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GuideStar Blog

Thinking about Networks

 

I was at the Ford Foundation this morning, attending a presentation of Generation Schools Network, a nonprofit with a bold mission of transforming public schools as a pathway out of poverty and preparing the future workforce for the 21-century economy. In a short time, the model has achieved impressive success.

Anne Sherman

We heard from several Generation Schools staff and stakeholders: a member of the senior team, a principal, a director of career and college readiness, two alumni, and representatives from a corporate partner. Each shared their compelling perspective on the model’s quality and impact. I was struck by how they don’t just talk to students about college and career; they’ve made college and career integral to the curriculum. Their objective, in the words of co-founder and Chief Learning Officer Jonathan Spear, is to “blow open the walls of the school” and engage colleges, employers, and other community partners in their students’ education.

Generation Schools clearly demonstrates the critical importance of networks. If kids are to succeed, they need to know about the worlds of college and work, and they must be comfortable navigating them.

This is all particularly meaningful to me because I work for the Social Impact Exchange. Our mission is to build growth capital markets that will increase the access effective nonprofits have to funding that will allow them to scale their impact. Nonprofits like Generation Schools that have both evidence of success and plans to scale their impact are of great interest to us. Yet, reflecting on this morning’s presentation, I find myself more curious about how Generation Schools has built and leveraged networks as part of their model than I am about their evaluation results or business plan.

We at the Exchange believe that if we are going to make progress on solving our society’s more intractable social problems, funders and nonprofits need to be able to work toward shared goals in a more coordinated way. For the past several years, we have worked diligently to build a network of funders and other sector leaders interested in scaling impact. We’ve learned a lot of things. For example, we have come to understand that we will only realize our vision of a functioning growth capital marketplace if we can build a vibrant and engaged network of supporters. We’ve also come to appreciate just how challenging this work truly is!

Our annual conference is a central component of our network development strategy. Our fifth anniversary conference is on June 18-19, 2014 in New York City. This year, the agenda will pay special attention to how cultivate and strengthen the network of funders that can support scaled social impact. We are delighted that Lance Fors of Social Venture Partners and Heather McLeod Grant will lead the entire audience in discussion on this subject. Related sessions include Tonya Allen, CEO of The Skillman Foundation, and Kenneth Zimmerman, Director of U.S. Programs at the Open Society Foundations talking about social movements and the role of philanthropy. Jacob Harold, CEO of Guidestar, will speak about the critical role of data in creating social change. I hope that you will also be there to help us broaden and deepen the networks we’re building to scale social impact in the U.S.

The preceding is a guest post by Anne Sherman, Vice President, Nonprofit Strategy at Growth Philanthropy Network. Before GPN, she was Director of Strategy at TCC Group, a consultancy that assists nonprofits, foundations, and corporate community involvement programs. Prior to TCC Group, she was community initiatives manager at Minneapolis Way To Grow, a citywide school-readiness initiative. Sherman holds a master’s degree in public affairs from the University of Minnesota Hubert H. Humphrey Institute for Public Affairs. Her volunteer work includes serving as chair of the governing body of the Center for Family Life in Sunset Park, Brooklyn, and as a member of the board of SCO Family of Services. She also serves on the selection committee of the New York Community Trust-New York Magazine Nonprofit Excellence Awards. Sherman is the co-author of Building Nonprofit Capacity: A Guide to Managing Change Through Organizational Lifecycles, published in 2011 by Jossey-Bass.


Building Trust Through Transparency

There is much debate about how to measure the effectiveness — or strength — of a nonprofit organization. Some argue that measures like percentage of “overhead” or CEO compensation tell you everything you need to know about an organization. Others, including both of us, argue that organizational effectiveness cannot be reduced to crude financial measures — that to truly understand organizational effectiveness, you need to understand what the organization is trying to accomplish, what its track record of success has been, and what its plan for future impact is.

Anne Wallestad

At the heart of this debate is the critical question of trust. Donors are asking, “Can I trust this nonprofit to do what it says it is going to do?” “Will it use my resources wisely and effectively?” “Is it stable and sustainable enough that an investment in it is an investment in the future?”

These questions are both emotional and rational, and get to the core of the delicate and essential trust between donors and organizations. And while there are lots of mechanisms to help donors and organizations build that trust, we often overlook the very important role of the board of directors.

Boards — by definition — exist to preserve and protect the public’s trust. They have both a legal and an ethical responsibility to ensure that there is meaningful oversight of their organization’s operations and finances. They guarantee that the chief executive is held accountable to an independent body of individuals who protect and serve the organization’s mission and — by doing so —safeguard the public’s trust in the organization.

All too often, though, basic information about nonprofit boards is hidden from view. Left with no way to tell which organizations are following clearly established governance best practices, the public is left in the dark and organizations are subject to speculation and skepticism.

Jacob Harold

That is about to change. In a move that we believe will create a seismic shift in the public’s understanding of governance and board leadership, BoardSource and GuideStar are launching a new tool to help organizations share information with the public about its highest level of leadership: its board of directors.

Beginning today, organizations will have an opportunity to share information about their board’s practices as a part of their profile on the GuideStar Exchange. It now includes questions about board orientation and education, CEO oversight, ethics, board composition, and board performance — key elements of strong oversight and accountability. Soon, as a part of the ongoing evolution of GuideStar’s website, this information will be visible to the public in a new section of the GuideStar profile focused on “People and Governance,” creating transparency around what has all too often been hidden from the public’s view.

We hope that organizations will embrace this opportunity to share more information about how their boards are leading their organizations in thoughtful, intentional ways and help build trust with their donors and the public at large. And for those organizations that have not yet embraced the essential governance practices that are highlighted in the profile, we hope that the questions will serve as a catalyst for self-reflection and change within their boardrooms.

Ultimately, we hope that boards begin to be seen for what they truly are: an essential mechanism to ensure that nonprofit organizations are worthy of the public’s trust. And for those boards that might be asleep at the wheel, we hope that this will be a wake-up call — and an opportunity to fulfill the promise of good governance.

The preceding is a co-authored article by Anne Wallestad, president & CEO, BoardSource, and Jacob Harold, president & CEO, GuideStar. This is cross-posted on the BoardSource blog, Exceptional Boards, here. BoardSource is the recognized leader in nonprofit board leadership and supports, trains, and educates 90,000 nonprofit board leaders from across the country each year. GuideStar is the go-to resource for individuals searching for reliable information about nonprofit organizations, with more than 6 million users in the last year.


How to Attract Volunteers from Abroad and Develop Your Organization

Michael, 25, flew from Germany to the U.S. this summer to put his accounting background to good use at a non-profit focused on homelessness and housing in New York City.


Government Shutdown Hurting Nonprofits

The House of Representatives voted unanimously in favor of paying all furloughed government workers back pay when the shutdown ends. Congressman Michael Turner, R-Ohio, told the Christian Science Monitor that federal workers shouldn't suffer consequences due to the government stalemate. While the weekend legislation was great news for 800,000 federal workers, it didn't extend to the 1.4 million tax-exempt charities and nonprofits that also rely on government funding.


Follow-up to NEW GuideStar Exchange Webinar

Transparency – it’s one quality that donors, funders and other stakeholders are looking for in a nonprofit and it’s something that nonprofits are striving to achieve. Making information accessible and easy to share isn’t always a simple task, however. With this in mind, we recently overhauled our GuideStar Exchange program to better align with the information our research indicates donors and funders are looking for, and to make it easier for nonprofits to showcase their commitment to transparency. This overhaul included a new tiered program structure, new benefits for participation, a new, easier platform to update information, and many other features.


More Charitable Organizations Using Single-Member LLCs

Many section 501(c)(3) tax-exempt organizations are using single-member limited liability companies (SMLLCs) in their structures. With the recent IRS guidance that donations to a domestic SMLLC of a U.S. section 501(c)(3) organization are treated as charitable contributions to the parent tax-exempt organization, the practice may increase (IRS Notice 2012-52, 2012-35 I.R.B. 317).


5 reasons you should be a GuideStar Exchange participant

There are myriad reasons you should consider joining the GuideStar Exchange program, the only program of its kind that encourages nonprofit transparency on a national scale and allows nonprofits to supplement the public information that is available from the IRS, but I’ll only touch on five here:


Root Cause and the Highland Street Foundation Invest in Massachusetts

Our veterans are broadly viewed as heroes and role models, but our admiration for their service has not translated into a national agenda to serve our veterans. Many lack access to gainful employment, vocational training, disability services, and support for their families. Mental health issues are widespread, and in 2010, 22 veterans committed suicide every day.
The lack of public resources directed to veterans should be a source of national shame, but the crisis provides foundations and social impact investors with a unique opportunity to build solutions from the ground up by investing in nonprofit innovators working to give veterans comprehensive support.


Call for Fellowship Applications

Call for Applications to the LeaderSpring Fellowship Program for Nonprofit Executive Directors

Are you an executive director of a nonprofit based in San Francisco who wants to improve your leadership and management skills? Enhance the capacity of your organization? Build collaborative relationships with other nonprofit leaders? If yes, LeaderSpring invites you to apply to a two-year, on-the-job Fellowship program. Applications are due Friday, August, 30th, 2013. Click here for more information, visit www.leaderspring.org or contact LeaderSpring at (510) 286-8949 or julie@leaderspring.org.


Non-profits and Top U.S. Civic and Community Projects

How do you create successful partnerships in non-profit work? Some of it depends on cooperation, some of it touches on chemistry. But what about about considering the attribute of civics and charity?