The Idea in Brief
• Philanthropic organizations tend to have a hard time objectively assessing the performance of their people and programs and adjusting their funding decisions and strategies accordingly. They simply aren’t subject to the same market forces that for-profit companies are.
• These organizations have to impose self-discipline, particularly in recessionary times. The authors explore how some are making sound decisions and demanding stronger performance from themselves and the programs they fund.
• The James Irvine and Annie E. Casey foundations, among others, are balancing evidence about programs and outcomes against their stated values and beliefs; matching funding strategies with people and processes; and actively soliciting external feedback.
Creating lasting environmental, social, and economic change requires discipline—a concept with which many foundations, grant makers, and committed wealthy individuals (well-intentioned as they may be) have traditionally struggled. Exempt from the accountability imposed on business by the markets or on government by voters, philanthropy is free to experiment and take risks. But with few external parties offering candid feedback or calling them to account, philanthropic investors (and their boards) have had insufficient experience objectively assessing their own performance and making hard decisions about programs and people.
