Mutz Class Digs Deeper into Philanthropic Approaches
This blog was written by Mary Tyndall, food programs director of St. Joseph Community Health Foundation, to provide an inside look into her Mutz Philanthropic Leadership Institute class.
The March 2023 Mutz cohort tackled the challenging and complex topic of "approaches to philanthropy," with three key takeaways:
- Systems change is critical to making comprehensive gains in the work of equity and inclusion;
- Impact investing is an innovative tool that funders can use to affect positive social outcomes; and
- Humility is central to a productive relationship between funders and nonprofits.
The 2023 Mutz cohort also spent time examining impact investing strategies, including presentations from Lisa O’Mara, vice president of LOCUS Impact Investing; Christie Zarkovich, chief administrative, financial, and investment officer for Health Forward Foundation; and Allison Clark, associate director of impact investments for the MacArthur Foundation.
"When nonprofits can prioritize leadership and governance, they can better serve their communities." – Candice Perry
Brian Johnson, a member of the 2023 Mutz cohort, states that “The concept of a win-win using investment funds to support community needs with a potential investment return is very intriguing. The potential is that a charitable organization may have the flexibility to, among other options, support loans or programs that a commercial institution would not normally support and opens the possibility that the program can move forward.”
Clark explained impact investing in this way: “grants are a form of investment with a 0% financial return, typical financial investing has the goal of the most financial return, and everything in between is impact investing.” O’Mara commented that impact investing can leverage other dollars in order to have a greater benefit to the community, such as more affordable housing units, more small business loans, or a new childcare center located in an underserved neighborhood. For example, the Topeka Community Foundation takes 1% of its investable assets and invests them into projects that make a change in the local community, such as a line of credit for Habitat for Humanity to purchase homes under predatory high-interest contracts for deeds to low-income residents. The line of credit helps dozens of residents purchase their homes with 0% or low-interest loans. Clark shared that the McArthur Foundation views impact investing as being able to 1) solve funding gaps and 2) innovate and demonstrate something that is perceived as a risk is working and worthy of investment.
"If anything came out of the unrest of 2020, it was amazing awareness of work done at the grassroots level." – Bill Stancykiewicz
Next, the current Mutz cohort focused on the topic of capacity building with a panel discussion led by Ruth Stone, president of CDO Consulting Group. Guests included Candice Perry, nonprofit excellence program officer for the Welborn Baptist Foundation; Bill Stanczykiewicz, assistant dean for external relations with the IU Lilly Family School of Philanthropy; and David Bennett, interim president & CEO of the Foellinger Foundation. The panel shared various ways foundations can support building capacity in their nonprofits and why it was important.
Many participants commented that the discussion about the perceived power funders hold over grantees was helpful. “Humility is essential to the work we do as funders, especially in terms of building authentic relationships with nonprofit partners,” says Mutz Institute participant Emerald Blankenship. The presenters asked philanthropists to allow grantees to make mistakes and to encourage transparency and true partnership.
Mutz Institute participants were fortunate to hear from experienced philanthropic leaders during their March meeting, including a presentation from Pamela Ross, vice president of community leadership and equitable initiatives at the Central Indiana Community Foundation/Indianapolis Foundation. Mutz Institute 2023 cohort member Faith Van Gilder stated, “I was very inspired hearing Pamela Ross describe culture change at Central Indiana Community Foundation. Her slides were informative and showed the evolution of the CICF mission to combat systemic racism.”
"I expect to die still learning." - Pam Ross
Ross noted the growing gap between affluent and low-income residents in central Indiana, and that “a person’s race has a profound impact on their access to opportunity.” She noted that the philanthropic sector is “not going to program our way out of systemic racism,” and must work to change systems that unfairly hold people back from realizing their full potential. Ross also discussed how important it is for leaders, both board members and executive directors, to embrace the work and to be aware of their own gaps in understanding.
The CICF incorporates equity into all its work by:
- focusing on root causes and not symptoms of racial inequity;
- supporting efforts that address and seek to eliminate disparities;
- serving high percentages of under-appreciated, marginalized populations with quality, comprehensive programming with a sharpened focus on outcomes;
- investing in initiatives that are endorsed by community stakeholders, including residents and those being served by the project;
- including a feedback mechanism for residents and/or populations served to inform programming design and delivery; and
- ensuring organizational and board leadership is representative of the populations served.
The day of learning ended where most philanthropic work begins—the mission. Cecilia Diem, a managing consultant for AmPhil, stated that mission-based philanthropy is simply shorthand for strategic philanthropy, and answers the questions of who you are going to serve and how you are going to serve them. Whether employing strategies such as systems change or impact investing, Diem encouraged all participants to act with humility and approach the mission “with love and a true calling to make the world a better place.”