of a mem-
ber’s investment. Moreover, the business, usually situated in the
region, is owned entirely by the cooperative membership, which
usually ranges from 10 to several hundred people. The members
decide where profits are invested and how new projects are devel-
oped. EWS, with more than 6,000 members from across Germany, is
exceptionally large and dispersed, and extremely diverse in its invest-
ments—unlike most of its peers. Its members meet once per year
and elect a board of directors who make the day-to-day decisions.
“It’s the most hands-on, democratic form of ownership,” says
Andreas Wieg of the DGRV, the Berlin-based federation for German
cooperatives. “There’s very little administration, and cooperatives
can easily accommodate more or fewer members.”
Wieg and the DGRV watched on in amazement from 2006 onward
as the number of energy cooperatives in Germany shot up into the
hundreds and eventually leveled off at around 850, reaching a total
of about 185,000 members by 2014. “We were very surprised,” Wieg
says. “The energy cooperative proved attractive to people who didn’t
themselves have land or rooftops, or simply didn’t have enough money
to invest on their own but wanted to be part of the Energiewende.”
Germany’s banking cooperatives, many of which are in rural commu-
nities, were particularly eager to boost the effort. “The cooperative
banks said, ‘Look what’s going on in our backyards. Let’s get in on it!’”
One of the new cooperatives was EWS, which changed its legal
status from a collectively owned company to a cooperative in 2009.
24 Stanford Social Innovation Review / Winter 2019
The rationale for the switch had nothing to do
with the cooperative’s form; even when EWS
was a company, every shareholder had one, equal
vote. Rather, the original structure didn’t allow
the enterprise to grow: A new investor could
enter only if an existing one left.
“We had many people coming to us who
wanted to be involved,” says Ursula Sladek. She
explains that the amount of capital that a collec-
tive business could have was also limited, which
was not the case for cooperatives. Instead of the
ceiling of several hundred thousand dollars that
the collective partnership had to work with, the
cooperative had no such limit.
But observers note that EWS is such a huge
cooperative that it’s impossible for its many members to be involved
directly—a key characteristic of both the co-op idea and citizen
energy in the first place. EWS could be taken to task for not prac-
ticing what it preaches. “It’s a valid point,” admits Ulrich Drescher,
an activist who participated in the transition from collective busi-
ness to cooperative. The collective’s democracy was richer than
the cooperative’s. In fact, he says, only about 300 of the more than
6,000 members even show up for the annual meeting. “It’s those
who have the time, money, and desire to come,” he says. In practice,
the board of directors, who are elected every three years, call many
of the shots, and the cooperative’s votes are largely unanimous.
Another point of contention, though, is the annual dividend, which
is 3.5 percent of profits. The dividend could be much higher, says
Drescher, given EWS’s black numbers, even as high as 6 percent, he
claims. “There are some, a small minority,” says Drescher, “who want
or need the money. But they’re voted down by a substantial majority.”
Most members, like Drescher, want to see the profits reinvested in
the cooperative: in new sources of generation and innovations look-
ing toward the future.
In fact, as a result of its success, the cooperative has begun to
limit the shares of new members to only $1,200 a head. “We started
to attract people who were just in it for the money,” he says, “and
we didn’t want that. It’s not what EWS is all about.”
MAINSTREAMING THE ENERGIEWENDE
During the 2000s, EWS steamed along, as did the Energiewende,
though, oddly, the grassroots side of the energy revolution didn’t
usually garner coverage in the mainstream media. But Germany’s
energy markets were being revolutionized from below—in the
spirit of Schönau’s energy rebels. EWS had become one of many
clean-energy companies, albeit one of the few that offered “pure
renewable energy”—power and biogas that hailed from sources
with no connection to nuclear power or coal. In fact, because the
German energy market made it extremely difficult to obtain such
energy at a reasonable price, EWS began purchasing ever more of its
electricity directly from renewables producers in Norway, Sweden,
and Austria. In order to encourage investment in new-generation
facilities, EWS maintains that the generation facilities that it
buys from, mostly hydroelectric plants, must be new or built in
the last six years.
By 2011, the share of renewable electricity Germans used
had jumped to 20 percent, which made it impossible to ignore.
Renewables were shooting up, while energy supply remained stable
and reliable. Farming communities, which suddenly had a second
source of income, were among the transition’s most enthusiastic
supporters, regardless of their political affiliation. The Energiewende
created more than 300,000 jobs and kept in local communities mil-
lions of euros that otherwise would have landed in the pockets of
foreign oil companies. In many parts of the world, Germany was held
up as a model for going renewable, and one country after another
adopted similar programs.
But it took another nuclear disaster for Angela Merkel, a
career physicist, to jump aboard the Energiewende. After Japan’s
Fukushima Daiichi nuclear power plant melted down in March
2011, Merkel went public underscoring the feasibility and impor-
tance of the Energiewende, which in German politics had until then
belonged solely to the Green Party. The government reviewed and
expanded Germany’s renewable-energy targets and stressed its
commitment to climate protection, and Merkel was briefly dubbed
the “Climate Chancellor” for her forceful backing of renewables in
international forums.
Yet, despite the bump in official attention, Merkel’s ruling coali-
tions neglected the Energiewende as the shock of Fukushima faded,
even as evidence of climate change’s threats mounted. Industry
PHOTOGRAPH COURTESY OF EWS
whined that it was too expensive, even though many industrial sec-
tors were exempt from the renewables’ surcharge, making the elec-
tricity they paid for among the cheapest in Europe. In Merkel’s third
administration (2013-2017), a conservative Social Democrat govern-
ment undertook reforms to slow the Energiewende and centralize
it, reacting to criticisms that it was all moving much too quickly.

% EWS employees Frederik Penski
(left) and Thies Stillahn install
saltwater batteries for testing at
EWS headquarters.
To the detriment of the energy cooperatives and citizen energy in
general, the government began auctioning off large quantities of
renewable-energy production, prompting bidding wars in which the
smaller producers couldn’t hope to compete. The number of newly
launched renewable cooperatives stagnated, and existing co-ops’
investments dropped abruptly—by one-third in 2014.
Even though citizen energy had kick-started the world-
renowned Energiewende—as of 2016, 42 percent of Germany’s
renewable-power capacity was in the hands of 1.5 million laypeople
and farmers—it looked then as if its heyday was over. While EWS’s
business hasn’t faltered, that of many other, smaller clean-energy
enterprises invested only in generation has fallen off, and some have
gone under. EWS has fared better because it is larger and more ver-
satile than most energy cooperatives.
Through the solidarity-kitty program run since day one, EWS
encourages fledgling renewable-energy enterprises of many diverse
stripes, from the Black Forest to the developing world. It counts
2,700 “rebel power units” that it has midwifed to life, most of
them granted a bonus over five years for every kilowatt of energy
produced and sold. The solidarity funds, which totaled more than
€1.6 million ($1.85 million) in 2017, go toward sustainable-energy
generation and support for other renewable-energy collectives, as
well as energy-efficiency projects, educational programs, clean-
energy projects abroad, and developing technologies, such as salt-
water storage and hydrogen fuel cells. In line with tradition, EWS
steps in where the state is failing. For example, last year it jumped
into Germany’s slowly changing transportation sector by investing
in charging stations for electric vehicles. On all supported projects,
applicants who are EWS customers receive priority.
But EWS also seeks out speculative, risky ventures that might
bear fruit with a little help. Currently, it is identifying apartment
buildings with roof space that could host solar panels. It inquires
whether the owners are interested in generating clean electricity
that they can then sell directly to their tenants at submarket prices.
EWS helps with the financing and guarantees the owners and tenants
that it will supply all electricity, at the cut price, that the apartments
require, above and beyond that generated by the rooftop panels.
“Our philosophy on financing new technologies is to keep eyes
and ears open and not to prematurely exclude options that at that
moment are very costly or underdeveloped,” says solidarity-program
head Gaudian. “The Energiewende has shown us that that can change,”
she adds, pointing to the technological advances in solar power in the
2000s, when at the same time prices plummeted. Battery technology
is such a field today, wide open and including experimentation with
PHOTOGRAPH COURTESY OF EWS
dozens of alternative chemical mediums. “Maybe it will just be by
accident that we stumble upon the one that works best,” she says.
EWS’s expertise in gas and electrical grids is so rich that it advises
and supports other initiatives angling to win concessions to operate
their local grids. One of the battlefields is Berlin, where the bid of
the cooperative Bürgerenergie Berlin is currently tied up in court.
Stanford Social Innovation Review / Winter 2019 25
Michael Sladek is on its board, which lends the operation both know-
how and credibility, says one of its leaders, Luise Neumann-Cosel.
“We’re trying to raise 100 million euros,” she says. “It benefits us
enormously to have someone on our side who has done it before.”
And in Berlin, EWS’s representatives team up with Greenpeace,
environmental think tanks, the Greens, and others in the sustain-
ability community who are straining to push Germany back onto
the favored path. EWS’s lobby arm—which the cooperative didn’t
approve unanimously, so offensive did some find the concept of lob-
bying—liaises with Bundestag and regional politicos and keeps the
Schönau headquarters informed about the latest legal developments.
It is a voice for citizen energy where the decisions are made. “If the
big [nuclear and fossil fuel] players are in Berlin, pushing their inter-
ests, and we’re not there, we lose out for sure,” says Sebastian Sladek.
BACK TO THE BURGHER
In Schönau today, a busy construction site is under way next to
EWS’s head office, shattering the tranquility of its corner of the
wooded Black Forest valley. It has 140 staff—up from 32 in 2008—
and is hiring after another year of solid numbers. The new building
will house, among other departments, the five-person innovation
team, which is toiling over nothing less than the future of the En-
ergiewende itself.
“The IT and digital revolutions are made to order for complet-
ing the Energiewende,” says Thies Stillahn, the project’s director.
“Eventually we’ll have to connect all of the segments of the energy
transition: transportation, generation, storage, distribution, and
efficiency.” Stillahn says that the individual technologies are mostly
ready, but they have yet to be linked together to function as a single
system with maximum efficiency. The system as a whole, he says,
must be unified but also decentralized, smart, and citizen oriented.
“We might not be able to do the whole thing,” he says of EWS, “but
maybe we’ll get part of it right, and that will be our contribution.”
Perhaps that part will be the technologies that EWS is developing
to enable small-scale community producers to sell or trade energy
online. In this vein, it is investing in small, promising IT startups
from across Germany that will help link individuals in their com-
munities so that neighbors involved in clean-energy generation can
sell electricity to one another. Oxygen Technologies is one of the
new companies that is working on ways for individual producers to
barter energy with one another on a peer-to-peer Internet platform
that the company is designing for that purpose. The startups work
between the EWS office and a startup incubator in Freiburg, where
yet other promising initiatives are located.
Ursula Sladek says that, given the impasse in Berlin, the imper-
ative has returned to the burgher and communities that want to go
100 percent renewable as quickly as possible. “The Energiewende’s
stalled,” she says. “Climate change is upon us. I think we’re going to
have to go back to the grassroots, the way we did after Chernobyl.
It’s in our [best] interest to make it happen.” n
26 Stanford Social Innovation Review / Winter 2019

Plutocratic biases are baked into the policies that structure charitable giving and big foundations.
, We must overhaul philanthropy to make it better serve democratic ends.

Philanthropy
in the
Service of
Democracy
BY ROB REICH

W
Illustration by Doug Chayka

e live in a second gilded age

of massive and still grow-
ing inequality. While this is
a foe to civic comity, it is a charitable contributions. Americans donated more
friend to private philanthropy. In than $410 billion to eligible nonprofit organizations
the United States, there were approximately 200 in 2017. Of that total, giving by living individuals
private foundations in 1930 possessing aggregate assets of less than $1 billion. accounted for $287 billion, or 70 percent. Nearly all
In 1959, there were more than 2,000; in 1985, more than 30,000 private foun- Americans donate some amount of money every year.
dations. As of 2014, the number was nearly 100,000, with total capitalization A small donor does not wield the same kind of power as
of more than $800 billion. What Andrew Carnegie and John D. Rockefeller does a big philanthropist. Yet the distribution of small
were to the early 20th century, Bill Gates and Mark Zuckerberg are to the giving matters a great deal in the aggregate, fueling the
21st. With every passing year, a new billionaire appears to arrive on the operation of thousands of nonprofit organizations, and
philanthropic scene, declaring an intention to make the world a bet- small donors enjoy the same discretion as big philanthropists
ter place. Amazon founder Jeff Bezos is now the world’s richest and also can benefit from tax incentives for their giving. Any consid-
man, at $160 billion. His September 2018 announcement that eration of philanthropy must go beyond the Rockefellers and Gateses of
he would donate $2 billion to combat homelessness and create the world and attend to the amount and significance in a democratic
a network of preschools is only the most recent example, and this society of ordinary charitable giving.
is likely just his initial foray into big philanthropy. It may seem that philanthropy is just voluntary activity, a result
The scope of philanthropy goes far beyond billionaires and their of the exercise of individual liberty. But as I argue in my new
foundations, though. Despite the eye-popping size of large foundations and book, Just Giving, this is a mistake. It is indeed voluntary,
the growth in the total number of foundations, the overwhelming majority but because philanthropy is a tax-subsidized activity, it is
of total giving, at least in the United States, comes from living donors making partly paid for by all taxpayers. Strictly speaking, then,
Stanford Social Innovation Review / Winter 2019 27
28 Stanford Social Innovation Review / Winter 2019
donors are not exercising a liberty to give their money away; they
are subsidized to exercise a liberty they already possess. Unlike the
Carnegie-and-Rockefeller era, when enormous philanthropic entities
were created without any tax concessions for doing so (because the
personal income taxation had yet to be adopted; it would arrive only
in 1917), today philanthropy is partially underwritten by the state
through a complex web of advantageous tax laws that apply both to
donors and to nonprofit organizations and private foundations. In the
United States, subsidies for charitable contributions cost citizens more
than $50 billion in forgone federal tax revenue in 2016.
Contemporary philanthropy in democratic societies is embedded
within a set of legal rules that structure and encourage it. Whether,
when, to whom, and how much people give is partly a product of
laws that govern the creation of nonprofit organizations, charitable
trusts, private and community foundations, and so on, and spell out
the rules under which these may operate. These factors are shaped
by tax policies that set up special exemptions for philanthropic and
nonprofit organizations and that frequently permit tax exemptions
for individual and corporate donations of money, property, and other
assets. They are governed by laws that enforce donor intent, often
beyond the grave, creating philanthropic projects and entities that
can exist, in principle, in perpetuity. These governance arrange-
ments are an essential component of the modern practice of the
time-immemorial activity of giving.
The policies that structure American philanthropy are broken.
There’s a long list of reasons why this is so. Donor-advised funds are
spreading like kudzu, increasingly dominating the list of most popular
charitable causes and, in the process, warehousing increasing sums of
philanthropic wealth while donors take immediate advantage of tax
benefits for giving. President Donald Trump’s 2017 Tax Cuts and Jobs
Act significantly diminished the incentive for giving by capping total
itemized deductions and raising the standard deduction. Numerous
studies predict a decrease in charitable giving in 2018. And our wealth-
iest donors are making philanthropy into a political weapon, funne-
ling dark money through social welfare organizations or 501(c)(4)s
and, like Mark Zuckerberg, Pierre Omidyar, and Laurene Powell Jobs,
setting up limited liability companies (LLCs) at least partly in order
to avoid the transparency requirements that attach to foundations.
But, worse than being ineffective and broken, the policies that
structure American philanthropy are also indefensible. The array
of policies designed to stimulate the charitable donations of ordi-
nary citizens and the philanthropic projects of the wealthy—chiefly
through private foundations—subvert, rather than support, demo-
cratic aims. Philanthropy too often undermines democracy, and it is
our policies—not the preferences of individual donors or operations
of particular nonprofits—that are largely to blame.
How can philanthropy support democracy? To answer this
question, we need to operate on two levels. We need to target and
address the injustice at the heart of the most important and most
common policy instrument at use in the United States, and in many
other countries, concerning philanthropy: the tax deductibility of
charitable contributions. Deploying tax concessions in the form
of tax-deductible contributions cannot be defended. We should
replace tax deductibility with a flat tax credit for donors. And we
need to recognize that even if there were no tax advantages at all,
the ultrawealthy would still have enormous power. Big philanthropy,
ROB REICH (@robreich) is professor of politi- and the director of the Center for Ethics in
cal science and, by courtesy, of philosophy and of Society. Portions of this article are drawn from
education (at the Graduate School of Education) his new book, Just Giving: Why Philanthropy Is
at Stanford University. He is the codirector of the Failing Democracy and How It Can Do Better.
Center on Philanthropy and Civil Society (pub- He also serves on the board of GiveWell.
lisher of the Stanford Social Innovation Review)
whether tax subsidized or not, is an exercise of power—the attempt
to direct private assets toward some public purpose. It is a form of
power that is unaccountable, low on transparency, donor directed,
and by default perpetual. Big philanthropy is a plutocratic element
in democratic society. The challenge is to craft, through various
policies and social norms, a framework that domesticates plutocrats
to serve democratic ends.
THE PLUTOCRATIC BIAS OF TAX DEDUCTIBILITY
Few things are more soporific than analyzing tax policy. And yet the
subject is of enormous consequence in philanthropy. It’s where much
of the governance and regulation of philanthropy rest, and where
the tax treatment of nonprofit organizations and charitable contri-
butions set the incentive structure for giving. Philanthropy would
not disappear if tax incentives for giving were eliminated, but the
total amount and overall distribution of philanthropy would likely
be dramatically different without the incentives.
The policy instrument of choice in contemporary philanthropy is
the tax deduction. There are two big problems with this: A deduction
for charitable contributions rewards donors arbitrarily—treating
differently two donors who make identical contributions to the
identical organizations, ostensibly producing the identical public
benefit—and it systematically benefits the wealthy, amplifying their
voices and giving preferences over everyone else.
First introduced into the tax code in the War Revenue Act of 1917,
the tax deduction allows individuals to deduct the sum of all eligible
charitable donations from their taxable income. Over the course of
the past hundred years, Congress has often modified the provision,
changing and occasionally eliminating the ceiling on total charitable
deductions and expanding the set of eligible recipient organizations
of tax-deductible gifts. But the heart of the policy has always been
the same: a deduction of charitable giving from taxable income. In
some form or another, the deduction applies to contributions to pub-
lic charities, donor-advised funds, private and family foundations,
and community foundations, and to charitable bequests.
Let’s consider this from the perspective of two would-be donors.
Take Annie, who rents an apartment and brings home the median
personal income in 2017, roughly $31,000. And take Bill, who owns
a house and brings home a personal income in the top 1 percent,
roughly $300,000. Assume that Annie and Bill both wish to make
a $1,000 donation to their local food bank.
A tax deduction for a donation creates a subsidy by the govern-
ment at the rate at which the donor is taxed. Progressive taxation
will levy different taxes on people with higher and lower incomes. In
2017, Annie falls into the 15 percent tax bracket. A $1,000 donation
to the food bank would diminish her taxable income by $1,000. As
a result, Annie would find that her $1,000 donation cost her $850,
because the government would effectively pay 15 percent, or $150,
of her donation, subtracting this amount from her tax burden.
 Stanford Social Innovation Review / Winter 2019 29

By contrast, Bill occupies the top tax bracket—39 percent in lower the cost of their charitable giving; in light of the declining mar-
2017—and would find that a $1,000 donation actually cost him only ginal utility of additional dollars for people at the top of the income
$610. The government would effectively pay $390 of his donation. scale, they can afford a “higher price” for charitable donations than
In extending these tax incentives, federal and state treasuries can poor people. The upside-down phenomenon is not specific to
forgo tax revenue. Had there been no tax deduction on Bill’s $1,000 the tax deduction for charitable donations, of course. Deductions in
contribution, the state would have collected an additional $390 in general massively favor the wealthy. In 2013, the wealthiest decile of
tax revenue. Or, to put it differently, tax incentives for philanthropy earners claimed more than two-thirds of all tax deductions.
constitute a kind of spending program or “tax expenditure.” Tax Finally, and perhaps most glaringly indefensible, the tax subsidy
incentives for philanthropy are one of the largest tax expenditures for charitable contributions is available only to those individuals who
for individuals in the US tax code, and they amount to massive itemize their deductions—people who opt not to take the so-called
federal and state subsidies for the operation of philanthropic and standard deduction on their income tax. This effectively penalizes,
charitable organizations and to the individuals and corporations or fails to reward and provide an incentive for, all people who do
that make donations of money and property to them. not itemize their deductions, a group estimated to be roughly 90
But notice how the policy instrument treats Annie and Bill dif- percent of all taxpayers after the 2017 Trump tax reform takes effect.
ferently. They make identical donations to the identical organiza- In this respect, only the very wealthy receive any tax benefit from
tion, and yet, despite his higher income, Bill receives a larger subsidy the charitable deduction. And yet almost all Americans make annual
than Annie. Annie’s $1,000 donation costs more than Bill’s $1,000 charitable contributions.
donation—$850 for Annie and $610 for Bill. This is known as the The upshot is that the charitable giving policies in the tax code
“upside-down effect” of tax deductions, where the deduction func- are deeply inegalitarian: They systematically favor the rich in pro-
tions as an increasingly greater subsidy with every higher step in viding them with larger benefits. It’s of course true that wealthy
the income tax bracket. people give away more money in absolute terms than do poor people.
Since the same social good is ostensibly produced in both cases— But why should public policy differentially reward the rich over the
the food bank receives $1,000 from each—the differential treatment poor? Why should more than two-thirds of the tax expenditures for
appears totally arbitrary at best and unfair at worst. If anything, lower charitable giving be attached to the giving preferences of the wealth-
income earners might seem to warrant the larger subsidy in order to iest 10 percent of Americans? The relevant issue here, therefore, is
not just that the incentive applies unequally to donors of
different tax-filing statuses and income levels; it’s that
the public funds forgone in the tax deduction are flowing
The Very Rich Give Differently disproportionately to the favored charitable organizations
Percent of total giving to various  ■ OTHER ■ BASIC NEEDS of the rich. Tax policy in the realm of charity favors the
causes by income group, 2005 ■ ARTS ■ COMBINED
■ EDUCATION PURPOSE wealthy and, by extension, weights the preferences of the
■ HEALTH ■ RELIGION wealthy over those of the poor in the nonprofit organiza-
tions they fund. The 1 percent receive a tax-policy meg-
6.9% 5.9% 8.1% 9.5% aphone and use it to promote causes very different from
1.1 2.2
3.0 5.7 those favored by the middle class and poor. (See “The Very
3.4 5.6 14.8 15.4 Rich Give Differently” on this page.)
10.4 In a democracy, the justification of any tax incentive
12.4 for donations must be rooted in something more than the
8.6 desire to reward people for practicing charity. I believe
10.9 31.9 that the best justification for tax-subsidized giving is that
25.2
charity is essential to the project of supporting civil soci-
ety. A tax incentive is justified for its role in stimulating
or amplifying the voice of citizens in the production of a
5.3 diverse, decentralized, and pluralistic associational sector,
5.8 25.3 which is itself important because it is considered a bedrock
66.7
of a flourishing democracy. If nonprofit organizations con-
57.3 11.1 stitute, to a significant degree, the institutional matrix of
3.8 associational life, then stimulating charitable donations
4.0 to a wide array of nonprofits might amplify the voice of
23.0 citizens and enhance civil society to the overall benefit
16.9 of liberal democracy.
But if pluralism in civil society forms a foundational
Less than $100,000 to $200,000 to More than basis for the policies that structure charitable giving, a
$100,000 $200,000 $1 Million $1 Million
plutocratic bias in the policy instrument is unjustifiable.
Source: “Patterns of Household Charitable Giving by Income Group, 2005,” The Center on Philanthropy at Indiana With the upside-down subsidy and the capricious exclu-
University, Summer 2007.
sion of nonitemizers in the current policy scheme, we get
30 Stanford Social Innovation Review / Winter 2019
not equal citizen voice in civil society but plutocratic citizen voice,
underwritten and promoted by tax policy.
In theory, it would be quite simple to remedy these problems.
Tax policy could allow nonitemizers to deduct their charitable con-
tributions from their income (on top of the standard deduction).
Better, since this solution would still leave the upside-down effect
in place, policies could allow all donors an identical nonrefundable
and capped tax credit, rather than a tax deduction, for donations.
By offering an equivalent tax credit to all donors (say, 25 percent
of any donation) and capping the total annual credit at some level
(say, $1,000), the fix avoids the upside-down structure of the deduc-
tion, offers an equal credit to all donors, and affords donors the lib-
erty to continue to give money away after the cap has been reached,
but no longer with any state subsidy to do so. The policy proposal
bears a resemblance to a stakeholding grant or a campaign finance
voucher scheme for each citizen, though, rather than directing the
use of the stakeholding grant for investment in one’s own projects
or a voucher for expressing political voice, the tax credit could be
directed only toward eligible civil society organizations. Call it a
civil society stakeholding grant, assigned on an equal basis to every
citizen in the form of a nonrefundable tax credit, with Bill Gates
receiving the same-size credit as every other citizen.
The credit could even be designed to try to surmount one of the
most stubborn and yet unfamiliar features of charitable giving: the
fact that American giving has hovered around 2 percent of gross
domestic product for several decades. What might boost charita-
ble giving above that rate? Rather than constructing a tax credit
as a percentage of any charitable donation, eligibility for the credit
could be conditional on first giving away 3 percent of one’s income
without any tax advantage for doing so. After donating 3 percent,
a person would receive a civil society tax credit of, say, $1,000 to
direct to the charities of her choice. If every person knew that by
giving away 3 percent of income they would receive a $1,000 credit
for further donation, that might induce higher rates of giving.
THE PLUTOCRATIC POWER OF FOUNDATIONS
The tax deduction contains a plutocratic bias, favoring the wealthy and
their charitable projects. A tax credit would correct this bias, treating
donors equally by granting to each donor an equal credit. But even with
a tax credit, the wealthy would still have greater power than poorer
people, simply by virtue of their greater resources. Indeed, even if there
were no tax incentive whatsoever for charitable giving, the ultrawealthy,
through their greater giving capacity, would exercise more power
than others. Bill Gates and I may receive an identical tax credit, and
the policy instrument may treat us without plutocratic bias. But, let’s
face it, Bill Gates will have a greater effect on civil society than I will.
In understanding why the policies that structure American phi-
lanthropy are indefensible, we have to move to a second level of anal-
ysis, from plutocratic bias in tax-deduction policy to the plutocratic
power that the wealthy exercise. It’s not the tax deduction that’s
the problem here; it’s the structure of the private foundation. We
need to confront the largely unaccountable, nontransparent, donor-
directed, tax-advantaged, and by default perpetual power of big phi-
lanthropy. And we need to ask whether it is healthy for democracy
that the number of foundations in the United States has exploded
over the past few decades.
Though rooted in historical traditions, the modern private foun-
dation in the United States is a creation of the age of Carnegie and
Rockefeller. The idea behind the Rockefeller Foundation and the
similarly minded Carnegie Corporation was to establish an entity
with broad and general purposes, intended to support other insti-
tutions and indeed to create and fund new organizations, seeking
to address root causes of social problems, rather than deliver direct
services (work “wholesale,” not “retail”), and designed to be admin-
istered by private, self-governing trustees, with paid professional
staff, acting on behalf of a public mission.
Private foundations are, more or less by definition, the legal sanc-
tioning—or, more precisely, the legal promotion—of plutocratic voices
in democratic societies. This concept was recognized as such in the
Carnegie-and-Rockefeller era. When Rockefeller came before the
US Congress to seek a federal charter to incorporate the Rockefeller
Foundation, he encountered widespread criticism. Louis Brandeis,
the trust-busting “people’s attorney” who would later become a US
Supreme Court justice, testified before the Senate Industrial Relations
Committee in 1916 that the Rockefeller Foundation was “inconsistent
with our democratic aspirations” and confessed to “grave apprehen-
sions” about the power lodged in the hands of a few wealthy men.
Democratic societies are committed to much more than a rep-
resentative government with free and fair elections. They are also
committed to the equal standing of citizens and an equal respect for
their interests. Such equal standing and respect are manifest when
citizens are formally equal under the law—there is no second-class
citizenship—and when all citizens possess an equal opportunity for
political influence and participation.
This shared expectation of political equality sits in tension with
the existence and growing power of private foundations to influence
public policy. The larger the foundation, the greater the potential
power. Think here of Bill Gates, whose philanthropy permits him to
stride upon the world stage as if he were a head of state. Why should
we grant such an outsize voice to any citizen of our democracy? Can
we publicly justify our current laws that define how foundations may
be created and structure how they operate? Perhaps foundations
play salutary roles in democratic societies, despite being exercises
of unequal power and expressions of plutocratic voice—or could
play such a role if they were subject to different legal arrangements.
For most of the 19th century, creating a grantmaking foundation
at one’s private initiative with one’s private wealth was not permis-
sible; authorization and incorporation by a democratic body were
necessary. The prospect that general-purpose foundations might
be brought into existence was viewed as a threat to democracy.
Even after such foundations were created, they continued to be
treated with public scorn and skepticism. In a decision that seems
positively unimaginable from today’s vantage point, the regents
of the University of Wisconsin passed a resolution in 1925 that
banned the university from accepting philanthropic donations
from foundations.
We have come a long way since then. Philanthropists are today
widely admired, their names trumpeted from buildings and their
photos gracing magazine covers. The permission to create a foun-
dation, moreover, is both freestanding—not requiring approval by
a democratically elected body—and, as with ordinary charitable
donations, subsidized with tax advantages.

But the pendulum has swung too far. I believe we need policies
and social norms that render private foundations supportive, not
subversive, of democratic aims. To understand how, we must first
understand the institutional oddity that is the private foundation.
FOUNDATIONS LACK ACCOUNTABILITY
In the commercial marketplace, if a company fails to make a profit
because consumers opt not to purchase the goods it sells, the com-
pany goes out of business. In the public institutions of a democratic
state, officials responsible for crafting law and allocating tax dollars
must stand for election; if citizens do not approve of the public poli-
cies and spending decisions of their representatives, they vote for
replacements at the next regularly scheduled election.
By contrast, foundations have no market accountability; they
have neither goods for sale nor marketplace competitors. Instead
of selling anything, foundations give money away to other organ-
izations, whose own livelihood frequently depends on continuing
support from foundations. Foundations have no consumers or com-
petitors, only supplicants for their money, in the form of grants. If
citizens do not like a foundation’s grantmaking decisions, they have
no recourse, because there is nothing to buy and no investors are
holding the foundation accountable.
Moreover, foundations have no electoral accountability; no one in
a foundation stands for election, regardless of what the public thinks
about the distribution of its grants. Suppose a group of people disap-
proves of what the Gates Foundation, or any other foundation, is doing.
What then? There’s no way to unelect Bill and Melinda Gates. Refer-
ring to the foundation’s education grantmaking, critic Diane Ravitch
has called Bill Gates the nation’s unelected school superintendent.
Compounding the lack of any formal accountability is the diffi-
culty any foundation has in developing informal processes to gen-
erate honest feedback from grantees, beneficiaries, and the general
public. People who interact with foundations are typically deferential
and solicitous, pleading for a grant or seeking the next grant. There
is little incentive for a potential or actual grantee to offer critical
feedback to a foundation. Every person who works in a foundation
understands what comes with the territory: People who become
foundation officers are transformed overnight into the smartest
and best-looking people in the room.
FOUNDATIONS LACK TRANSPARENCY
Compounding the accountability problem, foundations are frequently
opaque, drawing blackout shades across their windows. They face a
legal requirement to pay out 5 percent of their assets every year and
file an annual tax form with some basic data. But they need not have
an office, a telephone number, or a website. (Fewer than 10 percent of
foundations have a website, according to the Foundation Center.) They
need not publish an annual or quarterly report or articulate any grant-
making strategy. They need not evaluate their grantmaking; if they
do, they need not make such evaluations public. They need not report
on trustee decision making.
Some foundations—especially the largest and most professional-
ized—do operate transparently, providing all of the above informa-
tion and more. But this is a function of the idiosyncratic preference
of a particular foundation, not a legal requirement or professional
norm. A great many small family foundations operate with virtually
Stanford Social Innovation Review / Winter 2019 31
no public trace, save their legally required annual tax filing. It’s not
just small family foundations that seek to avoid transparency, either.
In 2017, the Paradise Papers, a leak of documents to the Süddeutsche
Zeitung, revealed that James Simons, a billionaire hedge fund man-
ager, had created the Simons Foundation International with an esti-
mated $8 billion endowment. Incorporated in Bermuda, its assets
thus entirely tax-free, the foundation had, according to a 2017 profile
of Simons in The New Yorker, no Web page or public presence at all.
Foundations are legally designed to enshrine donor intent and
protect philanthropic assets in perpetuity. Thus does the dead hand
of the donor potentially extend from beyond the grave to strangle
future generations. Foundations must be governed by a board of trus-
tees, but the donors and their family or trusted associates can serve
in this role; there is no requirement of community or public govern-
ance. Wealth management firms routinely market their services in
setting up a family foundation as vehicles for the intergenerational
transmission and sustenance of family values. A founding donor may
thereby control the governance and purpose of a foundation forever.
For foundations with few or no formal accountability mecha-
nisms, practically no transparency obligations, a legal framework
designed to honor donor intent in perpetuity, and generous tax
breaks to subsidize the creation of a foundation, what gives them
their legitimacy in a democratic society?
THE DISCOVERY CASE FOR FOUNDATIONS
The positive case for foundations depends on changing the policies
that govern them and creating new social norms that will influence
wealthy donors. And it depends on transforming the apparent vice
of unaccountability into a virtue. Because of their size and longevity,
foundations can operate on a longer time horizon than can businesses
in the marketplace and elected officials in public institutions, and
can take risks in social policy experimentation and innovation that
we should not routinely expect to see in commercial firms or state
agencies. I call this the discovery argument on behalf of foundations.
Begin with an uncontroversial supposition: A democratic state
wishes to advance general welfare or to pursue the aims of justice,
however understood. But democratic representatives do not know
the best means for achieving such aims, either at any given moment
or, especially, with an eye toward changing social conditions in the
future. What kinds of policies and programs, for instance, will best
promote educational opportunity and achievement? Some believe uni-
versal preschool is the answer, others a better school finance system,
others improved and more pervasive opportunities for online learning.
To answer such questions, a democratic society, recognizing that
its elected leaders are not all-knowing, that reasonable disagreement
on the best means to pursue just ends is likely, and that social con-
ditions are always evolving, might decentralize experimentation in
social policy so that it can identify and adopt better and more effec-
tive policies at realizing democratically agreed-upon aims. Moreover,
this need for experimentation is never-ending. In light of constant
change in economic, cultural, technological, and generational con-
ditions, the discovery process is, in ideal circumstances, cumula-
tive, in contributing to society a storehouse of ideal, or simply very
effective, ways to address different contexts and shifting priorities.
To be sure, a democratic government can stimulate some meas-
ure of experimentation and risk-taking innovation on its own. It
32 Stanford Social Innovation Review / Winter 2019
can, for example, invest in basic research with uncertain outcomes
by directing public funding to research universities. It can develop
federal structures of government that treat jurisdictional subunits as
sites of policy experimentation—hence Brandeis’s famous descrip-
tion of American states as laboratories of democracy. Democratic
government has good reason to be experimentalist, to approach
policy and institutional design as a form of problem solving.
Such approaches notwithstanding, political leaders would also
be right to harbor some skepticism that democratic government is
ideally suited to carry out such experimentation itself. For one thing,
citizens in a system of democratic governance tend to expect and
prize tested and reliable outcomes in public policy. Elected repre-
sentatives who allocate public funds to chancy strategies for solving
social problems—in the sense that the selected policy may fail in
delivering any benefits at all—also run the risk of being punished
at the ballot box. Furthermore, wasteful government spending
tends to be deplored, and yet experimentation requires that some
trials fail if the approach is to deserve the label “experimentation”
in the first place.
What extragovernmental structures, then, can be designed to
carry out decentralized experimentation? My claim is that founda-
tions are one such vehicle for
this important work of discov-
ery and experimentation.
My aim here is not to defend foundations,
Foundations have a struc- but to identify the right standard by which
tural advantage over market
and state actors in this discov-
to assess them.
ery effort: a longer time hori-
zon. Once more, the lack of
accountability may be a surprising advantage. An essential feature
of the discovery argument focuses on the ideal conditions for inno-
vation and risk-taking. Unlike profit-driven businesses, foundations
are not subject to quarterly or annual earnings reports, bottom-line
balance sheets, or impatient investors or stockholders. Commercial
entities in the marketplace do not have an incentive structure that
systematically rewards high-risk, long-time-horizon experimenta-
tion; they need to show results in order to stay in business. Similarly,
public officials in a democracy do not have an incentive structure
that rewards high-risk, long-time-horizon experimentation; they
must quickly show short-term results based on the expenditure of
public dollars to stand a strong chance of reelection.
Precisely because of their lack of ordinary democratic account-
ability and legal permission to persist for decades, foundations can
fund experiments and innovation whose payoff, if it comes, benefits
future, rather than present, generations in the long run. Moreover,
because the universe of private foundations is diverse and donor
driven, different foundations are likely to experiment with different
approaches, improving the chance that they will find effective or
simply better social policies or solutions to social problems.
How are we to evaluate philanthropic discovery? And what
mechanisms could disseminate or bring to scale successful experi-
ments that are the product of foundation-fueled innovation? Failed
innovations die, though society has presumably learned something
from the failure. Other foundations may take up and modify the
experiment and later generate positive results. Still other foun-
dation projects succeed in showing positive effects. Ideally, foun-
dation-funded experiments would be subject to demanding social
science review, not anecdotal reports from the field. But from the
perspective of a foundation, success in its philanthropic giving con-
sists not in funding innovative and risky social policy experiments
and then sustaining the most successful of them forever. Because
the assets of the marketplace and the state dwarf the assets of even
the largest foundations, success consists in seeing the successful or
proven policy innovations that the commercial marketplace or the
state brings to scale.
Thus, the proper attitude of foundations toward democratic
government is one of humble servant, instead of “smarter sector”
or superior provider of social goods. A foundation project that was
initially privately funded and democratically unaccountable auditions
for adoption as a publicly funded and democratically accountable
government responsibility.
The institutional design of foundations permits them to operate
on a different time horizon than the marketplace and the govern-
ment. Because their endowments are designed to last, foundations
can fund higher-risk social policy experiments, and they can use
their resources to identify and address potential social problems
decades away or innovations whose success might be apparent only
after a longer time horizon. In short, unlike business and the state,
foundations can “go long.” They can be the seed capital behind one
important discovery procedure for innovations in effective social
policy in a democratic society.
Some of the greatest accomplishments of American foundations
do seem to fit this model. Consider the quintessential example of
successful foundation activity, Andrew Carnegie’s promotion of
public libraries. Carnegie provided significant funding for the con-
struction of libraries but conditioned his grants to municipalities
on modest matching public dollars (usually 10 percent annually).
Between 1911 and 1917, Carnegie’s philanthropy contributed to the
creation of more than 1,500 public libraries. The library grant pro-
gram was discontinued shortly thereafter, yet citizens found the
libraries important enough to demand that they become the full
responsibility of the local municipality. The privately financed pub-
lic libraries successfully auditioned for inclusion in public budgets.
Similar accounts could be given for other foundation successes, such
as the development of Pell Grants in higher education and the coor-
dination of a national 911 emergency response system.
POLICY RECOMMENDATIONS
The discovery argument can be mobilized on behalf of some of the
privileges that attach to contemporary foundations, and to some of
their activities, but it has its limits. Namely, it does not justify the
full range of legal permissions currently afforded to foundations. I
am particularly skeptical that it is possible to defend the legal per-
mission for a foundation to exist in perpetuity. I am also skeptical

that the array of tax subsidies attached to philanthropy today is
necessary for the creation and sustenance of foundations.
The discovery argument points the way toward some sensi-
ble policy recommendations for improving the work foundations
should perform for democratic society. Three proposals specifically
come to mind.
First, and perhaps counterintuitively, establish a floor, not a ceiling,
on the size of foundations. The massive boom in small foundations is
a problem. For foundations to be capable of providing sufficient risk
capital for discovery, they must have significant assets and likely have
a professional staff able to manage and disseminate their learning.
By contrast, a small family foundation is not in a strong position
to carry out such a task. The number of foundations with less than
$1 million in assets nearly doubled from 1993 to 2013. Foundations
with less than $1 million in assets rarely have a paid staff, almost
never give away more than $50,000 in a year, and function more or
less as a tax shelter and charitable checkbook for wealthy families.
These families could accomplish the same outcome and produce
the same public benefit by simply making an ordinary charitable
donation, rather than setting up a foundation as the vehicle for their
philanthropy. There is no good reason for the public to support, via
tax benefits, the intergenerational transmission of family values by
inviting family members to share in the governance, often with paid
salaries, of a foundation that disburses less than $50,000 a year.
And taxpayers would no longer be subsidizing enormous sums of
money that have been committed to a foundation but have not yet
been granted to charitable organizations. More than one-quarter of
foundations’ total assets are held by just the 50 largest. What loss
to public benefit would there be with a minimum asset threshold to
create a foundation—say, $10 million or $50 million? I think very
little, and quite possibly there would be some gain, for wealthy indi-
viduals under the minimum asset threshold might be more inclined
to donate their money to public charities than to create their own
family foundations.
Second, place time limits on foundations. Do we need the endow-
ments that fuel foundation grantmaking to be perpetual? If so, do
we need the founder’s intent to be honored in perpetuity? On this
matter, I side with John Stuart Mill in believing that perpetuity is
injurious to society. “There is no fact in history which posterity will
find it more difficult to understand, than that the idea of perpetuity,
and that of any of the contrivances of man, should have been cou-
pled together in any sane mind,” Mill wrote in 1833. No argument
on principle can specify the optimal life span of a foundation; the
relevant consideration here is that it have an incentive structure that
encourages work on a time horizon longer than that of other social
institutions. What Rockefeller’s advisors proposed to Congress in
1911, that the life span of a foundation be capped at 100 years, or five
generations, seems to me a more-than-adequate horizon in which to
engage in the important, democracy-supporting work of discovery.
Third, apply the social norm of peer review to discovery. How might
public policy or the creation of philanthropic norms guide private
foundations and orient them more reliably toward the work of discov-
ery? One possibility would be to expect in their annual public report-
ing a long-term or intergenerational impact statement. Foundations
would submit to public scrutiny their strategies for long-time-horizon
experimentation. Another possibility would be to introduce, espe-
Stanford Social Innovation Review / Winter 2019 33
cially among the largest foundations, a voluntary peer review in
which the philanthropic strategies and investments were subject to
periodic evaluation by expert peers, be they other foundation leaders
or the beneficiaries of grants. Peer review could in principle foster
norms that, without the need for formal legal regulation, would help
to hold private foundations to a discovery mode. I have in mind the
norms that have arisen in the world of academia, where professors
with tenure enjoy an unaccountability for their scholarly produc-
tivity that is in many respects quite similar to the unaccountabil-
ity of the assets in a private foundation. Tenure may help to guide
scholars toward longer-time-horizon projects than they under-
took when they were untenured, and the practice of peer-reviewed
scholarship helps to sort better from worse research and creates a
forum for reputational competition. Perhaps something similar in
the world of philanthropic foundations would be salutary.
THE TRAILING EDGE OF CHANGE
Until we pass such reforms, we must face philanthropy as it is, not as
it ought to be. How well do actual foundations perform in the United
States and elsewhere when measured against the vision articulated
and defended here? Are foundations fulfilling their discovery role?
A rigorous assessment is beyond the scope of my argument,
but it is worth noting that skepticism is certainly warranted. Many
prominent foundation observers, including those who are friends of
foundations, believe that they are underperforming when measured
on almost any yardstick of success. And they are certainly under-
performing if measured by the standards of pluralism and discov-
ery. In 1949, a prominent foundation leader, Edwin Embree, wrote
an article for Harper’s Magazine called “Timid Billions,” concluding
that, despite obvious social problems and ample philanthropic assets,
there was “an ominous absence of that social pioneering that is the
essential business of foundations.” More recently, Gara LaMarche,
who spent more than 15 years at two of the world’s largest founda-
tions (the Atlantic Philanthropies and the Open Society Institute),
concluded that foundations tend to be risk-averse, rather than
risk-taking. “Courageous risk-taking is not what most people asso-
ciate with foundations,” he writes in Boston Review, “whose boards
and senior leadership are often dominated by establishment types. If
tax preference is meant primarily to encourage boldness, it doesn’t
seem to be working.” Joel Fleishman, the former director of the
Atlantic Philanthropies and author of The Foundation: A Great American
Secret, thinks that foundations would do their work better if they
were more transparent and risk-taking. Others, such as Waldemar
Nielsen, a prominent author on the subject of philanthropy, have
challenged foundations’ support for innovation, arguing that they
are more frequently on the “trailing edge, not the cutting edge, of
change.” A more recent review of foundation activity suggests that
only a small fraction of grantmaking should count as investing
boldly in social change.
Perhaps these critics are correct. If so, then so much the worse
for foundations, and so much the worse for the distinctive institu-
tional privileges that currently attach to them. My aim here is not
to defend the existing behavior and performance of foundations but
to identify the right standard by which to assess them—a standard
rooted in how foundations can serve democratic societies despite
their ineliminable plutocratic aspects. n
34 Stanford Social Innovation Review / Winter 2019

Too many organizations ignore or avoid addressing internal conflict. A healthy perspective
, on disagreement can increase resilience and spur needed innovation.
The Upside
of Conflict
BY ALAN FOWLER, ELIZABETH FIELD
& JOSEPH MCMAHON
Illustration by James Heimer
A
serious yet unaddressed problem
lurks within many civil society organizations, par-
ticularly those that work internationally (ICSOs).
The problem is one of destructive internal conflict.
If left untreated, such strife can, like high blood
pressure that remains ignored, cause lasting dam-
age to organizational heath and performance.
Intraorganizational conflict can arise from
many different sources. A sudden shift in donor
priorities can upend current programming. A
change in politics or public policy can make an
organization’s mission less relevant or viable.
Potential negative publicity about an overseas
branch can spark heated debate about whether
and how to deal with it. Substantive disagree-
ments between boards and executives or between
field offices and headquarters are common. The
question is not simply whether conflicts arise,
but rather whether organizations are equipped
to deal with them.
Our research into the topic has revealed that
they are not. We have spoken to more than 100
people working for 93 ICSOs across 23 countries.
A sizable majority of respondents—60 percent—
Stanford Social Innovation Review / Winter 2019 35
believe that internal conflicts at their organizations
are significant or commonplace, and 75 percent
of respondents rate the conflicts their organiza-
tions have as moderate to severe, but a mere 5
percent think their organization has an effective
conflict-resolution system. The inevitable, unwel-
come conclusion is that many ICSO staff function
where disputes are common and serious yet systems
to solve them are absent.
Such conflicts, when not addressed construc-
tively, often have many costs, both visible and
hidden: the physical and psychological toll on staff
and volunteers; energy and resources redirected
from programmatic work toward crisis manage-
ment; reputational damage; difficulty in attracting
or retaining staff; and problems of motivation,
morale, and performance among staff and volun-
teers. There is also an additional cost: Many ICSOs
are missing the opportunity that serious disagree-
ments offer to improve internal functioning and
increase their resilience as operating conditions
across the world become more turbulent.
In what follows, we analyze how ICSOs can
positively address these and other unsettling
issues when they uphold a healthy perspective
on conflict—one that maintains the intentional
and conscious view that addressing conflict can
bring gains in two ways. First, these organizations
can better respond to external disruptive forces
(e.g., significant economic, political, relational,
and social changes) by confronting difference and
disagreement to build adaptive capacities. Second,
they can improve their staff’s work experience,
thereby ensuring healthier and more productive
relationships.
How an organization responds to conflict helps
to determine whether the energy involved benefits
36 Stanford Social Innovation Review / Winter 2019

or hinders performance. By avoiding or denying internal conflict,
ICSOs miss the opportunity to find the upside that can arise from
successfully addressing important internal disagreements. Turning
the energy of conflict into positive problem solving enables these
organizations to remain relevant and effective when working in
multiple countries and complex conditions.
Although our inquiry focuses on ICSOs, we believe that observa-
ALAN FOWLER is honorary professor chair of
African philanthropy at Wits Business School,
University of the Witwatersrand, in
Johannesburg, South Africa. He has a long
professional engagement with and has written
extensively about the management of non-
profit organizations dedicated to international
development and poverty reduction. He is a
cofounder of the International NGO Training
and Research Centre, Oxford, UK.
ELIZABETH FIELD is the conflict advisor at
the International Secretariat of Amnesty In-
ternational. She is a mediator, conflict coach,
facilitator, and organizational development
practitioner.
JOSEPH MCMAHON is an arbitrator,
mediator, and facilitator. He is manager of
Collaborative Processes, LLC, and president of
Inter-Mediation International.

tions and recommendations from our work are applicable to many

forms of CSOs, as well as market-sector entities, particularly when
corporations embrace social responsibility. Evidence from other
types of organizations indicates that, under the right conditions,
internal conflict can improve performance.1 Positive efforts to
prepare for and respond to disagreements can, among other gains,
meaningfully improve people’s morale, working relationships, and
creativity, and increase openness to change. Our survey and inter-
views with leaders have convinced us that ICSOs especially need
to upgrade their conflict capabilities and are well positioned to do
so if they choose this path.
UBIQUITOUS AND UNADDRESSED
In 2015, we conducted our survey of ICSOs to ascertain the presence
and nature of intraorganizational conflict and to assess whether
these organizations had conflict-management systems. The ICSOs
we surveyed are dedicated to long-term development and humani-
tarian relief in countries across the world. They range in size from
small organizations—those with few staff, limited outreach, and
yearly budgets in the hundreds of thousands of dollars and dedi-
cated to single issues, such as early childhood development—all the
way up to massive ICSOs with many thousands of staff working in
more than 100 countries, with annual turnovers exceeding a billion
dollars, and implementing multiple types of projects.
What are ICSO intraorganizational conflicts often about?
In addition to the major sources already mentioned, our survey
respondents identified the following, in rough order of signifi-
cance: conflicts about closing gaps between mission rhetoric and
practice; ways of adapting organizational design to better address
shifts in operating conditions; (re)distribution of authority between
headquarters and country offices; dissatisfaction with attributes of
leadership; inappropriate management styles; gender-insensitive
behaviors; unfair personnel decisions; inadequate diversity and
inclusion; unfair hiring/promoting; (im)proper use of funds; staff
participation in decision making; too little or too much sensitivity
to donor values when diversifying funding; altering methods of pro-
gram implementation; and (mis)use of monitoring and evaluation
performance information. In sum, topics span governance, policy,
strategy, practice, and sustainability.
Our survey identified that intraorganizational conflict in civil
society is ubiquitous and largely unaddressed. Along with these star-
tling findings, we learned that more than eight out of 10 respond-
ents described their organization’s ability to respond to conflict as
“less than adequate.” Respondents also informed us that conflict
was often avoided, rather than used as a source for positive organ-
izational change. A follow-up involved confidential interviews with
midlevel to senior ICSO leaders. The survey results and interviews
demonstrate that ICSOs are seldom in a position to take advantage
of the opportunities that conflict presents, and as a result are suf-
fering the negative effects. (See “Pathways for Choice and Their
Potential Outcomes,” page 37.)
CONFLICT AVOIDANCE
If responding effectively to conflict is so important, why do so many
organizations ignore or avoid it? Without direct information con-
cerning the historic and current relationship between ICSOs and
internal conflict, we find it worthwhile to consider whether and why
their history and current context creates a predisposition to con-
flict avoidance. As many ICSOs came into existence during or at the
conclusion of World War II, their internal conflicts may have been
the last thing staff, volunteers, and humanitarian workers wished to
acknowledge. Moreover, such conflict may have appeared incompat-
ible with religious and humanitarian organizations. Instead, it was the
very problem these early ICSOs sought to address—externally, rather
than internally. Similarly, their subsequent growth in an era when the
Cold War had come to an end enabled them to tackle agendas set out
in the United Nations’ Millennium Development Goals, which were
essentially technocratic, not political. In the face of large-scale pov-
erty and opportunities to act, paying attention to one’s own internal
difficulties could have felt self-indulgent. Whatever the case, getting
on with the job of poverty reduction took hold. Putting organizational
energy elsewhere was probably perceived as wasteful.
But time has shown that the very problems that ICSOs intend to
address may implicitly be the source of their own conflicts. Several
authors have explored ideas of mission mirroring or the “nonprofit
paradox,” in which nonprofits end up importing or mirroring the
issues they were set up to solve.2 Some authors even speculate that
certain psychosocial considerations make ICSO staff less likely to
engage constructively in conflict. Nonprofit consultant David La
Piana suggests that a “more insidious explanation for the nonprofit
paradox is that values-driven people sometimes feel that their ethical
activities entitle them to act less morally—a process that Stanford
University psychologist Benoît Monin calls moral credentialing.” 3
Additionally, the content of the work that ICSOs cover can affect
how conflict manifests and what its roots are. Staff at ICSOs may
be exposed to highly stressful or traumatic materials, stories, and
experiences and may themselves be at risk of developing secondary
stress or trauma. Chronic stress may make collaborative conflict
management and problem solving more difficult as its impact on
the brain and body alters how people interact with others, especially
those who are perceived as different or threatening.
Moreover, there may be seemingly good reasons for ICSOs to
shun conflict or open discussion about it. They are humanitarian,
and often organized as federations of multiple groups where power
is widely distributed. Intercultural differences over what is or is not
a conflict, and sensitivities about how it is or is not to be broached,
 Stanford Social Innovation Review / Winter 2019 37

can hamper the creation of a recognized system to respond. In addi- equality, both in their mission-related work [and] inside their
tion, internal conflict may be very difficult for ICSOs to address, organizations; this can create cognitive dissonance, some-
much less embrace, because of the fear that doing so will generate times quite pervasive in nature.” 6
even more conflict. An ICSO program director flagged the following
concerns in her confidential interview with us: So, by failing to address conflicts among staff, ICSOs can actually
exacerbate the problem. When significant disagreement arises, if
“How would this affect our board members, on whom we rely an organization does not positively channel the energy associated
for connections and funds? How would discussing intraorgan- with a personal commitment to a moral mission, its efforts to find
izational conflict impact our donors? What would they think? resolution may increase in cost and difficulty.
Would addressing or admitting internal conflict be embarrass-
ing or potentially lead to bad press? Isn’t internal conflict wholly THE REMEDY
inconsistent with our image and mission? Would raising the But this problem also affords an opportunity: ICSOs can greatly
issue of conflict cause our staff to lose confidence in leadership? strengthen themselves by confronting conflicts and adopting what we
Even if we wished to better address [conflict], do we really know call a Healthy Conflict Perspective (HCP). This philosophy involves
how to do that? Would an attempt to do so just create additional an intentional and sustained orientation to treat “disharmony” as a
conflict? Would we just be opening a can of worms, or worse?” normal, desirable, and creative feature of organizational life.
Specifically, HCP has four elements that we have drawn from exist-
These can be challenging questions for ICSO leadership—if the ing literature, lessons from business organizations, and our own expe-
issue ever rises to their attention. riences in addressing conflict. (See “The Four Elements of a ‘Healthy
Sociologist Amitai Etzioni has examined the types of power that Conflict Perspective’ for Civil Society Organizations,” page 39.) We
organizations deploy to ensure employee compliance. He argues that outline the four elements below by offering a definition for each ele-
nonprofits are normatively oriented, attracting individuals motivated ment, a brief description of some of the research that supports it, and
by value commitment and “passion.” This, in turn, suggests staff are a few practical steps that ICSOs can take to implement it. Although
predisposed to react emotively to internal troubles and disagreements, our study centered on ICSOs, the remedies described herein are likely
creating a volatile atmosphere where constructive dialogue suffers.4 to apply equally to many, if not all, types of civil society organizations
Staff tend to bond strongly with the ICSO’s mission, which leads to the and nonprofits, as well as to businesses and government agencies.
expectation that they will participate in its decisions. If this expectation Because civil society organizations (CSOs) are idiosyncratic, we
is denied, it can generate extreme psychologically charged responses.5 believe that they should broadly define “perspective” for themselves,
In reflecting on his experience, one former ICSO leader writes: based on foundational principles, rather than attempting to identify
and apply an excessively detailed formula. Each CSO will need to
“Because of their value-driven nature, NGOs tend to place determine how these elements best fit its own interests and context.
unusually high importance on fairness, justice, solidarity, and Element 1: Conflict-competent leadership | This element is dedicated
to constructively address con-
flict early and collaboratively. If
Pathways for Choice and Their Potential Outcomes necessary, a conflict-competent
leader will drive a process to
The decision either to address or to avoid addressing intraorganizational conflict has serious ramifications
for an ICSO. change the organization’s atti-
tude and approach to conflict.
Such a leader acknowledges that
HEALTHY CONFLICT conflict is ubiquitous and often
DENIAL AND
ENGAGEMENT AVOIDANCE complex, while recognizing that
■■Finds the “upside” and creativity ■■Avoided conflicts merely reemerge later it can be an important driver of
within the conflict
■■Simmering unresolved conflict reduces better performance.
■■Deals with operational turbulence and disruption organizational resilience The survey results show
■■Improves organizational performance ■■Avoiding conflict may result in the loss
of some options
that ICSO leadership tends, by
■■Fully considers employee/associate interests
■■Organizational avoidance reduces/squelches
and large, not to address con-
■■Takes advantage of adaptive management
internal communications flict head-on and would, in the
■■Improves morale and demonstrates inclusiveness
and fairness ■■Temporary or poorly conceived solutions words of one survey respond-
often result
■■Increases organizational resilience ent, “rather sweep it under the
■■Valuable assets are diminished;
■■Finds sustainable solutions employee turnover may result carpet than address it.” But by
■■Harnesses employee creativity ■■Morale suffers; leadership creating a climate of avoidance
■■Demonstrates real leadership is questioned and fear around serious disa-
greement, leaders contribute to
the triggering of staff’s threat
defenses. Such defensiveness
can show up in cognitive biases
38 Stanford Social Innovation Review / Winter 2019
(such as unnuanced, polarized thinking) and self-protective stances,
or emotions (such as anger and shame). These tendencies inhibit
learning and increase the likelihood that people will behave in a
way that escalates the conflict or becomes destructive.
Leaders are in a unique position to improve their organization’s
perspective on conflict, thereby bypassing the avoidance trap. Our
research and work experience have shown that small actions can
have large effects. Even microadjustments in behaviors—welcoming
questions, accepting disagreement, showing respect for difference—
can ripple through an organization, demonstrating that conflict is
not something to fear and avoid.
Comments from our survey reinforce this point. As one senior
ISCO staff member wrote:
“We moved from a leader who was combative to one skilled in
conflict. … What a big difference it made. … Leadership is calm
and does not back up from conflict. … We [the staff] received
positive messages from leadership about being a great team.
… The new leadership demonstrated personal commitment. …
Leadership action is symbolic.”
People take cues from their social environment about their behavior,
and leaders are essential in shaping that environment.
To put this element into practice, senior leaders need to model
the desired attitudes and behavior, and both support each other and
hold each other accountable. Simple steps—such as reflecting at the
ends of meetings about whether they have understood differing
opinions and inputs, listened to each other, and given constructive
feedback—can help shift the dynamic. Additional steps include:
■■ Destigmatize conflict as a topic; prepare people for disagree-
ment by talking about how it is normal and healthy.
■■ Develop skills that enhance conflict competence: empathy,
communication, cross-cultural awareness, listening, and emo-
tional intelligence. Integrate these skills into leadership-
development programs, trainings, and other channels.
■■ Assess your conflict styles and develop skills in areas where
they are weak. (Programs such as the Thomas-Kilmann In-
strument or the Kraybill Conflict Style Inventory can help you
to achieve this objective.)
■■ Start a conversation about how an HCP can fit into your orga-
nization. To tailor an HCP effectively, leaders need to monitor
and adjust interventions. Leadership using a facilitation team
to work on a conflict culture and developing an HCP should
stay closely involved.
Element 2: Open and inclusive organizational culture | The right culture
is one in which people feel confident and comfortable being them-
selves, challenging the status quo, questioning ways of doing things,
and suggesting new alternatives. Staff are able to take (calculated)
risks and experiment without fear of negative emotional sanctions,
such as blame and shame. Mutual trust is developed, sustained, and
valued. People are honest and open about divergent ideas and inter-
ests, and treat differing viewpoints as an asset.
Like functional conflict, diversity is positively correlated with
organizational performance. The key to success is to encourage
an organization to make the most of different perspectives, ways
of working, experiences, functions, and identities. This requires
an organizational culture that encourages people to be themselves
and contribute fully. Social psychologist Dan Cable writes about
the “seeking system”—the part of the brain that craves exploration
and learning and motivates us to explore our environment, grow,
change, and make meaning—and its importance in creativity. Under
the right conditions, the seeking system, according to Cable, is bet-
ter able to help individuals solve problems and think analytically.7
By contrast, if they don’t feel safe and perceive that the threat is
coming from within their group, they are more likely to withdraw
and conform.
A healthy culture of conflict is crucial for innovation. As a director
of strategy at a midsize ICSO said, “Good innovation comes when
poking holes in another’s ideas—this means conflict.”
Some ways to put this element into practice include:
■■ Have well-known, identified spaces, places, and moments for
dialogue outside formal meetings and routines. Beware of
the meeting with a fixed agenda that does not allow for social
interactions.
■■ Cultivate mindful meetings and practices. Pay attention to the
pace and how meetings are run, and be sure to include input
from all participants.
■■ Declare respect for each person’s dignity. Establish norms for
treating one another with dignity and accepting one another’s
identity.
Element 3: Fair and effective conflict processes | These are methods
that establish a coherent, organization-wide response to conflict oc-
curring within the organization. Such processes should be at least
somewhat formal and include ways of responding to and learning
from intraorganizational conflict, as well as measures to prevent
undue escalation, such as training, conflict-resolution approaches,
ombuds, and mediation. More formal processes, such as a grievance
system or dispute-review panels, may also be included but should
be used more sparingly. The system covers all types of conflict
likely to occur within the organization—from one-on-one interper-
sonal disputes to fights between organizational divisions to broad
and overarching disagreements about organizational purpose and
management. The core components of conflict processes should be
written and made broadly available.
Although each process can be tailored to individual ICSO needs,
an organizational document or framework describing the process
should include at least two parts: (1) the principles and values that
guide how the ICSO intends to address intraorganizational conflict,
and (2) an adequate description of the processes to be used to han-
dle various types or expressions of conflict.
In general, a description of the approach to conflict will state how
the processes are initiated and how the organization will respond to
a given conflict. This statement may define the participating actors
from the organization—conflict advisor, coach, conciliator, ombud,
convener, group facilitator, confidential listener, dispute review board,
conflict coach, mediator, and so forth. It is useful to provide multiple
options for conflict support—from a first port of call for conflict advice
(such as a conflict advisor) to conflict coaching to trained networks
of listeners who can attend to the issue and refer people on.
 Stanford Social Innovation Review / Winter 2019 39

Studies demonstrate that fair exchanges are intrinsically reward-

The Four Elements of a “Healthy
Conflict Perspective”
for Civil Society
Organizations
CONFLICT-
COMPETENT LEADERSHIP
■■Be the example
■■Destigmatize conflict as a topic
■■Avoid avoidance; take responsibility
■■Show strong, sustained commitment
to HCP
■■Show that candor and humility
are strengths
■■Have periodic “barometers”
FAIR AND EFFICIENT
CONFLICT-MANAGEMENT
PROCESSES
■■Aim for transformation of a conflict
to an “upside” condition, not merely
resolution back to the status quo
■■Work on the principle of fairness
with processes that generate respect
for the outcome
■■Don’t overspecify steps or stages—have just
enough form to show a practical way forward
■■Designate a first port of call for
conflict advice
■■Have a clear communication
policy, strategy, and practice
ing and unfair exchanges generate threat reactions and other neg-
ative behavioral outcomes (such as lack of empathy for people who
are believed to be unfair).9 Perceptions of fairness also influence
how people deal with conflict,10 and employees’ ability to voice
concerns upward at least partly informs such perceptions.11
OPEN AND INCLUSIVE
ORGANIZATIONAL CULTURE Conflict management systems are not likely to be fully
■■Have identified spaces, places, effective without the other elements of the HCP. For
and moments for dialogue outside
formal meetings and routines instance, having such systems in place can give the false
■■Develop, sustain, and value mutual trust impression that the problem is resolved. Additionally, a
“system” that focuses only on grievance or formal proce-
■■Make honesty about divergent ideas
and interests the norm dures (also called rights-based procedures) will not suc-
■■Treat differing viewpoints as
ceed. Grievance and rights-based processes in general have
an asset, not as disloyalty
less satisfactory outcomes for disputants and do not neces-
sarily address the needs of the parties. Rights-based pro-
cedures tend to be legalistic and focus on the issue
immediately confronted—and often ignore
the larger, systemic organizational con-
RESPECTFUL RELATIONSHIPS text in which the true cause for conflict
FOUNDED ON
CONVERSATIONAL COMPETENCE has arisen. A conflict management
■■Conversation and dialogue replace debate system should be dynamic, adapt-
■■Participants speak to bring about understanding and able, and responsive. The work is
listen to understand not “done” when the system is
■■Difficult issues are properly and carefully raised, not avoided implemented, but it must con-
■■Processes used are designed for the needs of the issue and
tinually evolve and respond to
have appropriate time, data, and resources available
■■The interests of all participating are adequately discussed
the users’ needs, expressed via
and understood built-in feedback loops. Omis-
■■Participants work to have similar and realistic expectations sions and inadequacies in organ-
■■There is a mix of creativity, pragmatism, and risk ization conflict processes can
■■Conversational leadership is shared, generate significant problems for
rather than positional
ICSOs—problems that can be reme-
■■Participants or groups of participants
died easily.
appropriately engage in self-reflection
To put this element into practice, keep
the following in mind:

■■ Identify the likely problems and disagreements the conflict

processes will address.
■■ Recognize that the ways in which conflicts are managed are as

important as the sources of conflict, whether it is functional,

Informal processes should also be available and used to the great- healthy conflict about how to do the work (“task conflict”) or
est extent feasible. We suggest that ICSOs not overspecify steps or dysfunctional, unhealthy conflict (“relationship conflict”).12
stages; processes should not be mechanical but should follow just ■■ Emphasize early interventions and the prevention of conflict

enough form to show a practical way forward. On the other hand, escalation.
where the processes need to be adjudicatory (i.e., those leading to ■■ Keep the process as simple as you can while maintaining fair-

decisions affecting rights, such as termination of employment), ness, efficiency, and effectiveness. The perception of fairness
they should be adequately detailed to let participants know how generates respect for the outcome (as painful as the outcome
the process will unfold. In every form of conflict process, fairness is may be for some).
essential to generate respect for the outcome, even if it has adverse ■■ Distinguish between “conflict transformation” (the highest

consequences for some.
The business, education, and policy spheres have long advocated
and employed conflict processes.8 This is why it is so shocking that
conflict-sensitive response systems are seldom in place or in use at
ICSOs. Our work consistently demonstrates that sufficiently detailed
conflict processes give participants the comfort and satisfaction of
goal) and merely “resolving” the conflict.13 Conflict transfor-
mation seeks to address the root causes of the conflict, rather
than just the immediate problem. It is long-term and
relationship-centered. Alternatively, resolution often seeks to
make a decision and move on.
■■ Consider multistep approaches, beginning informally and

generally knowing how such problems will be addressed. Perceptions at the point of conflict, and treat “adjudicatory” approaches
of fairness are important across many organizational exchanges. as a last resort. In this context, a multistep approach means
40 Stanford Social Innovation Review / Winter 2019

making initial efforts to address the conflict at the point at
which it arose and ensuring that the disputants retain owner-
ship over the outcome. The approach then, as needed, directs
the conflict to a higher level in the organization (such as con-
ciliation, followed by more formal mediation and, if necessary,
the involvement of more senior management), rather than pre-
emptively starting at a higher, more formal level. We use the
term “adjudicatory” to mean that the final and binding resolu-
tion is left to a party outside the conflict.
■■ Ensure that a wide range of informal and collaborative pro-
cesses—such as mediation, group facilitation, and dialogue—
is available and used readily.
■■ Don’t overspecify steps or stages. Such processes should have
just enough form to show a practical way forward.
■■ Review the literature on creating such processes. While there
is no cut-and-paste approach that will succeed, ICSOs can
adopt the general principles we have discussed to make the
changes in their organizations necessary to benefit from inter-
nal conflict.
Element 4: Respectful relationships and interactions founded on
conversational competence | To build respectful relationships and be
conversationally competent, organizations must ensure that discus-
sions and interactions at all levels (from one-on-one encounters to
small groups to board meetings to organization-wide communica-
tions) be open, direct, respectful, and candid.
Additionally, we take conversational competence to mean that
robust discussions are valued and that participation is seen as a
Overheard from ICSO Employees and
Associates about Conflict Processes
positive attribute. Participants are patient, listen to obtain better
understanding, and speak to aid understanding. Where conversa-
tional competence exists, difficult issues are properly and carefully
raised—not avoided or hidden behind a mask of politeness. Conver-
sational competence focuses not only on the issue at hand but also
on how it is addressed. From time to time, people assess how well
they are conversing and adjust the process as needed.
Listening and speaking respectfully are important components
of conversational competence. These skills also affect staff’s ability
to contribute at work. Conversations are crucial to building rela-
tionships, which in turn drive individual performance and motiva-
tion.14 When people feel connected, heard, and understood, they
are happier, more productive, more fulfilled, and more engaged.
Management professor Christine Porath’s research15 on workplace
incivility and rudeness has found that such negative environments
shorten attention spans, disrupt short-term memory, and impair
immune systems.
People commonly assume that anyone can carry on a conver-
sation, but conversations can be quite difficult when they involve
conflict. Therefore, participants must try to ensure that the conver-
sations do not turn into debates that simply (re)state opposing posi-
tions. Every conflict process, at its core, relies upon communication
—generally via some form of conversation. This is certainly true in
coaching, facilitation, mediation, dispute-review boards, and simi-
lar forms of conflict resolution. Even processes that are principally
adjudicatory, such as arbitration or hearings, use the conversational
question-and-answer format to convey data and information.
Through such discussions, participants can express their interests
and seek outcomes that satisfy those inter-
ests. This is why communication is essential
to fostering collaborative processes, which
rely on interest-based bargaining.

‘‘
To develop conversational competence,
As far as I
know … no organizations need to recruit, teach, nurture,
such [conflict] and reward at all levels the skills, behaviors,

‘‘ ‘‘
procedures
There is a and aptitudes we have identified. When con-
When conflict is acknowledged, exist. But I could
need or a be wrong.” versations lack a basic level of respect, the
the ‘resolution’ is often just to
systematic approach
[to conflict]. It will
agree to disagree, even about critical issues participants’ ability to resolve a conflict is
such as mission, organizational structure,
help the significantly diminished.
staffing, and personnel. Further, the ‘reso-
organization.”
lution’ is typically addressed or discussed To put this element into practice, organi-
only among senior management behind zations should take the following steps:
closed doors, with limited to no commu-

‘‘
nication to other staff. As a result, staff are [We] lack
left in the dark about the resolution, or, ■■ Exhibit conversational competence in all
the tools

‘‘
worse, they may hear rumors that—to the
I don’t observe
and approach to organizational communications, from
extent that the ‘resolution’ doesn’t really understand and
a lot of overt solve the problem—serve only to informal hallway communications to
actively tackle
conflict management add fuel to the fire.” board meetings.
many conflicts.”
attempts … [but I see] a
fair amount of reverting ■■ Model good communication habits in
to passive-aggressive mid- and senior-level management
kinds of approaches.”
conversations.

‘‘
The system [at
our organization]
is at a more superficial
level, and while it may give
issues, so conflicts end
order and procedure,
it does not build trust.”
‘‘
I think we are ■■ Make a review of not only what was dis-
very conflict- cussed but how it was discussed a regu-
averse and avoid
addressing the hard
lar part of meetings, and make correc-
tions in light of such reviews.
up using up a lot of ■■ Make conversational competence a core
management time.”
component of your organization’s efforts
at diversity and inclusion.

Survey Highlights on Conflict
Processes
■■The vast majority of respondents
indicated that their organization did not
have a conflict management system that was
comprehensive—only 5 percent indicated that a system
was even in place—and used regularly and effectively.
■■Approximately 70 percent of respondents believed
that moderate to severe conflict either was not addressed or
was not sustainably addressed.
■■More than half of respondents characterized their organization’s
answer to conflict as inconsistent and not coherent.
■■Where conflict management systems were absent,
60 percent of the respondents believed such
systems should be put in place.
A FINAL WORD
Designing and implementing a process to improve intraorganiza-
tional conflict can itself generate conflict. The process for each orga-
nization will be idiosyncratic. Nevertheless, there are guidelines we
believe to be relevant to almost any such effort:
■■ Form a team that includes leadership, management, and
staff to plan and make recommendations about design and
implementation.
■■ Monitor and adjust leaders’ interventions to tailor HCP to
their particular organization. Leaders should also assess their
own conflict competence and take steps to improve it, if nec-
essary, and should stay closely involved, whether they use an
external consultant or an internal team.
■■ Assuage employee/staff fears (“Oh no, not another change pro-
gram”) by being inclusive, responding to organizational needs,
and communicating the benefits. Help to mitigate fears by
demonstrating how systemic efforts are fully supported by se-
nior management, not a “flash in the pan.”
■■ Don’t rush the process. Maintain reasonable expectations
for the nature and size of your organization. As with other
substantial change programs, the process can take a year or
more.
■■ Try to use internal resources for approaches that arise from
within the organization; use outside parties cautiously. En-
dogenous repairs can be promoted by having a facilitation or
mediation team composed of current staff, who can respond
quickly to address conflict. Existing staff with specialized
training or skills better understand the local context and may
be more immediately trusted than outside consultants.
■■ Consider whether existing management and organizational
development processes that encourage feedback, equal partici-
pation, and collaborative problem solving will help to increase
participation in and ownership of any change process.
Stanford Social Innovation Review / Winter 2019 41
■■ Use tried and tested techniques like 360-degree feedback (a
feedback process that involves multiple sources, such as an
employee’s colleagues, supervisees, supervisors, and self-
evaluation) and Open Space Technology (a participant-driven
process for running meetings).
■■ Keep employees and associates informed of efforts and progress.
Intraorganizational conflict in ICSOs is inevitable, even more so
when they operate in a highly disruptive environment. We need not
question whether conflict works for or against organizational effec-
tiveness. The outcome lies in the hands of ICSO leadership and boards.
The downsides of conflict are not easy to assess and quantify. They
are diffuse and seldom part of work planning, and incur expenses that
are both relatively objective, such as hours spent and consultants hired,
and highly subjective, such as damage to relationships and trust. The
same holds true for assessing the benefits of investments in conflict
competence. The value of having an effective system in place and of
upside gains—in creativity and effective adaption, for example—is
almost impossible to compute. But becoming conflict-competent need
not require a leap of faith. There is enough evidence to establish that
the benefits are likely to far outweigh the costs. n
N OTE S
1 Leslie Dechurch, Jessica Mesmer-Magnus, and Dan Doty, “Moving Beyond Relation-
ship and Task Conflict: Toward a Process-State Perspective,” Journal of Applied Psy-
chology, vol. 98, no. 4, 2013, 559-78.
2 David Allyn, “Mission Mirroring: Understanding Conflict in Nonprofit Organiza-
tions,” Nonprofit and Voluntary Sector Quarterly, vol. 40, no. 4, 2011, 762-96.
3 David La Piana, “The Nonprofit Paradox,” Stanford Social Innovation Review, Sum-
mer 2010.
4 Amitai Etzioni, A Comparative Analysis of Complex Organizations: On Power, Involve-
ment, and Their Correlates, New York: The Free Press, 1971.
5 Mark McPeak, “Integrated Conflict Management Systems for International NGOs,”
Sydney: University of New South Wales, 2014, 13.
6 Mark McPeak, “Selection of a Mediation Model for Nongovernmental Organisa-
tions,” Sydney: University of New South Wales, 2013, 1.
7 Dan Cable, Alive at Work: The Neuroscience of Helping Your People Love What They Do,
Cambridge, Mass.: Harvard Business Review Press, 2018.
8 See, for example, the discussion of conflict-process design in Lawrence Sussskind et
al., eds., The Consensus Building Handbook: A Comprehensive Guide to Reaching Agree-
ment, Thousand Oaks, Calif.: Sage Publications, 1999, 209; Carsten De Dreu et al.,
eds., Using Conflict in Organizations, Sage Publications, 1996; and Cathy Costantino
and Christina Merchant, Designing Conflict Management Systems: A Guide to Creating
Productive and Healthy Organizations, Hoboken, NJ: Jossey-Bass, 1996.
9 Golnaz Tabibnia and Matthew Lieberman, “Fairness and Cooperation Are Reward-
ing: Evidence from Social Cognitive Neuroscience,” Annals of the New York Academy
of Sciences, vol. 1118, no. 1, 2007, 90-101.
10 John P. Conbere, “Theory Building for Conflict Management System Design,” Con-
flict Resolution Quarterly, vol. 19, no. 2, 2001, 215-36.
11 Ibid., 234.
12 Carsten De Dreu et al., “Task Versus Relationship Conflict, Team Performance, and
Team Member Satisfaction: A Meta-Analysis,” Journal of Applied Psychology, vol. 88,
no. 4, 2003, 741-47.
13 “A transformational approach begins with two pro-active foundations: 1) a positive
orientation toward conflict, and 2) a willingness to engage in the conflict in an effort to
produce constructive change or growth.” John Paul Lederach, “Conflict Transfor-
mation,” 2003, https://www.beyondintractability.org/essay/transformation.
14 Psychologist Ron Friedman writes about the importance of relatedness to motiva-
tion and performance in his book, Best Place to Work: The Art and Science of Creating
an Extraordinary Workplace, New York: TarcherPerrigee, 2015.
15 Christine Porath, Mastering Civility: A Manifesto for the Workplace, New York: Grand
Central Publishing, 2016. See also http://www.christineporath.com for videos and
articles on the topic.
42 Stanford Social Innovation Review / Winter 2019

New research explores when top-down control works best in international development work, and when
, organizations should let employees in the field navigate challenges by using their own judgment.
The
Power
of
Letting
Go
BY DAN HONIG
F
Illustration by
Jakob Hinrichs
ifteen years ago, I was riding on the back of a motor-
cycle down the side of a mountain in rural East Timor
during a monsoon. At the handlebars was Vicente Brito,
my colleague at our small NGO focused on youth agri-
culture. That morning, the road had been dry and pass-
able. Now, we were driving down what looked more like
a river, sliding perilously close to the edge.
We paused to discuss our options. I wanted to stop
for the night and wait for the morning light to find our
way down the mountain. Vicente disagreed. He insisted
in Tetun, East Timor’s lingua franca, that he “knew” the road. I argued that it was
better to live than to risk death.
 “You’re the boss,” he said. I looked at Vicente and thought about what he meant by
“knowing” the road. So much of our NGO’s work came down to what each of us “knew”
in a vague way. Knowing when to push a group of young people to do more, and when
to offer a sympathetic ear. Knowing which local leaders to have faith in, and which to
keep at arm’s length. And now Vicente—who had grown up just a few kilometers away
from where we were—was telling me he knew the way home. “Okay,” I said. “Let’s go.”
We slowly made our way down the mountain, the thin headlight of our motorcy-
cle illuminating little beyond the sheets of rain in front of us. Vicente navigated by
feel, by memory, guided first and foremost by his own informed judgment. When we
reached the bottom, he lifted his visor and coolly turned to me, as if to say, “I told you
I could do this.” And then off we went, back to our office in Dili, East Timor’s capital.
The tension between my perception of the impassible road and the clear path
Vicente could see has become something of an object lesson. Organizations often
must juggle fallible employee judgment and top-down control by those with less con-
textual knowledge. The reasons not to “navigate by judgment” are many. Agents may
Stanford Social Innovation Review / Winter 2019 43
not have the same goals as their managers. They
may lack the skills, acumen, or ability to execute
tasks properly, despite the best intentions. On
the other hand, even the best-designed controls
can stifle employees or grantees who have to fol-
low them. This kind of strain raises the question:
When does well-intentioned management control
actually improve performance, and when does it
have a net negative effect?
My research shows that when the terrain is
unknown or rapidly changing, better outcomes
result when those actually on the ground are in
control of decision-making processes. Employees
who are in the field have the geographic advan-
tage that enables them to respond quickly when
flexibility and adaptation are needed—and who,
through their daily experience, can incorporate
what numbers miss.
THE TRADE-OFF
To figure out what’s really going on in the field, aid
delivery organizations must rely on their field staff.
These employees have asymmetric information—
access to knowledge about what’s going on “on the
ground” that their bosses lack. While this informa-
tion is valuable to organizations, asymmetry also
gives field staff the power to misrepresent their work
or shirk their responsibilities. This produces a classic
principal-agent problem, as economics and politi-
cal science literature usually refer to it: The boss
(principal) needs to rely on employees (agents) to
get things done but doesn’t fully know what they’re
doing. Agents may not share the principal’s goals,
or may act in ways that do not advance the princi-
pal’s goals, despite these agents’ best intentions.
The principal can attempt to monitor and control
the agents in a variety of ways to ensure that agents
act in ways desired by the principal.
Just as too little control is a risk, so is too much.
Monitoring may prompt agents to execute the tasks
44 Stanford Social Innovation Review / Winter 2019
that are being monitored to the exclusion of harder-to-evaluate ele-
ments of their jobs. Management control may also make organizations
less flexible and responsive, causing agents to act based only on what
they know their principals can also see and verify. Nobel laureate
economist Jean Tirole, in collaboration with Philippe Aghion, has
framed the tension between management control and agent action
as a trade-off between principal control and agent initiative.
Top-down control has varying degrees of success in development
projects. When progress can be verified from a distance and quan-
titative performance targets serve as reliable summary statistics
for projects—as may be the case for delivering vaccines or building
roads—quantitative targets and monitoring might be quite effec-
tive. For other projects, however, the best measures are still likely
to be weak proxies for a project’s purpose. Attempts at judicial or
civil service reform, for example, are far less tractable to quantifi-
cation. Physical locations also affect how likely top-down control
is to work. Contexts vary regarding how much the right actions
depend on things that can be seen but not verified, and with regard
to how rapidly things change and thus whether flexible responses
are necessary. We might expect, for instance, more fragile states to
be places where navigation by judgment is particularly important.
In my new book, Navigation by Judgment, I examine when organi-
zations might be better served by putting greater control in the hands
of field staff, and increased top-down management is more conducive
to organizational success. I built a database of more than 14,000
projects from nine different bilateral and multilateral aid agencies
across 180 recipient countries over 40 years, in order to investigate
the relationship between management practices, country context,
and project success. I complement this quantitative analysis with
eight qualitative case studies examining US Agency for International
Development (USAID) and United Kingdom Department for Inter-
national Development (DFID) projects in Liberia and South Africa.
The data suggest that agencies that navigate by judgment are
much more able to cope with unpredictable environments; their per-
formance stays remarkably stable as recipient countries become less
predictable. This pattern holds up both across countries and in single
recipient countries over time. As a given country becomes more frag-
ile and unpredictable (as rated by the State Fragility Index), agencies
that place greater control in the field are more able to maintain their
project performance. Tasks that are less tractable to measurement
drive this overall country-level effect; it’s not when, for instance,
projects focus on building roads, but rather when they concentrate
on improving transportation-sector management that we clearly see
the advantages of greater field control.
THE VALUE OF SOFT INFORMATION
Field staff who have the freedom to navigate by judgment can make
use of “soft information”—local, contextually bound information
that is difficult to include in a formal report or in an e-mail back to
headquarters. Soft information is useful in many contexts; often, an
organization’s success depends on it. In retired US general Stanley
McChrystal’s analysis of counterinsurgency operations in Team of
Teams, he describes Iraq as a complex, unfamiliar, and opaque envi-
ronment. In previous operations, he had managed his agents via
top-down control. In this environment, however, that strategy felt
inappropriate. Instead, McChrystal relied on “empowered execution
DAN HONIG is an assistant professor of Inter-
national Development at Johns Hopkins SAIS
and the author of Navigation by Judgment: Why
and When Top Down Management of Foreign
Aid Doesn't Work (2018).
by field agents” and prioritized agent initiative and soft information
over principal control—to marked success.
“In the old model, subordinates provided information and leaders
disseminated commands,” McChrystal writes. “We reversed it: we
had our leaders provide information so that subordinates, armed with
context, understanding, and connectivity, could take the initiative and
make decisions.” 1 Reducing or eliminating the control mechanisms
and approval processes that slowed things down put more control in
the hands of officers in the field, enabling them to respond rapidly.
The organization had a greater ability to react to changing circum-
stances; operations could better incorporate agents’ soft information.
Evidence from international development assistance shows that
soft information plays an indispensable role in development work.
But such information contributes to different levels of intervention
success, depending on how it is incorporated. A comparison of two
of the eight case studies in Navigation by Judgment demonstrates this
point: In the mid-2000s, both USAID and DFID had projects aimed at
improving the effectiveness of South African municipal governance.
However, the ways in which USAID and DFID designed and imple-
mented their interventions were quite different.
USAID’s municipal governance project operated by delivering
trainings to municipalities. On a given day, a trainer would travel
to a community to hold a session on a prearranged topic—say, debt
management. Success indicators suggested that all of the staff should
be trained in debt management practices. Following the trainings,
agents would verify that the trainings had occurred and track how
many people had been trained.
By contrast, DFID’s project worked primarily by embedding in
local municipalities advisors who resided there for extended periods
of time, building skills and systems on an ongoing basis. DFID advi-
sors relied on their soft information to inform their own judgment.
Project documents had specific reporting requirements, but they did
not rely on quantifiable outputs. Rather, DFID asked that “resident
advisor ISFs [integrated service facilitators] conduct an assessment
of [the] status quo and prepare a report.” Essentially, DFID advisors
set their own goals and then reported their own performance.
How did the projects compare? The USAID effort proved to be a
disappointment, even though it met its targets. The “numbers didn’t
tell about the impact,” said the head of USAID project implementa-
tion. The training numbers weren’t fabricated, but, as one USAID
actor described them, all the organization counted were “bums on
seats.” Municipalities were not interested in the trainings, and little
was changing. In multiple cases, national South African government
officials didn’t recall the advisory component of USAID’s project,
and in one case a long-serving municipal manager whose munici-
pality had received both USAID training and a USAID advisor had
no memory of USAID’s existence.2 As one staff person put it, the
Local Government Support Program was “a real disappointment.”
DFID, however, had some success. Its reporting, according to one
implementor, was “more content-rich, not a numbers game.” As full-

time residents, DFID’s advisors were often able to find a way to pos-
itively influence municipal systems. By using soft information, they
could make judgments about what reforms were appropriate and how
to achieve them in ways they never could have formalized for a dis-
tant headquarters. Both beneficiaries and project staff reported that
DFID advisors achieved some shifts in municipal practices. It would
be an overstatement to say DFID accomplished all of what it set out
to do in terms of direct municipal impact. However, the DFID project
was successful enough for the South African national government to
use it as a model when the government launched its own municipal
support program, Project Consolidate.
These projects illustrate the Tirole-and-Aghion trade-off between
agent initiative and principal control. USAID and DFID implemented
programs with similar goals, but DFID’s project exhibited far greater
navigation by judgment than USAID’s, which settled on an initial
model that delivered measurable trainings. USAID’s program was
more rule-bound, and its tight principal control precluded soft infor-
mation from being incorporated into organizational decisions.
DFID, by contrast, navigated substantially by judgment. The
“price” of DFID’s greater degree of agent initiative was a lesser degree
of principal control. DFID intentionally designed the intervention so
that field agents’ judgments would determine the project’s direction.
Field agents were the primary drivers of what the project did and
when, as well as when course corrections were necessary.
OUR COUNTING OBSESSION
While USAID’s project in South Africa may have seemed extreme in
its reliance on quantifiable measures, the notion of setting perfor-
mance targets or objective performance criteria will sound familiar
to many in the nonprofit sector and the aid industry. Use of these
measures as a tool of organization control is intuitively logical:
Performance targets enable principals to guide interventions from
afar, preventing agents who may not share the organization’s best
interests from distorting projects or simply failing to work toward
its goals. Organizations can also tie compensation, success, and pro-
motion to the accomplishment of targets the principal can observe.
A recent Organisation for Economic Co-operation and Develop-
ment (OECD) review of USAID found that the agency uses about
200 standard indicators, and many more custom indicators, to
monitor and evaluate projects. Performance targets can orient field
staff and give principals a way of holding them accountable if they
do not reach their targets. All of this works well when we can set
clear targets—when we know what we want our agency to accom-
plish, how long it’s likely to take, and whether we’ve gotten there.
But what about when we can’t set targets? Appropriate targets
that drive agents toward the ultimate impact of a program are often
difficult to find. For example, the OECD’s Development Assistance
Committee published, in 2013, a member survey of 28 international
development organizations’ (IDOs’) experience in “Managing and
Measuring for Results.” 3 All 28 IDOs reported that they sometimes,
often, or always had difficulty in selecting appropriate indicators
against which to measure. Three of the 28 IDOs said that achieving
this goal was a problem 100 percent of the time. They never felt as if
it was easy or straightforward to choose targets.4
Part of the problem is what’s known as Goodhart’s Law: Measures
must be reasonable; if messy, proxies for success may lose their use-
Stanford Social Innovation Review / Winter 2019 45
fulness when employed to control or guide field staff actions. Count-
ing the number of people trained may well be a good way to tell if a
completed project has reached its intended audience. But when the
same measure is used as a control mechanism, it inevitably will focus
field staff on meeting the target and will in turn undermine the meas-
ure’s accuracy as a proxy for the broader success of the intervention.
This is not to say that quantitative measures can’t be useful. When
what we can measure is really what we want, we should absolutely
focus our organizations on achieving it. One of the true classics of
private-sector management scholarship is titled “On the Folly of
Rewarding A, While Hoping for B.” 5 The “folly” is not orienting agents
toward something measurable (A), but rather pointing agents toward
a target (A) when some other, broader thing (B) is what the organ-
ization desires. If a project is focused on relatively verifiable tasks,
such as building a road or delivering a vaccine, targets can drive field
workers (and their organizations) toward success. In these situations,
I am a strong supporter of the shift toward payment for performance,
particularly when the standards by which performance is evaluated
emphasize outcomes over process.
But plenty of the work IDOs and NGOs do has no measurable “A”
that is a reliable summary statistic for interventions. IDOs’ efforts at
policy and administrative tasks, for example, rarely have reliable stand-
ards by which to judge success. Neither do NGO efforts to strengthen
civil society, raise awareness, or improve organizational capacity.
We should know better—and, in fact, we do. A 2013 review of
NGO reporting in the humanitarian sector found that only 3 percent
of indicators NGOs use focus on impact, in contrast with 38 percent
that focus on outputs.6 The same review quotes a 2012 ALNAP report,
“State of the Humanitarian System,” to assert that “outputs, while eas-
ier to measure, can be misleading as indicators.” I suspect that many
readers have often been in rooms where someone has said, “Well, it’s
not a perfect measure, but it’s the best we’ve got.” Why do we need
to measure, even when we know it may well distort what gets done in
projects and grants? Why do we keep on engaging in Kerr’s “folly”?
One reason is that we often use quantitative measures not merely
to drive performance but also to report on performance. This report-
ing function drives us to use measures even when we know they are not
accurate. To “feed the beast,” we need to keep producing the data that
legislators, voters, or donors seem to value, regardless of whether we
believe these numbers are meaningful. The more politically insecure
an IDO—the more an organization feels the need to manage up to its
authorizers and funders—the less likely it is to navigate by judgment.
This isn’t the only reason for our obsession with counting, though.
Numbers give us a sense of security; a sense that we have “objective”
data on which to base our assessments. But the numbers that give
us such a sense of security are often a facade. Numbers may reflect
objectivity, but they are not necessarily any more indicative of broader
truth than any “subjective” assessment. When we reduce our under-
standing of our own efforts to what we can count, we may well improve
our organizations’ perceived accountability in the eyes of funders.
But at the expense of actual results, this seems like a Pyrrhic victory.
RETHINKING ACCOUNTABILITY
Going beyond a world where our accountability technology is based
on what we can quantify requires us to rethink what, precisely, it
means to be accountable. Core to our modern use of “accountability”
46 Stanford Social Innovation Review / Winter 2019
is ensuring that money achieves as much impact as possible. So, too, is
demonstrating impact to stakeholders, authorizers, and funders. But
my research shows a real tension between the demonstration of impact
and the impact itself. What should we do when the act of measure-
ment itself distorts for the worse the thing that is being measured?
One less-than-satisfying option, usually taken as the default, is to
accept that any demonstration of impact needs to be quantifiable, and
then to try to do the best job possible while also focusing accountabil-
ity efforts on measuring and reporting what is countable. But if this
hinders the work whose impact it aims to demonstrate, perhaps we
need to consider different forms of accountability.
If we empower agents, we must hold them accountable. But account-
ability and countability are not the same thing. Merriam-Webster’s dic-
tionary defines “accountable” first as “subject to giving an account;
answerable,” and second as “capable of being explained; explainable.”
One way forward for an organization attempting to implement a project
that is difficult to manage using measurement of either outputs or out-
comes is simple, if somewhat radical: stop using measures for the pur-
pose of evaluating interventions or managing agents. Lant Pritchett,
in reviewing Navigation by Judgment, frames this as the distinction
between “accounting” and “account-based” accountability.7 We can
hold people accountable, and may do a better job of doing so, the less
we focus on counting, or accounting for, the numbers.
A few months ago, I had the good fortune to chat with Ruth Levine,
program director for global development and population at the
William and Flora Hewlett Foundation, about how and when field
judgment is compatible with accountability. We ended up talking
about her interactions with her program officers who make grants
on Hewlett’s behalf. “The question when I talk to a new program
officer about what she wants to support isn’t whether I would make
the same decision,” Levine said. “It’s about the quality of her rea-
soning—whether she’s thinking through risks and possibilities.”
Levine’s accountability system for her staff is primarily account-
based, rather than accounting-based. This does not mean Hewlett
uses no metrics in its work; Hewlett has arguably led the field in its
focus on results, including the measurable results of projects (though
it does so while often giving grantees substantial long-term support,
which encourages trusting relationships and gives grantees the flexi-
bility and leeway to experiment, fail, learn, and improve). Quantified
performance data does play a role in evaluating program officers
for Levine as well; biennial surveys of grantees provide informa-
tion, including numeric ratings of program officers, which Levine
considers. But these data are not the primary tool that holds staff
accountable; “the numbers” are inputs into, rather than answers to,
an evaluation process. Quantitative data inform judgment, rather
than substitutes for it.
An accountability system like Levine’s requires trust—a manag-
er’s trust in his or her own judgment, and in his or her ability to trust
the judgment of others. Agents, too, must trust their supervisors and
organizations. Building trust takes time and requires effort from both
agents and their supervisors. Much of Levine’s orientation of new
staff focuses on shared expectations regarding behavior (e.g., “share
information; ask for permission, not forgiveness”); the full team also
discusses these expectations at every annual retreat. This process
helps establish and maintain a mutual understanding of what Levine
expects of her staff, and what they can expect of her.
An accountability system that facilitates agent judgment also
requires the organization to have agents (staff or grantees) who the
organization believes are capable of good judgment—and thus implies
a greater organizational focus on who these agents are and what moti-
vates them, rather than the carrots and sticks to which these agents
might respond. This concept echoes the ideas of Harvard University
political scientist Jane Mansbridge, who has argued, in situations
where the best monitoring fails us, that we need to move to more
trust-based “selection” accountability, not simply maintain our tra-
ditional understanding of accountability, based around “sanctions.” 8
Mansbridge argues that an accountability system oriented to the
carrots and sticks of sanctions—rewards for good performance, or
penalties for poor performance—“not only stems from distrust but
also creates distrust.” In situations where monitoring is incomplete, a
sanctions-based system may undermine trust between management
and agents. Organizations may do better by focusing on selecting and
training agents, instead of by implementing tight top-down monitor-
ing and performance-based sanctions.
An organization that rethinks quantitative performance data as
its primary tool of accountability does not need to eliminate meas-
urement; it just needs to use measures for different purposes. Meas-
ures can help an organization learn and improve, or can serve as an
input into decision making.9 But when measures are tied to perfor-
mance expectations, or taken as the answer to whether performance is
acceptable, they become counterproductive. If USAID agents had not
felt pressured to meet output targets in its South African municipal
governance project, the number of people trained might have been
a useful measure that catalyzed management and understanding of
the project. However, the pressure accompanying these measures dis-
torted their meaning and usefulness and played an important role in
preventing the project from achieving its intended broader impact.
Another tool that can hold employees accountable but still give
them the room to navigate by judgment is an after-action peer review.
For example, doctors and medical personnel often engage in institu-
tional reviews, or peer reviews, to diagnose any issues that occurred
during a surgery or medical procedure. Where soft information is
needed for day-to-day decision making, such as determining a course
of medical action, peer reviews can be a way to improve processes.
Judgments from a jury of peers can hold agents accountable and still
provide mechanisms to change behavior and future action.
Too much control, not just too little control, can cause poor per-
formance. Essential to judgment-based accountability is ensuring
that reactions to any mistaken judgment or poor performance are
an opportunity for professional growth through the nurturing of
employees’ skills. Good judgment needs to be kindled and coaxed; it
cannot be dictated, and it will be lost quickly if agents anticipate that
they will lose their autonomy and ability to make judgments at the
first error. Organizations and their agents need the space to fail and
to learn from those failures. This does not imply an absolute tolerance
of mistakes. While a young doctor is not barred from the profession
for a single error, neither is a consistently errant physician in training
set loose on the general public. The key is remembering that one of
the best ways to educate judgment is to use it and to learn from error.
Redesigning accountability to encompass the expertise of those
in the field, and the wisdom of those who have done similar work,
can lead to greater, more sustained organizational success. Such

an “account-based” accountability system will generate data that
are harder to quickly summarize in clean, well-formatted charts for
inclusion in annual reports than will one centering on what can be
quantified. Yet an account-based system may well generate greater
organizational learning and performance improvement over time.
NAVIGATION BY JUDGMENT
The tension between field autonomy and the need for accountability
and fidelity to an organization’s plans is common in the sector. Interna-
tional, national, and local NGOs, big bilateral and multilateral donors,
and private-sector operators in the developing world must all try to
manage unpredictable environments. Much of what these organiza-
tions do is difficult to guide using top-down control and quantifiable
performance. Navigation by judgment offers the advantage of incor-
porating agent knowledge to improve on-the-ground performance,
but it comes at the cost of principal control. For all the gains that a
focus on measurable results has brought the sector, a fixation on the
measurable aspects of a project can undermine the desired results.
To be sure, resources are now available to help principals manage
agents. A world of GPS devices, satellite images, and smartphones
has made observation of field staff easier than ever before. A recent
episode of the popular National Public Radio program Planet Money
suggested that “the future of work looks like a UPS truck.” 10 Appar-
ently, the search for efficiency has driven UPS, a parcel delivery service,
to a high degree of technology-enabled process control. Drivers are
instructed on how to load their truck, what order to deliver packages
in, and where to stop their truck on a street to make multiple deliveries.
To save valuable seconds when signing forms, left-handed drivers are
required to keep their pens in their right front pocket, right-handed
drivers in their left front pocket. “Technology means that no matter
what kind of job you have, whether you’re alone on a truck on an empty
road or sitting in a cubicle in front of your computer, your company
can now monitor everything you do,” NPR reported.
But a management system that works well for UPS may not work
for a banker, plumber, or school principal. For struggling US public
school administrators, a focus on what can be quantified may ensure
that students are in classrooms but not that they are learning. On
a factory floor, management technology-enabled observation and
quantification may ensure that production targets are met, but at
the expense of quality.11 Generally, soft information and informed
judgment remain essential to good outcomes.
In a variety of settings and fields, agents historically have been
afforded discretion not by design, but by default; principals lacked the
ability to monitor tasks well enough to make eliminating discretion
a viable option. Now, monitoring technology has made possible what
was previously impossible. This means organizations must make
conscious, intentional decisions about when the benefits of moni-
toring and measurements exceed their costs and when they don’t.
Sometimes organizations will be more effective with fewer
controls, less measurement, and rethinking what and who will
drive programs to the results they seek. They can seek to measure
smarter, rather than simply crunching an ever-increasing volume
of numbers. Measuring smarter will sometimes mean measuring
different things—for example, shifting from outputs to outcomes
where outcomes are verifiable. Sometimes choosing not to meas-
ure, even when it is possible to do so, is measuring smarter. Smart
Stanford Social Innovation Review / Winter 2019 47
measurement needs to include a consideration of possible distor-
tions in agent behavior.
An organization seeking to increase navigation by judgment need
not adopt it wholesale. It can experiment by giving some offices, sec-
tors, or projects greater control on a pilot basis and committing to
evaluating the performance after it can compare the long-term impact
of projects with the results from a similar country, sector, or project.
But such experimentation must go beyond merely tweaking the formal
rules. “Ultimately, institutional reform and real change requires more
than new architecture,” a recent Overseas Development Institute paper
on reforming the World Bank concludes. “It requires a change in the
plumbing too—the internal systems, processes, and behaviors within
agencies.” 12 Piloting new navigation strategies must involve not just
monitoring and evaluation practices, but also management practice
and HR processes for hiring, promotion, and staff rewards, to succeed.
Top-down instruction can no more mandate flexibility and initiative
than can “better performance.” Only careful design and patient sup-
port, not fiat, can induce a shift to greater reliance on staff judgment.
Moving toward greater navigation by judgment has its challenges.
To be sure, changing organizational management strategy involves
risk for those leaders at NGOs, foundations, and IDOs. But we need
to weigh these risks against the benefits of greater efficiency and
performance. Cost is not an issue: Navigation by judgment enables
organizations to attain better results without substantial infusion of
capital or high-priced technology. To forsake improvement because
of our comfort with a system built on what can be quantified is to
condemn many foreign aid efforts to the mere facade of success
built on meaningless numbers. n
N OTE S
1 Stanley McChrystal, Tantum Collins, David Silverman, and Chris Fussell, Team of
Teams: New Rules of Engagement for a Complex World, New York: Penguin, 2015.
2 For this and all case study data, as well as lists of interviewees, please see Dan Honig,
Navigation by Judgment: Why and When Top-Down Management of Foreign Aid Won’t
Work, New York: Oxford University Press, 2018. Some material here overlaps with
the book; used with permission.
3 OECD Development Assistance Committee, “Managing and Measuring for Results:
Survey Highlights,” Paris: OECD, 2013. The title itself suggests the aid sector’s mud-
dling of measurement as a management tool on the one hand and measurement as a
means of rigorously evaluating impact on the other.
4 Fifteen of the 28 reported it was “often” a problem, 10 “sometimes.”
5 Steven Kerr, “On the Folly of Rewarding A, While Hoping for B,” Academy of Man-
agement Journal, vol. 9, no. 1, 1975.
6 Saul Guerrero, Sophie Woodhead, and Marieke Hounjet, On the Right Track? A
Brief Review of Monitoring and Evaluation in the Humanitarian Sector, London: Action
Against Hunger and the Consortium of British Humanitarian Agencies, 2013.
7 Lant Pritchett, “Account based accountability and Aid Effectiveness,” Harvard
Building State Capability Program, https://buildingstatecapability.com/2018/06/28/
account-based-accountability-and-aid-effectiveness.
8 Jane Mansbridge, “A Contingency Theory of Accountability,” in Mark Bovens,
Robert E. Goodin, and Thomas Schillemans, eds., The Oxford Handbook of Public Ac-
countability, New York: Oxford University Press, 2014.
9 For a fuller discussion of these issues, see Robert D. Behn, “Why Measure Perfor-
mance? Different Purposes Require Different Measures,” Public Administration Re-
view, vol. 63, no. 5, 2003.
10 Planet Money, “The Future of Work Looks Like a UPS Truck,” Episode 563, National
Public Radio, 2015.
11 On this last, factory-floor example, see Ethan Bernstein, “The Transparency Para-
dox: A Role for Privacy in Organizational Learning and Operational Control,” Ad-
ministrative Science Quarterly, vol. 57, no. 2, 2012.
12 Katherine Bain, David Booth, and Leni Wild, Doing Development Differently at the
World Bank, London: Overseas Development Institute, 2016.
48 Stanford Social Innovation Review / Winter 2019

To achieve greater equity, we must yield to the decision-making authority of the communities we seek to help.
, StrivePartnership and other partnerships in the StriveTogether national network are enhancing collective
impact to integrate and elevate the expertise and authority of those closest to the problems we’re trying to solve.
Elevating
Community
Authority
in Collective
Impact
O
n a sunny August day in 2006, an
extraordinary assemblage of civic and
corporate leaders convened at the apex
of the Newport Southbank Bridge, which
spans the Ohio River between Cincin-
nati, Ohio, and northern Kentucky. The
event kicked off what was then called
Strive—Cincinnati/Northern Kentucky, a newly
formed cross-sector partnership with a regional agenda
to provide high-quality education to every child in
urban neighborhoods, from cradle to career. School
district leaders, college presidents, foundation execu-
tive directors, corporate CEOs, elected officials, and
nonprofit leaders from Cincinnati strode south along
the lilac-hued, half-mile pedestrian walkway known
locally as the Purple People Bridge. Their counter-
parts from Covington, Newport, and other urban
communities who had walked north from Kentucky
met them at the middle.
This broad array of institutional leaders across two
% Children listen to a
teacher at a preschool in states came together to declare their shared allegiance
one of the Cincinnati-area to a common framework. The arrangement would
school districts supported become known as “collective impact,” a strategy that
by StrivePartnership .
secures long-term commitments by a group of key
Photograph by
actors from different sectors to pursue a common
Peggy McHale Joseph agenda for solving a specific social problem.1 The impact
Stanford Social Innovation Review / Winter 2019 49
BY BYRON P. WHITE,
JENNIFER BLATZ
& MARK L. JOSEPH
of the endeavor reverberates today: This publication
alone has referenced Strive—Cincinnati/Northern
Kentucky, now known as StrivePartnership, in at least
38 articles, starting with a seminal piece by John Kania
and Mark Kramer in 2011.2 StriveTogether, a national
nonprofit launched by several of the original leaders of
Strive—Cincinnati/Northern Kentucky, now supports
70 communities nationally that have formed cross-sec-
tor partnerships working to ensure that 10.5 million
children succeed.
Two of us—Byron White, executive director of
StrivePartnership, and Jennifer Blatz, president and
CEO of StriveTogether—were on the bridge in 2006,
albeit playing different roles. White was associate
vice president of community engagement at Xavier
University, and Blatz was director of operations at
Strive—Cincinnati/Northern Kentucky. From our pres-
ent-day vantage points, we both marvel at how much
the work has evolved.
As Blatz recalls, the early focus was on the unprec-
edented partnership among institutional leaders. The
voices from the microphone that day were theirs, mak-
ing a public pledge to work together to achieve better
outcomes for children across three urban communi-
ties. A number of students, parents, and neighborhood
leaders were also present on the bridge, listening and
50 Stanford Social Innovation Review / Winter 2019
wondering how they could contribute to this newly formed part-
nership. Forums in each of the three communities followed the
announcement and sought to bring “community voice” into the work.
These forums were well intentioned, Blatz recalls, and we knew
that community input was important to the work of the partnership.
But we didn’t fully embrace the importance of community authority
in those early days, nor did we have the tools or expertise to tap into
it fully. While we looked to community members to help identify
problems, they were not equal peers with institutional leaders in
framing those problems or prescribing solutions, let alone leading
implementation. We considered their insights but afforded them
little direct power in determining how they spent funds, deployed
personnel, and assigned tasks.
When White returned to lead StrivePartnership in 2017, he saw
that, despite impressive results, the regional work had shown some
fragility for not having wholeheartedly embraced community authority
and ingenuity in those early days. While staff members had cultivated
working relationships with grassroots leaders to achieve specific pro-
grammatic goals, those connections often dissipated when employees
departed. StrivePartnership as an organization lacked a reputation for
having a deep understanding of or commitment to community-level
leadership, and our capacity to manage such relationships had not
penetrated our organizational structure and practices. The grassroots
community saw itself as outside the power structure that determined
our priorities and decisions. Reflecting on the growth and prolifera-
tion of this work more broadly over the past 12 years, Blatz found that
other cities were struggling with these issues as well.
Some scholars, consultants, and practitioners who seek collabora-
tive solutions to improve communities have argued that this weakness
is irreparable and a reason to dismiss collective impact. We think that
conclusion is an overreach. We see the exposure of this deficiency as
evidence that what we have been practicing has not been collective
impact in its most durable and effective form. We believe the underly-
ing premise of collective impact is sound. However, the field’s notion
of what constitutes the “collective” has been shortsighted.
Arriving at this understanding is more a matter of collective
impact’s growing pains than evidence of its ultimate failure. It is as
much a by-product of its foundational intention to promote institu-
tional collaboration than a rejection of community. But our experience
in applying collective impact has shown us that community participa-
tion must become a much more integral part of any such collaborative
effort. Institutional leaders must empower residents and grassroots
leaders as peers with shared authority, shared responsibility, and shared
accountability. Doing so requires cultivating a broader, more diverse,
deeper collective of actors who can ensure even greater impact than
collaborations where institutional leaders dominate. StrivePartnership
has taken responsibility for advancing this model, and StriveTogether
has supported and encouraged the efforts of other community part-
nerships in its national network to do likewise.
THE HEADWINDS OF THE EQUITY MOVEMENT
This enlightened approach to collective impact does not call for
remaking it into a grassroots-organizing enterprise. There are
organizations and efforts better equipped to mobilize citizen
power. Collective impact has always been an institutional device,
and unabashedly so. It seeks to build strategic connection across
BYRON P. WHITE is executive director of MARK L. JOSEPH is the Leona Bevis and
StrivePartnership and a vice president of the Marguerite Haynam associate professor of
KnowledgeWorks Foundation. community development at the Jack, Joseph
and Morton Mandel School of Applied Social
JENNIFER BLATZ is president and CEO of Sciences at Case Western Reserve University.
StriveTogether. He is also founding director of the National
Initiative on Mixed-Income Communities.
sectoral boundaries. For StrivePartnership, that initially required
reaching out to institutional sectors that previously, at least when
it came to education, had not aligned.
Perhaps in part because of its institutional orientation, collective
impact is known for the methodical use of data-driven analysis to
identify precise strategies that can produce scalable change. Such a
characterization, sometimes unfairly cast as the sole feature of col-
lective impact, has elicited criticism from those observers who see a
significant democratic role for citizen action and favor the organic
nature of community decision making and problem solving. For
example, in 2013, when the Kettering Foundation asked researcher
Richard Harwood to investigate collective impact’s prospects for
supporting citizen action, he offered this analysis in a memo:
“As collective impact has risen in prominence, connections to
more informal community groups have fallen as a priority. Their
potential for producing impact and scale is considered to be lim-
ited. Engaging communities also seems to be less important.
Both of these practices suffer from a perceived ‘messiness’: they
appear to be disorderly detours in a process that prides itself on
efficiency, keeping things moving, and being ‘professional.’ ” 3
More recently, the Cincinnati-based human-design-thinking
firm Design Impact published a report in January 2017 that sounded
a wake-up call. Many different efforts using collective-impact
approaches, inspired by StrivePartnership, had been launched to
address a range of issues, from child poverty to physical develop-
ment. Design Impact had worked with many of these organizations
to elicit community voice and input. But in their report, the authors
warned that such appeals were insufficient to produce equitable
results. “When we only ask for feedback and don’t invite community
as codesigners (with equal decision-making power), we can make
the same situations we are solving for even worse,” they concluded.
“In short, community voice without community leadership is sig-
nificantly less effective.” 4
Perhaps the harshest critique of collective impact’s institutional
focus can be found in “Collaborating for Equity and Justice: Moving
Beyond Collective Impact,” an article written by Tom Wolff and nine
of his colleagues in the January 9, 2017, edition of Nonprofit Quarterly.5
Though the piece is arguably too critical of collective impact and dis-
misses it as unsalvageable, it makes some important points. “We believe
that efforts that do not start with treating community leaders and res-
idents as equal partners cannot later be reengineered to meaningfully
share power,” Wolff and his coauthors write. “In short, coalitions and
collaborations need a new way of engaging with communities that leads
to transformative changes in power, equity, and justice.”
The article identifies 10 perceived shortcomings in the “flawed
model” of collective impact. First among them is that “collective
impact does not address the essential requirement for meaningfully
engaging those in the community most affected by the issues.” 6 The
 Stanford Social Innovation Review / Winter 2019 51

authors introduce six collaborative-practice principles that promote
equity and justice.
The Wolff critique suggests that a collaborative education model
that is mature in its ability to mobilize institutional resources can-
not simultaneously accommodate community authority. But there
is no reason to accept this implication. A deeper notion of collective
impact insists that this goal is achievable. Neither an institutional
solution that shuts out community authority nor a community organ-
izing model that does not effectively deploy institutional assets can
realistically effect transformational change that produces equity and
justice. At its core, collective impact has always sought a third way.
A COMMUNITY-ENHANCED MODEL
Summoning the collaborative spirit that launched Strive—
Cincinnati/Northern Kentucky, and inspired by the work of our sister
organizations across the country, StrivePartnership’s most recent
iteration builds upon recent lessons to more authentically integrate
community authority into our work. The driver of StrivePartnership’s
work is a model of the urban education ecosystem, derived from
the organization’s more recent efforts, that goes beyond the more
institution-centric positioning that framed the terms of engage-
ment on the Purple People Bridge. It builds on this foundation by
recognizing the primacy of intimate influencers’ and community
assets’ effect on students’ learning.
The model, represented by spheres of influence, acknowledges
that the student is surrounded first by the relationships of individuals
whom the student trusts and interacts intimately with. (See “The
Urban Education Ecosystem” on this page.) Those in this “influ-
encer sphere” include parents and caregivers, peers, and ministers.
Surrounding this sphere is the “community sphere,” which reflects
the community organizations and informal associations aligned
with place. Among these are places of worship, recreation centers,
barbershops, and volunteer community councils.
Beyond this sphere is the “institutional sphere,” which includes
many of the organizations and agencies that typically drive collec-
tive impact for urban youth: K-12 schools, colleges and universities,
social services, the business community, philanthropy, and educa-
tion nonprofits. At the outer edge is the “systems sphere,” which
includes large, mostly governmental agencies that drive policies in
health, criminal justice, housing, and other areas.
Cutting across each sphere of the ecosystem model are three
channels of motivation: care, civic, and commerce. Those in the care
channel are committed to the students’ whole being. Those in the
civic channel are focused on some particular aspect of the students’
development, such as health or education. Those in the commerce
channel engage the student primarily as a consumer.
Although we have developed this model to improve the educa-
tional outcomes of urban youth, it is easily adaptable, and has been
applied successfully, to other work in the social sector. For example,
coauthor Mark Joseph works with federally funded housing author-
ities that seek to facilitate the creation of mixed-income housing
communities. He finds that the central premise of elevating com-
munity authority of low-income residents may foster more produc-
tive interaction among individuals across economic lines. Joseph
and his colleagues Robert Chaskin and Amy Khare have identified
low-income residents’ lack of influence on decision making and
governance—the absence of community authority—as hamper-
ing inclusive and more equitable redevelopment.7 By contrast, the
HOPE SF mixed-income public housing transformation initiative
in San Francisco uses a collective-impact approach, has prioritized
resident voices and leadership since its inception in 2007, and is
the country’s most promising effort at achieving equitable mixed-
income development.8
Joseph and Miyoung Yoon, a doctoral student at Case Western
Reserve University’s Jack, Joseph and Morton Mandel School of
Applied Social Sciences, note in their consideration of the experi-
ences of youth in mixed-income communities that all of the spheres
of influence in our model have the potential to affect children both
positively and negatively. The two draw on youth developmental
assets theory and strain theory. Youth developmental assets theory

The Urban Education SYSTEMS

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52 Stanford Social Innovation Review / Winter 2019
enumerates the key factors that promote healthy development for
young people. Strain theory elucidates the various forms of stress
that a young person’s environment generates, and considers more
and less constructive means of dealing with that stress. Joseph and
Yoon argue that, to help youth successfully navigate a mixed-income
environment, community initiatives must be designed to use the
assets in each sphere while being attentive to, and minimizing the
impact of, factors that cause strain.9
However, while institutional and civic leaders have paid a great
deal of attention to the deficiencies of the community and influencer
spheres, they have largely overlooked or undervalued assets that exist
within them. For instance, they typically don’t enlist low-income
parents whose children perform at an academically high level to
design and manage successful parent involvement. They don’t call
upon inner-city churches that sponsor vacation bible schools in the
summer to lead summer literacy programs. They don’t recruit as
mentors neighborhood barbers who consistently charge their young
customers to work hard in school. Campus officials generally do not
reach out to the personal champions of first-generation college stu-
dents after the student enrolls, but eagerly replace them with newly
assigned campus mentors.
It is not just that actors within these spheres have been ignored;
they have been pushed out of the way as harmful to students. This
negligence is what critics of collective impact emphasize, and right-
fully so. Those of us who defend the practice, therefore, must address
this oversight if we are to restore credibility to the work and advance
it on behalf of children and communities.
StriveTogether has done just that in pursuit of its vision to ensure
that every child, regardless of race, income, or zip code, succeeds
from infancy through adulthood. Members of StriveTogether’s
national Cradle to Career Network agree to follow its Theory of
Action, a framework for building the civic infrastructure for achiev-
ing the organization’s objective. Communities also commit to track
and work across seven areas: kindergarten readiness, early-grade
reading, middle-grade math, high school graduation, postsecondary
enrollment, postsecondary completion, and employment.
To help communities achieve more equitable outcomes and
accelerate progress, StriveTogether advises, shares knowledge, and
provides financial incentives. Its approach uses an equity lens and
combines continuous improvement, design thinking, and leadership
development according to the Results Count program developed by
the Annie E. Casey Foundation. Many communities working with
StriveTogether have achieved impressive results. Ten network mem-
bers, including StrivePartnership, have shown progress on at least
60 percent of indicators across the seven cradle-to-career areas.
To better understand how cradle-to-career civic support devel-
ops within and across communities, StriveTogether began a five-
year evaluation by Philadelphia-based firm Equal Measure, which
has tracked the progress of 16 cradle-to-career partnerships. The
data validate StriveTogether’s approach in helping communities
get better results for children and families. The evaluation, now in
its final year, has also helped to uncover where communities have
made the least progress, and has done so partly by inviting these
very communities to participate in the work.
Through these insights, StriveTogether has evolved its framework
to reflect the evolution of its vision of quality collective impact.10
In StriveTogether’s Theory of Action, which was launched in 2013
to guide the work of the national network, the foundational prin-
ciple reads:
“The work of the partnership must be grounded in the con-
text of the community. Partnerships engage a broad array of
community voices through building awareness and informa-
tion sharing; involving and mobilizing the community toward
improvement; and co-developing solutions and strategies with
community members.”
In 2018, StriveTogether launched a comprehensive strategic
planning process. The refined approach that has emerged requires
organizations to define the community’s authority in the earli-
est stages of partnership development. In this way, they better
understand the root causes of disparities and can identify and
implement strategies that promote more equitable outcomes for
children and families.
LESSONS FROM THE FIELD
StrivePartnership’s breakthrough insight into the value of commu-
nity authority came as a result of the Cincinnati Preschool Promise
campaign, a community-driven effort led by education and early-
learning advocates, preschool providers, and faith and community
leaders, and facilitated by StrivePartnership. As a result of its success,
Cincinnati voters passed a ballot initiative in November 2016 that
extended quality preschool access to more children in the city. The
effort informed StrivePartnership’s understanding that to advance
equitable, systemic solutions, “new centers of power must emerge”
from “those most adversely affected by our current systems and
policies,” according to Greg Landsman, who was executive direc-
tor of StrivePartnership during the campaign.11
StrivePartnership spent years building this plan by hosting
hundreds of house parties, community forums, town-hall meet-
ings, and parent and preschool-provider listening sessions across
the city. At the same time, we enlisted business and labor leaders,
elected officials, and our faith communities. In the end, hundreds of
people volunteered, including more than 400 on Election Day, and
the school levy passed with the highest margin of victory for any
Cincinnati Public Schools levy in history: 62 percent to 38 percent.
However, not only did grassroots participation help drive pas-
sage, it also fundamentally altered the parameters of the endeavor
by defining what “quality” looked like. For institutional leaders,
quality preschool was defined by Ohio’s Step Up to Quality five-star
credentialing system, which assesses curriculum, screenings and
assessments of students, teacher education and ongoing training,
and how much interaction and feedback centers have with families.
Three or more stars indicate a quality program, which means parents
enrolled in Preschool Promise could send their children there. But
as community representatives weighed in, they made it clear that
another essential factor was trust. For a parent, especially a single
mother, a quality provider might be the older woman from the house
down the street who—regardless of how many stars her operation
possesses—has demonstrated that she truly loves the mother’s baby
girl. This insight and demand led the campaign to seek not only to
raise money to subsidize the cost of quality daycare for low-income
parents and caregivers, but also to aid neighborhood centers that

were unrated or had not achieved three stars to upgrade their rat-
ings, but that the community already trusted.
The lesson illustrates that sharing authority with community
representatives is essential to the future success of collective-impact
work—both because it is the just and publicly popular thing to do and
because it is strategically superior. For instance, when Wisconsin’s  “For true community engagement, professionals need to step back
Higher Expectations for Racine County engaged with partners to
invite community members and institutional leaders to address racial
inequities in the county, not all participants were enthusiastic about
receiving community guidance. Community representatives had not
been included in the past, and some institutional leaders were wary of
their engagement. Nevertheless, community members joined “action
teams” alongside leaders from Racine Unified School District, United
Way of Racine County, the Racine Police Department, Racine County,
and other institutions at the Racine-based Johnson Foundation at
Wingspread. These teams focused on outcomes in kindergarten read-
iness, early literacy, school climate, and employment.  along six differently paced but interdependent “layers” within the
The process was not quick or easy, but ultimately community rep-
resentatives helped identify the root causes of disparities and part-
nered with institutional leaders to create unique, and potentially
groundbreaking, initiatives. Among other efforts, they developed an
employment-pathway initiative that has helped youth in the region’s
highest-need zip codes to build capabilities, develop skills in informa-
tion technology, earn high school diplomas and college credits, receive
driver’s licenses, successfully complete paid internships, and, in some
cases, earn permanent employment in the IT field. Participants and
volunteer mentors have described their new relationships and expe-
rience as transformative. Institutional leaders are exploring how to
use this new model across other large sectors of the local economy
in a way that will support employers and boost community members
who have historically been unemployed or underemployed.
This determination does not make the work easy. Elevating com-
munity authority fundamentally shifts the power dynamic between
communities and institutions and inevitably brings underlying ten-
sions into play. What happens, for instance, when the community’s
notion of “success” diverges from the outcomes the partnering insti-
tution wants to pursue? Who defines what “expertise” looks like—
professional training or life experience—and how it gets deployed?
And if the institution brings its abundant assets—financial, techno-
logical, data—to bear on the partnership, can it ever achieve true
parity with the community?
THE IMPORTANCE OF COMMUNITY AUTHORITY
Such challenges are ever present, and the evidence of long-term
results deriving from these efforts is preliminary. Nevertheless, a
number of recent theories about community development and sys-
temic change support the quest to embrace community authority
as a way of making the most of institutional and community assets.
John McKnight, cofounder of the Asset-Based Community Devel-
opment (ABCD) Institute, asserts that community and institutional
assets intermingled in a local context provide the best support for
children. “The educational resources of the village include the knowl-
edge of neighborhood residents, the clubs, groups, and associations
that are citizen-based learning environments, and the local insti-
tutions (businesses, not for profits, and government bodies),” he
writes. “Each provides incredible learning opportunities. It is these
Stanford Social Innovation Review / Winter 2019 53
neighborhood educational assets that are activated in a village that
raises its children.”12
Dan Duncan, a member of the ABCD Institute’s national faculty
and chair of its board, insists through his work at Clear Impact that
institutions can support community authority without overriding it.
to create space for citizens to discuss their own hopes and dreams
and the roles they can play to achieve their dreams,” he writes. “True
support is when professionals allow citizens to be in charge of their
own destinies and then step in when their help is requested.” 13
Furthermore, models such as Stewart Brand’s Pace Layers sug-
gest that community authority, in conjunction with institutional
advocacy, is essential to generating and then sustaining the level of
rapid innovation needed to address seemingly intractable problems
that affect marginalized communities. The founder and president
of the Long Now Foundation, Brand argues that civilization evolves
social ecosystem. From slowest and innermost to fastest and out-
ermost, the layers are nature, culture, governance, infrastructure,
commerce, and fashion. It is easy to see how the whims of fashion
and art change much more quickly than do the slow revolutions of
nature and culture. Brand describes their interplay this way: “Fast
learns, slow remembers.  Fast proposes, slow disposes. Fast is dis-
continuous, slow is continuous.  Fast and small instructs slow and
big by accrued innovation and by occasional revolution. Slow and
big controls small and fast by constraint and constancy. … All dura-
ble dynamic systems have this sort of structure.  It is what makes
them adaptable and robust.”
Although Brand’s model visually inverts the StrivePartnership
urban education ecosystem, the latter’s institutions and systems
spheres align with the slower, inner layers of Brand’s ecosystem.
Compare the inertia and resistance to change of nearly all mature
bureaucracies with the lives of community residents, who move at
a faster pace. Consider a tragic community event, such as a police
shooting of an unarmed man in an urban community. Before any
officials arrive, the community gathers, shares information infor-
mally, and starts to mobilize—at a speed similar to that of Brand’s
fast-moving, expressive fashion layer. Later, as with Brand’s com-
merce and infrastructure layers, community leaders, such as pastors,
arrive on the scene to offer a semblance of order to the spontaneous
response by organizing a protest or scheduling a press conference.
Later still, the police chief and mayor—the governance and culture
layers—arrive and announce official policies and protocols. The pace
of action accelerates the closer one gets to the community level. And
while it is more chaotic, it is also more responsive, often dictating
the urgency with which other spheres will react.
Or think of a different example and consider social media—which
sits at the “influencer” level of our model in the commerce channel.
Has society known a more rapidly evolving and deeply influential
medium, particularly among our youth? It is quite possible that more
black children now imagine themselves as scientists as a result of
the social media outpouring over the technology-enthused movie
Black Panther during spring 2018—along with the spontaneous van-
loads of children transported to screenings by neighbors and church
groups—than through the comparatively glacial pace of countless
formal STEM programs. To what extent have our collective-impact
54 Stanford Social Innovation Review / Winter 2019
strategies incorporated tactics that leverage the speed and reach of
these ubiquitous and ever-changing cultural phenomena?
The point is that collective impact, with its emphasis on institu-
tional processes, has been biased toward the slower layers of Brand’s
ecosystem and has failed to recognize the outer, faster layers as
equally essential. As a result, we may have shortchanged ourselves
in terms of the learning and innovation that these layers can bring
and perpetuated within the ecosystem an imbalance that, arguably,
has thwarted continuous learning.
The importance of community-level voice and influence is a
theme that also emerges in the work of Joseph and his colleagues at
the National Initiative on Mixed-Income Communities. Their applied
research has focused on the challenges of promoting more equity and
inclusion in historically segregated communities that have become
more racially and economically diverse through mixed-income
development and gentrification. Joseph notes that the barriers to
embracing participation from marginalized populations frequently
come from the more affluent and the social structures over which
they have power.
In their 2015 book, Integrating the Inner City, Joseph and coauthor
Robert Chaskin quote one public-housing resident as he describes
his unsuccessful attempts to meaningfully engage his wealthier
neighbors: “You’re trying to interact, but it’s just like you’re invis-
ible. Nobody wants to recognize you. I know what the problem is.
It’s them. It ain’t me. I can interact with anybody.” The factors that
contribute to these tensions, according to Chaskin and Joseph,
include differences in lifestyle, lack of daily interaction, and differ-
ent perceptions based on class and race. These circumstances are
reinforced, they write, by “the enduring power of an urban under-
class narrative in which institutionalized assumptions regarding a
culture of poverty—a pattern of values, beliefs, and behaviors pre-
sumably embraced by the underclass in opposition to mainstream
values of work and self-sufficiency—remains salient.”
THE QUEST FOR A DEEPER COLLECTIVE
StrivePartnership and other collective-impact organizations within
the StriveTogether network have been refashioning their work to
recognize more deeply and authentically community assets for achiev-
ing equitable educational outcomes for youth. Accomplishing this
goal demands substantive shifts in core organizational structure,
operational practices, and foundational knowledge. These changes
are ambitious but achievable. Our experience and observation sug-
gest that enacting them requires three strategic endeavors:
Pursue new learning. | The first challenge is to resist the tempta-
tion to believe we already know what to do. Despite having a staff
with long-standing experience working in urban neighborhoods as
community organizers and partnering with communities through
their universities, White recognized that his team was susceptible to
institutional biases. To mitigate this tendency, the team embarked
upon a Community Deep Dive initiative to identify, mobilize, and
enhance community assets as a means of elevating agency. In col-
laboration with the Kettering Foundation, whose work focuses on
democratic practices at the local level, StrivePartnership has facili-
tated resident-led surveys in Cincinnati’s Roselawn neighborhood
that highlight its existing potential to support children and learning.
Through a community-organizing activity called the Dream Game,
Roselawn residents have led the discussion to define problems and
create solutions that draw primarily upon assets they control and
also to indicate the external assets that they need. The exercise is
helping StrivePartnership to learn and disseminate new practices
that redefine the power dynamic between urban core communities
and institutions and in turn improve youth outcomes.
Broaden capacity and expertise. | Many organizations in the
StriveTogether network have brought on more staff and leader-
ship positions dedicated to community engagement that goes be-
yond creating goodwill to drive efforts that recognize community
authority and expertise. StrivePartnership’s job description for its
manager for community strategies states that it “leads in the design
and implementation of efforts to identify, mobilize, and magnify
community assets, expertise, and authority—including the contri-
butions of residents and small-scale neighborhood efforts—and to
integrate them into StrivePartnership’s broader institutional prac-
tices to advance racial equity and social justice.”
The Road Map Project, a StriveTogether network member focused
on South Seattle and South King County, reconstituted its leader-
ship structure after its 2016 strategic planning, which focused on
advancing racial equity. Road Map Project participants recognized
that the members of its founding advisory board, which was made
up mostly of institutional, civic, and philanthropic leaders, did not
adequately represent the students and parents from communities
it sought to serve. Rather than simply expand membership of the
original Project Sponsors Group to include more community repre-
sentatives, the body dismantled itself and established a new Com-
munity Leadership Team to guide the work.
The new team, about 12 people, includes youth, faith, and com-
munity leaders who more closely represent the racial and geographic
composition of the seven school district service areas in which the
Road Map Project works. A diverse panel, which included members
of the old Project Sponsors Group and other community leaders who
engaged in the planning process, selected its members. Institutional
leaders from school districts, colleges, foundations, and other civic
institutions from the original group remain active in the project.
Modify organizational policies and goals. | The ultimate measure
of organizational priorities is whether the organization has concrete
goals for which it is held responsible. StriveTogether has signaled its
priorities by emphasizing equity and community voice in its evolv-
ing Theory of Action and by making funding dependent on these
goals through its recently launched Cradle to Career Community
Challenge grant program. StrivePartnership tracks not only the
number of “place-based participants” engaged in its projects, but
also the degree to which they take appropriate steps. For example,
StriveTogether member Seeding Success in Memphis has shifted
its data support efforts from reporting findings to the community
to equipping grassroots organizations with the data collection and
analysis tools they need to make decisions on the ground. For in-
stance, volunteers and staff in the network of grassroots reading
programs supported by Literacy Mid-South can now track both
the attendance of the 2,500 children and adults they reach collec-
tively and the actual time of instruction for each participant. They
report those data to the relevant community organizations (such
as Memphis Athletic Ministries), enabling the recipients to better

target their efforts. The result has led to an improvement in read-
ing skills and reading comprehension.
None of these efforts is perfect, and we need to do much more to
reclaim lost time. As we progress, we are discovering that, in fact, we
can reengineer collective impact without abandoning its core principles.
LESSONS FOR COLLECTIVE IMPACT
As StrivePartnership builds momentum to refashion its work in a
manner that elevates community expertise and authority, we are
discovering lessons that may be useful to the broader field. The
following three are chief among these:
Resist the deficit narrative. | Consider all the terms, expressions,
and code words we use to describe the failings of urban communi-
ties and the people who live there: marginalized, low-income, at-risk,
crime-ridden, minority, poor, disadvantaged. Now, try to find an af-
firming adjective to counter each one of those terms that regularly
appear in our presentations and grant proposals. It is not so easy to
do. We have created an entire lexicon to reinforce the paradigm that
urban communities are deficient. This language shapes our mental
models. It takes intentional effort to change this default position.
Consider the shift that some communities have made by begin-
ning to use the term “returning citizens” to describe those who
have served time in prison, rather than referring to them as felons
or ex-cons. In her now-famous TED talk, “The Danger of a Single
Story,” Nigerian author Chimamanda Ngozi Adichie says, “Show a
people as one thing, only one thing, over and over again, and that is
what they become.” If we are going to shift our behavior, we must
deliberately shift the narrative.
Do not settle for community voice. | Collective-impact organiza-
tions have done a fairly good job in recent years of consulting with
local residents and grassroots representatives to provide input in
and secure endorsement of institutionally driven strategies. Focus
groups, town-hall meetings, and community surveys are all de-
vices that capture community needs and wishes. However, these
exercises fall far short of recognizing a community as a legitimate
peer in the design, production, and implementation of those strat-
egies. Our efforts to solicit community voice may very well lead
to decisions that are more reflective of community desires. But it
is wrong to take from residents their insight—the one asset they
hold exclusively—and then deny them the authority to contribute
directly to making those decisions, let alone define what information
is gathered and why. Enlisting community voice is not a substitute
for community power.
Along with our commitment to promote community authority, we
also must enable community representatives to participate effectively
in sophisticated, multisector initiatives and institutional represent-
atives to partner and engage effectively with community represent-
atives. The ABCD Institute has a basic tool kit for practitioners that
assigns three questions to community and institutional partners as
they embark upon their collaborative work, to ensure that residents
have authority over the appropriate decisions: First, as neighbors,
what can we achieve just by using our own assets? Second, what can
we achieve with our own assets if we get some outside help? Third,
what can’t we do with our assets that outsiders must do?
Stanford Social Innovation Review / Winter 2019 55
Pursue equity with humility. | The recent focus on racial equity
and inclusion by mainstream institutions is a powerful develop-
ment. These companies are revising mission statements, rewrit-
ing funding guidelines, and creating new positions. Most of us
whose organizations have failed over the years to fully appreciate
inequities are feeling good about this enlightenment. But our lim-
ited progress should elicit sober reflection. We should recognize
that while mainstream organizations were operating in ignorance,
groups close to the ground—many of them less prominent and
with smaller budgets—were relentlessly devoted for decades to the
work of eradicating racial, economic, and social injustice. It is easy
to push past these organizations as larger, well-funded enterprises
like StrivePartnership step up to join the equity movement. It would
be more appropriate to step aside and give these community enter-
prises the credit they deserve for having stood in the gap when oth-
ers were looking the other way, and to hear from them the lessons
they learned in the struggle.
The next iteration of collective-impact work must recognize the
primacy of those whom students themselves (or whomever we seek
to help) value most—their families, teachers, churches, and others
in the influencer and community spheres. This requires more than
a simple revision of our rhetoric or the collection of new data. We
must overhaul our assessment of the urban education ecosystem,
rigorously pursue new knowledge to confront our biases, restruc-
ture how our organizations operate, and install new practices and
policies to sustain change.
These efforts have begun in earnest at StrivePartnership and
beyond through StriveTogether and its network of related partner-
ships across the country. We fully accept the challenge that critics
of collective impact present. However, rather than abandoning
the practice, as some have suggested, we are doubling down on it,
by evolving the very notion of what “collective” means to address
inequity and injustice. n
N OTE S
1 John Kania and Mark Kramer, “Collective Impact,” Stanford Social Innovation Review,
Winter 2011.
2 Kania and Kramer, “Collective Impact.”
3 Richard Harwood, “Collective Impact Supporting Appendix,” Kettering Foundation,
September 27, 2013.
4 Design Impact, “Metathemes: Designing for Equitable Social Change,” January 2017.
5 Tom Wolff et al., “Collaborating for Equity and Justice: Moving Beyond Collective
Impact,” Nonprofit Quarterly, January 9, 2017.
6 Wolff et al., “Collaborating for Equity and Justice.”
7 Robert Chaskin, Amy Khare, and Mark Joseph, “Participation, Deliberation, and De-
cision Making: The Dynamics of Inclusion and Exclusion in Mixed-Income Develop-
ments,” Urban Affairs Review, vol. 48, no. 6, 2012.
8 Mark Joseph et al., “HOPE SF: San Francisco’s Inclusive Approach to Mixed-Income
Public Housing Redevelopment,” Shelterforce, Spring 2016.
9 Miyoung Yoon and Mark Joseph, “An Integrated Conceptual Framework for Youth
Development in Mixed-Income Communities,” working paper, 2018.
10 Jeff Edmondson and Ben Hecht, “Defining Quality Collective Impact,” Stanford
Social Innovation Review, Fall 2014.
11 Greg Landsman and Erez Roimi, “Collective Impact and Systems Change: Missing
Links,” Nonprofit Quarterly, February 12, 2018.
12 John McKnight, “An Educating Neighborhood: How Neighbors Create a Village That
Raises Their Children,” National Civic Review, vol. 106, no. 4, 2017.
13 Dan Duncan, “The Components of Effective Collective Impact,” Clear Impact, 2016.
 PEER to PEER
On September 13-14, 2018, Stanford Social Innovation Review
hosted Nonprofit Management Institute 2018 “Toward Real Change:
Diversity, Equity and Inclusion” at Stanford University.

Activist and author

Darnell Moore
President of
moderates a panel
Hispanics in
on movement
Philanthropy Ana
building and
Marie Argilagos
empowerment
discusses important
in traditionally
issues affecting the
disenfranchised
Latinx community.
communities.

Stanford history professor

Judith Smith, Founder of Axis Dance Company, Sherri Dr. Clayborne Carson recalls his
Young, Director of the African American Shakespeare personal stories from the civil
Company, Timothy Seelig, Director of the San Francisco rights movement
Gay Men’s Chorus, and Nayantara Sen, Manager
of Cultural Strategies at Race Forward, discuss the
manifestation of diversity in the arts.
Angela Glover-Blackwell, Founder in
Residence of PolicyLink, delivers a
powerful closing to the conference

Rashad Robinson,
CEO of Color of
Change, highlights
the importance of
intersectionality
Makiyah Moody of La Piana Consulting, Crystal German of Prosperity Labs, Tyra in nonprofits and
Mariani of New America, and Ifeyinwa Offor Walker of The Offor Walker Group share philanthropic
insights and perspective on being women leaders of color in the social sector. organizations

To find out more about upcoming SSIR convenings, visit: ssir.org/events

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INSIGHTS FROM THE FRONT LINES
Time for a Three-Legged
Measurement Stool
Going beyond traditional monitoring and evaluation to focus on
feedback can lead to new innovations in the social sector.
BY FAY TWERSKY
P
eople have framed the con-
versation about measurement
in the social sector in terms of
monitoring and evaluation for
decades. They shorthand it as “M and E” and
serve it up as a generic, two-dimensional
description for measuring nonprofit per-
formance. Monitoring is the routine data
collection and analysis conducted by an
organization about its own activities, while
evaluation typically means the kind of data
collection and analysis conducted by an in-
dependent third party.
In many respects, these two complemen-
tary parts of measurement have matured
and strengthened over time. Aided by tech-
nology, monitoring has developed to collect
information about who is being served and
with what level of frequency and intensity,
and even to track short-term outcomes—all
of which can inform decision making. And
the evaluation field is now more nuanced,
with new approaches to answer a wide array
of questions about outcomes, impact, and
the factors that enable or inhibit change.
But, for all their advancement, these two
building blocks are insufficient. We need a
third leg of the nonprofit measurement stool
to achieve more balance: feedback. Distinctly
focused on the customer or constituent
experience, feedback involves systemati-
cally soliciting, listening to, and responding
to the experiences of nonprofit (or govern-
ment direct-service-provider) participants
ILLUSTRATION BY ARIEL DAVIS
and customers about their perceptions of a
service or product. By listening to custom-
ers’ experiences, preferences, and ideas,
we can gain unique insights that will help
improve the quality and effectiveness of
social programs.
INNOVATION, REVELATION,
AND AMPLIFICATION
Certain organizations are already leading
the way in using feedback. Many have em-
braced customer perspectives as a crucial
component of their work to source innova-
tion, to surface hidden problems, or simply
to amplify marginalized voices in our typ-
ical systems of service delivery. Examples
of these three advantages underscore how
adopting feedback into the measurement
process can benefit both the programs and
their respective clients.
Sourcing innovation | Some organizations
implement all three legs of the stool, such as
Nurse-Family Partnership (NFP), a model
evidence-based program that recently used
feedback to question its assumptions about
what its clients actually wanted. NFP began
in 1977 as a research project in Elmira, New
Stanford Social Innovation Review / Winter 2019 57
York, whose studies determined that when
a nurse regularly visits with a first-time
mother for two years, providing a range of
support and information, the arrangement
produces many benefits, such as better birth
and early child outcomes, and improved par-
enting. The program has been externally
evaluated for 40 years and expanded into
42 states and six tribal communities. But
in 2015, then new CEO Roxanne White and
new Chief Communications and Marketing
Officer Benilda “Benny” Samuels determined
that even evidence-based programs needed
periodic innovations to reach new mothers
and retain participation. So NFP decided to
participate in Listen for Good, a systematic
feedback tool to ask mothers about their ex-
periences with the program—from whether
they would recommend it to other new
mothers to what they saw as its strengths
and improvable areas.
Some staff were skeptical that these
women would want to participate. They
worried that the mothers wouldn’t want to
use their data plan minutes to respond to
the Listen for Good survey via text message.
But when staff sent the feedback survey to
10,000 recipients, they received almost 1,000
responses in 20 minutes. The first thing
they noticed was just how much the moth-
ers appreciated the invita-
tion; they saw it as a sign of
respect. While they provided
positive feedback about the
program overall, they also
had innovative ideas for
improvement, such as con-
necting the participating
mothers with one another,
not just with the NFP staff;
creating an app for NFP’s
print materials; and, counter
to the staff’s expectation,
asking to be able to commu-
nicate with the nurses both
via text and in person.
These recommenda-
tions led to innovations now
being tried at NFP, includ-
ing creating a new feedback
58 Stanford Social Innovation Review / Winter 2019
FAY TWERSKY is the director of Effective Philanthropy at
the William and Flora Hewlett Foundation, and the former
director of Impact Planning and Improvement at the Bill &
Melinda Gates Foundation.
The author would like to thank Amy Arbreton, Jill Blair, Carla
team that is not only engaging mothers but
also inviting feedback from staff, volun-
teers, and partner organizations. NFP, the
gold-standard, evidence-based program,
has integrated feedback as a third leg of its
measurement stool to unlock new insights
and drive continuous improvement.
Surfacing hidden problems | The Second
Harvest Food Bank serves millions of peo-
ple each year in Silicon Valley but never
systematically solicited feedback from its
customers until 2016. From its first feed-
back efforts in 10 locations, Second Harvest
learned that customers from different cul-
tural communities were having vastly differ-
ent experiences with food and service at the
food banks—white and Latino clients were
markedly more satisfied than Asian clients.
This insight led Second Harvest to exper-
iment with more culturally sensitive ap-
proaches to its work, including new-volunteer
recruitment and training, food choices con-
sistent with traditional Asian diets, and even
a new location for food pickup, to better
serve the Asian community.
Second Harvest, like many nonprofits,
will likely never invest significantly in an
expensive third-party evaluation, but rig-
orous systematic feedback has bolstered
its understanding of client experiences and
preferences. If the organization can improve
clients’ experiences, it will be better posi-
tioned to accomplish its mission to reduce
hunger in all local communities.
Giving voice to those who are least heard
Epiphany Community Health Outreach
Services (ECHOS) is a nonprofit ministry of
the Episcopal Diocese of Texas that provides
health and social services to the growing
population of immigrants and refugees in
Houston, Texas. ECHOS provides a range of
critical safety-net services, including English
language classes and, more recently, Hurri-
cane Harvey relief services. Through its first
efforts at customer feedback, ECHOS learned
that clients were waiting excessive amounts
of time, which consequently made ECHOS’
support difficult to access.
ECHOS’ staff realized that this experi-
ence contradicted their intention to treat
Ganiel, Lindsay Louie, Rick Moyers, Katie Smith Milway, Prithi
Trivedi, Melinda Tuan, and Jennifer Wei for their comments on
earlier versions of this article, and especially Sam Schaeffer,
CEO of the Center for Employment Opportunities, who
first referenced feedback as the third leg of a three-legged
measurement stool.
immigrants and refugees with respect.
Consequently, ECHOS is changing its regis-
tration process so that clients no longer have
to stand in line to be received. It is also insti-
tuting expanded hours and making workflow
improvements to increase efficiency. In fairly
short order, the organization has transformed
how it manages the flow of people, in order
to promote a more positive and respectful
customer experience.
ITERATIONS ON FEEDBACK
When I began my career in applied research
30 years ago, I was taught that client satisfac-
tion surveys were useless. They were seen as
“lite,” in contrast with “hard” outcomes. Be-
cause of the power differential between non-
profits and their clients, evaluators assumed
that satisfaction measures would always be
positive and therefore not meaningful.
It’s a new day now. Throughout the social
sector is a growing recognition of the
importance of being human centered—
that is, of putting the people we seek to
benefit at the center of problem solving.
That human-centered design principle
should also apply to nonprofit measurement.
Many funders are already interested in
connecting more with the communities
they aim to serve, as well as looking for new
measurement tools. In fact, a recent study
by the Center for Effective Philanthropy
found that foundation CEOs believe that
listening more to the people they hope to
| help is essential to their success. The Fund
for Shared Insight, the philanthropic col-
laborative that has been the driving force
behind Listen for Good and other feedback
efforts, has grown rapidly in the past four
years, from six participating funders to 78
co-funders and counting.
US-based funders, such as the Plough
Foundation in Memphis, Tennessee, have
found feedback to be a powerful tool for
their grantees. “The organization had
never asked [its] populations what they
wanted,” says Diane Rudner, the Plough
Foundation board chair. She describes
the learning from feedback, particularly
from an organization serving people with
developmental disabilities, as “so valuable
… it’s amazing!”
Internationally focused Omidyar Network
partnered with the Acumen Fund on “lean
data sprints,” in which they gathered feed-
back from approximately 30,000 customers
from 68 Omidyar investees across 18 coun-
tries. Like Listen for Good, the Acumen tool
uses the Net Promoter system, which involves
a calculation of customer experience scores.
Based on this first effort to be customer-
centric in its measurement, Omidyar and its
investee organizations generated actionable
insights about each relevant sector—such as
independent media, education, and financial
inclusion—and each organization’s perceived
strengths and weaknesses.
The Omidyar Network still relies on tra-
ditional impact evaluation when it can, and
on elaborate dashboards to monitor the
progress of the organizations and businesses
it supports. But now that the company has
added a third dimension, customer feedback,
to its measurement stool, it’s positioned for
customer experience to drive improvement.
Let me be clear: I am not arguing against
monitoring or evaluation. They are both
important tools. Evaluation helps us to gain
a deep understanding of what works and
why, and monitoring helps us track our prog-
ress and provides useful signs for course
correcting. But not every organization can
invest equally in each leg. The advantage of
feedback, when properly integrated, is that
it is both information-rich and affordable.
The insights, ideas, and preferences of our
ultimate beneficiaries can unlock new pos-
sibilities for operational improvements, pro-
grammatic innovation, and more respectful
engagement.
As a mentor of mine advised, “Let not
the abuse of a thing be an argument against
its proper use.” It’s time to stop denigrating
satisfaction surveys and unleash the power
ILLUSTRATION BY ARIEL DAVIS
of feedback in new ways. Let’s strengthen
our measurement tools to be reliable, com-
parative, and simple to use, with both quan-
titative inputs and qualitative comments.
And let’s start listening to gain insight, to
improve, and to innovate. n

The Hidden Costs of
Public Contracting
Nonprofits need a strategy to ensure that public dollars
don’t put them in the red.
BY MARY KATE BACALAO
A
ll grant dollars are equal, but
some are more equal than oth-
ers. Public contracts provide a
stable revenue stream for non-
profit human-services providers, but they
come with a hidden price tag—contract man-
agement costs that make public dollars much
more expensive to administer than other
types of dollars. Nonprofits often cope with
the problem in isolation, using private, un-
restricted dollars to offset the expenses of
managing public contracts—but this creates
opportunity costs for a nonprofit’s least re-
strictive type of funding.
Indirect costs consist of all expenses that
support a program but also serve a broader
organizational purpose, such as agency-level
accounting and operational expenses.
Typically, nonprofits recover these and other
overhead expenses by pooling and then allo-
cating them to program contracts. Public
funders usually assume that a default rate of
10 percent—assessed against the contract’s
subtotal of direct program costs—is suffi-
cient for nonprofit human-services providers
to recover their indirect expenditures.
But funders’ assumptions about indirect
costs are unrealistic. Understandably wary of
disappointing their funders, nonprofits per-
petuate the problem by underreporting their
needs and then underresourcing vital agency
systems. Research shows that this drives a
“nonprofit starvation cycle” of “underfed
overhead”—a race to the bottom for non-
ILLUSTRATION BY ARIEL DAVIS
profits trying to attract and retain stable
revenue streams. Ironically, funders’ efforts
to support nonprofit systems have produced
an atmosphere of chronic underinvestment.
Public contracts not only fall short of cov-
ering indirect costs but also create them.
Contract management costs hide across a
range of functions, from monitoring and
reporting to budgeting and spending. When
they add up in proportion to the value of a
contract, they serve important purposes,
such as ensuring robust stewardship of tax-
payer dollars. But when they add up dispro-
portionately, they unfairly burden the already
underfunded systems that manage them.
INDIRECT COSTS
As a nonprofit senior manager, I oversee a di-
verse portfolio of contracts and subcontracts
with federal, state, and city government
agencies. My team performs all the functions
of contract management and handles the
attendant expenses. We know that indirect
cost rates are poorly structured to absorb
these expenses. The pressure that exists in
these situations—to prove administrative
Stanford Social Innovation Review / Winter 2019 59
capacity by dealing seamlessly with dupli-
cative obligations and delays—diverts re-
sources from vital agency functions that
help programs deliver outcomes. Contract
management expenses fall into five gen-
eral categories: program monitoring visits,
fiscal monitoring visits, contract reporting
requirements, delayed invoice payments,
and budget modification delays.
Program monitoring visits offer non-
profit staff an opportunity to strengthen
programs in collaboration with experienced
public partners. However, when government
monitors arrive on-site, these visits often
feel like an exam in a course without a text-
book. Monitors with heavy contract loads
can’t provide hands-on guidance, and grantee
handbooks can muddy the waters. Such mon-
itoring visits test how well nonprofit staff
can guess the individual monitors’ priorities,
rather than how well the program works. The
staff time devoted to this guesswork comes
at the expense of real problem solving and
performance management.
Fiscal monitoring visits are supposed to
do what an independent audit does—so why
do both? Nonprofit staff responding to fis-
cal monitors produce most, if not all, of the
same types of documentation required for
an independent audit—especially an A-133,
or Single Audit, which tracks
compliance with federal cir-
culars and other regulations.
When government funders
perform an additional audit,
it doubles the demand on
staff time, creating costs
far outside the scope of the
contract. Individual mon-
itors lack the training and
expertise of professional
auditors, and nonprofit staff
lose hours, if not days, com-
pleting administrative tasks.
A reporting calendar
for a public-contracts port-
folio can be a full-time job
for a nonprofit administra-
tor. Costs include the time
required to pull data and
60 Stanford Social Innovation Review / Winter 2019
MARY KATE BACALAO is the director of public funding
at Larkin Street Youth Services. Her work has appeared in
the Nonprofit Quarterly, the San Francisco Chronicle, and
the San Francisco Examiner.
plug them into each funder’s template—a
form of double data entry—as well as to pro-
duce detailed narratives and even participate
in monthly phone calls with public agency
representatives. The public contracts report-
ing function is extremely important: It can
provide the evidence, from municipal legis-
latures to the US Congress, to justify appro-
priations for public programs serving the
most vulnerable. But reporting must be cost-
effective, whether that means streamlining
protocols, increasing indirect rates, or both.
Budgeting and spending functions also
incur outsize expenses. Nonprofit invoic-
ing follows strict monthly deadlines, but no
deadline exists on the government side for
paying nonprofit invoices. Delayed payments
translate into a pileup of receivables, strain-
ing short-term cash flow. As a result, payables
can also accumulate, and nonprofit staff must
do cash management gymnastics until pay-
ments arrive. If the agency can afford it, a line
of credit does the heavy lifting to absorb the
disruption to cash flow. However, this work-
around shifts the burden to the nonprofit and
its bank. It also shifts the focus from new
dollars, which the nonprofit should be pur-
suing, to dollars already invoiced, which the
nonprofit must continue to pursue instead.
Finally, the budget-modification process
can drag for weeks or months, constrict-
ing short-term cash flow when spending
needs diverge from the prenegotiated bud-
get. To manage this problem, some public
funders impose early deadlines for budget-
modification requests—the idea being that
advance notice of requests guarantees time
to process them. But early deadlines don’t
prevent delays; instead, they shift the risk
to nonprofits to identify spending patterns
before true patterns have emerged. Funders
will recapture any unspent funds—including
those that can’t be spent without a formal
budget modification request—so nonprofits
forfeit their funding if they don’t expend the
resources to monitor it closely.
If public funders don’t cover the indirect
costs that their own contracts create, then
who does? Private foundations may be more
willing to pay the real costs of delivering
results, and in doing so bust the myth that
low overhead spending is a proxy for strong
performance. But, by and large, private, unre-
stricted funds absorb the burden of full cost
recovery, limiting the agency’s use of its least
restrictive dollars, which should ideally be
discretionary surplus that the agency can
reinvest in strategic needs. A board could
spend these dollars on the agency’s asset
base, acquiring land, buildings, or equipment.
Alternatively, the board could build a cash
operating reserve to hedge against emer-
gencies, funding cuts, or recessions. Instead,
unrestricted dollars, with all their untapped
potential, get sidelined to plug holes in pro-
gram budgets or prop up underfunded
administrative departments, depriving the
board and senior staff of key investment and
risk-management opportunities.
WHAT NONPROFITS CAN DO
The nonprofit starvation cycle has kept indi-
rect cost rates artificially low for too long. If
we want public funders to pay full costs—the
daily operating expenses plus balance sheet
costs for strategic needs—we must show them
how this agency-level spending is beneficial
at the program level. We must also make
room in the budget by cutting the contract
management expenses that divert nonprofit
resources away from delivering results.
First, nonprofits must understand their
total contract management costs and be
prepared to communicate them to public
funders. Managers should review the staff
hours spent administering public contracts
and produce a time study that tracks these
costs. They should look for patterns: Are
the most valuable contracts getting the
most time, or is a smaller contract generat-
ing excessive costs? A time study—even an
informal one—will help nonprofits clarify
how they can afford to allocate their staff
time to the delays and duplicative obligations
involved in nonprofit contracting.
Nonprofits should also look for hidden
costs in accounts receivable. Who owes the
agency what, and how much? Managers must
decide what’s material: If a single public
funder accounts for more than 10 percent
of the agency’s receivables, then staff should
work with that funder to reduce the agen-
cy’s receivable days. The time spent analyz-
ing receivables should then be added to the
time study: How many hours do staff spend
tracking submitted invoices and making
ends meet until payments come through?
Second, nonprofits must propose cost-
cutting solutions from the funders’ point of
view in order to show funders what it would
look like to reduce unreasonable expenses.
What is the agency’s actual indirect spend-
ing, over and above its indirect rate? What
percentage of this spending pays for unnec-
essary work, and how can those resources
be reallocated?
It’s critical that nonprofits create space in
these conversations for full costs. If funders
could cut contract management costs down
to size, as well as raise indirect rates, how
would the agency invest in its strategic needs?
How would freed-up or additional resources
help programs deliver outcomes? Managers
must spell out the upside for their public
funders and their publicly funded programs.
Third, nonprofits must manage their
costs down, using red tape to create teach-
able moments. Doing so requires being
proactive—and repetitive—about the key
takeaways from the time study and the pro-
posed cost-cutting solutions. It also means
using contract reporting to document what
is and isn’t working to cut down on expenses.
One way to manage costs down is to resist
being double monitored. If a nonprofit pays for
an independent audit, managers should ask
their fiscal monitors to rely on it. If the audi-
tors have provided an unqualified opinion for
several years running, what else do the mon-
itors need to see? A public funder may refuse
a nonprofit’s request to forgo a second fiscal
audit, but smart advocacy can substantially
reduce its scope, saving hours of staff time.
Nonprofits must be prepared to encounter
ILLUSTRATION BY ARIEL DAVIS
resistance from public funders, who stand to
incur substantial expenditures if they change
how they structure indirect rates. But that’s
precisely why the work must start with cut-
ting the contract management costs that
don’t help nonprofits deliver results. n

The Four Principles of
Venture Funding
Whether someone is investing in a tech startup or a grassroots
advocacy organization, the same rules of success apply.
BY TERRY WINOGRAD, JOCELYN GOLDFEIN & ROBERT BANK
A
n entrepreneur is a person
with an idea, whether that idea
launches a tech startup or a so-
cial change movement. But if
you’re a venture capitalist or a philanthropic
funder, how do you know which fledgling en-
terprises to back? From our perspectives from
years in the California tech world (Terry and
Jocelyn) and in social change philanthropy
(Robert), we see four basic principles that
guide successful investing in both situations.
Our first rule concerns the entrepreneur:
Bet on outstanding people.
The Silicon Valley success stories are leg-
endary: Steve Jobs’ meteoric rise with Apple
and Mark Zuckerberg’s transformation of
social networking through Facebook, for
starters. There are similar iconic examples
in global philanthropy. Take Leymah Gbowee,
a Liberian activist who led a women’s move-
ment to end her country’s 14-year civil war.
Fed up with the bloodshed, Gbowee organized
tens of thousands of women in 2002 to flood
the streets and markets with peaceful sit-
ins. After this grassroots effort succeeded
in bringing the warring parties to the peace-
making table, she turned her attention to the
fledgling democracy and started looking for
funders to support her work to get women
to the polls. In 2003, she sent a proposal to
American Jewish World Service (AJWS),
which Robert leads—an organization that
supports 450 grassroots organizations in
19 countries working to promote human
ILLUSTRATION BY ARIEL DAVIS
rights and combat poverty in the developing
world. AJWS gave her nascent organization,
Women in Peacebuilding Network, its first
grant. Gbowee used the $12,400 to deploy 250
women in seven communities and registered
more than 10,000 women to vote in five days.
With continuing support from AJWS
and other funders, the movement grew.
Soon, Liberia’s women—who had previously
been almost universally disenfranchised—
represented 51 percent of the country’s reg-
istered voters. In 2005, these women helped
elect the country’s—and, in fact, Africa’s—
first female president, Ellen Johnson Sirleaf.
In 2011, Sirleaf and Gbowee were together
awarded the Nobel Peace Prize.
Not every philanthropic investment wins
the Nobel Prize, nor does every venture cap-
ital bet become Apple. And the ultimate goal
of strike-it-rich Silicon Valley is different
from that of a social change funder seek-
ing to reduce poverty and advance human
rights. But the best gambles in both spheres
bet on passionate, well-functioning indi-
viduals and teams—pioneers like Jobs and
Gbowee and their colleagues—who stand
Stanford Social Innovation Review / Winter 2019 61
out for their smarts, creativity, vision, grit,
and determination. Finding all of these qual-
ities in one person or team is rare, but when
it happens, you have identified an entrepre-
neur worth backing.
BUILDING MOVEMENTS IN STAGES
The principles of successful investing in ven-
ture capital and social change philanthropy
are remarkably similar, and, in our experience,
following them offers a high probability of
success. In addition to betting on outstanding
people, there are three further rules.
First, take calculated risks by knowing
the investment landscape. In venture capi-
tal (VC), early investors get bigger shares,
because they shoulder bigger risk. But taking
risks doesn’t mean backing every idea that
comes along. Venture firms have a broad
view of the entrepreneurial landscape and
apply due diligence, evaluating prospects
and assessing their potential in compari-
son with others. These earliest investments
in a fledgling entrepreneur’s operation are
essential: They enable that person to expand
enough to be attractive to venture funders
at increasingly higher levels.
Social change philanthropy takes a
similar approach to risk. AJWS supports
hundreds of local—many of them nascent—
grassroots organizations
helping marginalized peo-
ple working to defend their
rights. These ventures might
seem riskier than the devel-
opment and infrastructure
projects that large NGOs or
agencies, such as the World
Bank, already support. But
AJWS has the perspective
to bet successfully on entre-
preneurial projects because
it has local representatives
working in the countries
where it operates. Like ven-
ture funders, they know
the landscape and care-
fully vet each individual or
group they back, to ensure
that they are trustworthy,
62 Stanford Social Innovation Review / Winter 2019
TERRY WINOGRAD is professor emeritus of computer
science at Stanford University, founder of the Stanford
Human-Computer Interaction Group, and past president
of Computer Professionals for Social Responsibility.  rights and combat poverty in the developing world.
understand what the community needs,
and can execute their ideas. AJWS can thus
confidently find and fund a Leymah Gbowee
at an early stage.
Second, amplify impact and sustainability
by creating networks. VC firms give startups
more than money: They foster invaluable
connections that help those enterprises grow
and thrive. VC backers introduce their com-
panies to customers, employees, and part-
ners. Investors that specialize in a particular
area can also facilitate customer relationships
among companies that they back. And having
a VC backer gives entrepreneurs credibility
with other companies offering goods or ser-
vices. For instance, cloud-computing-plat-
form providers (including Amazon Web
Services, Google Cloud, and Microsoft Azure)
offer 100,000 free credits to VC-backed
startups because they believe it’s a safe bet
that many of these ventures will eventually
become lucrative paying clients.
Building networks is also crucial to suc-
cess in social change philanthropy. In each
country where it operates, AJWS funds
constellations of organizations of different
sizes that work on the same issues. It brings
them together to incubate ideas and launch
ambitious local and national campaigns that
have changed the course of communities and
nations. In El Salvador, for example, AJWS
supported the growth of a farmers’ move-
ment that won a national ban on metallic
mining—a first anywhere in the world. The
problem was critical: Gold mining had poi-
soned the water supply, and local communi-
ties were seeing dramatic increases in cancer
and kidney disease. Twelve grassroots groups
convinced thousands of local people over
11 years to advocate for government inter-
vention. AJWS invested in this effort, and
its in-country consultants supported and
guided the network to organize and grow.
After years of advocacy, court cases, and
incremental victories, the farmers won a
government ban in 2017. And the network
has spread even farther: AJWS connected
the El Salvador coalition to activists in Haiti,
where international companies have recently
begun to explore gold mining. With guidance
JOCELYN GOLDFEIN is managing director at Zetta Venture
Partners, where she leads funding rounds for startups apply-
ing artificial-intelligence tools to solve business problems.  450 grantees in 19 countries working to promote human
from the seasoned Salvadoran activists, the
Haitians aim to stop this potentially devas-
tating exploitation before it begins.
While these lateral networks help drive
profits and social change, vertical networks
ensure the success of enterprises long into
the future. Both venture funders and philan-
thropists can offer their investees access to
new funders who will help them grow. That
is why the VC process works in stages, start-
ing with small, seed investments of around
$100,000 that help startups build capacity.
Entrepreneurs who use that first investment
to build a solid business model and customer
base can then attract VC firms that invest at
increasingly higher levels, bringing millions
of dollars to the table. Indeed, a startup that
has used its early funds well will find VC
firms competing to be a part of its future.
Similarly, AJWS takes great pride in
the fact that many of the nascent ventures
it supports at the “seed level” later use
these funds to grow and professionalize,
and eventually attract larger investments
from others. By the time Gbowee won the
Nobel Prize, many other funders had joined
AJWS in supporting her organization, and
she was collaborating with dozens of other
human rights groups. One woman deter-
mined to harness the power of other women
to bring peace and stability to her country
had become a movement and a desirable
investment.
Third, look for opportunities on the lead-
ing edge of problem solving. Venture funders
quickly tire of proposals for a company that
will create a “better version” of something
that is already being done; rather, they look
for something entirely new. Jocelyn’s firm,
which specializes in artificial intelligence
(AI), was ahead of the curve when it was
founded in 2013. The following year, Google
bought DeepMind, a large, London-based
AI company, for more than $500 million,
an acquisition that signaled that AI is a new
frontier for investment and development.
Similarly, one of AJWS’s most significant
investors, Dena Kimball, of The Kendeda
Fund, approached AJWS to solve one of the
world’s most persistent challenges: child
ROBERT BANK is president and CEO of American Jewish
World Service, a social change organization that supports
marriage and gender inequality in India,
where 1.5 million girls each year wed before
age 18. Many countries have responded by
raising the marriage age; but because the
practice continues despite the laws—and
because women suffer severe gender inequal-
ity regardless of when they marry—AJWS
and its grantees looked for a more effec-
tive approach. With a $30 million multiyear
investment from Kendeda, AJWS now funds
more than 60 grantee organizations in India
tackling the root causes of this problem: rigid
social norms that restrict girls’ aspirations,
life choices, and behavior. These grantees
support girls to make decisions about their
own lives—and to influence their families
and communities, sparking the social and
political change needed to advance gender
equality. The project also includes research
and advocacy to shift the global response
to child marriage toward these solutions—
making this project an incubator for problem
solving that can be applied around the world.
INVESTING IN PEOPLE
Unlike traditional schemes in global de-
velopment, which often export top-down,
prepackaged solutions to people in need,
AJWS’s model of funding local social change
entrepreneurs puts power in the hands of
those who are best positioned to make lasting
change by ensuring that the human rights
of the most vulnerable people are realized.
This is what it will take for our solutions to
have the resilience to reduce poverty in the
long term and counter the dangerous and
turbulent forces threatening democracies
and human rights around the world today.
This kind of venture funding for social
change can fuel the rise of powerful civil
society movements able to counter author-
itarianism, change laws, and raise people
out of poverty. We’re witnessing grassroots
organizations—networking together with
others to form movements—changing the
course of nations.
Whether investors are backing widgets
or rights, the rules are the same: Find the
right people, and give them the resources
and connections for their ideas to fly. n
 This supplement was produced by Stanford Social Innovation Review for the JOHN D. AND CATHERINE T. MACARTHUR FOUNDATION

Finding,
Funding,
and
Scaling

Perspectives on
large awards,
open competitions,
and new directions
in philanthropy

2 Seeking Both Problems and Solutions 9 Selecting a Pool of Bold Ideas 16 The Need to Double Down
ILLUSTRATION BY TIM COOK

By Jeff Ubois
4 The Promise of Incentive Prizes
Jeff Ubois Interviews Thomas Kalil
7 A Competition with Many Winners
By Kristen Molyneaux
By Anne Ferola & Lindsay Kijewski
10 An Open-Data Approach to Transform
Grantmaking
By Bradford K. Smith
13 The Vital Role of Early-Innovation Funders
By Carol Dahl
By Michael Feigelson & Elvira Thissen
18 Doing Competitions the Right Way
By Rochelle Alpert & Joshua Mintz
21 Making Better Big Bets
By Heather McLeod Grant &
Alexa Cortés Culwell

FINDING, FUNDING, AND SCALING • WINTER 2019 1

 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
Seeking Both Problems
and Solutions
BY JEFF UBOIS
O
ver the last three years, thousands of applicants, project judges,
individual funders, and foundation staff have contributed time,
money, attention, and work toward the John D. and Catherine
T. MacArthur Foundation’s 100&Change, a global competition seeking
bold solutions to the critical problems of our time.
While the most visible result of these efforts is the MacArthur board’s
decision to give $145 million in awards to four organizations, including a
$100 million grant to Sesame Workshop and the International Rescue
Committee, 100&Change has also unlocked millions of dollars in addi-
tional funds from other sources; highlighted other promising solutions
to important global problems; and developed some new approaches to
knowledge production, collaboration, and decision making in philanthropy.
As the 100&Change team at MacArthur—and the broader nonprofit
community of which it is a part—prepares for the next open call for pro-
posals, scheduled for early 2019, we are taking time now to summarize,
reflect on, and share what we and others have learned from the first round
of grants. To do this, we’ve invited commentary from a number of part-
ners, MacArthur staff, and others with critical, instructive perspectives.
CONTRIBUTORS
The authors in this supplement address a broad set of issues. Though each
piece speaks for itself, they are best understood in relation to each other,
as they represent different viewpoints on a few cross-cutting themes.
The changes in philanthropic practices and possibilities resulting
from a trend toward large grants, the potential uses and abuses of open
calls and open challenges, and strategies to help foundations become
more open to new ideas are addressed in “Making Better Big Bets,”
by Heather McLeod Grant and Alexa Cortés Culwell; “The Promise of
Incentive Prizes,” in which Thomas Kalil of Schmidt Futures answers
questions; and “An Open-Data Approach to Transform Grantmaking,”
by Bradford K. Smith, president of the Foundation Center.
Observations from other funders, who are focused on early-stage
innovation and on field-shaping and field-building, are provided by Carol
Dahl of The Lemelson Foundation in “The Vital Role of Early-Innovation
Funders” and by Michael Feigelson and Elvira Thissen of the Bernard van
Leer Foundation in The Hague, the Netherlands, in “The Need to Double
Down.” Both of these foundations supported 100&Change grantees
before MacArthur did, providing them with a close view of the effect
that 100&Change had on recipients. (Note: We’ve also conducted an
extensive set of interviews and surveys with 100&Change applicants—
some anonymized and others fully attributed—and we’ve highlighted
applicant perspectives in other venues, particularly the 100&Change
website. We have not done so for this supplement, as even invitations
to past and potentially future applicants can seem coercive.)
For funders considering whether to run a competition, detailed advice
on managing large competitions and cohorts of grantees, as well as on the
Jeff Ubois is senior program officer for 100&Change.
2 FINDING, FUNDING, AND SCALING • WINTER 2019
legal issues associated with competitions, are provided in “A Competition
with Many Winners,” by Kristen Molyneaux of the MacArthur Foundation,
and in “Doing Competitions the Right Way,” by Rochelle Alpert of Morgan,
Lewis & Bockius LLP and Joshua Mintz of the MacArthur Foundation.
BACKGROUND
As noted by the authors of this supplement, 100&Change is driven by
a complex set of opportunities and needs facing the world, the field of
philanthropy, and the MacArthur Foundation itself.
There is growing recognition among foundation boards and staff that
to meet emerging global challenges, philanthropy will need to greatly
increase its effectiveness and the scale of the efforts it supports. The
current array of projects backed by philanthropy simply may not be
sufficient to meet the current set of global challenges.
Resources are a significant challenge. For effective nongovernmental
organizations addressing global problems, funding at the level typically
provided by private foundations is insufficient to address more than a
tiny fraction of their beneficiaries. Sometimes, a single large award is
needed to create lasting change, and as others have noted, capital in
the quantities required to support “transition to scale”—mezzanine
funding—is generally unavailable from US foundations.
The emergence of new donors presents some opportunities for those
seeking larger grants. Since 2010, more than 180 billionaires from 22
countries have taken the Giving Pledge and committed to giving more
than half of their wealth—estimated at more than $990 billion—to
philanthropy or charitable causes. If creating a pipeline of vetted oppor-
tunities and projects can unlock more of this wealth more quickly, the
world will be better for it.
Still, as Foundation Center President Brad Smith notes, most foun-
dations resist or reject unsolicited proposals. Too many operate using
opaque processes, refrain from publishing what they learn, and find it
hard to work together with other funders, even when addressing global
problems far too big for any single foundation to tackle alone.
100&Change aims to address these and other issues by opening the
MacArthur Foundation to new possibilities and supporting the best of
these possibilities with much larger awards.
CHOICES AND CONTEXT
The final shape of the competition reflected these concerns, as well as
a series of decisions and trade-offs taking into account important goals
and viable alternatives.
Throughout the process, we received generous help and advice from
peer foundations and other funders. Some are contributing to this supple-
ment, and others, particularly the Bill & Melinda Gates Foundation, were
generous with time and insights. We found that our peers were also helpful
in confronting early-stage unknowns: Would we find anything that met
the criteria we had in mind? What information would our board require
to make a decision? What was the the project, our focus was finding a
right balance between focus and Criteria for 100&Change Applicants single proposal, but over time, that
openness—i.e., how restrictive broadened to include other groups
might the criteria be? MEANINGFUL. Is the proposal bold? Does it seek to solve an of applicants as we sought multiple
In hindsight, several decisions important and urgent problem? Will the proposed solution sig- benefits to participation, even if there
ended up shaping the entire pro- nificantly improve the condition of the target beneficiaries and would be only one $100 million grant.
cess. For funding organizations result in broad public benefit? In order to provide value to
thinking about making large (over multiple applicants, we took two
$10 million) awards, engaging in VERIFIABLE. Does the proposal present evidence that the solu- approaches. First, we procured train-
donor collaboration, or managing tion has previously yielded practical and concrete results? Does ing, technical assistance, and consult-
open competitive calls, it’s worth the proposed solution rely on existing methodology, technology, ing advice for the eight semifinalists.
considering some of these big and/or provable science? This effort involved MacArthur
takeaways. Foundation assigned program staff
The first was scale and timing, FEASIBLE. Does the team have the skills, capacity, and experi- as well as a number of consulting
and the decision to make one $100 ence to deliver the proposed solution? Do the budget and project organizations,includingManagement
million award rather than a handful plan align with a realistic understanding of the costs and tasks to SystemsInternational,whichprovided
of smaller grants. A staged pipeline implement the proposed solution? planning assistance related to scaling;
of projects, in which the best- Bridgespan, which provided strategic
performing projects are awarded DURABLE. Does the team propose a solution that has staying feedback on pitching big ideas to
increasingly larger amounts of power? Is there a plan in place to support the resolution of the donors; Mobility International USA
funding, is a more typical approach problem, including any need for ongoing support, if necessary? and Access Living provided extensive
to large-scale funding. But we found feedback to semifinalists (and the
that it is possible to assemble this MacArthur Foundation) on how
virtually by tapping the entire nonprofit sector. And while many global proposals could be more inclusive of people with disabilities.
problems of significance require decades to address, we looked for imme- Second, we promoted the top 200 applications through other
diate needs that could be addressed in a more or less permanent way. partnerships, including the Center for High Impact Philanthropy (see
A second decision had to do with focus. Prizes can focus attention “Selecting a Pool of Bold Ideas,” by Anne Ferola and Lindsay Kijewski),
on an issue, identify new approaches to a known problem, or identify a the Foundation Center, and Charity Navigator. These efforts resulted
cohort of organizations working on an issue. Often, it is assumed that in additional funding—mostly modest grants from individual donors—
the funder has expertise in the problem being addressed. MacArthur’s awarded to nearly 40 different organizations.
decision to instead open the call to both problems and solutions, whatever Although our main focus was on the needs of those organizations that
their source, reflected the recognition that the most pressing problems became semifinalists, we also worked hard to ensure that participants
of our time, and the best solutions to them, might not be known to us. were turned down respectfully and clearly. Not everyone was satisfied
So unlike the vast majority of open competitions, 100&Change was with the explanation received, yet the time and cost allocated to work-
and is athematic. Applicants were not restricted to a particular domain ing with those who did not advance was immense.
or approach but were instead allowed to define both the problem and Along the way, we also noted a number of surprises.
the solution, provided that both fit within broad selection criteria. (See The first was the number of collaborations that were sparked between
“Criteria for 100&Change Applicants” on this page.). lead applications and their partners. These weren’t merely handshake
A third set of decisions had to do with the reviewing and decision agreements; all told, we received more than 700 memoranda of under-
process. How could we best ensure that the process was open, fair, and standing and learned that many eventually led to collaboration even in
transparent? This involved striking a balance between different possibili- the absence of direct financial support.
ties. For example, confidential reviews can increase candor and lead to The second was how awareness of the program resonated differ-
smart decisions, but they also conflict with our commitment to an open ently in different sectors. Although we actively promoted the project
process. Similarly, the strict application of administrative requirements and received applications from more than 80 countries, certain types
tends toward fairness, but it can also lead to otherwise unqualified of programs and applicants may still have been underrepresented.
applications moving on to judges, with good ideas occasionally failing A third surprise was how the applications we collected were used by
to advance due to fixable technicalities. other organizations. We didn’t initially intend to become a publisher, or
We also sought to balance decision authority and influence between to encourage others to reevaluate, re-rank, and in some cases identify
outside judges (who looked at all qualifying proposals), outside expert organizations worth funding. But the knowledge and ideas contributed
reviewers (who looked at high-scoring proposals), foundation staff (who by 100&Change applicants turned out to have a readership elsewhere.
worked with both sets of reviewers, as well as applicants), and MacArthur’s
board (which made the final determination). To help do this, we normal- FUTURE PLANS
ized the scores awarded to applications according to whether they had We will be announcing the next round of 100&Change in early 2019. It
been judged by relatively optimistic or skeptical individuals. (More on this will involve more intense collaboration with other donors, better collec-
at www.100andchange.org/fairness.) In the end, though, the choice of tion and redistribution of knowledge, increased support for 100&Change
awards rested with the MacArthur Foundation’s board. applicants. We are exploring an expansion of the 100&Change platform
The fourth set of decisions concerned managing different groups of to offer services for other philanthropists who wish to run their own
applicants, and the reuse of applicant data by third parties. Going into competitions.

FINDING, FUNDING, AND SCALING • WINTER 2019 3

 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION

The Promise of
Incentive Prizes
Jeff Ubois interviews Thomas Kalil of Schmidt Futures (a philanthropic initiative founded by
Eric and Wendy Schmidt) about how calls to solve big problems through competitions can,
when done right, galvanize innovation.

BYLINE

How did you first get interested in the role

that incentive prizes can play in stimulating
innovation?
In the late 1990s, I was working for President Bill
Clinton on his National Economic Council and
happened to read a book called Longitude. This
book described a series of prizes offered by the
British Parliament in the 18th century to encour-
age the development of methods for precisely
measuring the longitude of a ship at sea. The
British Parliament was motivated to pass this
legislation because of some tragic maritime
disasters and the need for increased navigational
accuracy to complete longer ocean voyages.
I thought this was a really interesting idea
and was able to get the National Academy of
Engineering to do a study on prizes. This study
made an important distinction between “recog-
nition” and “inducement” prizes. Recognition
prizes—like the Nobel Prize—provide rewards
to people for something they have already
accomplished. Inducement prizes are designed
to encourage individuals or teams to accomplish I was able to work with Congress to pass legisla- This was part of a broader effort within
a specific goal that no one has achieved yet. tion in 2010 that gave every federal agency the President Barack Obama’s Strategy for
I was also able to help get DARPA the author- authority to support incentive prizes of up to $50 American Innovation that we called the “innova-
ity to support incentive prizes. Beginning in million. Prior to the passage of this legislation, tion tool kit” that included dozens of different
2004, DARPA used this authority to advance Congress had given DARPA and NASA prize approaches to solving problems—including
the development of self-driving cars. A team authority, so other agencies assumed that that open data, citizen science, human-centered
led by Sebastian Thrun, then director of Stanford implied that they didn’t have prize authority. design, evidence-based grantmaking, and
University’s Artificial Intelligence Laboratory I also recruited a series of experts in multisector collaborations.
(SAIL), won the competition in 2005, and Google open innovation to the Office of Science and
PHOTOGRAPH COURTESY OF THOMAS KALIL

recruited Thrun to lead their self-driving car effort.
What did you do to advance the government’s
use of incentive prizes when you joined the
Obama administration?
Thomas Kalil is chief innovation officer for Schmidt Futures.
He was the deputy director for technology and innovation for
the White House Office of Science and Technology Policy and
senior advisor for science, technology, and innovation for the
National Economic Council.
Technology Policy, including Robynn Steffen
from Yale Law School, Cristin Dorgelo from
the XPRIZE Foundation, and Jenn Gustetic
from NASA. They built a vibrant community
of practice of federal program managers that
were experimenting with incentive prizes and
worked with the General Services Administration
to launch Challenge.gov—a one-stop shop for
federal prizes and challenges.
What is the argument for increased use of
incentive prizes?
I am a strong believer in Joy’s Law: “No matter
who you are, most of the smartest people work
for someone else.” So you are usually going to
be better off if you make it easier for people
outside the boundaries of your organization to
know (a) what problems you are trying to solve
and (b) how they can get involved.

4 FINDING, FUNDING, AND SCALING • WINTER 2019

 I also believe that a well-designed incentive
prize can enable the sponsor to:
■■ Set a goal without having to decide in
advance which team or approach is most
likely to be successful
■■ Pay only for results
■■ Leverage investment that can exceed the
value of the prize purse
■■ Shine a spotlight on a problem
■■ Encourage fresh approaches by reaching
beyond the “usual suspects”
■■ Change people’s views about what is pos-
sible
Having said that, it is not always the right
approach to solve a given problem, and it is
certainly not a substitute for more traditional
funding mechanisms, such as grants or contracts.
Prizes have been criticized for pulling more
time and energy from a field than they return
to it. Were there any specific situations
from your time in the White House when
you argued against issuing a challenge of
some kind?
There were definitely instances where:
■■ Agencies had not thought hard enough
about the problem statement or the vic-
tory conditions.
■■ The amount of money they had for the
prize purse was inadequate, given the
resources required to solve the problem.
■■ The agencies were really running a tradi-
tional grant competition but just calling it
a prize competition.
■■ They had not thought about what they
would do after the competition in the
“post-award” phase.
How did the government’s use of incentive
prizes evolve?
As of July 2018, agencies have sponsored more
than 840 incentive prizes. Over time, agencies
became willing to sponsor prizes that are larger,
more ambitious, and more important.
For example, DARPA is sponsoring a $10
million prize for a team that can launch pay-
loads to orbit, with no prior knowledge of the
PHOTOGRAPH COURTESY OF THOMAS KALIL
payload, destination orbit, or launch site, and
accomplish that goal twice within days. This
could dramatically expand access to space,
with important applications in Earth observa-
tion and global communications.
The National Institutes of Health is funding
a $20 million prize competition to improve the
diagnostic technology needed to rapidly identify
antibiotic-resistant bacteria and to distinguish
between bacterial and viral infections. This is an
area where innovation is desperately needed.
The British government has estimated that by
2050 the cost of failing to address antimicrobial
resistance could be $100 trillion and 10 million
casualties every year.
Some agencies began to explore a broader
set of tools called “market shaping” for accel-
erating the development of innovations that
have a high social return and a low private
return. For example, drug companies have
little or no incentive to develop vaccines for
poor people.
In an initiative that will save the lives of seven
million poor children in developing countries over
the next 20 years, five countries and the Bill &
Melinda Gates Foundation pledged to purchase
millions of doses of a safe and effective vaccine
against pneumococcal diseases
such as bacterial pneumonia. The 100&Change model empow-
This is called an advance
market commitment, which is
ered nonprofits, universities, and
essentially a purchase order for social enterprises to pursue more
a product that doesn’t yet exist. ambitious goals, which is the
Some government agencies are
using milestone payments, which
essence of moon-shot thinking.
provide companies with pay-
ments for intermediate progress
toward a given goal.
I think it is unfortunate that the government
is accustomed to making financial commitments
that are contingent on failure but views making
financial commitments that are contingent on
success as exotic. The federal government has
more than $2 trillion in loan guarantees on its
balance sheet (financial commitments contin-
gent on failure, such as bankruptcy), but hardly
any financial commitments that are contingent
on success, such as advance market commit-
ments, milestone payments, incentive prizes,
or “pay for success” contracts.
Ideally, more organizations and sectors would
have the capacity to (1) identify unmet needs,
(2) develop performance-based specifications
for effective solutions to those problems, and
(3) provide the incentives where needed that
would motivate teams to develop these solutions.
You were also active in the Obama administra-
tion’s efforts to identify and pursue “Grand
Challenges.” How are they different from
incentive prizes?
A Grand Challenge is an ambitious but achievable
goal that can help address some major economic,
societal, or scientific problem, and that also has
the potential to capture the public’s imagination.
Historical examples include President John
F. Kennedy’s decision to put astronauts on the
moon, and the Human Genome Project. This
project not only sequenced the human genome
but drove down the cost of doing so from $100
million to $1,000.
The Obama administration launched several
Grand Challenges. For example, the BRAIN
Initiative is designed to dramatically increase
our understanding of how the brain encodes
and processes information by developing the
tools needed to study the brain in action. The US
Department of Energy supported SunShot, an
initiative to make solar energy as cheap as coal
by the end of the decade. USAID is supporting
several Grand Challenges for Development,
including one to reduce newborn and maternal
mortality in the first 48 hours after birth.
A Grand Challenge is an ambitious but
achievable goal (the “what”), and an incentive
prize is a particular tactic for solving problems
and promoting innovation (the “how”).
To what extent did the Obama administra-
tion use Grand Challenges to stimulate
partnerships?
To achieve the goals of the BRAIN Initiative,
President Obama explicitly called for an “all
hands on deck” effort that involved not only
government agencies, but companies, research
universities, foundations, nonprofits, and patient
groups. For example, the Kavli Foundation played
a critical role in the agenda-setting that led to
the BRAIN Initiative, and the Kavli Foundation,
the Allen Institute for Brain Science, and the
Howard Hughes Medical Institute made sig-
nificant commitments to support research that
would advance the goals of the BRAIN Initiative.
Why do you think there is a case for a more
systematic effort to identify Grand Challenges?
In general, I would like to see a “moon-shot
culture”—where more individuals and orga-
nizations are involved in the identification and
pursuit of ambitious goals.
I think it is particularly powerful to link the
attainment of a compelling goal with a “why now”
story. In some cases, something has changed
about the world (e.g., technological progress,
FINDING, FUNDING, AND SCALING • WINTER 2019 5
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
fundamental scientific advance, institutional
or business model innovation) that makes the
previously impossible possible.
Done right, combining the ambitious goal
with a “why now” story can create a positive
self-fulfilling prophecy. As President Kennedy
observed, “By defining our goal more clearly,
by making it seem more manageable and less
remote, we can help all peoples to see it, to
draw hope from it, and to move irresistibly
towards it.”
The first step would be a more concerted
effort to identify goal statements that have
these characteristics in a broad range of
domains—such as health, education, eco-
nomic and social mobility, energy and climate,
sustainability, science and technology, the
future of space exploration, etc. The second
step would be to identify the coalitions of
companies, research universities, nonprofits,
foundations, investors, government agencies,
and other actors that would have the ability
to achieve these goals.
An exercise like this would be timely, given
the growing number of wealthy families that
have signed the Giving Pledge. Some of them
may be looking for an ambitious goal that they
can embrace, in the same way that Bill Gates
wants to eradicate polio and Yuri Milner wants
to send a spacecraft to another star.
Formulating goal statements is hard! Were
there some things you learned about how to
do that effectively that you can share?
One of our partners on innovation was Steve
Blank, a serial entrepreneur who worked with
the National Science Foundation on the develop-
ment of the curriculum for its Innovation Corps
(I-Corps) program based on the “lean startup”
methodology. Steve and his colleagues also
created a course called Hacking for Defense,
which encouraged agencies in the Department
of Defense to describe problems they had that
could be tackled by multidisciplinary teams of
graduate students. He found that the agencies
needed feedback on their problem statements—
often because their original formulations were
overly prescriptive. They not only described
the problem but also outlined the technical
approach that they thought would be neces-
sary to solve it. One pedagogical resource that
Steve created is an annotated set of problem
statements with descriptions of what makes
them good or bad.
Another dimension that is hard to get right
is the “too hard versus too easy.” There have
been some large-scale incentive prizes that
failed because industry was making more
6 FINDING, FUNDING, AND SCALING • WINTER 2019
progress than people expected, and the prize
was overtaken by events.
I think that people who do a lot of problem
definition have developed some useful heuristics.
For example, Schmidt Futures is supporting a
project by Karim Lakhani and the Laboratory
for Innovation Science at Harvard University to
capture and share their “lessons learned” from
working with many different types of scientists
on open innovation.
Does an emphasis on moon shots narrow the
range of potential participants?
Absolutely not. Some universities are empowering
students to organize their research, coursework,
service-learning, international experiences, and
entrepreneurial activities around one of the Grand
Challenges identified by the National Academy
of Engineering. I’d like to see more universities
allow students to “major in a discipline but minor
in a problem.” Faculty, students, and practitioners
could identify the coursework and experiential
learning that would position students to become
changemakers and make a contribution to an
important problem at home or abroad.
Researchers are also developing tools that
enable individuals to get involved in really chal-
lenging scientific problems, such as mapping
the brain.
“Minor in a problem” is useful for both institu-
tions and individuals, and for the rapid learning
that is necessary to do prize administration
well. Did you find prizes reorganized expertise
or produced new knowledge in the federal
system in useful ways?
Civil servants that used open innovation often
learned that reaching beyond the “usual sus-
pects” definitely had value. For example, USAID
supported a Grand Challenge on Ebola to develop
better protective equipment for health-care
workers that are treating infected patients. The
team of the winning entry included a wedding
dress designer! They figured out how a health
worker could easily remove the suit without
the contaminated exterior ever touching the
wearer’s skin, while making the suit cooler
and lighter.
What do you see as the similarities and differ-
ences between the work that you have done
on incentive prizes and Grand Challenges,
and the growing interest in “big bet” phi-
lanthropy, as exemplified by MacArthur’s
100&Change program?
I definitely see a strong connection between
Grand Challenges and big bet philanthropy,
given the focus on making measurable progress
on an important goal, such as improving the
early childhood education of Syrian refugees
or reducing newborn mortality in Africa. I think
the 100&Change model empowered nonprofits,
universities, and social enterprises to pursue
more ambitious goals, which is the essence of
moon-shot thinking.
Someone once observed that if private capital
markets worked the way that philanthropy does,
when FedEx talked to private investors, they’d be
told, “I’m willing to provide 10 percent of what
you need, but only if you use it to buy delivery
trucks in Detroit.” I think it is more useful for
philanthropists to ask partners, “What would
you think is needed to accomplish your goals?
What would you do if you weren’t limited by
the resources currently under your control?”
There are also some important differences.
In most cases, government-initiated Grand
Challenges started with a definition of the
problem (e.g., make solar energy cheaper than
coal), as opposed to the open-ended call that
MacArthur issued.
Are there areas where you think that these
approaches (incentive prizes, market-shaping,
Grand Challenges, big bets) are underutilized?
There are certainly classes of problems that
both the private sector and the government
underinvest in.
For example, the private sector tends to
underinvest in solutions for problems faced
by low-income communities because of their
low purchasing power. Silicon Valley venture
capitalists are not throwing money at startups
that are trying to help the 36 million adults in
the United States that are reading at the third-
grade level or below.
It’s also the case that the US government
makes significant investments to harness
science, technology, and innovation for some
national goals (national security, health, space,
energy, basic science) but not others (e.g., pro-
moting economic and social mobility, reducing
the intergenerational transmission of poverty).
An interesting thought experiment would
be to imagine that one of the agencies with the
responsibility for promoting economic and social
mobility had a research arm like DARPA. What
goals would it set? How might it use incentive
prizes and big bets to achieve them? For example,
if the Department of Labor had a research and
innovation arm, it might seek to reduce the time
for non-college-educated workers to gain an in-
demand technical skill from years to months,
leveraging advances in AI-based digital tutors
that model the one-on-one interaction between
an expert and a novice.
A Competition with
Many Winners
100&Change sought to add value to participants by helping to raise the profile of a variety of
meaningful solutions.
BY KRISTEN MOLYNEAUX
F
rom the outset of our inaugural
100&Change, we recognized that
a competition is inherently biased
toward thinking of one organization as a “win-
ner.” However, that was not how we at the
MacArthur Foundation defined success nor
how we designed our competition. Instead,
we set out to raise the profile of meaningful
and impactful solutions to our world’s most
pressing problems, using the competition as a
mechanism for surfacing those solutions. Every
step of the way, we tried to build an applica-
tion process that would bring added value to
all participants whether they were ultimately
selected for the award or not.
While we had notions of what that meant
at the beginning of the process, we did not fully
understand what that would mean until we
were in the thick of the competition. Some of
this uncertainty was due to the challenge of run-
ning a large-scale competition for the first time
and our natural learning curve; the other was
because we chose to use a design-build philoso-
phy throughout our process. The design-build
process enabled us to outline what we planned
to do and afforded us the flexibility to adapt
based on our real-time learnings. This provided
the team with opportunities to adapt to what we
were hearing from participants in terms of what
was working, what was not working, and what we
could do to strengthen the process. All of these
elements came together as we worked to build
a competition that added value to participants,
maintained rigor, and provided the foundation
with the kind of information it needed in order
to make such a bold award.
The guiding values for our inaugural
100&Change focused on openness, transpar-
ency, and ensuring value-add to participants.
Kristen Molyneaux is senior program officer for
100&Change at the MacArthur Foundation.
In order to set expectations from the outset,
we provided all applicants with a transparent
process, clear criteria, and the timeline for the
competition. Over the course of the competition,
we have written and spoken frequently about
the ways that we held ourselves accountable
to our values of openness and transparency.
However, we have spent less time discussing
the added value for participants. Here, we will
discuss those elements and provide greater
insight into how we conceptualized participant
value-add throughout the competition.
LEARNING TO SCALE
From the outset, we recognized that a yearlong
competitive process would be time-consuming
and intense for teams. As part of the semifinal-
ist phase, we built additional activities into our
timeline that went beyond asking teams to
simply revise their proposals. These activities
included applicants’ authentic engagement with
their communities of interest as well as stake-
holders of their proposed project. In an effort to
increase awareness of their work and to respond
to questions from the broader public, MacArthur
also asked that all semifinalist teams hold live
internet events on Facebook Live or Reddit Ask
Me Anything. Teams were also asked to share
learnings on our 100&Change Perspectives
blog. Technical tasks were required of each
team, such as responding to reviewer feedback,
working to make their proposals more inclusive
of people with disabilities, hosting site visits for
MacArthur staff, and participating in meetings
with our board of directors.
Our focus throughout this process was on
helping teams build stronger proposals that
would enable them to thoughtfully scale their
work to their ambitions and reasonably deploy
a large philanthropic award. From our traditional
grantmaking experience, we recognize that many
organizations struggle with scaling successful
interventions, and while many assume these
struggles are due to resource constraints alone,
it is also true that many organizations simply
lack a clear plan for adapting to the unforeseen
barriers that can arise during the scaling pro-
cess. In an effort to mitigate these challenges,
we decided to focus extensively on supporting
teams to develop a scaling plan.
“While there is no generally accepted
definition of scaling,” writes Larry Cooley,
president emeritus and senior advisor
for Management Systems International
(MSI), “we view it as expanding, adapt-
ing, and sustaining successful projects in
a geographic space, over time, to reach a
greater number of people.”
While all barriers and challenges to suc-
cessful scaling cannot be planned in full, there
are ways for organizations to better prepare
themselves for scaling activities and to think
critically about the types of partnerships,
resources, and plans that they need in order
to increase their chances of success. To help
our semifinalists build robust scaling plans, we
enlisted the help of MSI, a US-based develop-
ment firm that has a long history of provid-
ing support to organizations that are scaling
interventions. Over the course of six months,
MSI worked individually with each semifinalist
team to help them build scalability plans and
act as a critical friend and thought partner.
From these activities, we hoped that all eight
teams would walk away with a compelling,
strong revised proposal with a built-in scaling
plan that could inspire a broad set of donors.
During this same time, MacArthur staff
conducted site visits of 100&Change semifinal-
ist teams and commissioned technical reviews
of their initial and revised proposals from field-
FINDING, FUNDING, AND SCALING • WINTER 2019 7
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
level experts and experts on the inclusivity of
people with disabilities. These experts provided
teams with extensive feedback on where gaps
remained in their plans and provided insights
on the strengths and weaknesses of the pro-
posed approach. All of this feedback was given
to participants to continue to strengthen their
proposals and incorporate feedback received.
In tandem, our legal team continued its own
due diligence to identify any work proposed in
sanctioned countries, review legal structures
and memorandums of understanding, and
conduct background checks on key person-
nel associated with each of the proposals. In
addition, our financial and impact-investment
teams assessed the financial standing of each
organization. Neither analysis
focused on disqualifying teams; The whole 100&Change process
rather, they sought to better
understand and identify areas
has demonstrated that inspiring
worth targeting for additional donors and the public does not
support should the team become come from a single proposal, a
an award recipient.
All teams were also required
single interaction, or a single idea.
to identify an external evaluator
to serve as a partner over the five-
year grant period. The purpose of
this evaluator was to help teams identify areas
where they needed to change course or adapt
their work as well as track impact over time. Each
evaluation plan was reviewed by the foundation’s
evaluation team, and another layer of feedback
was provided on how semifinalists could work
to strengthen their overall evaluation structure.
The extensive due diligence of our six-
month semifinalist phase produced a set of
proposals that had been extensively vetted,
iterated, improved, and strengthened over
time. It represented an achievement that
boosted each participant’s confidence. “If
you had asked me in December 2016 if I felt
we would have been able to execute on our
initial proposal, I would have said yes, but I
would have been a bit unsure if we could do
it,” a member of one of the semifinalist teams
said. “Today, six months later, I know that we
can execute on this plan.”
In September 2017, our board selected four
finalists from our eight semifinalists, and we
entered what we called “Phase III” of the com-
petition. During this time, the teams focused
mostly on preparing for the Finalists Live event
in December, after which the board would make
its decision. We did not want our finalist event
to focus solely on the board’s decision-making
process; instead, we wanted to highlight and
promote the work of all the semifinalists and
finalists for other potential donors. Although
8 FINDING, FUNDING, AND SCALING • WINTER 2019
we intended to pick just one team for the award,
we were committed to helping each team try to
find funding for their solutions.
To learn how to increase their donor base
and better understand the needs of donors look-
ing to make larger philanthropic contributions,
the finalists and semifinalists attended the Big
Bettable workshop, held by The Bridgespan
Group, which focused on pitching big ideas.
The two-and-a-half-day session focused on
how to break proposals into smaller pieces that
would provide donors with clear investment
opportunities while also tying those opportu-
nities to impact.
In the end, we have had varying success with
this part of the process and are rethinking how
we can build the next application to support this
type of staged investment approach and provide
active opportunities to bring donors along in
our process. However, this event, coupled with
many additional fundraising activities since the
100&Change announcement, has led to broad
general interest and significant (more than $50
million to our semifinalists after 2018) follow-
on funding from other donors.
THE TOP 200
While working with our eight semifinalists,
we also started to realize that there was a
wealth of interest from other donors and
high-net-worth individuals in the types of
organizations that surfaced through our com-
petition process. It was not until we started
talking to donors about the more than 1,900
applications from various sectors all around
the world that we fully realized the treasure
trove of information we were sitting on. A new
purpose for our 100&Change process was born:
We began to focus on finding ways to better
connect big ideas to philanthropists, donors,
and intermediaries looking to make larger “big
bets” for social impact.
Over the course of the same yearlong process
that the semifinalists and finalists were work-
ing to refine their proposals, we partnered with
several agencies to create new ways to profile
and highlight the many high-quality ideas we
received. During this time, we embarked on
four significant activities to try to bring greater
visibility to these proposals:
n We identified the top 200 scoring propos-
als and published them in a publicly acces-
sible interactive directory.
n Our partner Charity Navigator identified
the 37 organizations already on its highly
rated charities list and promoted them as
“Charities with Bold Solutions.”
n The Center for High Impact Philanthropy
at the University of Pennsylvania published
a guide titled Bold Ideas for Philanthropists
to Drive Social Change, which highlighted 16
proposals as “Best Bets” and promoted 81
organizations in total.
n We started the 100&Change Solutions
Bank, a publicly accessible, searchable
database that is a repository of all the pro-
posals we received.
This work has been fruitful for a subset of
organizations, particularly those from within
the Top 200 list. While not every organization
has received funding through this process,
many organizations have found creative ways
to use their Top 200 designation to interest
new donors or to incorporate the feedback they
received from judges to build stronger proposals
that they presented to existing donors. In both
cases, for some organizations, this has led to
increases in grant dollars received.
Today, we continue the fundraising work
we started during the 100&Change process.
We are helping to support several donor col-
laboratives that have formed around many of
our finalists and have linked semifinalists to
donors and other competitions. In addition, we
continue to promote the work of all Top 200
applications and, where possible, are track-
ing where these organizations have received
interest from donors. Some applicants received
direct funding from judges who were part of
the competition, some saw an uptick in direct
contributions through Charity Navigator’s Web
pages, and others are still seeking ways to best
take advantage of the various designations and
profiles that 100&Change provided.
The 100&Change competition, with all of
its learnings, has demonstrated that inspiring
donors and the public does not come from a
single proposal, a single interaction, or a single
idea. Rather, each of the steps outlined here
provides an opportunity to forge new relation-
ships and strengthen existing connections by
presenting a clear narrative of where you are
trying to go and how you plan to get there.
Selecting a Pool
of Bold Ideas
How the University of Pennsylvania’s Center for High Impact
Philanthropy winnowed 100&Change’s Top 200 Entries
BY ANNE FEROLA & LINDSAY KIJEWSKI
T
housands of applicants from around
the world responded to the MacArthur
Foundation’s open call for $100 million
proposals. These ideas represented a rich collec-
tion of potential solutions for significant social
and environmental problems. But while most of
the attention was focused on 100&Change’s lone
$100 million grant, the University of Pennsylvania’s
Center for High Impact Philanthropy (CHIP)
saw broader opportunity: With a database of
more than 1,900 solutions to the world’s most
pressing challenges, how could the visibility
and opportunity associated with a project as
enormous as 100&Change be useful beyond a
single prizewinner?
MacArthur asked CHIP to evaluate the top
200 proposals (as determined by MacArthur’s
judges), highlighting those that our team felt
had the greatest potential to create meaning-
ful impact. The result is our guide, “Bold Ideas
for Philanthropists to Drive Social Change.” It
includes 81 opportunities organized in various
ways (e.g., by geography or cause area), as well
as 11 “Best Bets”—those proposals that truly
stood out based on our team’s rigorous analysis.
CHIP believes that the experience of review-
ing large numbers of diverse proposals helps
new philanthropists learn how to think about
opportunities and risks. Indeed, inviting tal-
ented and committed students to be a part of
this process is one of the best ways to advance
the field of philanthropy, by training the next
generation of thoughtful donors.
Our 100&Change analysis differed from
CHIP’s standard research process in that it was
based solely on what was presented to MacArthur
and the comments of 100&Change judges; our
analysts did not conduct additional due diligence
to validate claims made by the applicants. The
Anne Ferola is director of education and strategic part-
nerships at the Center for High Impact Philanthropy at the
University of Pennsylvania. She oversees the center’s key rela-
tionships with institutional funders, individual donors, and non-
profit practitioners, and directed CHIP’s 100&Change analysis.
Lindsay Kijewski was a 2017 Lipman Family Prize fellow at
the University of Pennsylvania and served on the project team
for CHIP’s 100&Change analysis.
MacArthur Foundation provided CHIP with the
complete text of each application, along with a
database that included their judges’ scores and
comments. Because the purpose of the project
was to identify additional opportunities beyond
those selected by MacArthur, we did not evaluate
the foundation’s semifinalists, which left us with
192 total prospects. CHIP’s team narrowed this
pool through a series of four phases that took
place between June and October 2017.
Phase 1: Social Impact | The first phase of our
analysis focused on two overarching questions:
n Does this proposed solution address
CHIP’s understanding of social impact—
i.e., a meaningful improvement in the lives of
intended beneficiaries?
n What is the scope of positive change
that could be achieved with the project’s
success?
Each application was reviewed by two
researchers on the project team, who considered
the problem it was trying to solve, who would
benefit from the solution, and to what degree
those lives could be improved if it were successful.
It was at this point that we chose to exclude
scientific and medical R&D from our analysis. In
reviewing those submissions, we realized that
a fair assessment of their strength required a
level of technical expertise that we did not have,
and thus they could not be properly evaluated.
Eighty-one applications stood out for the
clarity of their social impact goals and the logic
of their proposed solutions; these are included
in our “Bold Ideas” guide. This pool offers a wide
array of high-quality opportunities for donors,
but we didn’t stop there.
Phase 2: Theory of Change | In consultation with
CHIP senior staff, the team constructed detailed
logic models and theories of change for each of
the 81 projects. This process identified any gaps
in logic or assumptions made on the trajectory
from inputs to impact. We reviewed the evidence
offered in the applications to assess whether
the assumptions seemed reasonable and, in
turn, completed one more step in the process of
evaluating each project’s potential for success.
Phase 3: Tactics and Risk/Reward | To narrow
the field even further, the team looked at the finer
points of the applications, comparing their scale
with that of proposals we commonly see in this
philanthropic arena. The differences presented
some interesting insights and challenges for
the team to grapple with. Did the level of risk
seem appropriate? Were the implementation
strategies sound? Did the implementers have
the infrastructure to support such a dramatic
influx of funding, and was there any potential
for the projects to sustain themselves without
a grant of this size from MacArthur? It was at
this stage that the 100&Change judges’ com-
ments were also considered, helping to guard
against any biases our team may have had.
After incorporating these additional perspec-
tives, the team was ready to present its top 24
proposals to CHIP’s panel of experts.
Phase 4: Selection and Vetting | The team
presented the final submissions to an assembly of
CHIP senior staff, analysts, fellows, and experienced
funders with expertise ranging from community
development and public health to education and
impact investing. This distinguished panel chose
11 projects that they felt had the greatest potential
for impact. These proposals then passed a final
round of vetting with area-specific experts from
the University of Pennsylvania and were recog-
nized as our best bets in the guide.
This final group represents a wide cross-
section of global funding opportunities, offer-
ing a variety of strategies from large-scale
expansion of proven programs to higher-risk/
higher-reward innovation plays.
One of our biggest takeaways was the impor-
tance of communicating solutions in a way that is
understandable to a wide variety of stakeholders
in order to gain the broad support—philanthropic
and otherwise—that such solutions deserve.
We continue to consider the best ways to
share the information we have synthesized. Our
hope is that by distilling the information into
guidance that can be understood and tailored for
interested individuals, we help move the billions
in uncommitted philanthropic capital now sitting
on the sidelines into active use to generate the
real-world changes we all seek.
View and download our guide, “Bold Ideas for Philanthropists
to Drive Social Change,” at https://www.impact.upenn.
edu/100-and-change-bold-ideas/.
FINDING, FUNDING, AND SCALING • WINTER 2019 9
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION

An Open-Data Approach
to Transform Grantmaking
Proposals for grants can offer a wealth of ideas and information to the
nonprofit community, if foundations take the right steps.

BY BRADFORD K. SMITH

T
raditional grantmaking, whereby
individual groups or people apply
for pools of funding through a linear,
all-or-nothing process, is inefficient, wasteful,
and opaque to applicants and other outsiders.
What if nonprofit proposals could come from a
wider pool of candidates and be easily screened,
mined for ideas, linked to related information,
and shared with the world? In MacArthur’s
100&Change competition, Foundation Center
saw an opportunity to explore how philan-
thropy’s grantmaking process could be trans-
formed in a way that would focus the field on
generating and sharing knowledge, rather than
simply getting and giving grants.
GRANTMAKING TODAY
In the United States, foundations receive a
tax exemption on their investment income in
exchange for contributing to the public good.
Some fulfill that role by maintaining one or more
program areas and inviting the public—in the
form of nonprofits—to apply for grants. The
rationale for that open approach is that no
matter how knowledgeable a donor, staff, and
consultants may be, the best ideas may come
in over the transom.
Nevertheless, of the more than 87,000
active independent, community, and corporate
foundations in the United States, 70 percent
do not accept unsolicited proposals. Together
they represent 41 percent of total assets and 38
percent of annual giving in the nation. More than
$27 billion of the $71 billion distributed every
year by foundations is not up for grabs—you
need an invitation.
little or no staff and limited budgets. But this proposals?” “Why do foundations request so
argument makes less sense for larger founda- much information?” “What do foundations do
tions with highly qualified professional staff and with all that information?” Questions like these
significant operating budgets. Despite that, 41 have a way of focusing the mind. It is increasingly
percent of the roughly 1,200 largest US founda- difficult to provide suitable answers in an age
tions, accounting for more than $600 billion in when technology has transformed the ways in
assets, do not accept unsolicited proposals. which we find, consume, supply, and process
Other grantmakers say that
they don’t want to waste the We turned a team of 25 data
valuable time of nonprofits,
who might invest in preparing
scientists, coders, and designers
proposals that have little chance loose on the entire set of 1,871
of approval. It is true that the proposals and 1,700 videos that
majority of all proposals fail
to get funded. When I worked
were submitted to the competition.
at the Ford Foundation in the
1990s, I remember counting
more than 144,000 requests
in a year in which we made fewer than 2,000 information in most every other realm of our
grants. That pattern is repeated throughout lives. For several years, Foundation Center has
the sector: Nonprofits and foundations invest worked to improve knowledge-sharing prac-
enormous effort in preparing and reviewing tices of foundations. But a recent collaboration
proposals through time-consuming processes with the MacArthur Foundation gave us the
in which most of the data, analysis, and insights opportunity to experiment with opening up
generated in the process are simply discarded. the grantmaking process itself.
In fact, this counterproductive process
is actually becoming worse as foundations “THE SOLUTIONS BANK”
increasingly turn to prize philanthropy to spur Grants of the size of the 100&Change project
innovation and emphasize branding. The best —$100 million—are extremely rare in philan-
thing about prize competitions is that they are thropy. Only four of this size were made in all of
open to all; the pitfall is that the funnel is even 2016. It is rarer still to make such a gift through
narrower, producing only one or a handful of a competitive process. Because 100&Change
awards at the end. was designed by the MacArthur Foundation
Foundation Center, the leading source of as a competition and as an open-application
information about philanthropy worldwide, process, the foundation decided to share all the
is at the crossroads of foundations and their proposals with other foundations, nonprofits,
ILLUSTRATION BY TIM COOK

Many donors keep their doors closed for fear
they will be overwhelmed with proposals, which
would require a costly infrastructure to evaluate.
Proposal review is indeed labor-intensive, and
tens of thousands of small foundations have
Bradford k. Smith is president of the Foundation Center.
nonprofit partners. We maintain years of in-
depth data about grantmaking and provide
tools and training to help the grant seekers find
funding. From nonprofits, we frequently hear
such questions as: “How do I get a grant from
a foundation that doesn’t accept unsolicited
researchers, and the public at large.
Sharing presents practical problems, since
merely posting thousands of PDFs on a website
is not an effective way to transmit knowledge.
Moreover, the application process requested
some confidential information.

10 FINDING, FUNDING, AND SCALING • WINTER 2019

 In 2017, with MacArthur support, we turned
a team of 25 data scientists, coders, and design-
ers loose on the entire set of 1,871 proposals
and 1,700 accompanying videos that were
submitted to the 100&Change competition.
The result was the Solutions Bank, a free online
resource allowing users to explore proposals by
subject, population served, strategy, and rela-
tionship to one or more of the United Nations’
17 Sustainable Development Goals.
The bank’s largest volume of proposals are
in categories such as economic opportunity,
energy and environment, and health, but subjects
range from agriculture to transportation. The
“population served” field includes age groups,
ethnic and racial groups, social and economic
status, and other categories. “Geographic area
served” includes regions, subregions, coun-
ILLUSTRATION BY TIM COOK
tries, and cities, and also broad domains such
as oceans and space. Users can search with
keywords or maps, or by choosing criteria from
drop-down menus.
For example, searching “oceans” generates
a list of 57 proposals, including Northeastern
University’s mariculture project to grow sus-
tainable, healthy animal protein. The system
displays the core elements of the application
along with accompanying videos, links to related
proposals (such as Kepley BioSystems Inc.’s
synthetic bait project), relevant research (such
as a study on the depletion of forage fish stocks),
and links to foundations that have funded the
university in the past.
Linking information in this way turns the entire
body of proposals and videos into knowledge
that can be used by other foundations looking
for “shovel ready” grant proposals to expand
a current program area or launch a new one,
or to create another prize competition. By
including information about who currently
funds 100&Change applicants, the site is also
intended to be useful for nonprofits and other
organizations seeking their own funding.
BUILDING THE BANK
Foundation Center has a long history of col-
lecting, cleaning, and coding data about phi-
lanthropy and applying data science to make
sense of raw information. In 1960, it published
its first print directory, including information
on some 5,200 American foundations. In the
following years, Foundation Center developed
a grant classification system that evolved into
the Philanthropy Classification System, a tax-
onomy of more than 1,300 terms to categorize
a grant’s subject, population served, approach
strategy, transaction type, and organization
type. These entries are coded by location using
GeoNames, an open database of more than 11
million geographic place names.
In 2016, Foundation Center began using a
database of more than one million hand-coded
foundation grants to train computers to do the
coding process on their own through machine
learning, an approach that uses statistical
techniques to give computer systems the
ability to “learn” by progressively improving
performance on a specific data-driven task
such as classification, without being explicitly
programmed. Once the system was able to
classify grants at 90 percent accuracy—the
target we had established—we applied it to
FINDING, FUNDING, AND SCALING • WINTER 2019 11
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
Foundation Center’s entire store of content,
including some five million grants, blogs,
research reports, and news digests. These
were all coded according to the Philanthropy
Classification System, and their content was
indexed to search engines utilized in differ-
ent Foundation Center products and services.
Further refinements permitted auto-coding
to multiple classification systems, including
the Sustainable Development Goals and the
Organisation for Economic Co-operation and
Development (OECD) system that categorizes
global foreign aid expenditures. Through this
effort, Foundation Center makes it possible to
show how foundations and governments are
mobilizing to conserve oceans, support human
rights, or address virtually any
other global challenge.
We applied this technology
to the 100&Change proposals so
that users could search them in
the ways described above. But
the diversity of the proposals
meant that the process was not
as easy as we had anticipated.
Approximately 800 met all of
the application criteria and could
be easily machine-coded. The remainder did
not adhere closely to the format, had missing
information, or were otherwise difficult to
classify or assess. After the automated system
did the initial pass, we had to review all of the
coding the old-fashioned way—by hand. Still,
correcting the coding of thousands of pages of
text is faster and more efficient than reading
and coding every page.
As an experiment, we also coded some
1,700 videos that accompanied the propos-
als. After dividing each video into one-second
slices, we used image recognition software to
identify every object in each frame (“person,”
“books,” “desk,” “plant,” “bird,” “mountain,”
etc.). Audio transcription software translated
spoken dialogue from each video into text. We
then applied the same coding technology that
we’d used on the written proposals to this text
derived from the images and audio tracks. To
our surprise, we found that this video analysis
added little new information. We included
only some video features in the final version
of the Solutions Bank site, such as thumbnails
showing images and terms such as “sea life,”
“earth,” or “grass.”
THE GREAT POTENTIAL
This process demonstrated that using machine
learning to rapidly digest large volumes of pro-
posals has enormous potential. The Solutions
12 FINDING, FUNDING, AND SCALING • WINTER 2019
Bank allows users to fully explore all the knowl-
edge contained in the entire body of proposals,
not just the $100 million winner and finalists.
Foundation Center also had access to the
MacArthur Foundation’s scores for the 800
proposals that met all the application criteria.
We used this confidential information to try to
relate proposal features to the judges’ scores.
However, this set was far too small; machine
learning requires very large data sets to achieve
acceptable levels of accuracy (regarding classifi-
cation) and mitigate against bias. Nevertheless,
the group of 800 complete proposals provided
us glimpses of topics and beneficiary groups
(such as children) that were more likely to
garner higher scores. These findings, though
Today, America’s foundations
are like black holes, absorbing
enormous quantities of knowledge
while reflecting back almost none.
This situation could change.
far from conclusive, were encouraging enough
to convince us that, with a larger training set of
4,000 or more complete proposals, it would be
possible to make far more accurate predictions.
Our results were similar with video content—
and somewhat predictable. The main images
identified by the software were “person” and
“desk,” and those tended to receive lower scores
than others featuring, for example, “wildlife.” In
part, this was due to the MacArthur Foundation’s
guidance to applicants, which recommended a
low-cost, simple approach to video production.
One could argue that you don’t need machine
learning to prove that videos showing what a
project will actually accomplish are more effec-
tive than those featuring a talking head. However,
despite the widespread availability of technology
for shooting and editing video, many applicants
still find video production a challenge.
In the short term, we see immediate ways
to improve future iterations of MacArthur’s
100&Change competition. Auto-coding all
proposals at the outset, for example, could make
it far easier to assign the right proposal to the
right reviewer by subject, geography, or other
criteria. This more careful targeting would use
the valuable time of those outside readers more
efficiently and could also improve the accuracy
(and reliability) of their scoring. Similarly, the
analysis of 1,817 proposals contained in the
Solutions Bank could help future recruitment of
outside readers by ensuring that their expertise
is appropriate to the likely content of proposals.
But the greatest potential of these experiments
lies in finding new ways to encourage foundations
to accept unsolicited grant proposals, whether
in the form of prize competitions, as requests for
proposals (RFPs), or via the usual grantmaking
process. With larger numbers of quality grant
proposals in text or video form, it should be pos-
sible to construct statistically reliable training sets
that could in turn make it possible to automate
the first wave of eligibility screening. This would
enable smaller foundations to process and review
more applications, by making it quicker, easier,
and less expensive to reject the larger number
of proposals that do not fit priorities or criteria.
Precious staff time could instead be reserved for
analyzing the far smaller number of those that
do meet those basic requirements.
Furthermore, to the extent that foundations
are willing to accept unsolicited proposals and
do so in open processes like 100&Change, the
proposals themselves will become a valuable
outcome of the grant process. These can be
made available to funders wishing to benefit
from the ideas, organizations, insights, and
creativity—or who might want to provide sup-
port. Grant proposals need not be treated as
unique works of art: There is no reason why one
funder shouldn’t accept or even fund a proposal
originally submitted to another.
The MacArthur Foundation has heard from
numerous government, foundation, and nonprofit
users that are among the more than 1,300 users
that explore the Solutions Bank each month.
Further research will show whether funders will
identify promising proposals and potential grantee
partners through such an open platform. As the
number of open grant competitions grows, multiple
Solutions Banks could be built by subject area,
geography, beneficiary group, or other criteria,
as long as the privacy and intellectual property
of the applicants were properly protected. The
proposals within each could be treated as living
documents that organizations could continually
update with new information, retaining the spirit
of openness that lies at the heart of 100&Change.
Today, America’s foundations are like
black holes, absorbing enormous quantities
of knowledge while reflecting back almost
none. The laboratory created by MacArthur’s
100&Change suggests that this situation could
change. Armed with abundant resources, fueled
by the hope and creativity of millions of non-
profits, and powered by technology, founda-
tions can become sources rather than sinks of
information, radiating knowledge and valuable
insights to the entire nonprofit community.
The Vital Role of Early-
Innovation Funders
At The Lemelson Foundation, we seek to foster inventions that will have social impact and
improve lives. But our support for early-stage innovation could not succeed without a trusted
network of grantees and partners.
BY CAROL DAHL
I
n 2006, two engineering profes-
sors from Rice University visited the
neonatal ward in Queen Elizabeth
Central Hospital in Malawi and witnessed the
grave challenge that many premature infants
face. These infants were struggling to breathe
because of respiratory distress syndrome
(RDS), a breathing disorder that affects new-
borns. In Malawi, RDS is a dangerous condition
with only a 25 percent chance of survival. But
in the United States and other high-resource
countries, it is easily treated with a breathing
device called a bubble-CPAP, which provides
continuous positive airway pressure to the
infants and enables them to breathe normally.
The key challenge was that existing devices
were too expensive for hospitals and clinics in
Malawi and were not designed to withstand the
harsher physical conditions in African health-
care settings. After inevitably breaking down,
these devices ended up in equipment grave-
yards along with stacks of other well-meaning
donations not suited to the local environment.
So the professors, Rebecca Richards-Kortum
and Maria Oden, returned to Rice with a mission.
They engaged their undergraduate students to
work with the nurses and doctors in Malawi on
a design challenge to create a more affordable
and durable bubble-CPAP. The prototype they
came up with used a plastic shoebox from
Target and two fish-tank pumps. It had a frac-
tion of the cost of a standard bubble-CPAP but
proved just as effective at saving infants’ lives.
The joint team from Rice and Malawi perfected
the device and called it “Pumani,” a Malawian
word meaning “breathe restfully.”
Eight years later, that one prototype has
grown into an ambitious initiative called NEST
(Newborn Essential Solutions and Technologies),
Carol Dahl is executive director of The Lemelson Foundation.
to address not only RDS but also the other prevent-
able causes of newborn mortality in Africa. The
Rice 360° Institute for Global Health (Rice 360°)
team is also working with African universities to
help create a sustainable pipeline of inventors
and engineers to solve local and regional health
challenges. The Lemelson Foundation was there
at the earliest stage, providing support when it
was still just an inspired idea—that undergradu-
ate engineering students could be part of cre-
ating products to have real social impact in the
world. Starting with one small grant through our
longtime partner VentureWell, we were part of
an ecosystem of upstream funders that helped
Rice 360° develop their idea from a college
course into a scalable program that in 2017 was
awarded a $15 million grant from the MacArthur
Foundation’s 100&Change competition. NEST
is now on track to receive more than $60 million
in new funding.
Innovative initiatives are often most in need
of support during that crucial early stage, but
that is also when they pose the most risk for
investment by governments or the market.
Philanthropic and corporate social respon-
sibility capital is available to help support
scaled implementation of the most promising
projects, but there is a shared responsibility
for both upstream and downstream funders
to manage related risks.
Through 23 years of grantmaking, we have
learned along with our grantees how to help
incubate invention-based social entrepreneurs
to reach the point where they are ready to
scale through large awards from downstream
funders. We have found that it takes more than
great ideas and visionary, dedicated leaders.
It takes well-aligned partners committed to
learning together. It takes patient and strategic
support to help them refine their approach and
build institutional capacity. It requires starting
small and infusing the right kind of funding at
the right time to help grow their efforts. And it
takes an ecosystem of funders who bring their
specific strengths and resources to bear at dif-
ferent stages along the pathway.
INVENTING AN ECOSYSTEM
Prolific inventor Jerome Lemelson and his wife,
Dorothy, founded The Lemelson Foundation
more than two decades ago. Since that time,
the foundation has helped grantees in both
the United States and developing countries
launch more than a thousand invention-based
businesses and initiatives following a philoso-
phy we call “impact inventing”: creating new
products that have positive social impact, are
environmentally responsible, and are financially
self-sustaining.
The foundation is small in staff but large
in ambition. Our goal is to create and support
a more vibrant invention ecosystem focused
on problems that are worth solving, leading to
products that make a real difference in people’s
lives. Rather than open solicitations or running
competitions, we employ a different approach
as a moderate-sized, early-stage funder. After
setting our strategic direction, we rely on a net-
work of trusted grantees and partners on the
ground to seek out promising opportunities for
our work. Sometimes, when we find that those
partners do not yet exist, we help create them.
This was the case with VentureWell, one of
our earliest grantees. VentureWell is an NGO
that supports early-stage inventors and entre-
preneurs. In the early 1990s, Jerome Lemelson
recognized that there was a real lack of support
at the university level to help foster invention-
based entrepreneurs. Seeing that there was no
organization in this role, he set out to create one.
FINDING, FUNDING, AND SCALING • WINTER 2019 13
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
He formulated a vision for higher education to
engage students in inventing meaningful solu-
tions with market potential, which led to the
creation of the National Collegiate Inventors
and Innovators Alliance (NCIIA). NCIIA sup-
ported the success of student invention teams,
so that these teams could advance promising
ideas through entrepreneurship.
NCIIA was founded at Hampshire College
in 1995 and was incubated as an autonomous
program by a consortium of five colleges. In
2001, NCIIA became an independent 501(c)(3).
With our continued support, it developed
effective approaches to incubating student-
led, invention-based enterprises that could
be self-sustaining, scalable, and attractive to
downstream investors. However, 15 years into
this work, we realized that reliance on our fund-
ing put NCIIA at risk of functionally becoming a
subsidiary of the foundation. We also recognized
that they had value to offer way beyond what
we could support on our own.
Working with Phil Weilerstein, NCIIA’s
leader, we supported the development of a
broader focus and the diversification of fund-
ing sources. Providing introductions and even
cofunding projects with new funders helped
NCIIA solidify sustainable funding through
other partnerships. Eventually, The Lemelson
Foundation’s stable support level decreased
from 80 percent of NCIIA’s annual funding
to just one-fifth of their current $15 million
annual budget.
14 FINDING, FUNDING, AND SCALING • WINTER 2019
NCIIA evolved into VentureWell, Kinnos, a health-care company approach using recognition and
and the organization continues to started by Columbia University mentoring programs (RAMPs)
students mentored by
be a close partner of the founda- VentureWell, developed a dis- to foster inventors in developing
tion and now enjoys rapid and infectant solution in response countries. The RAMPs would allow
to the 2014 Ebola outbreak.
sustained growth with a robust us to identify key projects through
and diverse funding stream. At the outset, it recognition awards, and link them to mentoring
was solely focused on the United States, but to grow their ideas and business models. We
now it has global reach, with significant grants went looking for partners that could help us
from the US Department of State, USAID, the achieve this work, and in India we found Villgro.
Bill & Melinda Gates Foundation, the Kauffman Villgro started as the vision of Indian social
Foundation, and many others. VentureWell’s entrepreneur Paul Basil, who used a venture
programs have reached tens of thousands of capital investment model to support small-
students and faculty, and it has supported the scale farmers who had developed agricultural
creation of more than 600 invention-based innovations that were cheaper than traditional
companies with social impact that have raised tools and were designed to work in low-resource
close to $1 billion in additional investment. settings. In 2004, we helped Basil with a grant
For us, this formative experience was a of $100,000 to expand his startup through a
lesson in patience, rethinking organizational RAMP model. But we learned over time that
structure when necessary, and supporting there were gaps in our original vision. Recognition
capacity building. It also taught us that a diver- awards and mentoring alone were not having a
sity of funders is key to taking an organization large enough impact on the growth of invention-
PHOTOGRAPH COURTESY OF THE LEMELSON FOUNDATION
to the next level. Now, VentureWell is a major based social enterprises in India.
partner in the startup ecosystem, helping to So we worked with Villgro to provide targeted
position additional ventures for funding to scale. resources throughout this process, rather than
large infusions of money that they were not yet
INCUBATING INDIA’S SOCIAL equipped to deploy effectively. This included
ENTERPRISES funding a review to look at Villgro’s organiza-
While VentureWell helped promote impact tional and financial structure, and support for
inventing in the United States, The Lemelson building capacity based on that input to enable
Foundation knew that a crucial component to continued learning and experimentation. We
addressing the world’s most pressing problems also provided different types of funding as
involved supporting invention in the develop- needed to establish a successful model. Villgro
ing world. In 2002, we developed a strategic discovered that they needed equity money to
 support companies suited for investment and
scaling up, arguing that companies needed to
move beyond grant funding because it is con-
sidered a deterrent to downstream investors.
The Lemelson Foundation became an anchor
partner for starting the Menterra Social Impact
Fund along with other foundations and India-
based angel investors. Working together, the
Menterra Fund and Villgro now provide the
capital for early-stage impact inventors and
entrepreneurs throughout India.
Villgro evolved into the premier incubator
of social enterprises in India. It has cultivated
nearly 150 innovators, who have raised more
than $18 million in follow-on investments—11
times the initial funding it received. Their social
enterprises have created 4,000 jobs and have
helped incubate life-improving products that
have reached nearly 20 million people.
CREATING A PIPELINE OF GLOBAL
HEALTH INVENTORS
The lessons we learned as an early-stage
funder for VentureWell in the United States
and Villgro in India informed our growing
partnership with the Rice 360° team as their
vision expanded, their impact grew, and new
funders came on board.
Richards-Kortum and Oden’s initial program
grant from VentureWell allowed them to create
a hands-on engineering education program at
Rice called Beyond Traditional Borders. With
additional funding from the Howard Hughes
Medical Institute, this course evolved into the
Rice 360° Institute for Global Health, which
launched the first bubble-CPAP prototype (i.e.,
Pumani). An additional grant of $10,000 from
VentureWell was used to partner with a product
design firm to build a more refined version of
Pumani, and VentureWell’s Xcelerator training
program then helped prepare them for the next
stage of scaling. Cross-cultural collaboration
was key to their work from the beginning. They
developed their design by working closely with
the University of Malawi College of Medicine
and Malawi-based pediatricians Liz Molyneux
PHOTOGRAPH COURTESY OF THE LEMELSON FOUNDATION
and Kondwani Kawaza, as well as the neonatal
nurses who would be using the device.
In 2013, a global innovation award from
another one of our longtime grantees and
partners, the Lemelson-MIT program, enabled
the Rice team to build capacity by constructing
a new infant ward at Queen Elizabeth Central
Hospital as an innovation hub in Malawi to
introduce and test their technologies. Rice
360° received one of the first Saving Lives at
Birth grants from USAID to conduct the clinical
trials needed to drive investor interest in their
bubble-CPAP. After proving its success, they
worked with the Malawi Ministry of Health to
make Pumani available in all of the country’s
hospitals at one-tenth the price of comparable
systems in the United States.
But their story does not end there. Richards-
Kortum and Oden recognized a larger problem:
Every year, 1.1 million babies die throughout sub-
Saharan Africa for a variety of reasons. Seventy-
five percent of those deaths are preventable
with technologies that have been available in
high-income countries for over 50 years, but
most of these technologies are not suitable
for use in Africa. Their goal for Rice 360° was
to tackle the key mortality causes with a suite
of low-cost, rugged devices similar to Pumani.
This vision underpins their NEST program—17
complementary devices intended to provide
high-quality, comprehensive care for preemies
and full-term newborns in Africa.
In 2014, Rice 360° came to us with an
idea to make their work more sustainable by
increasing local innovation capacity in Africa.
The partnership between innovators in Malawi
and at Rice gave rise to the notion of introducing
the design-based bioengineering approach to
engineering students in Malawi. The Lemelson
Foundation provided seed funding to launch
a program that would offer design-based
bioengineering education for students at the
Malawi Polytechnic school at the University
of Malawi. The long-term goal is to harness
the power of local invention and entrepreneur-
ship, as well as create a sustainable pipeline of
biomedical engineers required to support the
introduction of new technologies to African
health-care institutions. Malawi Polytechnic
and Rice University students now participate
in a bidirectional exchange, learning from each
other as they invent and innovate.
Here, the pathway from idea to impact
started small, with targeted and incremental
funding for achievable goals. But Rice 360°
was engaged throughout the process with a
collaborating ecosystem of upstream funders,
building capacity and organizational structure
along the way. All this led to a point where Rice
360° and their NEST technology was poised
to compete in the 100&Change program and
go to scale with the support of the MacArthur
Foundation, The Lemelson Foundation, and
other funders.
THE ROLE OF UPSTREAM FUNDERS
IN SUPPORTING SUSTAINABLE
DEVELOPMENT
Upstream funders play a critical role in build-
ing a pipeline of organizations that have the
capacity to absorb large grants and deliver on
the promise of both scale and impact. As early
funders, we must be willing to take initial risks
to support innovation and invention at these
beginning stages. And while those risks are
high, the rewards can be great, both for the
organizations and for the social impact they
can generate.
Through our experiences with VentureWell,
Villgro, and Rice 360°, we now have perspective
on how early-stage funders can help create this
pipeline. First and foremost, start small with
metered funding. Although large amounts of
money early on might seem attractive to many
grantees and funders, it can be detrimental to
organizations that have not yet found their
organizational foothold and the optimal model
to scale their efforts. Next, take the time and
expense to build relationships based on trust
with grantees that are also aligned with the core
capacity of each partner. Be iterative; accept risk
and, especially, failure. Showing a grantee that
you are in it for the long haul helps both sides
create transparency. And finally, be confident
in the long-term goals you are trying to achieve,
and unafraid to change course or organizational
structure in service of those goals.
Also key for early funders: Know your limits.
We cannot (and should not) always take an
organization to the next stage. Dependence
on one funding stream can ultimately limit
the potential to achieve maximum scale and
impact. Different sources of support play dif-
ferent roles along the pathway. In the end, you
have to prepare your grantees to tap into the
larger ecosystem and build relationships with
follow-on funders.
Relationship-building requires engage-
ment with the entire ecosystem of partners
needed to take an organization from idea to
impact. By proactively collaborating with early
funders, downstream funders will have a greater
opportunity to identify and cultivate successful
projects ready to grow to scale. Downstream
funders also have a responsibility to help their
grantees build capacity and prepare for the
funding cliff that naturally occurs when large
award programs come to a close.
Ultimately, whatever our role in this funding
ecosystem, we all share the same goal: creating
projects for social impact that no longer rely
solely on philanthropic support. Such enter-
prises must develop the capacity to become
self-sustaining through government funding
or market mechanisms so that their work for
public good becomes woven into our social
fabric. That is the true pathway to sustainable
development.
FINDING, FUNDING, AND SCALING • WINTER 2019 15
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
The Need to
Double Down
Big bets can make a big difference, but only if they catalyze interest and follow-up
investment in the problems they seek to address.
BY MICHAEL FEIGELSON & ELVIRA THISSEN
E
ven before the 100&Change dead-
line for applications had passed, the
Bernard van Leer Foundation launched
a response to the Syrian crisis with grants to
the International Rescue Committee (IRC)
and Sesame Workshop. Foundation Executive
Director Michael Feigelson and Representative
Refugee Response Elvira Thissen thus had an
intimate view of the 100&Change process and
its effect on Sesame Street, the IRC, and funders
supporting young children affected by the Syrian
war and other crises around the world.
Sesame Seeds was created to restore hope for
a generation of children growing up amid violent
conflict. The program’s selection as the $100
million recipient of 100&Change also offers an
opportunity to place the needs of the youngest
refugees on the humanitarian map everywhere.
However, this will happen only if the grant can
motivate old and new donors alike to invest more.
This is not a given. In fact, the opposite could
happen. Additional philanthropic investment
can make a meaningful difference, but it means
that now—more than ever—foundations need
to step up, dream big, and take risks.
THE WORLD BEFORE 100&CHANGE
Our foundation has been focused on early
childhood development since 1964. For the first
three-plus decades, it was a lonely endeavor.
The widespread belief that babies live in a buzz
of confusion made it hard to convince policy
makers and philanthropists to invest. Today,
evidence from neuroscience, public health,
education, and economics has demonstrated
that babies and toddlers are anything but con-
Michael Feigelson (@mfeigelson1) is executive director of
the Bernard van Leer Foundation.
Elvira Thissen is representative refugee response at the
Bernard van Leer Foundation and leads the foundation’s work
with young children and families affected by crisis. She also
chairs the steering group of the Moving Minds Alliance.
16 FINDING, FUNDING, AND SCALING • WINTER 2019
fused. When surrounded by supportive families
and communities, they can process informa-
tion and learn faster than any other group of
human beings. Every second, their brains make
one million new neural connections setting the
foundation for a lifetime of learning and health.
As this evidence has emerged, there has
been a flood of interest. Early childhood devel-
opment is now central to the United Nations’ 17
Sustainable Development Goals. From Singapore
to Chile, Bangladesh to Germany, South Africa
to Mozambique, countries are prioritizing early
childhood. World Bank investments in babies
and toddlers more than doubled between 2012
and 2017. At the G20 summit this December in
Buenos Aires, we will hopefully see a declaration
supporting early-years investment signed by the
leaders of the world’s most powerful economies.
And yet, when we launched a new initiative
focused on Syrian refugees at the end of 2016, it
felt like going back in time. Despite approximately
811,000 Syrian children under the age of 5 living in
neighboringcountries,earlychildhooddevelopment
was getting very little attention. Critical services
for pregnant women, babies, and toddlers—health
care, food, water, shelter, and sanitation—remained
significantly underfunded. Some preschool edu-
cation was starting to be provided, but support
for maternal mental health, parent coaching, and
childcare was limited to small pilots, most of which
were running out of funding. As the strategy was
developed for No Lost Generation—an ambitious
advocacy platform focused on children affected
by conflict in the region—no one articulated the
need for goals explicitly focused on babies, tod-
dlers, and their families.
AN INITIAL LEAP OF FAITH
Building on our experiences working in Colombia
with displaced communities, in refugee camps
on the Thailand-Myanmar border, and in Central
America through the civil wars of the 1990s,
we launched our Syria response initiative with
initial grants—cofunded by the Open Society
Foundations—to the IRC and Sesame Workshop.
In parallel, we began an effort—now known
as the Moving Minds Alliance—to organize a
group of foundations to work together to build
the case for early childhood development in
crisis contexts. (Members of the Moving Minds
Alliance include the Open Society Foundations,
the ELMA Philanthropies, Comic Relief, the Vitol
Foundation, the Jacobs Foundation, Porticus,
and the Bernard van Leer Foundation.)
In the background, our Sesame Street and
IRC colleagues submitted their application and
slowly progressed through the 100&Change
application process. We wrote letters and
reviewed iterations of their proposal. We
cheered them on as they ran a marathon in
Amman, Jordan, in support of the project. We
knew the chance of winning was remote and
viewed the process as useful learning while we
searched for ways to bring their pilot programs
to greater numbers of children and families.
Then they found themselves in the final four.
Suddenly, it seemed real.
Days before they made their final pitch in
Chicago, we had a board meeting in which we
recommended a new grant of nearly ¤900,000
($1,050,000) to the IRC to follow up on the
initial pilot project. The discussion with trust-
ees centered on the fact that there was no
confirmed cofinancing and our funding could
cover only about half of the project cost. We
decided to take the risk. Within a few weeks,
the MacArthur Foundation made its announce-
ment. This changed the conversation.
THREE STAGES OF RESPONSE
Stage 1: Elation. A week before the announce-
ment, we had conversations with colleagues at
the IRC that indicated they already knew the
outcome but could not tell us. The giggling and
giddy tone of the conversations, however, raised
our hopes. For the first time, we were fully and
unabashedly expecting them to win.
The formal announcement of Sesame Seeds
receiving the $100 million grant was followed
by a flurry of e-mails from across the world.
Sesame Street’s photogenic Muppets began to
make appearances in places like Foreign Policy,
The New York Times, and Mashable. Each publi-
cation found a different angle. Some focused on
the potential long-term benefits of the program
to societal cohesion. Others highlighted how
this grant would help make sure a generation
did not lose out on critical years of education.
Conversations with major humanitarian
agencies and donors began to require less intro-
duction. It was noticeably easier to explain why
we were focused on this issue and to describe
what kinds of projects we wanted to promote.
We were elated. It felt like years of progress
in a matter of months.
Stage 2: Fear. One of the things that inspired
us to support Sesame Workshop and the IRC
early on was that they were willing to announce
their unique, bold partnership without any con-
firmed funding. Fear of failure often inhibits the
ability to dream, and especially to share bold,
ambitious dreams with others. We found their
audacity compelling.
The implementation of dreams, however,
is an entirely different matter.
After the award, the reality of the imple-
mentation challenges became increasingly
apparent. The fact that the grant represented
the largest-ever injection of funds into this kind
of project in a crisis setting added to the pres-
sure. If this was going to be a transformative
example for the humanitarian sector, success
in delivery had to be the number one priority.
Another major concern was that the
announcement would crowd out as many
stakeholders as it would inspire to join. Would
the prize push foundations with smaller budgets
away? Would it help or hinder collaboration
with other implementing agencies needed for
success? Would it give the impression that the
issue was now mainstream, therefore pushing
away funders with the kind of risk capital that
the field would still need for years to come?
Stage 3: Recalibration. There is an optical
effect in experimental psychology called the
Ebbinghaus illusion that demonstrates how
context affects our perception of size. At first,
the 100&Change announcement seemed
enormous given the absence of early child-
hood projects of this scale in humanitarian
settings. Media coverage, coupled with the
unprecedented nature of the award, magnified
the sense of size, which led to the initial elation
and subsequent feelings of fear.
But, from a coldly objective perspective, the
grant is not that big. One hundred million dol-
lars over five years, funding work in Syria, Iraq,
Jordan, and Lebanon, is equivalent to $5 mil-
lion per year per country. Taking this one step
further, we estimate that worldwide there are
22 million children under the age of 5 and five
million pregnant women in need of humanitar-
ian support and protection. Yet, in 2016, only
one-third of active humanitarian response plans
worldwide mentioned early childhood develop-
ment as an explicit priority. This is despite the
fact that globally the average length of protracted
displacement is 20 years.
The more we zoom out, the smaller the
award looks. So can $100 million actually shift
the humanitarian landscape? The answer:
Obviously not. But that is the wrong question to
ask. The right question? How do we capitalize
on the energy brought forward by 100&Change
to help shift the humanitarian landscape and
raise the kind of capital needed such that this
kind of project becomes the expectation in
all humanitarian response, not a reason for
celebration?
The process of recalibration has acceler-
ated our thinking, resulting in three takeaways:
n Stay close. The first priority for all those
wanting to see the youngest refugees bet-
ter served is to ensure that Sesame Seeds
succeeds. To their credit, the MacArthur
Foundation staff will be the first to recog-
nize that its grant is only a first step, and it
has also reminded us that the grant does
not come with a full-fledged engagement
in the field of early childhood development
or humanitarian assistance. Other funders
will need to step in as unforeseen chal-
lenges and opportunities emerge. Several
already have (Bezos Family Foundation,
The ELMA Relief Foundation).
n Set more ambitious goals. When we
started, we might have envisioned this as
success—a large new donor committing
to a project of this size. Instead, we have
been forced to think bigger. First, there
is great risk in leaning too heavily on one
seminal example—we need more. Second,
the energy created by 100&Change can
inspire others to make similar commit-
ments, but that energy will not last forever.
As a result, we have begun to ask how we
might use our relatively modest capital to
help mobilize the resources to stand up
early childhood initiatives of a similar scale
in crisis settings across the world.
n Build a shared story. Like all people, the
families affected by disaster and conflict are
concerned with shelter, food, health care,
and security. We need to make sure these
needs are met every day. But like all people,
they long for more. They want their children
to get a fair start in life. They want to have
some control over their lives. They want
their children to thrive. They want their chil-
dren to experience joy. Sesame Seeds—and
the similar projects we hope will follow—can
provide the basis for describing what the
humanitarian response of the future should
look like. As these stories emerge, we need
to repeat them so frequently that no one can
remember when they were exceptional. Part
of our recalibration may mean shifting more
of our time and money to the task of helping
build and tell this shared story—one that is
not about a specific project or organization,
but about a wave of unstoppable change
occurring across the world.
THE HIDDEN VALUE OF 100&CHANGE:
HELPING PEOPLE DREAM BIG AND
THINK DIFFERENTLY
The value of large grants depends on the size
of the problem and the maturity of the field.
That is what determines how big an Ebbinghaus
illusion $100 million can create.
Sometimes $100 million might actually
solve a problem once and for all.
In other cases, $100 million might be enough
to remove a well-defined obstacle that would
allow for the rest of the system to function
more effectively.
In this case, we have a large, seemingly
intractable, global problem that few have
attempted to tackle. It will not be solved quickly
or easily—and certainly not for $100 million.
However, what the award can and has done is
help people dream big and think differently.
Leaders from Sesame Workshop and the
IRC indicated that without the promise of the
prize, they would never have spent the time to
think through what an early childhood project
of this scale would look like. Today, they are
wondering whether a bold vision combined with
a clear plan might drive the funding instead of
the other way around.
We are of course biased, but—in our opinion
—this kind of help is a great value for the
money.
FINDING, FUNDING, AND SCALING • WINTER 2019 17
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
Doing Competitions
the Right Way
The legal and logistical challenges to hosting a competition are surmountable,
but they require proper planning and due diligence.
BY ROCHELLE ALPERT & JOSHUA MINTZ
W
hen the MacArthur Foundation
launched the 100&Change com-
petition, the idea was to attract a
range of innovative solutions to a serious social
problem. Although fairly straightforward on
its surface—the winner would receive a $100
million grant to enable real progress toward
a meaningful and lasting solution to a critical
problem of our time—the reality was far more
complex. A successfully run competition, which
minimizes risk to the sponsoring organization
while meeting a variety of objectives, takes
planning, a substantial investment of time and
resources, as well as meticulous and detailed
execution to pull off successfully.
MacArthur’s decision to run such a competi-
tion assumes that reaching out to experts in a
variety of disciplines can bring new approaches
to seemingly intractable problems. While hardly
a new concept with regard to philanthropy,
competitions continue to generate substantial
interest for the philanthropic community. The
reasons are manifold, but they include the grow-
ing interest in innovation and disruption, the goal
of highlighting and teaching issues of concern,
achieving greater brand awareness—including
attracting new supporters and talent—and/or
multiplying the value of the sponsor’s funding
for the organization’s area of interest.
THE DOWNSIDE
Every competition is different, but there are
certain issues that every competition by a
nonprofit organization needs to consider and
likely address.
Notwithstanding the allure of competi-
tions, their benefits must be weighed against
the burdens they place on sponsors, entrants,
Rochelle Alpert is partner at Morgan, Lewis & Bockius, LLC.
Joshua Mintz is vice president, general counsel, and secretary
at the MacArthur Foundation.
18 FINDING, FUNDING, AND SCALING • WINTER 2019
and organizers. Two initial questions to ask: Is
a competition the right approach for the issue
at hand, and will it attract entrants of value to
your organization? If the answer is yes, sub-
sequent planning should consider what types
of entries you want to attract and how best to
entice them through outreach and publicity.
Some organizations may assume that they
can attract quality entrants, and even reputable
persons from outside to serve as judges, simply
by offering a competition, but that is rarely the
case. A successful competition will normally
engage many applicants, but to have a handful
of winners, or even a single qualified winner,
entrants will likely need to spend time and
resources without any compensation, which
will dissuade at least some from participating.
(The same can be said for external judges.)
At the outset, it’s also critical to decide
whether and how you are going to assess the
value of the competition to your organization.
Success may be defined through objective or
subjective assessments, depending on your
goal(s) for the competition. If your chief aim
is to enhance your organization’s brand or
increase awareness of a particular issue,
that result may depend on subjective assess-
ment. But if your goal is to attract a new and
effective solution to a problem or to increase
donations for solving the problem, the success
of the competition may be readily measured
through an objective assessment of some type
extending beyond the end of the contest. A
competition might even require an objective
measurement of the proposed entries before
a prize is even awarded. For example, the
competition could require that measurable
goals be met through the entrants’ solution
before the prize is awarded.
Ultimately, every organization wants a
competition to enhance its reputation in the
community, while investing with finite resources.
That said, there are many pitfalls to avoid here:
Embarking on a competition requires persever-
ance, creativity, and a significant investment of
time and money to ensure that all foreseeable
issues, including legal ones, can be addressed.
Picking the right consultants for the competi-
tion’s design and execution is essential, so that
entries are forthcoming and are judged fairly in
accord with the rules.
Nonprofits, much like businesses, need to
avoid the specter of unhappy entrants claiming
that an organization ran afoul of its own rules.
The best way to avoid bad publicity—whether
from a failed competition; disgruntled winners; or
unhappy losers who sound off on social media,
civil or government lawsuits, and so on—is to
treat all entrants equally and apply the rules
fairly. You have to think of your rules as form-
ing a “contract” with all entrants. Address at
the outset as many issues as you can imagine
might arise in creating and administering the
competition, and establish procedures for how
any such conflicts will be resolved. Ultimately,
following the rules as written constitutes your
best defense against disputes or criticism.
You also need to address the particular idio-
syncrasies of various awards. For example, if a
trip is the prize, you must address any issues
that may arise from the travel and define the
expenses to be covered. Likewise, if a car is the
prize, you must require entrants to be of driving
age, to be licensed, to have insurance, and to
pay any vehicle transfer fees.
Before you publicly announce plans for
ILLUSTRATION BY TIM COOK
a competition, leave sufficient lead time for
addressing the development of procedures
for implementing the rules of the competition.
At this stage, it’s also worth examining both
practical and policy issues associated with the
competition, including:
 ■■ Who will be responsible for developing
the rules governing entrants’ interactions
with your organization
■■ How you will make sure the rules are
unambiguous and adhered to through-
out the competition (including address-
ing any abuses that you may or may not
foresee, such as any conflicts from entries
by organizations, entities, or people with
whom the organization has a prior existing
relationship)
■■ Eligibility standards and confirmation of
the compliance with eligibility standards
of the winning entrants
■■ How you will announce winning entrants,
and how you will celebrate or use winning
entries
The MacArthur Foundation was starting
ILLUSTRATION BY TIM COOK
from scratch. We recruited a cross-disciplinary
team from across the organization led by Cecilia
Conrad, managing director of the MacArthur
Fellows. We tried to consider all relevant issues
and were keenly aware of the reputational
risks associated with this effort. We retained
Common Pool, an experienced firm that had
managed a number of other competitions. We
also retained a consultant to help us evaluate
the program and conduct the next round more
effectively. We based the process on values that
were nonnegotiable: openness; transparency;
attention to diversity, equity, and inclusion;
and the commitment to provide benefit to all
applicants.
LEGAL ISSUES
Before launching a competition, sponsors
should carefully consider the range of legal
issues that might arise and formulate plans to
address them thoroughly. Different styles of
competition and methodology will raise dif-
ferent issues, so experienced counsel is critical.
Nonprofits that sponsor a competition—
particularly private foundations—require spe-
cial consideration under the law. Some of these
concerns include:
■■ Ensuring that the prize serves your chari-
table purpose
■■ Avoiding more than incidental private
benefit to third-party interests as part of
the project that might be funded through
the competition
■■ Avoiding the use of proceeds for lobbying
or intervention in political campaigns
■■ Avoiding self-dealing under private foun-
dation rules
■■ Avoiding excess business holdings
■■ Adhering to the rules regarding grants to
individuals, including prizes and awards
In addition to specific rules that apply to
the sponsor as a nonprofit, there are general
legal issues that should be addressed, includ-
ing those that vary depending on the structure
of the competition. For example, is it based
on chance or skill? Sweepstakes are based
on chance and have one set of legal param-
eters, while skill-based competitions must
adhere to another. (It is easy to find yourself
inadvertently in the realm of chance if you do
not craft your skill competition carefully.) In
the United States, generally speaking, only
governmental entities have the right to run
chance competitions with consideration (e.g.,
FINDING, FUNDING, AND SCALING • WINTER 2019 19
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
lotteries), and each state has its own rules that
apply to organizations, including nonprofits.
To complicate matters further, each coun-
try has its own set of governing requirements.
Thus proceed with caution with an international
competition. They are many obstacles to run-
ning a worldwide event, particularly when you
also have to follow US nonprofit requirements.
For competitions limited to entities or residents
of the United States, you will need to consider
the requirements in both federal and state laws.
In short, an appropriate characterization of
the competition is important in determining the
nature of the laws that will apply to it. For example,
if results are determined by random drawing or
by a public vote on the Internet, your competition
may fall within federal and state legal prohibitions
on lotteries, if it is determined that the competition
involves chance and monetary—or in some cases
nonmonetary—consideration. Consequently, to
avoid being classified as a lottery, a competition
that requires an investment of significant time
to craft a winning entry and/or any payment of
money should also avoid the element of chance
to minimize legal risk.
You can avoid the consideration issue by
providing for an alternative means of entry that
does not require consideration. For example,
if one way of entering your competition is to
raise donations for the organization, you can
avoid the element of consideration, if qualify-
ing entries can also be made without raising
any money. To be successful with this type of
structure, you need to treat all entries the same.
For example, entries that raise donations will
have just as much chance to win as entries that
do not. Providing extra chances to those who
actually raise funds for the organization versus
those who enter through an alternative means
of entry will not suffice to eliminate consider-
ation, since the two types of entrants are not
treated equally.
Alternatively, you can avoid being classified as
a “lottery” by eliminating any element of chance
in the competition. This can be accomplished
by specifically defining selection criteria and
a selection process that includes competent
judges who assist the selection based on the
predefined criteria. If the criteria are not used
to choose the winning entry, your competition
could be challenged as an illegal lottery. In short,
risk exists if the odds of winning depend on the
number of participants, not the content of the
entries, as evaluated by qualified judges. This
element must be carefully assessed in the
structure of the competition.
Ofcourse,anychangesmademid-competition
must be done, if at all, with care, explained
20 FINDING, FUNDING, AND SCALING • WINTER 2019
carefully to all involved, and made only after
considering how potential changes may disad-
vantage entrants. If a clarification puts certain
entrants at a disadvantage or materially changes
the rules midstream, some entrants may cry
foul. The guiding principle should always be to
treat all entrants equally.
MacArthur was careful in preparing its
rules, terms, and conditions. (See rules at
www.100andchange.org.) Yet we still learned
valuable lessons that will inform similar future
efforts. An important lesson is to secure an
unbiased third party to review the rules and
flag any ambiguities.
PRIVACY AND INTELLECTUAL PROPERTY
Other important elements to consider when
creating a competition include privacy and
intellectual property, both of which create
risks for the sponsor. The importance of each
of these depends, of course, on the nature of
the competition.
One area fraught with potential problems
is the collection, storage, and maintenance of
MacArthur’s approach to these
issues embraces the foundation’s
core values: Intellectual property
rights should be used for the
public good and distributed widely.
personal information and other data that may
be obtained from entries. Understanding and
adhering to applicable laws is critical. The
sponsor must clearly disclose how information
will be treated, shared, stored, protected, and
disposed of. The differences in state laws must
be considered. Generally the sponsor should
seek to meet the most rigorous standards.
In addition, if the competition is open to
entrants outside the United States, data collec-
tion must comply with the requirements of all
relevant countries. This, in turn, may generate
conflicting requirements. For example, if the
award is greater than $600, then the sponsor
may need to report the award to the Internal
Revenue Service, which requires the taxpayer’s
identification number. But requesting this type
of information from an individual outside the
United States may violate the privacy require-
ments of other countries.
Intellectual property rights fall into multiple
categories for the sponsor. The clearance and
protection of the sponsor’s own intellectual
property in the competition, such as the
competition’s name and content shared with
entrants in the competition, must, of course,
be addressed.
To the extent that the entry incorporates
intellectual property of the entrant and others,
such issues must be addressed in the rules, so
that the sponsor is protected from any liability
for misuse of the entrant’s intellectual prop-
erty or that of third parties. The rules must
state who will own the entries submitted and
what rights the sponsor may have to the ideas
contained in the entries and/or the resulting
solutions. Requiring the entrant either not to
use third-party content or to disclose such
use and obtain consent from the third party
is critical for protecting the sponsor. Likewise,
ownership of the winning entry or entries
must be carefully considered both according
to intellectual property norms and under the
rules governing the sponsoring organization’s
nonprofit status.
Lastly, the sponsor needs to consider any
future liability arising from implementing ideas
that may appear in the entries
submitted. Like movie studios
that receive unsolicited scripts, the
sponsor should consider specifying
in the rules that entries should not
include proprietary information or
trade secrets, so that the sponsor
limits future liability for any alleged
misuse of an entry.
The MacArthur Foundation’s
approach to these issues
embraced the foundation’s core values:
Intellectual property rights should be used for
the public good and distributed widely at little
or no cost. Moreover, MacArthur decided to
advance the entrants’ ideas through a website
dedicated to featuring the submissions, so
that other organizations might support them.
If done right, competitions can be valuable
tools to enhance the impact of a philanthropic
organization and its entrants. Organizations
wishing to embark on this journey would be
well served to seek the advice of experienced
consultants and legal counsel to help chart the
right course. In furtherance of the MacArthur
Foundation’s mission and culture, its repre-
sentatives are available to discuss the lessons
learned from 100&Change with other philan-
thropic organizations. We maintain a series of
blog posts capturing some of these lessons,
we are also conducting a series of webinars,
and our website provides contact information
for members of the 100&Change team at
www.macfound.org/100&change/.
Making Better Big Bets
Philanthropy is poised for a grand transformation, but it will require a lot of investment,
capacity building, and experimentation to get it right.
BY HEATHER MCLEOD GRANT & ALEXA CORTÉS CULWELL
I
t has become cliché to say that the
United States is entering a new gilded
age of philanthropy—one that could
make the original era of the early 1900s seem
unambitious by comparison. The question being
asked now is, will this philanthropy actually
create greater impact on important problems,
or will it be mere charity that reinforces an
increasingly tenuous status quo?  universities and hospitals receive so much
The stakes have never been higher. The
well-known Giving Pledge (where billionaires
commit to donate at least half of their wealth
while living) now boasts more than 180 families
and $800 billion in capital. Additionally, the next
few decades will see a massive intergenerational
transfer of wealth, as baby boomers pass up to
$30 trillion on to heirs, some of which will end
up in foundations and donor-advised funds
(DAFs). And thousands of recently minted
centa- and deca-millionaires are also eager to
give back and “make a difference”—total giving
in the United States exceeded $410 billion in
2017. The amount of private capital available
for philanthropy has never been greater.
The problem is, the philanthropy “market-
place” isn’t set up to support effective deploy-
ment of these assets, and new donors face a
number of internal and external barriers to giv-
ing. Despite decades of strategic philanthropy,
social innovation, and conversations about
growth and scale, the sector still lacks efficient
mechanisms for matching resources with needs
at the magnitude required to create lasting social
change. This creates a compelling opportunity
to rethink the next decade of philanthropy and
build a better giving marketplace—one that
motivates donors to deploy resources more
effectively to solve meaningful problems.
Heather McLeod Grant and Alexa Cortés Culwell
are the cofounders of Open Impact, a strategic advisory firm
partnering with social change leaders and philanthropists to
envision, design, and accelerate their impact. They both have
more than 25 years of experience in social change and philan-
thropy. Heather is coauthor of the best-selling Forces for Good,
and together they authored “The Giving Code: Silicon Valley
Nonprofits and Philanthropy”; they are frequent contributors to
Stanford Social Innovation Review.
FROM SMALL, SAFE, AND
SCATTERED GIVING …
The critique of the status quo goes something
like this: On the capital supply side, much philan-
thropy is short-term, too small, overly restricted,
detached from end-user needs, fragmented, and
risk-averse, and doesn’t address root causes
or systems change. (This is why safe bets like
funding.) The interests of donors direct giving,
rather than market demand or real needs; and
most donors don’t initially know how to give
effectively. Additionally, because of federal poli-
cies, philanthropic capital is allowed to accrue
in foundation endowments and DAFs faster
than it is given away. Today, there are literally
billions, if not trillions, of philanthropic dollars
not being put to use.
On the demand side—because of how
funding is structured, and because there are
few barriers to entry, mergers, or failures—the
nonprofit sector is highly fragmented and ane-
mic. Hundreds of thousands of small groups
struggle to survive and are unable to provide
solutions at scale. They don’t have the “virtuous
capital” needed to invest in the talent, systems,
or growth that would allow them to eventually
achieve an “end game” or hand off their solu-
tions to government or private markets. In
fact, fewer than 1 percent of nonprofits boast
a budget over $50 million, a number that pales
in comparison with those of large companies.
This presents the sector with a Catch-22:
Like their for-profit counterparts, nonprofits and
their causes can’t grow without a large infusion
of more flexible capital—but donors are skittish
about funding groups that appear ineffective
precisely because they are capital starved. We
are hardly the first ones to note these dynamics:
A number of sector leaders have been chipping
away at this problem for several decades. Now,
however, global challenges such as climate
change, income inequality, immigration and
refugees, and the very future of liberal democ-
racy are becoming more dire. Not to mention
that philanthropy itself is provoking a backlash,
with several recent books launching critiques of
current giving and questioning whether donors
will act against their own self-interest for the
greater good. What, exactly, is to be done?
…TO BIGGER, BETTER, SMARTER,
FASTER GIVING
How can the sector help distribute more phi-
lanthropy, more effectively and more quickly,
to solve more problems? A recent article in
Stanford Social Innovation Review (SSIR) by The
Bridgespan Group made the case for “big bet”
philanthropy—grants of $10 million and up going
to a single organization or cause. The authors
analyzed large grants over the past decade
and illustrated how critical this infusion was
to scaling solutions; they also outlined barriers
to big bets, including lack of donor trust and
deal flow. We want to build on their thinking
and provide some ideas for how to overcome
these barriers.
At Open Impact, our experience advising
nonprofits, foundations, and new donors—
and conducting related research—may offer
some insights. While we don’t have all the
answers, we do have hypotheses about how
to improve philanthropy’s performance as a
sector, and we’re eager to dialogue with oth-
ers. For starters, we believe that more giving in
larger amounts is necessary but not sufficient.
Rather, the sector needs more strategic giving
that builds on existing knowledge, assets, and
ecosystems, and that aims to solve underlying
structural issues and problems. As a sector, we’ve
invested decades—and trillions of dollars—in
social innovation, experimentation, and learn-
ing. There is no reason to start from scratch.
The sector needs to give new donors the tools
that will help them succeed and motivate them
to think more expansively about where and how
to deploy their capital. Likewise, established
foundations of all ages, issue areas, and sizes
need to share their knowledge and networks
with these new donors. We also believe that
FINDING, FUNDING, AND SCALING • WINTER 2019 21
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION
more sophisticated intermediaries are needed
to broker connections between new capital
and existing organizations, movements, and
solutions. In other words, our sector needs to
cultivate a more robust philanthropic ecosys-
tem and build a truly functioning social change
marketplace. This won’t be easy, but it might
just be worth it.
WHAT DO NEW DONORS NEED?
To start, it is worth considering what new
donors need to be successful. We know from
our research into Silicon Valley philanthropy that
new donors struggle to give effectively and that
the market is not structured well to help them.
Donors’ business experience doesn’t always
translate to solving market failures or complex
social and environmental challenges, and many
of them are busy with careers, families, and run-
ning companies. They have little time to focus
on their giving or to learn all that it takes to be
an effective philanthropist. Consequently, they
either end up reinventing the wheel or making
safe choices with limited impact. Giving money
to an alma mater, a private school, or an elite
institution is both less risky and far less com-
plicated than creating an effective portfolio on
climate change, income inequality, immigration,
or homelessness, for example.
Most new donors need time, experience, and
trust to scale their giving. By the time a major
donor is ready to make a big bet of $10 million
or more, they’ve usually been engaged in philan-
thropy for at least five to 10 years. In our experience,
donors need this time to discover what issues they
care about, what approaches to take, and what
outcomes they hope to achieve. Most donors
learn by doing: making small grants, building
confidence, and then scaling up. Very rarely does
a donor start out with a $10 million gift—let alone
$100 million. Savvy fundraisers have known this
for a long time, which is why they invest so much
in donor cultivation. As a field, we should consider
ways to make this learning curve less steep.
Donors also need more and better informa-
tion about how philanthropy and social change
works—and how it can be very different from
business, requiring different mind-sets, tools,
and approaches. To make sure their big bet is also
a smart bet, donors need to understand which
strategies will help create change—whether
scaling up individual organizations, investing in
networks and collective impact, funding move-
ments and advocacy, or building field capacity,
to name just a few approaches. They also need
feedback loops, and ways of measuring their
impact, to know if their grantmaking is working
and to motivate them to give more.
22 FINDING, FUNDING, AND SCALING • WINTER 2019
Once these donors have identified what they
care about and how to measure success, they
need deal flow. To scale up their giving, donors
need a pipeline of “shovel ready” deals that
are large enough to absorb significant capital.
Unfortunately, finding these proven organiza-
tions or causes is difficult, because of structural
dynamics noted earlier. Indeed, the sector will
likely need to invest in intensive capacity build-
ing to help a subset of successful nonprofits (or
leaders and movements) become more big
bet ready. Many new donors also need ways
to outsource some of their giving—especially
if they have significant wealth; if they can’t
“build” it themselves, they should at least be
able to “buy” solutions.
Because these are complex challenges and
the sector is so fragmented, donors often need
trusted guides to help them with the process
of learning how to be an effective philanthro-
pist—and to motivate them to have more impact
with their wealth. Whether wealth managers,
family office staff, philanthropic advisors, or
other brokers, we think the role of intermediar-
ies has never been more important. In fact, we
think the larger social sector and established
foundations have an important role to play in
motivating and guiding these donors as well.
AN ASSET-BASED DEVELOPMENT
APPROACH
As it turns out, many of the things new donors
need to give “bigger, better, and faster” already
exist in the sector—from information, to oppor-
tunities to experiment and learn, to actual deal
flow. Unfortunately, these assets are hard for
individuals from outside the social sector to
find or access. In fact, existing foundations, if
properly organized, could help build a more
robust philanthropy marketplace by sharing
their knowledge and networks, and helping new
donors to experiment, learn, and scale up. If the
sector can connect existing assets with new
money, it might just be a winning combination.
After all, foundations and nonprofits have
spent decades researching and experimenting
with social change across every issue imagin-
able—from early childhood development to
climate change to prison reform. They have
been an R&D lab for society. Unfortunately,
most of this information is contained in private
reports, buried on websites, or held in the form
of tacit knowledge by seasoned grantmakers
and experts. And while there is much published
on social change and philanthropy—books,
SSIR articles, white papers—it is not written or
distributed in a way that reaches new donors.
The sector needs a more successful approach
to knowledge management and marketing,
taking new donors’ needs into consideration.
In addition to knowledge, donors need
trusted places to give and learn. Luckily, exist-
ing foundations already have pipelines of
proven, vetted, and diverse grantees. In some
cases, these institutions are looking for exit
strategies for their grants, creating a win-win
opportunity. Established foundations should
explore ways to open their portfolios to new
donors: through sidecar funds, by sharing their
due diligence and reporting, or by acting as a
“philanthropy concierge” to curate specific
investment opportunities for new donors. A few
foundations have begun experimenting with this
approach, including the MacArthur Foundation,
which has worked with the Foundation Center
to create a Solutions Bank of its proposals from
the 100&Change competition.
EMERGING MODELS FOR
CAPITAL AGGREGATION
Relatedly, the field needs more high-quality
intermediaries to help match more capital with
the innovations, organizations, and leaders that
need funding to scale. In the for-profit sector,
there is a whole ecosystem of financial-service
organizations and products that match investor
capital with opportunities, each with a variety
of risk/reward profiles: angel investing, venture
capital funds, hedge funds, private equity, invest-
ment banks, mutual funds, individual stocks,
curated portfolios, etc. Importantly, the social
sector has begun experimenting with new
approaches to capital aggregation and match-
ing financial resources to needs. Here are a few
intermediary models that we know from our
work, and which are important to build upon:
■■ Established foundations. In 2002, the
Pew Charitable Trusts made a counterin-
tuitive move when—despite being one of
the largest private foundations, with bil-
lions of dollars in assets—it converted to a
nonprofit in order to raise additional capital
from donors to fund its mission of being
a global research and policy organization.
While bold, this decision has so far paid off.
In 2017, the Pew fundraising team raised
$41 million from outside donors, and $429
million in 2016. Their unrestricted assets,
beyond their endowment, grew by almost
ILLUSTRATION BY TIM COOK
$95 million in the past few years.
■■ Venture philanthropy funds. Over the
last two decades, venture philanthropy
funds such as New Profit, Draper Richards
Kaplan (DRK), Venture Philanthropy
Partners, the Robin Hood Foundation,
 and Tipping Point have experimented
with aggregating funding from individual
donors, then re-granting to specific non-
profits and holding them accountable
for results. These funds often focus on a
specific issue (e.g., youth or poverty) or on
funding social entrepreneurs with ideas
across many issues. Even though most of
their grants are less than $1 million, these
funds provide a scalable model for aggre-
gating capital from new donors and getting
traction on an issue.
■■ Donor collaboratives. An emerging breed
of capital aggregation funds like Blue
Meridian are similar to venture philanthropy
funds but operate at a larger scale. They
often aggregate more capital, fund more
advanced nonprofits, make larger grants,
and provide additional value to investors,
such as grant coordination. A few exam-
ples include The Rockefeller Foundation’s
Co-Impact, started by the founding direc-
tor of the Giving Pledge; Blue Meridian
Partners, which was launched out of the
Edna McConnell Clark Foundation to aggre-
ILLUSTRATION BY TIM COOK
gate capital for youth-serving organizations;
ClimateWorks, in the climate change space;
and the Energy Foundation, which was an
early aggregator launched in 1991.
■■ Prize philanthropy. In this case, one
foundation or entity conducts a com-
petition—either explicitly focused on a
prize, or via sorting through thousands of
applicants to pick “winners”—and uses
this process to then attract funding from
other donors. In the case of MacArthur’s
100&Change or the Skoll Foundation
awards, the competition creates a market-
place for vetting ideas and then leverages
the resulting pipeline to attract additional
capital. This model borrows from for-profit
markets, where competition helps the
best ideas rise to the top and attract more
funding. Both Race to the Top and the
Social Innovation Fund under the Obama
administration were good examples of this
approach in government.
■■ Pitch sessions. The Audacious Project is
an example of this form of big bet giving,
which is similar to prize philanthropy but
ends with an in-person pitch session to
donors. Cosponsored by TED and Virgin
Unite among others, this model uses a
professional team to vet hundreds of appli-
cants and pick finalist nonprofits. Then,
interested billionaire philanthropists gather
for the final pitch, where social entrepre-
neurs present their pre-vetted solutions,
and donors can decide what they want to
fund and at what amount. Several other
organizations—from SOCAP to the Social
Impact Exchange to Battery Powered in San
Francisco—have experimented with this
pitch model on a smaller scale.
BUILDING A BETTER
GIVING MARKETPLACE
In conclusion, we think that reinventing philan-
thropy for a new era—and for greater impact—
will require leveraging the assets of traditional
foundations, bolstering nonprofit capacity,
building more connective infrastructure, and
experimenting with new models of capital
aggregation. We believe that a new generation
of donors is poised to drive enormous changes
in philanthropy and that the established sec-
tor has a chance to be transformed as a result.
With record growth in the number and scale of
private foundations, DAFs, impact investing, and
mission-oriented LLCs, donors are seeking new
ways to organize their efforts and accelerate
their impact. Established foundations can be
part of the solution—if they want to be.
The big questions remain: Will traditional
foundations, with little internal incentive to change,
reimagine their roles and use their knowledge
and networks to drive greater impact? And will
newly wealthy donors put their money where
their mouth is, and use their funds to change
underlying structures and systems for the benefit
of all? We hope so—in fact, we think the future
depends on it.
References for this article are provided in the online version.
FINDING, FUNDING, AND SCALING • WINTER 2019 23
 Supplement to SSIR sponsored by the MACARTHUR FOUNDATION

The John D. and Catherine T. MacArthur Foundation supports creative people,

effective institutions, and influential networks building a more just, verdant, and peaceful
world. MacArthur is placing a few big bets that truly significant progress is possible on
some of the world’s most pressing social challenges, including over-incarceration,
global climate change, nuclear risk, and significantly increasing financial capital for the
social sector. In addition to the MacArthur Fellows Program, the Foundation continues
its historic commitments to the role of journalism in a responsible and responsive
democracy, as well as the strength and vitality of our headquarters city, Chicago.

MacArthur is one of the nation’s largest independent foundations. Organizations

supported by the Foundation work in about 50 countries. In addition to Chicago,
MacArthur has offices in India, Mexico, and Nigeria.

24 FINDING, FUNDING, AND SCALING • WINTER 2019


HIGHLIGHTS FROM SCHOLARLY JOURNALS
BUSINESS
Misremembering to Feel Better
BY MARILYN HARRIS
urveys indicate that
S half of global consum-
ers report they are
willing to pay more for prod-
ucts from socially responsible
companies. Yet self-reports of
ethical behavior in the market-
place do not appear to match
reality. Sustainable products in
many categories are not market
leaders. For example, despite the
well-publicized need to protect
rain forests, consumers continue
to buy furniture and other items
made from rain-forest wood.
Rebecca Walker Reczek, an
associate professor of marketing
at Ohio State University’s Fisher
College of Business, believes
that selective memory contrib-
utes to this gap between what
consumers say they want and
their actual choices. “People
want to make good ethical deci-
sions; it’s part of how we develop
as humans,” Reczek says. “But
we don’t. I wanted to under-
stand if it’s for marketplace rea-
sons or our psychology.”
In a series of studies, Reczek
and her coauthors explored the
interplay of memory and desire
in ethical considerations when
purchasing products. Their
research probed the effect of
bias on memory generated by
conflict between the “should
self” (how we see ourselves
ILLUSTRATIONS BY ADAM McCAULEY
ethically) and the “want self”
(what we desire) and by the res-
olution of such conflict. The
authors found that people often
suffer from “willfully ignorant
memory”: They forget or mis-
remember ethically relevant
information when it conflicts
with their desire to purchase
something.
“Prior research has shown
that people tend to have poorer
memory of unethical actions
that they had engaged in pre-
viously,” says Angela Lee, the
Mechthild Esser Nemmers
Professor of Marketing at
Northwestern’s Kellogg School.
“What is interesting about this
paper is that forgetting happens
to unethical information peo-
ple encountered, rather than
unethical behaviors they had
performed.”
Reczek understood that pro-
viding ethical attribute infor-
mation to consumers is not
enough to ensure that they
use the information, because
memory has ways of muting
or twisting messages that are
uncomfortable and threaten
their sense of self. Although
some people cope by simply
avoiding questions about eth-
ical attributes when shopping,
participants in Reczek’s study
didn’t have that option: They
were explicitly informed of the
products’ ethical attributes.
In one experiment, uni-
versity students were given
descriptions of six hypothetical
brands of desks that differed in
wood source, quality, and price.
The ethical attribute pertained
to whether the wood was from
endangered rain forests or sus-
tainable tree farms. Asked to
memorize and then recall the
descriptions, participants were
roughly five times more likely
to misremember details about
the rain-forest wood as the
farm wood. Further tests ruled
out explanations other than
willfully ignorant memory.
Reczek also sought to
determine how much willfully
ignorant memory is driven by
the want/should conflict, and
whether willfully ignorant
memory affects not only recall
but also recognition. In this
Stanford Social Innovation Review / Winter 2019 63
experiment, two groups of par-
ticipants were asked to create
an outfit online from a selec-
tion of various T-shirts, jack-
ets, jeans, and shoes, with only
some participants instructed
to place the items in a labeled
shopping cart to indicate pur-
chase. The jeans choices had an
ethical dimension: They were
described as made by adults or
by adults and children.
Participants in both groups
showed a greater propensity
to incorrectly recognize ethi-
cal information when the jeans
were made with child labor. This
confirmed the authors’ hypoth-
esis that when consumers face
want/should conflicts regarding
ethical attributes, the default
response is to allow the want
self to prevail—by misremem-
bering the relevant attribute.
While such willful forgetting
may make people feel better
about certain outcomes, “the
failure to retrieve questionable
ethics-related information from
memory may lead to suboptimal
decision making,” Lee says. 
A third study investigated
how consumers would react
when the product’s ethical attri-
bute was relatively less pressing.
Participants were reminded of
the many other ethical issues
facing humanity, including
some, such as genocide, that are
arguably more distressing than
child labor. That group remem-
bered that child labor was
involved significantly more than
others. “The pressure of the
should self can be reduced when
consumers perceive the ethical
issue at hand as having relatively
less ethical weight,” Reczek says.
“When this reduction occurs,
consumers experience less
64 Stanford Social Innovation Review / Winter 2019
want/should conflict and are
more likely to remember ethical
information.”
The implications of Reczek’s
research are challenging for con-
sumers and social activists alike.
“For consumers, you can’t rely
on memory when it comes to
voting with your pocketbook,”
she says. “You have to take the
time to find out about a compa-
ny’s practices. And companies
focused on ethical production
have to remind consumers at the
point of purchase.” n
Rebecca Walker Reczek, Julie R. Irwin,
Daniel M. Zane, and Kristine R. Ehrich,
“That’s Not How I Remember It: Willfully
Ignorant Memory for Ethical Product At-
tribute Information,” Journal of Consumer
Research, vol. 45, 2018, pp. 185-207.
O R G A N I Z AT I O N A L
DEVELOPMENT
The Private
Benefits of
Corporate
Social
Initiatives
BY MARILYN HARRIS
mployees of an inter-
E national management
consulting company
were surveyed to discover what
motivated them to volunteer
for a corporate social initiative
(CSI) that required them to
take a temporary pay cut. Were
they being purely altruistic, or
did they also anticipate a pri-
vate benefit?
Many companies are mov-
ing from stand-alone corporate
social responsibility (CSR) proj-
ects to social initiatives fully
integrated into corporate strat-
egy. Christiane Bode, professor
at the SDA Bocconi School
of Management in Milan,
Italy, and her co-
researcher had studied
this same CSI previously, from
the perspective of the employee
who persuaded management
and other stakeholders to under-
take it. In this new study, she
sought to determine the consid-
erations that would motivate an
employee to volunteer for such a
project for less money.
Firms have come to see CSIs
as worthwhile programs because
they help attract, motivate, and
retain talent. Employees value
participating in projects with
social impact, and such pro-
grams also increase goodwill
for the firm. In addition, CSIs
“could be seen as a leadership
development tool, similar to
executive education programs
offered to high-performing
employees,” Bode says. In this
case, “there was also the hope
that the initiative might prepare
employees to better work in
emerging markets where engag-
ing with civil society might be a
prerequisite also for successful
implementation of commercial
project work.”
Apart from the savings
from paying less to those who
volunteered, the firm could
also assign a dollar value
to the less-tangible bene-
fits that would adhere from
CSIs. By taking these fac-
tors into account, firms can
gain “probably a good
deal more” than the
amount of compensa-
tion saved, said Barbara
Dyer, senior lecturer
and executive director
of the Good Companies,
Good Jobs Initiative at
the MIT Sloan School of
Management.
At the management
consultancy that Bode
studied, the CSI was structured
to be self-sustaining. The firm
saved $28 million in compensa-
tion paid out between 2002 and
2013 by reducing the pay of par-
ticipating employees by either 25
percent or 50 percent, depend-
ing on the host country. The cli-
ent social-impact organizations
paid only a third of the fees nor-
mally charged, offsetting the
firm’s hard-dollar savings.
Bode and her coauthor con-
ducted 32 interviews with 20
CSI participants, including 12
interviewed both before and
after their CSI participation.
The interviews contributed to
the design of a survey that the
researchers later administered
to the firm’s employees in the
United States, Canada, the
United Kingdom, and Ireland.
The assessment measured
employees’ interest in partici-
pating in a CSI with or without
a pay cut and how much of a
cut they’d accept.
Of the 665 employees who
responded to the survey, 113
had already participated in the
firm’s CSI. The researchers’
analysis focused mainly on the
majority of employees who had
not participated in the CSI, to
avoid those whose perceptions
might have been colored by
experience.
MARILYN HARRIS is a reporter, writer,
and editor with expertise in translating
complex or technical material for online,
print, and television audiences.
The results showed that a
significant fraction—roughly
25 percent—of employees was
willing to accept “nontrivial”
salary cuts for the CSI opportu-
nity. What’s more, a significant
portion of past CSI participants
so valued the experience that
they were willing to accept an
even greater pay reduction for
the opportunity to take part
again. “This suggests that, in
general, CSI participation con-
tinued to be attractive beyond
just a one-time novelty,” the
researchers write.
Many participants expected
that in addition to “making a
difference,” CSI participation
would yield them private bene-
fits, such as the opportunity to
have more leadership responsi-
bility sooner than they might in
their regular jobs at firms.
Interestingly, employees with
previous volunteer experience
were, on average, relatively more
optimistic about both making a
difference and reaping private
benefits than employees with
MBAs. “For the type of person
that selects into an MBA pro-
gram, social impact work may
overall be less attractive than
for other types of employees,
given their career aspirations,”
Bode says. “Another explana-
tion may be that individuals
who have previously attained
an MBA might have incurred
large debts to pay for the degree,
which is in line with our find-
ing that MBAs are particularly
sensitive to the requirement to
accept a salary cut.”
Still, almost two-thirds
of the CSI-willing employees
whom the researchers inter-
viewed personally expected CSI
participation to yield a private

benefit. “The diversity of expe-
rience that is gained through
these projects builds greater cul-
tural awareness, empathy, stron-
ger team and leadership skills,
and a range of analytic capabil-
ities—all desirable qualities,”
says MIT’s Dyer, who previously
spent 18 years as a senior execu-
tive in a global corporation lead-
ing CSR strategy and programs.
“The authors move the debate
forward by recognizing and val-
idating the layers of motivating
factors that enter into employee
choices to engage in corporate
social initiatives.” n
Christian Bode and Jasjit Singh, “Taking a
hit to save the world? Employee participa-
tion in a corporate social initiative,” Stra-
tegic Management Journal, vol. 39, 2018, pp.
1003-1030.
LEADERSHIP
How a Janitor
Put a Man on
the Moon
BY CHANA R.
SCHOENBERGER
xecutives and manag-
E ers often think they
can motivate their
employees by communicating
their organization’s highest
aspirations in an attempt to
infuse their day-to-day work
with meaning. But recent
research findings are equivo-
cal on this point, with some
such efforts leaving employees
more dispirited. The ambiva-
lence may be explained by the
disconnect between aspira-
tions and humdrum tasks. The
question is whether leaders can
bridge this gap.
A recent paper by Andrew
Carton, a professor of manage-
ment at Wharton, examines
President John F. Kennedy’s
ambitious goal to put a man on
the moon within a decade and
the steps NASA took to commu-
nicate this aspiration to agency
employees in a way that inspired
their collective work toward his-
toric success. Records suggest
widespread feeling among NASA
employees during the 1960s that
they were working toward the
same lofty goal of helping the
United States to reach the moon,
no matter their individual job.
“I wanted to look at peo-
ple’s ability or inability to see a
connection between their work
and the overriding purpose of
the organization they work for,”
Carton says. The quote from a
NASA janitor in the title of his
paper—“I’m Not Mopping the
Floors, I’m Putting a Man on
the Moon”—is apocryphal. But
when Carton went back to pri-
mary sources, he found multi-
ple quotes from workers at the
space agency during the moon
missions that expressed similar
sentiments. In the time before
Neil Armstrong’s 1969 moon-
walk, NASA employees said they
felt “they were putting people
on the moon even if they were
secretaries,” he says.
The study offers
“an inductive analy-
sis of how Kennedy
and leaders of
NASA in the 1960s
communicated to
employees about
NASA’s ultimate aspirations,”
Carton writes. He used pri-
mary sources, including NASA’s
archive of documents, as well
as documentary footage, inter-
view transcripts, and books
quoting NASA employees.
Carton found that Kennedy
and NASA leaders implemented
four stages of “sensegiving” as
they focused employees’ atten-
tion on a common organiza-
tional purpose. They started by
reducing NASA’s ultimate aspi-
rations down to one single goal
and gradually homed in on a
concrete and quantifiable objec-
tive: landing a man on the moon
and bringing him back safely.
These actions translated
into five levels of employee
engagement and connection-
building between day-to-day
tasks and the organization’s
aspiration. Employees were led
to understand that there were
specific steps to take for NASA
to achieve its ultimate goal,
and how they would each play
a part. This resulted, finally, in
workers feeling as though their
own daily work contributed to
the organization’s mission of
putting a man on the moon.
“Leaders thus act as archi-
tects by setting a highly par-
ticularized enabling condition
(constricting attention to a
single end-point), and employ-
ees act as builders who do the
heavy lifting by construct-
ing a complex lattice-work of
Stanford Social Innovation Review / Winter 2019 65
CHANA R. SCHOENBERGER
(@cschoenberger) is a journalist based in
New York City. She writes about business,
finance, and academic research.
connections between their
own work, the work of other
employees, and the organiza-
tion’s goals, ultimately gaining
a sense of their unique personal
contribution to the organiza-
tion,” Carton writes.
A new finding in this paper,
Carton says, is that leaders
should assume that employ-
ees won’t make a connection
between their daily work and
the organization’s overarch-
ing purpose on their own. It’s a
leader’s job to do this. Carton
envisions such an ideal leader
as an “architect”—instead of a
“transformational visionary”
or “overseer”—who draws a
blueprint of organizational
aspiration that articulates how
each employee’s work builds
the ultimate product so con-
cretely that employees can see
the plan and their place in it,
and become inspired.
Carton’s study “advances
our thinking about the leader
role in organized activity and
also yields very practical advice
for emerging leaders,” says the
University of Michigan’s Susan
Ashford, who calls it one of her
favorite papers this year.
“I think that a key theme
in the article is that it’s
not enough to have a
very big picture vision,
you have to also make it
vivid enough that peo-
ple can feel like it’s con-
crete and something that
they can achieve,” says
Batia Wiesenfeld, Andre
J.L. Koo Professor of
Management at New York
University Stern School
of Business.
The paper offers guid-
ance to executives at
66 Stanford Social Innovation Review / Winter 2019
companies that don’t have an
obvious NASA-style mission
but instead make money from
more pedestrian or commercial
activities. Those leaders also
have to find a way to motivate
employees, even if they are mak-
ing paintbrushes rather than
putting a man on the moon.
And if they set out a lofty aspi-
ration, they also need to com-
municate to employees the step-
ping-stones that connect their
work to that vision.
“The lesson for those people
is you need that big ambitious
goal that unites all the specif-
ics,” Wiesenfeld says. n
Andrew Carton, “‘I’m Not Mopping the
Floors, I’m Putting a Man on the Moon’:
How NASA Leaders Enhanced the Mean-
ingfulness of Work by Changing the Mean-
ing of Work,” Administrative Science Quar-
terly, June 2017.
PHILANTHROPY & FUNDING
Choosing the
Best Charity
BY CHANA R.
SCHOENBERGER
hen people consider
W giving money to char-
ity, how should they
make their decisions? Should
they put more weight on objec-
tive factors, such as the effec-
tiveness of the nonprofit in
question? Or should subjective
preferences, such as passion for
a cause or a personal connec-
tion, determine one’s choice?
In a new paper, Jonathan
Berman of London Business
School, Alixandra Barasch
of the New York University
Stern School of Business,
Emma Levine of the University
of Chicago Booth School of
Business, and Deborah Small
at the University of
Pennsylvania’s Wharton
School examine how we
think about charitable giv-
ing. The researchers’ con-
cerns emerge from recent
debates about effective
altruism, a movement
inspired by utilitarian phi-
losophy that advocates for
people to make charitable
donations to the programs
or organizations that will
produce the most social wel-
fare from the money donated.
The paper examines the extent
to which people think the rel-
ative effectiveness of a charity
should determine whether they
should give money to it, instead
of other organizations.
“I wondered, if there were a
way to give people information
about how effective charities
are, would they use or discount
the information?” Berman says.
Organizations such as GiveWell
are dedicated to promoting
charities that demonstrate
effectiveness.
The study consisted of five
experiments using participants
drawn from university
behavior-lab pools and online-
task marketplaces. The first
two experiments established
that people think the decision
to donate to charity is rela-
tively subjective and comparable
with other personal decisions,
and that people think it appro-
priate for charitable givers to
prefer charities or causes with
which they have an emotional
connection. In further exper-
iments, the researchers found
that subjects were more likely
to favor maximizing welfare on
the basis of effectiveness when
they were investing money,
rather than choosing a charity.
Subjects were also less likely to
give themselves permission to
choose the option that didn’t
maximize welfare when they felt
they were responsible for the
consequences of such a decision;
they felt the same if another per-
son was responsible.
The research points to a
shortcoming in the view of some
effective altruists that charitable
givers fail to maximize welfare
because they make mistakes or
lack the right information. While
people are willing to use effec-
tiveness as a criterion to decide
between different charities
devoted to the same cause, they
eschew this when faced with a
decision about different types of
charities and causes. Rather than
being “distorted altruists,” such
givers are making a normatively
appropriate choice to think sub-
jectively about their donations,
study participants thought.
According to the studies, donors
feel that consulting quantita-
tive data on the charity’s impact
isn’t necessary when people
are choosing between charities
devoted to different causes—one
supporting cancer research and
another supporting animal wel-
fare, for instance.
“In contrast, the current
research shows that the benefits
of comparing charity effective-
ness are limited when causes
vary by type, as people often
believe that it is more import-
ant to choose an option that
they emotionally connect with
rather than an option that does
the most good,” the researchers
write. If you are partial to cats,
you may choose to support a
cat shelter even if you’re shown
data indicating that a dog shelter
does a better job of helping dogs
(or saving animals overall) than
the cat shelter does of helping
cats. That may not be what you
ought to do, according to effec-
tive altruists, but people gener-
ally do not share this view.
Because the study shows
that people think that choos-
ing which charity to support is
subjective, not objective, giv-
ing them more information on
charities’ effectiveness won’t
solve the problem of donors
giving to ineffective charities,
the researchers find.
“Our results suggest that
people view charity decisions
as being relatively subjective,
which inhibits the impact of
effectiveness information on
welfare maximization,” they
write. To get people to choose
the option that provides the
greatest social welfare, more
information may not help, the
researchers write. “Rather, it
may require altering how indi-
viduals view their role as a
donor altogether,” they write. n
Jonathan Z. Berman, Alixandra Barasch,
Emma E. Levine, and Deborah A. Small,
“Impediments to Effective Altruism: The
Role of Subjective Preferences in Charita-
ble Giving,” Psychological Science, May 2018.

REVIEWS OF NEW AND NOTABLE TITLES
Not Quite Everything
Nathan Schneider’s chronicle of the cooperative movement
dazzles with stories but is short on solutions.
REVIEW BY GAR ALPEROVITZ
N
athan Schneider’s Everything
for Everyone: The Radical Tra-
dition that Is Shaping the Next
Economy is a whirlwind tour of
the cooperative movement flourishing in our
digitally connected global society. A profes-
sor of media studies as well as a journalist,
Schneider, and his collaborator, the scholar-
activist Trebor Scholz, are responsible for
some of the more inventive digital efforts
unfolding under the name of “platform co-
operativism,” which they define as an effort
to develop “shared governance and shared
ownership of the Internet’s levers of power.”
Schneider’s expertise, passion, and sense
for new possibilities shine through the sto-
ries that unite his book. These narratives
are drawn from his own extensive trav-
els; from the caves of Matera, Italy, where
he talks about rediscovering the rules of
monastic life as a template for networked
cooperation with young activists who are
experimenting there with self-imposed exile
in the 21st century digital monasteries, to
the streets of Jackson, Mississippi, where
he discusses how to remake the economy
of the Deep South based on cooperative
enterprise with veteran organizers for Black
liberation. Schneider writes with a journal-
istic objectivity that conveys a sense of deep
personal commitment by honoring the work
of generations that laid the foundations for
the contemporary cooperative movement.
Such commitment is necessary, espe-
cially in perilous times. One of the many
historical gems in Everything is an eye-
popping quote from 1930s socialist Nor-
man Thomas: “The only effective answer
to the totalitarian state of fascism is the
cooperative commonwealth.” It’s perhaps
no surprise that the latter—the vision of
a new society based in cooperative enter-
prise—has become relevant once again
when the former is distressingly reemergent.
In moments of crisis, alternative visions and
ideas can serve as novel solutions. In the
1930s, the United States managed to chart
a narrow third course—a “new deal” that
struck a fragile balance of corporate and
union power—between industrial capitalism
and the welfare state. But even as the New
Deal focused on regulation and redistribu-
tion, the socialist dream of the cooperative
commonwealth, transforming not just out-
comes but the underlying ownership of the
economy, was realized in local and federal
government programs, especially in rural
areas, where government loans to nascent
cooperatives, for example, brought electric-
ity to large swaths of the country.
Much like the age of electrification—as
Schneider is right to insist—our digital age
poses unresolved questions about access
EVERYTHING FOR EVERYONE:
The Radical Tradition that is
Shaping the Next Economy
By Nathan Schneider
304 pages, Nation Books, 2018
Stanford Social Innovation Review / Winter 2019 67
GAR ALPEROVITZ is cofounder of The Democracy
Collaborative and cochair of the Next System Project.
and power: Who can connect, and to whom,
and under what terms? And just as with the
advent of electric power, this digital revolu-
tion continues to inspire dreams of a trans-
formed future. Fueled by speculative capital,
these dreams have unfolded as promises of
ease and convenience, a thousand-and-one
services remaking the world as a cacophony
of “disruption.”
With digital power reconcentrating and
networks recentralizing under corporate
control, Schneider and Scholz imagined the
platform cooperative as a way to address the
“nagging questions of ownership and gov-
ernance” left out of the vague promises of
digital disruption. The platform cooperative
enabled them to advocate for a commitment
to realizing concrete forms of democratic
ownership: An Uber owned by its drivers.
A Twitter owned by its users. An Amazon
owned by everyone.
Schneider, as a participant and an
observer, is well-positioned to both tell the
story of this movement and its milieu and
document the attempts to salvage the dream
of networked cooperation and digital democ-
racy from Silicon Valley’s nightmarish tra-
jectory. His account highlights the spiritual
impulse behind these efforts to create digi-
tal alternatives in order to find new ways of
working and living with each other in coop-
erative economic models based in a desire for
community. Equally important, Schneider
explains the tensions that emerge as the
spiritual visions for a new culture come into
conflict with the realities of actual business
development and real-world collective deci-
sion making that are contentious, slow, and
messy. Like Schneider, for whom “economy
is a form of culture,” I believe that questions
of culture and the institutional forms that
produce and sustain it are essential for any
serious political vision.
However, it is because of these shared
concerns that I ultimately feel Schneider’s
important book fundamentally misses the
mark: He gestures toward the absolutely
critical questions about the relationship
between economic and cultural life, but too
often refuses to answer them. Instead, he
68 Stanford Social Innovation Review / Winter 2019
skates around the contradictions that his
work reveals and quickly moves on to the
next anecdote. For example, cooperatives do
not by themselves construct either a renewed
culture or an alternative political or eco-
nomic system. Faced with a multiplicity of
cooperative economic institutions that hap-
pily coexist with each other and our existing
economic system, and that lack a shared com-
mitment to socioeconomic transformation,
Schneider himself comments that “portions
of the commonwealth have trouble noticing
each other.” But is this lack of recognition
simply an accident of history? Or are there
good reasons to think that Ocean Spray, the
Associated Press, and the international credit
card interchange system—while technically
Cooperatives are undoubtedly important as
models for a democratic economy, but changing
the system is a different proposition ...
cooperatives—may simply not be playing on
the same side as the idealistic young platform
cooperators trying to remake the world that
Schneider spotlights?
In Everything, Schneider occasionally
recognizes the problem—that cooperative
ownership, absent of a politics and cul-
ture committed to a transformative vision,
doesn’t by itself deliver the desired change.
For instance, the Italian cooperative move-
ment has experienced rapid scaling that has
resulted in businesses looking increasingly
like their capitalist competitors, and which,
Schneider observes, leave a younger gen-
eration unsatisfied and in search for more
radical alternatives. Or, consider the electri-
cal cooperatives of the Deep South, which
arguably have stymied economic and racial
justice, even though they offer the potential
for justice—this is a potential which the
incredible organizers of One Voice and their
Electric Cooperative Leadership Institute
have seized upon by mobilizing poor black
residents in Mississippi to take back their
cooperatives from their sedimented white
leadership. Here, what matters is the move-
ment to build local power, rather than the
cooperative form itself.
In elevating cooperatives, Schneider leads
the reader to mistake the model for the sys-
tem. This mistake has political consequences,
because our focus needs to be on changing
the system, not just replicating models. By
elevating cooperatives into one of the “can-
didate regimes” for building a new social
model, Everything blurs the line between
economic instrument and systemic vision.
Schneider’s account invites us to imagine a
movement fragmented in its history and full
of moments of hidden potential and redis-
covery, despite co-ops’ inefficiency alone to
exact systemic change: “co-ops are not an
end in themselves. They’re not a destination.
But they’re the passageway to a peer-to-peer
commons.” But clarifying how this “passage-
way” could operate is the question of political
economy that can’t be answered by hand-
waving. Is the “cooperative commonwealth”
a subterranean network of affinity rooted in
the shared use of an institutional form? Or is
it a democratic-socialist program in which
cooperatives are one part of the means to
the endgame of justice?
Consider Schneider’s account of Barcelona,
centered around the captivating figure of
Enrique Duran, the anarchist bank rob-
ber made famous by his brazen acts of
expropriation-through-debt in the lead up
to the financial crisis and his later metamor-
phosis into tech entrepreneur, as the founder
of the blockchain-powered, grassroots-
centered Catalan Integral Cooperative (CIC).
Yet the cooperative lens that Schneider
focuses on Catalonia’s grassroots movement
for a new economy occludes Ada Colau, the
activist-turned-mayor of Barcelona, and the
remarkable place-based, anti-eviction orga-
nizing effort that took back the city gov-
ernment during the financial crisis. Under
Colau’s leadership, Barcelona has pursued a
“fearless city” agenda, launching a publicly
owned energy company and moving toward
deprivatization in other sectors, including
water, housing, and banking. Barcelona is in
the process of establishing a democratized
economy, with a politics that’s more than
just a collective act of refusal and exodus. An
account of the complete context that makes
both Duran’s bottom-up network organizing
and the citizen platform Barcelona en Comú’s
top-down—but with the people in charge—
leadership possible, and the respective chal-
lenges each are facing, would have provided
a more holistic account of the politics and
culture of Barcelona. Instead, Schneider’s
tourist perspective produces a narrative that
is laser-focused on cooperatives but invites
little room for anything that doesn’t fit this
framework. The result is an eclectic, decon-
textualized collection of anecdotes of experi-
mentation at the margins.
While evocative and inspiring, Everything
tells us little we need to know if we truly
want to change the system. Cooperatives
are undoubtedly important as models for a
democratic economy, but changing the sys-
tem is a different proposition from that of
proposing more cooperatives, and the “next
big idea” thrust of Schneider’s book risks over-
selling the power of the latter. Take worker
cooperatives, for instance: While intuitively
appealing, the truth is that no country has
ever been able to create a worker-cooperative
sector that includes more than a very tiny
percentage of the workforce. We are likely to
find ourselves in a blind alley if we center our
vision of the future on worker cooperatives
alone. In response, I’ve called for a “pluralist
commonwealth” in order to make explicit the
elements at different scales that were already
present in the populist call for a cooperative
commonwealth—notably the transformation
of monetary policy and the public ownership
of large industries (“public” as in national
or sub-national forms like the regional scale
Tennessee Valley Authority). A pluralist
approach to a systemic economic vision gives

us the ability to treat, with rigor, the ques-
tion of institutional design at different lev-
els, rather than assuming that one economic
model holds the solution to all our problems.
Answering the hard questions, about not just
power, scale, and strategy, but also about how
systems—and not just projects—relate to the
underlying mobilizing and organizing force of
culture and politics, is essential to the political
project of advancing a serious shared vision of
a transformed economy.
Despite Schneider’s showcasing of diverse
cooperative projects, his account ultimately
Making Economic
Sense of Religion
Sriya Iyer reveals how faith has driven India’s increasingly
powerful economy.
REVIEW BY KAVITA N. RAMDAS
W
hat does religion have to do
with economics, and vice versa?
While these may seem disparate
concerns, their deep historical
connection drives Sriya Iyer’s inquiry in The
Economics of Religion in India, which endeav-
ors to expand the study of religion through
economic analysis and delves into the chang-
ing demographics of India’s religious plural-
ism in relation to its global economic ascent.
The colonizing powers of Europe incor-
porated the Christian church’s “civilizing
mission” to justify the capture of lands
that did not belong to them, the subjuga-
tion and oppression of people whose cul-
tures and languages were foreign to them,
and the exploitation of resources to fatten
their coffers. An almighty sanction was
invoked by the conquerors to legitimize
the genocide of indigenous peoples across
the New World; promote slavery in the
United States, the Americas, and around
the globe; and motivate the Opium Wars,
which the British East India Company used
to seize Chinese markets while forcing
fails to reckon with the strategies for change
appropriate for the world we have (rather
than for the world we want). Is the platform
cooperative and its promise of a business
model for the 21st century the seed of an
answer to our systemic issues? Or is it a small
marginal phenomenon tolerated in the cracks
of the current system but incapable of chang-
ing its underlying logic? The most frustrating
moments of Everything are these—the ones
where Schneider meets the hardest questions
and falls back on rhetorical equivocation to
avoid answering them. ■
Indian peasants to grow poppies instead
of life-sustaining rice or vegetables.
Iyer wrote the book to “encourage econ-
omists to bring their insights and methods
to bear on the study of religion,” which she
believes would be beneficial for developing
countries, such as India, that are character-
THE ECONOMICS OF RELIGION IN INDIA
By Sriya Iyer
304 pages, The Belknap Press of
Harvard University Press, 2018
Stanford Social Innovation Review / Winter 2019 69
KAVITA N. RAMDAS, a feminist activist, is the director of
the Women’s Rights Program at Open Society Foundations,
the founder of the Stanford University Social Entrepreneurs
in Residence Program at the Haas Center, and the former
president and CEO of the Global Fund for Women.
ized by their religious pluralism. Iyer, for
example, uses statistical analyses of news-
paper reporting on what India refers to as
“communal riots”—conflicts between two
different religious communities that lead to
life and property loss and damage—in order
to reveal their causes. She finds a strong
correlation between such turmoil and state-
election years; these riots are instigated
by political parties hoping to rile up the
Hindu base and target Muslims, who are
concentrated in urban areas. These findings
are further interrogated in Iyer’s unique
survey of religious organizations in seven
of India’s 29 states seeking to understand
better how different religious communities
have responded to economic shifts as India
transformed its economy. The survey also
allows her to test her hypothesis that reli-
gions increase their provision of services as
a rational response to perceived economic
inequality and competition. The fascinating
responses to the questions explain how rapid
economic liberalization in India after 1991
compelled religious organizations of every
stripe to offer increased levels of services to
address growing inequality.
Iyer points to economic data to dis-
credit the Hindu Nationalists’ scare tactics
about Muslims having too many children
and thereby fundamentally changing India’s
demographics. She shows that high fertility
rates are closely correlated with low educa-
tion and income levels rather than with reli-
gious beliefs. The impressive work of the 2007
Rajinder Sachar Committee, which reported
on the impoverished living conditions of Mus-
lims in India, clarifies the many disadvantages
the Muslim community has experienced in
India since independence, including being
vulnerable targets of hate crimes.
These startling findings justify the use
of economic analysis to understand religion.
However, Iyer’s argument is weakened by its
reliance on reductive connections, two of
which are the tendency to equate religion in
India with Hinduism and to use myopic and
elitist descriptions and definitions of Hin-
duism. Hinduism and India are not synony-
mous, despite the best efforts of the current
70 Stanford Social Innovation Review / Winter 2019
right-wing Hindu nationalist government to
thus identify them in public consciousness. By
failing to clarify this, she often looks specifi-
cally at the relationship between economics
and Hinduism rather than between econom-
ics and religion. Iyer invokes the abundance
of academic research by economists focused
almost exclusively on Christianity and Islam
to justify this equation of religion with Hin-
duism. This makes little sense for a book on
India, which she herself argues is defined by
complex religious plurality within a quickly
growing and increasingly powerful economy.
An example of this internal confusion is that
the book has a whole chapter focusing on
the madrasa system, an Islamic educational
institution serving the Muslim minority in
India, while one might have expected a book
focused on Hinduism to include a thorough
review of Hindu nationalist schools and edu-
cational programs that have sprung up across
India over the past decades.
As an immigrant from India who has
lived in the United States for 30 years, I am
under no illusion about how difficult it is to
try to explain the pluralism of Indian reli-
gious traditions, the amoeba-like pluralism of
Hinduism itself, or the complexity of Indian
politics to international audiences, especially
to an American one, unfamiliar with non-
Abrahamic religious traditions. Yet, if a book
asserts that it seeks to explain Hinduism,
then it must acknowledge the decades-long
efforts by Dalit (“untouchables”) and Adivasi
(indigenous people also called Forest Dwell-
ers) activists who have pointed out that any
narrative about Hinduism must acknowledge
the implicit bias inherent in most upper-caste
Hindu depictions of that religion. Iyer’s over-
view of Hinduism and fundamental tenets of
Hindu practice essentializes and generalizes
from the narrow perspective of an upper-
caste Indian Hindu.
The numerous generalizations made
about Hindu beliefs simply do not hold
true for the vast majority of India’s lower
castes. Iyer does not once mention one of
the most important critics of Hinduism, B. R.
Ambedkar, a Dalit intellectual and consti-
tutional scholar who drafted India’s con-
stitution and wrote the powerful book
Annihilation of Caste, which shows how Hin-
duism is rooted in the entrenched hierarchy
of the caste system, which legitimizes the
oppression and subjugation of those at the
bottom. Iyer’s oversight reflects the broader
silencing and dismissal of Ambedkar by lead-
ing Indians, including Gandhi himself, who
refuse to engage with his blistering critique
because either they insist that the caste sys-
tem represents the genius of Indian society or
they pretend that it is fading into irrelevance.
A book based in research about the eco-
nomics of religion in India in the 21st century
that fails to directly address the endemic eco-
Fail[ing] to directly address the ... structural
injustices of the caste system represents the kind
of blind privilege [of] the upper castes.
nomic challenges and structural injustices
of the caste system also represents the kind
of blind privilege held by the upper castes.
Iyer’s lyrical description of the Hindu scrip-
tures and her generalizations about Hindu
beliefs, as well as her memories of singing
Christian hymns in private schools in India
alongside Muslim, Christian, Jain, and Sikh
girls, are very familiar to me, as a woman
also born into a privileged upper-caste fam-
ily. The perspective of high-ranking castes
about what Hinduism is and how it mani-
fests across India is dominant in Iyer’s book;
in reality, they comprise a tiny fraction of
the total population of India—which Iyer
even acknowledges in Chapter 6. There is,
for example, no attempt to clarify practices
like vegetarianism, which Iyer describes as
Hindu but which is a predominately upper-
caste practice. Most Dalits and Adivasis eat
and enjoy meat of all kinds, including beef.
Ambedkar was closer to the truth when
he argued on behalf of the “untouchables”
that “Hinduism is a veritable chamber of hor-
rors.” The statistics of modern-day India are
a testament to this claim: According to 2016
data provided by the National Crime Records
Bureau, crimes against Dalits by non-Dalits
have increased by 746 percent over a 10-year
period. In 2012, the same year of the hor-
rific gang rape of a non-Dalit woman on
a bus in Delhi, when urban middle-class
Indians poured into the streets to protest
her ordeal, 1,574 Dalit women across India
were raped. There were no public marches
in India’s streets for those women, and it
is most likely a highly underreported fig-
ure because Dalit women are terrified into
silence and fear by upper castes.
Caste is also dispiritingly tied to basic
economic statistics in India. In a nation of
1.2 billion people, close to 700 million live in
extreme poverty—a great majority of them
members of the lowest castes of India. A
majority of Hindu texts legitimize making
lower castes pay exorbitant interest rates—
the Manusmriti, an ancient Hindu legal scrip-
ture, declares that the lowest caste (Shudra)
and the Dalit communities should be charged
60 percent or more in annual interest on
loans. This practice, in turn, has contributed
to the high levels of modern-day slavery in
India because the texts demand “bodily inter-
est” when cash is unavailable, which means
that people from lower castes are expected
to toil for the moneylender or landlord from
generation to generation to repay debts. As
even Iyer mentions, decades after indepen-
dence, upper-caste Hindus continue to domi-
nate institutions of higher education in India.
In a recent list of Forbes billionaires, more
than 55 Indians were mentioned—the wealth
of the top 10 outstrips the 45 below them. Of
these 10, seven come from a particular caste
of traders—Vaishyas—and the remaining
45 are a mix of other upper castes of India,
as well as a few Muslims and Parsees (both
represent minority religions in India). There
is not a single Dalit or Adivasi on the list.
 Stanford Social Innovation Review / Winter 2019 71

The Economics of Religion in India is both
timely and highly relevant in its study of
the forces at play in India that expose the
inextricable connections between econom-
ics and religion. Just take the July 2018 New
York Times Magazine feature on billionaire
Baba Ramdev, a religious leader and a suc-
cessful businessman whose company, Patan-
jali Ayurved, had sales of $1.6 billion in the
2018 fiscal year despite his hateful state-
ments against Muslims in India, including
his threat to “behead hundreds of thou-
sands,” as a case in point. In seeking to
understand the dynamics around econom-
ics and religion at a time when Hindu fun-
damentalism is on the rise, however, Iyer’s
book leaves one wishing for greater nuance
and perspective on the actual forces of his-
tory behind current trends. Instead, she
sometimes presents opinion as fact, such as
her assertion that “Hindu fundamentalism
is a reaction to secularization by the British
Empire and the Congress Movement and
to the threat from other religions such as
Islam and Christianity and to Western val-
ues represented by the British Empire.” In
her effort to talk about economics, Iyer risks
minimizing the complex reasons behind cer-
tain developments, such as the emergence
of Hindu fundamentalism. It is dangerous to
blame it on broad, brief, and, at least in her
book, unexamined reasons—going all the
way back to the British Empire, the Indepen-
dence Movement led by the Congress, and
perceived threats from Islam and Christian-
ity and Western values.
Iyer’s book provokes readers into asking
the many questions that she leaves unan-
swered or unaddressed, which will likely
catalyze further research in this field. This
productive potential might make a differ-
ence in the future of all pluralist societies—
not just those in the so-called developing
world, but increasingly right here in the
United States. ■

A trio of new books highlighted online discuss critical issues and cross-sector advancements
that can inspire social change, from the hidden cost of women’s work, to how businesses can
market for green consumption, to how tech has changed one of America’s greatest cities. Read
excerpts of these books at ssir.org/book_excerpts.

Today’s savvy consumers don’t want
just a green product—they want a total
package that covers all their environ-
mental concerns, from health benefits
to savings. Magali A. Delmas and David
Colgan’s The Green Bundle: Pair-
ing the Market with the Planet offers
marketing lessons and advice on com-
munication techniques that can help
business managers reach their market
potential while also addressing sustain-
ability issues (Stanford Business Books,
2018).
Tara Patricia Cookson’s Unjust
Conditions: Women’s Work and
the Hidden Cost of Cash Transfer
Programs reveals how the work done
in conditional cash transfers (CCT) pro-
grams is largely done by women and,
consequently, greatly undervalued and
undercompensated. Addressing gender
inequality in the service sector means
considering how certain kinds of labor,
particularly the work of caregiving, dis-
proportionately affects women worldwide
(University of California Press, 2018).
Documentary filmmaker Cary
McClelland’s Silicon City: San Fran-
cisco in the Long Shadow of the
Valley chronicles the rapid metamor-
phosis of San Francisco through dozens
of interviews with its diverse inhabitants,
from venture capitalists to local activists.
Part social history, part case study,
Silicon City documents the effects of
gentrification and the tech takeover on
the city’s identity and social fabric, rich
in activist roots (W. W. Norton, 2018).
72 Stanford Social Innovation Review / Winter 2019
I MAGES THAT INSPI RE
Colonialism Meets Climate Change
H
PHOTOGRAPH BY undreds of pairs of shoes, adorned with
ADRIAN FLORIDO/NPR personalized messages tucked under
their worn soles, represent the lives lost
to Hurricane Maria, which decimated
Puerto Rico, its people, and its infrastructure when
it made landfall on September 20, 2017. The shoes are
part of a new memorial in front of the Capitol building
in San Juan, Puerto Rico, to commemorate the 4,645
hurricane-related deaths—a number that, according
to a Harvard University study published in The New
England Journal of Medicine in May, is more than 70
times greater than the death toll originally reported
by the media. The shoes are symbolic of the failures
of the US government to care for its citizens, of the
tragic consequences of global climate change, and of
the willful negligence and oversight perpetuated by
colonialism. They are also a haunting call to action
for activists and socially conscious individuals: Global
disasters are all our responsibility and require cross-
sector collaboration and effort. To quote Audre Lorde,
the black lesbian writer and daughter of Caribbean
immigrants to the United States, “There is no such
thing as a single-issue struggle because we do not
live single-issue lives.” And when it comes to solving
a problem like the devastating impact of Maria, we
must think and act not only across sectors, but also
across issues and across identities, in order to create
systemic change. —MARCIE BIANCO
 OUR MISSION
IS SIMPLE.

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