Do Metrics Inhibit Long-Term, Philanthropic Vision?

In the recent issue of the Stanford Social Innovation Review, Charles Conn of the Gordon and Betty Moore Foundation argues against metrics-driven philanthropy, arguing that this lowers the bar for social change by focusing foundations and their grantees on goals that can be achieved in the short term:

A recent movement, sometimes called philanthrocapitalism or venture philanthropy, seeks to avoid complacency and lack of focus in foundation management by introducing rigorous success metrics and accountability practices. Many of these new-style foundations limit their scope to a few problem areas and, like corporations, intensely monitor outcome metrics, often with tight windows for review. To those of us who came to foundation work after a career in business, this sounds eminently sensible; after all, the foundation world is littered with fragmented, unfocused, and failed programs.

Although there is much talk at these foundations about making large, “leveraged,” “focused,” “accountable,” and “multigenerational” commitments to critical problems, the evidence is often at odds with the rhetoric. With their position and pay now tied to near-term metrics, foundation managers aim lower. They pick modest programs with highly constrained objectives that they know they can meet. Or they fund noncontroversial “studies” instead of action. They add layers of bank-like process and control. With quarterly or semiannual hurdles for success, what program officer or foundation leader would choose to take on big, long-term, and risky objectives like contributing to lowering population growth or affecting climate change?

Interesting points, especially when tied to the environment, but I'd love to hear from Mr. Conn or others of actual examples where "...with their position and pay now tied to near-term metrics, foundation managers aim lower." While "pay for performance" would seem to be a logical practice for venture philanthropists, I haven't heard of any who have actually gone this far. (See my pitch for what I call Venture Philanthropy 2.0 in Philanthropy News Digest.)

In my experience as a program officer, I have found myself and my fellow program officers more prone to colluding with grantees who promise more impact than they can realistically expect to deliver. (Obviously, this was the case only with grantees who we, for a variety of reasons including gut feeling, wanted to winningly argue support.) And since most boards devote the vast majority of their time to reviewing new grant requests, rather than evaluating the impact of grants given, neither nonprofits nor program officers are called on their inflated promises.

Susan Herr

Posted at 1:50 AM, Mar 04, 2008 in Accountability | High Net Worth Donors | Performance Measurement | Philanthropic Strategy | Permalink | Comment