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The consequences of the nonprofit sector’s growing focus on accountability is one of the core topics of the Stanford Project on the Evolution of Nonprofits (SPEN), the major research initiative of the Center for Social Innovation at the Stanford Graduate School of Business.
The researchers found that charities, pressured by foundations and government grantmaking organizations, are adopting business practices such as strategic planning, evaluation, and auditing, resulting in more focus on accountability, on benchmarking, and also much closer, more sustained relations between funders and grant recipients.
However, not all grantees are happy about the situation. Denise Gammal, SPEN research director at the Center for Social Innovation, shares the voices of nonprofit executives with an audience of foundation leaders at the Council on Foundation 2006 annual conference and sets the stage for a candid panel discussion about foundations' evaluation requirements. On the panel, Karen McNeil-Miller, president of the Kate B. Reynolds Charitable Trust in Winston-Salem, reflects on her foundation's practices and that of the sector, while Eric Schwarz, president and CEO of Citizen Schools brings his nonprofit perspective to the discussion.
Nonprofit leaders see a disconnect in measuring qualitative social results with a quantitative yardstick. “How do you evaluate if you are giving someone emotional support?” asked one executive director. Others judge increased accountability as a needlessly expensive layer of bureaucracy. “Grant reporting takes resources away from our services; all these things we have to do are a big waste of time and paper,” another executive director said. Furthermore, the lack of standards within the sector leads to unique demands from each grantmaker, which are a challenge to fulfill when the typical grantee has an annual budget of under $200,000 and fewer than three staff members. How can (and why should) a grantee invest $50,000 in computing infrastructure and add staff to comply with the reporting requirements of a $16,000 grant?
While many of the nonprofit leaders saw benefits from reviewing their internal evaluation processes, the majority chafed at the requirements of their grantmakers on several grounds:
Denise L. Gammal is managing director of the Stanford Project on the Evolution of Nonprofits (SPEN) at the Stanford Graduate School of Business. She joined Professor Walter W. Powell to launch SPEN at the Center for Social Innovation in August 2002. She received her AB in politics from Princeton University and her doctorate in social and political sciences from Cambridge University (UK). Her research interests include public and social sector management, crisis management, media relations, and fundraising. She is currently analyzing SPEN data on nonprofits and the economic downturn. Gammal has worked previously in political consulting and corporate public relations. She serves on the board of Stanford Arboretum Children’s Center.
Karen McNeil-Miller is the president of the Kate B. Reynolds Charitable Trust in Winston-Salem, NC. Founded in 1947, Reynolds' mission is to improve the quality of life for those with financial need in Forsyth County and the state of North Carolina. Specifically, the Trust addresses social and human needs issues within Forsyth County through its Poor and Needy Division, and health and medical needs across the state through the health care Division.
Prior to joining KBR, McNeil-Miller spent 16 years with the Center for Creative Leadership, an international leadership development and research, nonprofit organization headquartered in Greensboro, N.C. While there she developed expertise in individual and organizational leadership development, succession planning, team building, diversity, executive coaching, leading change and transitions, and strategic thinking. McNeil-Miller's trained executives are from the world’s major companies in 24 countries.
McNeil-Miller is a former special education teacher and head of the Piedmont School, an independent school for children with learning differences. She has her undergraduate and master’s degrees from UNCG and her doctorate from Vanderbilt University. McNeil-Miller is a native of North Carolinia, has been married to husband Steve for over 20 years, and has two children.
Eric Schwarz is president and CEO of Citizen Schools. Prior to founding Citizen Schools, Schwarz worked for five years at City Year where he served as vice president for Organizational Development and, later, as executive director of City Year Boston. Schwarz is a 1983 graduate of the University of Vermont and earned a master’s degree at the Harvard University Graduate School of Education in 1997.
Julie Juergens is the director of external relations and program development for the Center for Social Innovation at the Stanford Business School. The Center builds and strengthens the capacity of individuals and organizations to develop innovative solutions to social problems for a more just, sustainable, and healthy world. From 1998-2002, Juergens directed Stanford's Public Management Program, providing leadership development for MBA students to apply business principles to social and environmental issues.
Juergens' prior experience includes developing service-learning courses and applying public service best practices at the Stanford Haas Center for Public Service; coauthoring the 1997 Corporate Community Involvement Study, which examined corporate philanthropy and socially responsible business practices in Silicon Valley; and teaching with the Close-Up Foundation, a nonprofit, civic educational organization in Washington, D.C.
Juergens serves on the board of directors for Start Up, a local economic development nonprofit that trains and supports entrepreneurs, and is on the advisory council for New Sector Alliance, a nonprofit consulting enterprise designed to strengthen the capacity and performance of nonprofit organizations. She received her AB from the University of California, Davis, where she served as student body president and her AM from Stanford University.
Resources
Download the first report from the Stanford Project on the Evolution of Nonprofits, Managing Through Challenges, which profiles the San Francisco Bay Area, Los Angeles, Calif., and national nonprofit sectors, and examines critical management issues facing nonprofits.
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Technology
Articles, Books and Cases
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