Showing posts with label Nonprofit. Show all posts
Showing posts with label Nonprofit. Show all posts

The price of trust

I have a much longer post on health disparities, race, and insidious marketing techniques that mis-appropriate people's trust people, but I'm still working on it. However, this evening, I heard this story on the radio (KQED, broadcast of All Things Considered) and had to get this down now.

In the story (transcript pending) Douglas Kamerow comments on the news that Merck pharmaceuticals may have written stories about VIOXX and then published those stories in medical journals under the names of medical doctors and researchers who the drug company has paid. The practice is politely called guest authorship - doctors and scientists are paid to lend their names to studies. Some call it by the more devious name ghost authorship - in which the company pays for the research and hires ghostwriters - masking its own involvement in the research but making sure it gets into the medical journals and literature that matter most to your doctor and mine.

Kamerow's commentary tells of articles published in the New England Journal of Medicine that discussed the benefits of a lung cancer screening tool. "On investigation" (Kamerow's words) the study was found to have been paid for by foundation funds. A foundation set up entirely by tobacco industry money. Five words in a Google search revealed this (from the New England Journal of Medicine):

"The Lung Cancer Screening Group's research was funded by 32 different entities, one of which was the Foundation for Lung Cancer: Early Detection, Prevention and Treatment. It has not been our practice to inquire about the specific sources of funding of foundations such as this. We recently learned, however, that this foundation was headed by the principal investigator of the 2006 study, that it was housed at her academic institution, and that the only contributor during most of its existence was the Vector Group, the parent company of Liggett, a major tobacco company. We and our readers were surprised to learn that the source of the funding of the charitable foundation was, in fact, a large corporation that could have an interest in the study results."

SourceWatch had this to say about the event:

Vector claims it exerted no control or influence over the research, but some tobacco control advocates believe Liggett funded the study to show that lung cancer is not as bad as many have long believed since such a high proportion of people who get lung cancer, a disease closely associated with cigarette smoke exposure, can be saved by screening.

Henschke's study, and her Foundation, also raised questions about the use of foundations to shield information about funders -- and particularly corporate donors -- from publishers and the public.

And here is what is posted on the Weill Cornell Medical College site, where the doctor behind the Foundation for Lung Cancer: Early Detection, Prevention and Treatment and the study in NEJM are located.

The Foundation for Lung Cancer: Early Detection, Prevention and Treatment received an unrestricted gift of $3.6 million from the Vector Group, the holding company for Liggett Tobacco, in a series of payments, from July 2000 to June 2003. The gift was used appropriately for the public good -- to support Weill Cornell Medical College's highly regarded, multi-institutional, international I-ELCAP [International-Early Lung Cancer Action Program], whose objective is to perform CT screening research for lung cancer in order to determine whether such screening improves cure rates for persons at risk.

The original $2.4 million pledge to the Foundation -- and the work funded by the Foundation at Weill Cornell -- was fully and publicly disclosed at the time through a press release, and was substantially covered in the lay media. It was discussed and disclosed in the academic community at conferences, which were widely attended by advocacy groups, agencies, and by investigators from around the world interested in lung cancer screening. It was also fully disclosed to other foundations and groups wishing to contribute funds to I-ELCAP.

The other post I am working on involves a letter from a major labor union encouraging its members to ask their doctors for a certain drug prescription. This is well-covered on the HealthBeat blog here. The title of the post, "Pfizer enlists a Labor Union (SEIU) to Promote the "Cholesterol Con"" gets to the heart of the matter - after all, why would a labor union be recommending drugs to its members?

These are troublesome practices. For (at least) the last seven years the public trust in nonprofits - be they universities, foundations, labor unions, social service organizations, publishers, health providers, or any other kind of organization in the sector - has been on the decline. Confidence in the sector hovers in the mid 60th percentile.

And here's the irony - these kind of marketing shenanigans involve a lot of players - corporate interests, individuals (the doctors), nonprofits, the media, and the public. Yet at the end of the day only one of these - the nonprofits - will pay the highest cost in terms of trust and confidence. Why is that ironic? Because these organizations have the most riding on keeping that trust and confidence.

In other words, these schemes in which the funders of research or opinions are paying others to serve as a mask for their vested interests will destroy the "reputational capital" of the others, be they medical journals or labor unions. But at the end of the day, the effect that they have on on the original vested interests will be minor and fleeting.

As a society we're likely to "pooh pooh" the bad behavior of tobacco or drug companies, or shake our heads in disgust and then move on. But somewhere in our minds, when we remember the story of the doctors and the lung cancer study, what we'll remember most accurately is that there was a nonprofit somewhere in the mix in that story. And later, when we are asked whether or not we trust nonprofits we'll think back to these stories. We won't remember the details (like how the nonprofit medical journal uncovered the funding coverup) but we'll remember there was something fishy in there. And we'll cast our doubt on the nonprofits. Our confidence will slip. Our trust diminish.

That is a high price to pay.

Talk amongst yourselves...about power

Back in March, the Council on Foundations hosted and recorded two conversations at the Seattle Public Television Station, KCTS. One of them, The Philanthropic Fault Line: Exploring the Sometimes Shaky Ground between Foundations and Nonprofits, used a paper I wrote, Rewriting Myths, as its backgrounder. The paper was commissioned by the Annie E. Casey Foundation and is available here. The video of the conversation is here (scroll down to second headline).

Two teasers about the paper - its about power and it identifies ways that that might actually change.

Here's the blurb from the Council web site ->

The Philanthropic Fault Line: Exploring the Sometimes Shaky Ground between Foundations and Nonprofits

This town hall-style conversation in the studios of KCTS-TV explores the various relationships between foundations and nonprofit organizations. The panelists discuss finding common ground in the sometimes thorny and contentious landscape of power, control, collaboration, finding authentic voice, and funding in a results-based environment. A number of COF conferees joined the greater Seattle philanthropic and nonprofit communities in this lively discussion.

Moderator: Diana Aviv, Independent Sector
Panelists: Edward Skloot – the Surdna Foundation

Carole Thompson Cole – Venture Philanthropy Partners

Clara Miller – Nonprofit Finance Fund

Putnam Barber – The Executive Alliance &

Pramila Jayapal – Hate Free Zone

Thanks to the Venture Philanthropy Partners July Newsletter for bringing the video site to my attention.

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10 reasons the discussion is always about nonprofit redundancy...

Notice how no one ever talks about "too many foundations?"

Time ran an article on "Rethinking Nonprofits." Remarkably, nothing new was said. However, the Agitator's comments on it are priceless. My favorites are number 8 + 6:

"8. I recently learned from my favorite sources (MySpace, The Daily Show, my text buddies) that people are still starving, the planet's still getting warmer, cancer hasn't been cured, Brittany can't find a decent rehab center -- what the **** have all these existing nonprofits been doing all this time?! +
6. I signed an online petition once to stop world hunger ... and nothing happened."
Of course, nowadays THE thing to do is start a 'social enterprise' of one's own. But, you get the idea.

Social Media and NPOs

Confused by all the hype? Well, here is more info on social media and nonprofits than anyone person could possibly generate. Which is why it is being captured on two linked wikis and several blogs. Check out the wikicarnival on social media and nonprofits at SocialMedia.Wikispaces.Com
and web 2.0 for nonprofits and Designing for Social Change .

Another way to know ratings are coming

When the neighbors (read: services users and donors) get up and arm about the ways nonprofits are acting, you can bet that rating/monitoring/calls for nonprofits effectiveness will increase.

Read this story about nonprofits in East Palo Alto, CA to see one example of this. And here (NorCalUrban: Article, "Local East Palo Alto Non Profits Taken to Task") is a local resident's blog post about the story.

Rating Nonprofits

This is a topic that surfaces, makes a splash, stumbles back below, and then resurfaces after time passes.

How come there are not easy-to-use, comparable, meaningful metrics for donors and others to use to compare nonprofit organizations? There have been several attempts (Philanthropix), there are some partial successes (DonorEdge, Guidestar reports, Charity Navigator), and there are some good resources on admittedly limited universes (Network for Good, GlobalGiving, GiveWell). I'm aware of at least one other nonprofit rating system in concept development stage (stealth mode).

The California HealthCare Foundation announced today another approach to this practice - a website for comparing California hospitals. According to a story the San Francisco Chronicle, the CalHospitalCompare site rates 200 hospitals on 50 criteria and allows users (patients) to compare along criteria as disparate as geography, type of service, and patient satisfaction.

The question about a nationwide nonprofit rating system is no longer if, but when. Major constituents in this - nonprofit associations, foundations, philanthropic associations, and government funders - should get involved, inform and improve these rating/comparison structures, rather than standing by and complaining about the shortcomings of these first efforts.

SXSW Panel on disruptive technology and nonprofits

For those who are done with TED and still have more conference in them, check out this panel on Disruptive Technologies and Nonprofits at the SXSW Festival.

Second chance to advise on self-regulation

The Panel on the Nonprofit Sector (hosted by Independent Sector) is taking public comments on their draft principles for effective practice. Read and comment here. You have until March 30, 2007.

Ask an expert

Stanford's Graduate School of Business (GSB) and the Stanford Social Innovation Review are making available the resource and knowledge of the GSB's Alumni Consulting Team (ACT). You can submit a management question and get an answer. Access the resource here.

Lets hope they make this a customer-feedback enabled site.

Disruptive philanthropy: the good and the bad

Not many people took note of this post from a month or so ago on the "myths of philanthropy" but it did get this response over at the nonprofiteer.

In the spirit of the Ralph Waldo Emerson's observation that "Great geniuses have the shortest biographies," maybe I should file this under "The ideas that get the least response may matter the most."

In just a few years the the belief that philanthropy and the independent sector are farm teams for market-based solutions has become standard operating procedure. In the last half-decade entrepreneurial activities have become required components of any pro-social idea, commercial revenue is seen as a 'must-have' in any project or organizational budget, corporate social responsibility has gone mainstream, and approaches that either screen the financial markets for their social impact or require market-based strategies for social benefit activities have become standard procedures (to say nothing of media darlings).

Why do I care about this conviction? It has already had many positive disruptive effects including new respect for social entrepreneurship and hybrid organizations, increased innovation in the capital markets for social good, and a more nuanced understanding of the operating costs consistent with delivering high quality services. These are just a few examples of the positive ways this conviction has disrupted the staid world of philanthropy and nonprofits.

On the other hand, the conviction has been fueled by and in turn accelerated demands by foundations that nonprofits need 'sustainable' strategies and that they, the foundations, need exit strategies. It has contributed to the growing role that earned income plays in the revenue models of nonprofits, without concurrent analysis of who gets left out by those fee structures.

Let me make one thing perfectly clear. No one of these strategies, structures or market tools is inherently bad. A lot of good has come (and will come) from each of them - from ApproTek to microfinance to double bottom line investment instruments. I am a proponent of many of them.

Taken together, however, we are in danger of losing sight of the limitations of markets, the failures of markets, and the need for tri-sectoral solutions to tri-sectoral problems. No single sector created things like environmental damage, poverty, or racism and no single sector (or single type of solution) will fix them.

Here are the questions we must ask ourselves when we create, support, and laud these philanthropic/market solutions:

  • When philanthropic ideas become the basis for market solutions, what gets lost?
  • Who no longer gets served?
  • What metrics start to matter and which ones no longer count?
  • How do these approaches exempt the public sector from playing a role?
  • What is the role for the public sector vis-a-vis such blended solutions?
  • What role did each sector play in creating the problem and how might that help us think about creating solutions?
The irrational exuberance about bringing together commercial markets and social benefit puts us in the position of possibly conflating two related, but absolutely distinct, sets of priorities. . The first priority is to drive more financial capital to social benefit activities - through product creation, innovative structural practices, and market or regulatory incentives. This is positive disruptive change.

The second priority is the interest of commercial financial firms to drive ever-larger segments of philanthropic assets into their coffers. To the extent that these firms and their products help grow the overall resources for social benefit, I support their contributions. To the extent that this set of priorities actually diverts resources from social benefit work or further reduces resources available to issues where no profit can be made they are powerful, negative disruptions.

To prevent the conflation of these two priorities (by the public, the media, policymakers, philanthropists, and others) we must mind the cumulative direction of these developments, not simply assess the benefits or failures of individual actions.

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New coin of the realm

Or, another possible title for this post would be: The flip side of the coin

Sunday’s New York Times ran a story on nonprofits that ‘screen’ their donations. This practice is perhaps best embodied by Doctors without Borders, which neither asks for nor accepts donations from:

“…companies or their foundations that derive income tobacco, alcohol, weapons, pharmaceuticals, medical equipment, biotechnology, oil, mineral, gas and other extractive industries like diamond mining.”
This is, of course, the other side of the aligned investing questions for foundations. There were only a few nonprofits mentioned in the article. Most of those mentioned were health-related including the American Heart Association, the American Diabetes Association, and the afore-mentioned D w/o B. It may be that is easier for these organizations to distinguish between their health-promotion goals and those potential funders whose core businesses clearly run counter to these missions.

Other nonprofits, such as The Institute for Global Ethics, point out that they refuse support from funders that are clearly aligned with a specific political position. As the Institute’s President noted, “We’re here to help people how to think, not what to think, and to the extent that people see us as coming from a particular position because of the money we receive, it dilutes our mission.”

One interesting note in the article, pointed out by Diana Aviv of Independent Sector, is the competitive pressure on nonprofits to raise funds. These organizations face real challenges of survival that one might presume would mitigate their ability to screen potential supporters. Something about beggars and choosers comes to mind here.

It is important to note that even with their pressing needs for funds, nonprofits set screens about what money they will take. This complements the aligned investing discussion taking place on the foundation side of the house – where recent research notes a doubling of the “number of foundations screening their investments in the last decade” and “a tripling of the amount of new foundation dollars invested annually in mission related investments.”

I see several important trends behind these kinds of stories. Here’s a list:
• The growing availability and competitiveness of screened investments instruments.
• The rising attention to corporate social responsibility
• Multitudes of new structures for donors to manage and deploy their philanthropic resources.
• The proliferation of social enterprises and hybrid ‘commercial and pro-social’ organizations.
What might all this portend?
• Ever-finer screens on how organizations allocate resources to meet their missions.
• Greater interest in easy-to-use data sources that help users make sense of philanthropic capital flows.
• A blending of legal requirements that govern commercial enterprise and nonprofit organizations into a new class of rules for social enterprises.
• New cultural assumptions about who does pro-social work, who funds its, and how different types of entities act responsibly.

Like many things, these developments are currently unfolding on parallel and seemingly unrelated tracks. But, as we all know, when we follow the money they are in fact quite tightly connected. Best we act now to envision and facilitate the positive changes that such revised social capital markets, structures and assumptions could bring.

What does all this have to do with coins of the realm? Increasing attention to how missions are carried out - credibility and trust - in other words, may be returning to center stage as critical assets for social benefit work.

Great American Think-off

Here's a contest called the Great American Think-Off. Its sponsored by the New York Mills Regional Cultural Center, in New York Mills, Minnesota. The population of NYM is 1180 (a fact proudly proclaimed on the center's website). Bully for them for a) hosting the Great American anything, and 2) asking great questions, even if you don't choose to write and submit the 750 word essay.

If you don't want to write, you can always vote in their online poll.

The 2007 question:

Which do you trust more, your head or your heart?

2006: Which is more valuable to society: Safety or Freedom?

2005: Competition or Cooperation: Which benefits society more?

2004: Should Same Sex Marriages be Prohibited?

2003: Do We Reap What We Sow?

2002: Is the Pen Mightier than the Sword?

You can read the essays from past winners here.

Nonprofit Commons in SecondLife

There is a great picture of the 2L nonprofit commons at Beth's blog.

The dancing man and the piano were making guest appearances - they were part of the TechSoup demo at NCG.

59 Smartest Orgs online

FULL DISCLOSURE: I am on the Board of CompuMentor/TechSoup, which helped develop the list that follows. (I thought I'd put this up front instead of that end - transparency matters)

This is an interesting list of "smart" nonprofits. I, of course, love a list of 59 anythings - just so its not the top ten.

You can read the list. I'll post the research methodology - its all about transparency. I noted that lots of folks in the comments added their favorite NPO, though only a few mentioned any of these criteria.

"So, how did we research these nonprofits?

Squidoo, NetSquared and GetActive each recommended nonprofits that were on their radars, charities that were talked about in 2006 and taking a different approach to fundraising, community, and idea spreading. Then we looked at how each of those organizations was interacting with the more compelling web 2.0 tools and principles. These aren't just orgs that throw up a video or a forum or a MySpace page and stop. These are organizations that are busy aligning their missions and models and stories to support the new marketing online.

We asked questions like:

What does the org's website look like?
Does it just ask for donations?
Do they have a way for members to share their stories?
Do they have lenses or Groups on Squidoo?
Do they have MySpace groups?
You Tube videos?
Flickr sets?
Do they value microdonations or only $1000 and more?
Do they run contests or challenges to engage their members?
Do they send out weekly or monthly newsletters?
Do they have RSS feeds?
Are people blogging about the org?
Are they stuck in the land of direct mail, control, and offline fundraising?
Are they optimized for the new cadre of young philanthropists?"

Zagat guide to nonprofits

Perla Ni, formerly of Stanford Social Innovation Review, has headed off to a new venture - a reviewers guide to nonprofits. You can sign up for info at GreatNonprofits. The site is live though the organization seems to be incubating. She's got an advisory board and a website - maybe that is all it takes to start a nonprofit nowadays.

Tax law for "for-profit charities"

Avid readers of the New York Times will note today's article about for-profit philanthropy. The story is here (login req'd). To save you some clicking, here is the abstract of the article the Times' references by University of Chicago professors Eric Posner and Anup Malani.