Stanford
University Sterling Speirn. Spring
2001
Graduate
School of Business Monday: 6:30pm –
8:15pm
R583: Topics
in Philanthropy
American business leaders played a key
role in forging the traditions of modern philanthropy, through the creation of foundations
unprecedented in their scope and scale early in the 1900s. Today, a renaissance in private philanthropy
and a resurgence of interest from the commercial sector is bringing new voices
and fueling the emergence of new strategies and new vehicles in the world of
organized philanthropy.
This course will survey the private
sector roots and strategies of organized philanthropy throughout the last
century, and examine current and emerging trends of contemporary
practices. Students will analyze philanthropic
strategies and the role of institutional investor that foundations play in the
nonprofit sector. They will examine
several cases and with the benefit of guest presenters assess the impact of
"new" philanthropy on nonprofit agencies and the underlying social
issue markets. To complement theory,
history, and case analysis, students will assess the ideas and values that
inform their personal philanthropy, analyze the strategies of two large private
foundations and prepare a paper on a topic of their choosing.
Course Objectives: The course objectives are threefold: (1) to introduce students to the concepts, practices, and
challenges of organized philanthropy, (2) to equip students with historical and
theoretical frameworks to enable them to apply a business and management
analysis to the philanthropic investment enterprise, and (3) to engage students
in a dynamic learning experience as we investigate a field that has heretofore
not been the subject of formal study.
Students will be encouraged to look for opportunities to apply business
principles examined in their core courses to aspects of the philanthropic
process.
Course Requirements: Because this is an emerging field of study, it is critical that
students master substantial supplemental readings early in the quarter. And because the course is so
discussion-based, class attendance, preparation, and participation are key to
producing and obtaining the benefits of the course.
Course
Requirements
1. Class
Participation and Contribution 40%
2.
Individual Project/Paper 30%
3. Private
Foundation Strategy Analysis 20%
4. Personal
Philanthropy Exercise 10%
100%
Course readings will be taken from three
main sources:
1. The
required course textbook, Philanthropic
Foundations, New Scholarship, New Possibilities, Ellen Condliffe Lagemann,
ed., Indiana University Press 1999.
(cited as Lagemann)
2. The course reader with articles and
reprinted essays (cited as CR)
3. Selected books available on reserve or in
class.
Class Preparation: The “study” of philanthropy is a relatively new field, and only
recently have substantial anthologies, essays and histories been
published. The “practice” of
philanthropy, however, through the corporate entity of private and public
foundations, is almost a century old and deeply rooted in American business and
social history. Students will have
substantial exposure to the ideas and practitioners of contemporary, or what is
labeled “new philanthropy.” But in
order to assess what is or isn’t “new” about contemporary philanthropy, and to
analyze philanthropic opportunities and strategies, students will be expected
to do substantial reading early in the quarter to acquire a solid background in
precedents, benchmarks, and milestones in 20th century
philanthropy. Students will be expected
to prepare thoroughly for class and to select individual projects that they
will present later in the quarter.
Classroom Behavior
1. There will be a seating chart and name bars are required at all
times in class.
2. Attendance is critical at each seminar session. Since each class constitutes 10% of total
class time, more than one absence will require the student to submit written
analysis of class assignments, or conduct additional research on optional class
readings.
Schedule of
Sessions
Due
to the challenges of scheduling guest presenters, the course will seek to build
a theoretical framework by alternating between discussion of historical and
supplemental readings and the analysis of case studies and contemporary practices.
Session 1: Tuesday April 3rd
I. Brief Overview of Course: Thinking about Philanthropy
II.
20th century
Philanthropy: American Foundations and
the Nonprofit Sector
Read
& Prepare:
A. David C. Hammack, “Foundations in the American Polity, 1900-1950”
in Lagemann, Chapter 2
B. Course Reader (CR) #1, James Allen Smith, “The Evolving Role of
American Foundations”
C. CR #2, Lester M. Salamon, “What is the Nonprofit Sector and Why
Do We Have It?”
D. CR #3, Brian O’Connell, “Philanthropy, America’s Extra
Dimension.”
E. CR #4, Kenneth Prewitt, “The Importance of Foundations in an Open
Society.”
Study Questions:
1. What characteristics of the philanthropic revolution at the
beginning of the 20th century were dependent upon business, the
social sector, and the role of government?
2. Do you agree with Smith’s
five eras (and metaphors) of American Philanthropy?
3. Hammack sets out “six
distinct approaches” foundations have used to improve the welfare of
mankind. Which do you think have
produced the most results?
4. Salamon suggests five
rationales for the sector, and O’Connell
identifies nine key roles that philanthropy has played. Prewitt suggests four claims to
legitimacy. How would you use this information to counsel a new philanthropist?
5. Do you see any connections between the reinvention of the
nonprofit sector in the early 1900s, and what you observe in the sector today?
Session 2:
Monday April 9th
1. Individual Motivations in Philanthropy and
2. New Philanthropy: Part I
1. In addition to preparing for the case study discussion on Social
Venture Partners, the First Written Assignment is Due at the beginning of
class.
Situation: You have just been informed
that your aunt has bequeathed you $100,000 with the condition that you must gift
the entire amount to one or more public charities within one year. In 2-3 pages, explain how you plan to
distribute the funds and provide a rationale, ranging from strategic to
personal, as to the charity(ies) you plan to invest in and the issues or causes
you plan to focus on.
2. Social Venture Partners: A Work in Progress
Read
& Prepare:
A. CR #5,
Case: Social Venture Partners
B. CR #6,
Social Venture Partners v2.0
C. CR #7, Social Venture Partners, v3.0
D. CR #8, Social Venture Partners 2000-01
Business Plan
E. CR #9, “Building a Platform for
Entrepreneurial Philanthropy around the U.S.”
Optional
Reading:
F.
CR #10, SVP Education Curriculum, Jan-June, 2001
G. CR #11,
SVP 1999 Work Plan
Study
Questions:
1. How would you assess the relative importance of “social,”
“venture,” and “partners” as contributing to the efficacy of SVP?
2. What are some of the tensions between a “venture capital
approach” to philanthropy and SVP’s commitment to philanthropic education of
its partners.
3. What impact has SVP had on the outcomes achieved by its grantees?
4. What are some of the lessons learned of SVP in working with the
new philanthropists?
5. How do you think the business model of SVP will evolve in the
next 3 years?
Session 3: April 16th
The
Early Giants & Impacts on Social Policy from the Progressive Era to the New
Deal (Focus on Medicine, Health, & Education)
Read
& Prepare:
A. CR #12, Waldmar Nielson, “Three Giants of the Past” from Inside
American Philanthropy: The Dramas of Donorship
B. CR #13, Ron Chernow, “Benevolent Trust,” from Titan
C. CR #14, Judith Sealander, “Foundation Philanthropy and Public
Policy Making in the Early-Twentieth Century United States”
D. CR #15, Andrew Carnegie, “The Gospel of Wealth.”
E. CR #16, John D. Rockefeller, “The Difficult Art of Giving.”
Study Questions:
1. Philanthropy is often described as the use of private wealth and
resources for the accomplishment of public purposes. What relative role did factors like religious convictions, family
and business acumen play in shaping the philanthropic activities of
Rockefeller, Carnegie and Rosenwald?
2. How would you assess the relative effectiveness of the early
giants? How would you compare/rank the
three?
3. What principles and strategies did they employ that might still
be utilized today?
4. Sealander sets out eight premises to structure the historical and
evaluative framework for thinking about US philanthropy, and especially the
first three decades of the 20th century (1903-1932). How does her thinking about that epoch
inform and illuminate our “contemporary” ideas about philanthropic practices
and the social environment today?
Reminder: Be sure to pick up your private foundation annual report for
written analysis due in two weeks (see Session #5 description).
Session 4: April 23rd
New
Philanthropy, Part II: What is Venture Philanthropy?
Read
& Prepare:
A. CR #17, “Virtuous Capital, What Foundations Can Learn from
Venture Capitalists,” Letts, Ryan & Grossman, Harvard Business Review, March-April,
1997.
B. CR #18, “If Pigs Had Wings,” Sievers, Foundation News &
Commentary, November/December 1997.
C. CR #19, “Venture-Capital and Philanthropy: A Bad Fit,” Kramer,
The Chronicle of Philanthropy, April 22, 1999.
D. CR #20, “Venture-Capital Philanthropy: Good and Bad,” Eisenberg,
The Chronicle of Philanthropy, August 21, 1997.
E. CR #21, “Venture Philanthropy 2001: The Changing Landscape,” (pp.
1-31) from the Morino Institute.
F. CR #22, “High Engagement Philanthropy—In Search of Effectiveness,”
speech by S. Speirn, Council on Foundations Annual Community Foundation
Conference, 9/26/00.
G. CR #23, Excerpts from Peninsula Community Foundation Annual
Reports, 1983-84, and 1984-85.
Study
Questions:
1. Prepare your own concise definition of “venture
philanthropy.”
2. What is new and what is not new about the
ideas suggested by venture philanthropy?
3. Is there evidence that venture philanthropy
is producing a higher return on investment?
4. What aspects of venture philanthropy do you
think will lead to increased social innovation in the next decade?
5. Which models or approaches described in the
readings appear to be having the most success to date? Why?
Session 5:
April 30th
In
addition to preparing for the case study discussion on Entrepreneurs
Foundation, the Second Written Assignment is Due at the beginning of class.
Read: CR #25a, Michael Porter and Mark Kramer, “Philanthropy’s New
Agenda: Creating Value,” in Harvard Business Review.
Task:
In groups
of no more than four students, analyze the annual report of a major private
foundation (to be distributed in class) analyzing its distinctive strategies,
theories of change, and report on results. Discuss how Porter and Kramer’s
ideas on creating value do or do not apply to the foundation’s work.
New
Philanthropy: Part III
Crossing
from the First to the Third Sector:
Lessons Learned
Guest
Speakers: Gib Myers, Bob Miller, Nancy
Glazer
Read
& Prepare:
A. CR #24, Case Study: Entrepreneurs
Foundation
B. CR #25, Excerpts from Advisory Board Meeting of the Entrepreneurs
Foundation, on lessons learned and results of lessons learned.
Study
Questions:
1. How did Gib Myers originally apply the idea
of venture philanthropy to the creation of the Entrepreneurs Foundation?
2. What methods would you use to assess the
success of the Entrepreneurs Foundation?
3. What aspects of venture capitalism seem to
translate well into the nonprofit sector and which do not? Why?
4. What lessons learned here would you use to
counsel a new philanthropist about to launch his/her own venture philanthropy
enterprise?
Session 6: May 7th
Women
in Philanthropy
Focus
on Institution Building, Art, Education, & Political Economy
Read
& Prepare:
Four
Case Histories
A. CR #26, Mrs. Russell Sage
B. CR #27, Abby Aldrich Rockefeller
C. CR #28, Elizabeth “Betty” Bottomley Noyce
D. CR #29, Madam C.J. Walker
E. CR #30, Waldmar Nielson, “The Rising Role of Women” from Inside
American Philanthropy: The Dramas of Donorship
F. Lagemann, Chapter 4, Meg Jacobs, “Constructing a New Political
Economy: Philanthropy, Institution-Building, and Consumer Capitalism in the
Early Twentieth Century.”
G. CR #31, Katharine Mieszkowski, “Learning and Change—Catherine
Muther,” from Fast Company
Optional Reading:
H. Lagemann, Chapter 15, Ruth Crocker, “The History of Philanthropy
as Life-History.”
Study Questions:
1. Lacking a business career, what life experiences, values,
strategies did Margaret Olivia Sage bring to her philanthropy?
2. Madam C.J. Walker, on the other hand, was known principally as an
entrepreneur. How did this shape her philanthropy?
3. For all four women, how
does each find “strategic fit” between their personal motivations and the
causes they chose to support?
4. How would you compare each philanthropist’s “theory of change”?
5. How would you assess the relative impacts of their strategies?
6. The Sage Foundation and the Twentieth Century Fund pursued very
different strategies with respect to consumer credit. What are some of the public policy issues that are being
contested today in the philanthropic arena?
Session 7: May 14th
Measuring
the Results of Philanthropic Investments
Read
& Prepare:
A. CR #32 Case: New Profit, Inc. Governing the Nonprofit Enterprise
(and the Balanced Scorecard)
B. CR #33: Chapters 2 & 3 , from Social Purpose Enterprises
and Venture Philanthropy in the New Millennium, Roberts Enterprise
Development Fund
C. CR #34, Walker & Grossman, “Philanthropy and Outcomes: Dilemmas in the Quest for Accountability,”
from Philanthropy and the Nonprofit Sector in a Changing America.
To
Be Distributed: Social Return on Investment Reports from Roberts Enterprise
Development Fund
Session 8:
May 21st
The
Future of Philanthropy: Emerging Trends in Foundation Philanthropy
Guest
Speaker: Lucy Bernholz, PhD.
Read
& Prepare:
A. Lagemann, Chapter 17
Additional
Readings To Be Distributed
Session 9:
June 4th
New
Philanthropy: Part IV
Center
for Venture Philanthropy: Social Venture Funds, Results and Challenges
Organizational
Capacity Grants Initiative
Materials
To Be Distributed
Session 10: June 6th
Third
and Final Written Assignment is Due at the beginning of class.
Task: A paper approximately 10-15 pages in length on a philanthropic
topic of your choice.
Reinventing
Philanthropy
Read
& Prepare:
A. Case: Triangle Community Foundation
B. CR #35: Clotfelter and Ehrlich, “The World We Must Build” in Philanthropy
and the Nonprofit Sector in a Changing America.
C. CR #36: Lenkowsky, “Reinventing Philanthropy,” in Philanthropy
and the Nonprofit Sector in a Changing America.