7 Not So New Ideas in Philanthropy — History allows us to move beyond 21st-century rhetoric

I am grabbing this from Phil Buchanan’s review of Philanthropy in America: A History by Olivier Zunz over at the Center for Effective Philanthropy site: http://www.effectivephilanthropy.org/blog/2012/01/seven-%E2%80%9Cnew%E2%80%9D-concepts-that-are-not-so-new-after-all-reflections-on-a-history-of-philanthropy/.

His list of not-so-new ideas about philanthropy perfectly illustrates how a historical understanding such as the one offered in Zunz’s book can inform and deepen the debates and discussions about philanthropy in the 21st century and beyond.

Reading Zunz’s book, I noticed seven examples of things that are often portrayed as new – or not done – despite the fact that this is not, historically, the case.

1. How often do you hear the lament that nonprofits never die, because the sector lacks the forces of “creative destruction” – to use economist Joseph Schumpeter’s term – that buffet the for-profit world? In a 2010 article in Harvard Business Review, Allen Grossman and Bob Kaplan write, “Apparently, Schumpeter’s cycle doesn’t operate in the social sector.” Yet, history offers evidence to the contrary. During the Great Depression, Zunz notes that “one-third of private charitable agencies in the United States disappeared” during a three-year period. (I’ve also argued that, to the extent that nonprofits have been more resistant to these forces, that’s partly the point of them – to operate outside markets.)

2. Heard a lot about “cross-sector collaboration” or, more recently, of the term “collective impact?” A Stanford Social Innovation Review article describes the concept as the “commitment of a group of important actors from different sectors to a common agenda for solving a specific social problem” and discusses the need for a “fundamental change in how funders see their role, from funding organizations to leading a long-term process of social change.” But Zunz recounts how the earliest major American philanthropists saw their role in precisely these terms, and he cites many examples over the past century of government, foundations, nonprofits, and companies working together to address serious social problems, such as the effort to fight tuberculosis in the early 1900s. He describes the work of the Russell Sage Foundation and nonprofits to combat the disease and then notes, “Other funding partners in the fight against tuberculosis came from business, labor, and government. Life insurance companies naturally invested in reducing mortality rates among their customers.” It is likely the case that such efforts remain too rare, but there are many historical examples worth understanding.

3. Today, that work by life insurance companies on tuberculosis might be heralded as “corporate social responsibility,” “blended value,” or, in the newest term for what appears to be essentially the same thing, “shared value.” But there is nothing new about companies seeking to do social good and make a profit – or the recognition that these goals sometimes go hand in hand (although quite clearly sometimes they don’t). Zunz recounts, for example, how the insurer “Metropolitan Life paid for a major study of tuberculosis in Framingham, Massachusetts, and underwrote a large educational campaign.”

4. What about policy and advocacy work – which so often gets described as if it is a new push or something that funders historically haven’t done? This is perhaps the most powerful part of the story Zunz tells: the fact that philanthropy and public policy have been closely connected since the earliest days of institutional philanthropy and the subsequent spread of “mass philanthropy” in the U.S. a century ago. Zunz describes the evolution of the law with respect to this issue, but what is clear is that the earliest major foundations sought to influence policy, recognizing that this was a crucial way to make change. “Philanthropists have invested their resources in the greater American fight over the definition of the common good. They have taken all sides in all the partisan encounters that have divided our society and have strategically intervened in essential debates on citizenship, opportunity, and rights.” Zunz argues that this activity has “enlarged democracy.”

5. And what of the push to move beyond transactional charity to influence systems and lives on a significant scale, or to combat “root causes” of social problems? Reading press coverage of philanthropy, it would be easy to conclude that, before the Gates Foundation, no one really cared if they were making a difference with their philanthropy. But there is nothing new about the quest to make a measurable difference, as Zunz recounts. He discusses the way Julius Rosenwald pursued a strategy of improving education for blacks in the South, or the influence of philanthropy on private colleges and universities to become much more focused on scientific research – and much more secular. Zunz cites a 1907 Outlook magazine article by Daniel Coit Gilman, a founding member of the American Social Science Association and a president of Johns Hopkins University. “Gilman underscored the new philanthropy’s insistence on long-term solutions to social problems instead of temporary relief for the destitute. High among its goals was the search for root causes.”

6. How about PRIs (Program Related Investment) or the broader concept of “impact investing?” Zunz tells the story of the creation in 1967, by nine foundations, of the Cooperative Assistance Fund to invest in minority businesses. To their credit, the thoughtful present-day proponents of this kind of approach, such as Jed Emerson and Antony Bugg-Levine, are quick to acknowledge its history – but much of what is written by others seems ignorant of what has come before.

7. Finally, how many times have you heard that nonprofits don’t know how to market themselves? And yet American history includes many examples of brilliant marketing, fundraising, and education efforts led by nonprofits. Zunz describes how nonprofits mobilized mass participation and action for positive effect in the fights against disease. He also describes the successful campaigns to encourage giving that accompanied the birth of the “community chest” and the community foundation, and the “democratization” of philanthropy. Indeed, the country’s high level of charitable giving is the result of savvy marketing by nonprofits.

Does Phil hit all the examples of not-so-new ideas in philanthropy? Are there other examples of 21st-century “new” ideas that have deep historical roots? Sound off below in the comments.