Keynote Address

2013 Annual Gathering of Members

Philanthropy Australia

RMIT University
Melbourne Australia
April 16, 2013

Kevin K. Murphy
President
Berks County Community Foundation

Thank you Louise.

It occurs to me that we are truly blessed in this field.
When were dealing with our donors, were working with people who have made
incredibly selfless commitments to the common good.
When were working with our grantees, we are working with people who have foregone
many other options to dedicate their lives to the service of others.
We work with the best of humanity and we work with them at their best.
Today, we received a stark reminder from Boston that there are dark forces as work as
well.
Our thoughts and prayers are with our colleagues and friends in Boston as they begin to
deal with the horrible tragedy there. But our work must go on, as we MUST overcome
the evil that happened there.
Thank you for inviting me. I bring greetings from Vikki Spruill, the President and CEO
of the Council on Foundations and our 1750 member foundations.
I arrived here fresh from presiding over the Councils AGM in Chicago last week and
attending the Philanthropy New Zealand AGM earlier this week. I may be setting some
kind of world record for AGM attendance in a two-week period.
Fresh off those experiences and a week of thinking about philanthropy, Louise asked me
to talk with you a little bit about two or three key trends in global philanthropy and what I
think they mean.
I was raised in the Methodist church and almost went into the ministry. I got close
enough to learn the first lesson taught to every Methodist minister: Use no more than
three examples and use no more than 19 minutes. I do in fact have three trends that I
think are shaping philanthropyand a bit of a conclusion about what those mean for
peak bodies.
The first and most obvious of these is the globalization of philanthropy.
Look no further than the fact that the CEO of a small community foundation is in
Melbourne Australia meeting with foundations from halfway around the world for
evidence that the world of philanthropy is changing.
The globalization of philanthropy is evident in two ways.

First, theres a growing desire or need for cross border giving. Global companies
wanting to be involved beyond their headquarters community drive some of this.
Companies like IBM, for instance, seek to be global citizens.
Large foundations are in on the act too, as they seek to address global health issues, for
instance. Simply put, you cant eliminate polio in the worldas the Bill and Melinda
Gates Foundation seeks to dounless you eliminate polio everywhere in the world.
Even community foundations have developed global grantmaking interests. Many of us
help our Jewish families make grants to support Israel. The Cleveland Foundation has
an active program of building relationships with Cuba. Even the little Berks County
Community Foundation has an active partnership with a foundation in Russia to promote
youth philanthropy in our communitiesand a program to build relationships with
China.
The other facet of the globalization of philanthropy is the desire to share what were
learning with each other and to recognize that many of the changes were confronting in
our communities arent unique to our region.
So when we think about how to revitalize an old industrial city in Southeastern PA, were
as eager to learn the lessons of Liverpool England, as we are Liverpool Ohio. Funders
concerned about ocean quality are pretty aware that every ocean has two sides that must
learn from each other and coordinate.
So, globalization is the first major trend I see.
The second major trend I see all over the world is the shifting relationship between
philanthropy and government. Its not yet entirely clear how all of this will shake out.
In many countries like the United States and Russia, the governments have suddenly
taken notice of the existence of these curious animals called foundations. In the case of
Russia, its clear that foundations make President Putin uncomfortable, as its a general
rule that anything he doesnt control makes him uncomfortable
In the U.S., congress has begun to question what foundations do and how the money is
spent.
In February, I spent 2 hours testifying before the House of Representatives Committee
on Ways and Meansour tax writing body defending the importance of the charitable
deduction in our tax code. In my lifetime, that deduction has NEVER been called into
question.
Theres increasing interest around the world by legislative bodies in whether our
resources could be used to replace diminished governmental resources. Theres a lack of
basic mathematical understanding at play here. By way of example, the County we serve

has a county government. It would spend our entire grantmaking budget in about 40
hours. The Bill and Melinda Gates Foundation, were we to spend all of its endowment
replacing the budget of the U.S. Government, it would last about 80 days.
For decades, weve operated on model of philanthropy invents, government
implements. From health care breakthroughs to white lines painted on the sides of the
road, foundations have been the experimental risk capital for society, with government
providing the resources to bring social change to scale.
But its not clear that model will hold up in the future.
If it seems like Im unclear about whats going on in the relationship between
philanthropy and governments around the world, its because I am. I see change at lots
of levels but not yet a clear direction for the future.
The final big trend I see is the changing relationships between donors and their
philanthropic legacies. This is sometimes characterized as the emergence of new forms
of giving.
There may be new forms of giving..but I havent see one yet.
What I have seen is a greater tendency of donors to be deeply involved in the
management of their philanthropy. Sometimes this is in the form of wanting to have
greater family engagement in their legacy.
The new donors are often marked by a skepticism about the traditional ways foundations
have workedand doubts about whether they want to be part of our networks.
Above all, many of these donors believe that the lessons they learned while making their
money can be applied to the social problems they choose to address in giving their money
away.
Sometimes theyre right. Sometimes theyre wrong.
But the higher level of donor involvement is reflected everywhere. United Ways see
more donor designated gifts.
Community Foundations have seen an explosion of donor advised funds that allow
donors and their families to remain involved in grant-making. Colleges report declines
in general giving in favor of more specific support for particular pet programs.
The effects of this arent entirely clear. Its certainly a disruption of the historical pattern
of believing that the administration of social funds was best entrusted to professionals
with deep background and expertise in social problems.

So, globalization, changes in the relationship with government and increased donor
involvement.
Heres what I think that means for peak bodies like Philanthropy Australia and The
Council on Foundations. All of these trends point in the same direction to me: A
growing role, but a changing one for national organizations.
Again, in the spirit of Methodism, I see three important roles: Connecting Foundations,
Advocating for them, and supporting the Growth of Community Philanthropy.
As donor involvement changes and both donors and the government demand more
evidence that were getting results with these incredible legacies we manage, were
discovering all the time the critical importance of connecting philanthropy across its
traditional siloes.
Knowing that a large community foundation in Melbourne is working on sustainable
energy and connecting them to a small family foundation in Brisbane allows them to
exchange information, move more quickly, test and validate their theories in ways that
we didnt used to have.
This requires a different model of national organization, one that has capacity and
inclination to be closer to its members and can be a thought leader among its members.
This is very different from the old transactional model where the associations
passively waited to respond to information requests and responded with studies or issue
papers.
In our early experience in attempting to convert the Council to a more proactive,
connecting organization, I can tell you that it is proving to be both hard and rewarding.
The second imperative for these national organizations is advocacy on behalf of the field
in changing times, or perhaps more accurately, representation. The Australian economic
situation is such that Im convinced you are poised for a dramatic growth in the size and
scope of philanthropy here.
And heres one thing I can promise you: In timesome in your government will come to
view endowed philanthropy with a mix of skepticism, envy and lust.
Where we see generous permanent endowments legislators in difficult budget times see
big piles of cash.
Where we see social innovation some will see end around run on government.
Where we see thoughtful leadership thats not politically motivated some will see
arrogance and where we see patience and an understanding that social change takes
time some will see ineffectiveness.

The dialogue that needs to go on with government at all levels is a constant one and is
best managed through collective action.
Building the capacity of national organizations needs to be a priority for philanthropy all
around the world. Our ability to act independently of government and achieve results
with the money were entrusted with is ONLY as good as our ability to, in fact, act
independently of government pressures.
This is not an argument against transparency and accountability. It is an argument that
says national associations give us the vehicle to begin and carry on conversations with
policy makers about our roles and responsibilities on an ongoing basis.
And without those conversations, bad things can happen.
The final critically important role that national associations are playing, and must play, is
the elevation of community philanthropy.
Before you dismiss this as the predictable argument of a community foundation CEO, let
me ask you to suspend that assumption. I am, famously, considered a grumpy
curmudgeon in the states about the so called community foundation movement. In my
role as the CEO of a community foundation, Ive been a leading and loud voice against
national branding, joint marketing efforts and just about any other symptom I see of the
disease known as community foundation self-indulgence syndrome.
But in my role as chair of the Council, I lead an organization where weve come to
realize that community philanthropyincluding but not limited to community
foundations is the face of philanthropy in our advocacy work.
When Congress wanted someone from a foundation to testify in February about the
importance of the tax deduction, I was selected. I wasnt picked for my good looks, but
for the fact that community foundations like mine show Congress that endowed
philanthropy is and can be a broadly participatory exercise.
We are, to put it bluntly, a far more sympathetic face than our colleagues at large national
foundations, no matter how important and compelling their work is.
The local connections of community foundations and the impact they have make policy
makers very loathe to do anything that we say would hurt philanthropy.
The Council for years (maybe decades) treated community philanthropy as a third-class
citizen in its planning, its governance and its communications. Only in the last five years
or so has the Council realized that by lifting up and embracing community philanthropy,
it both strengthened the network of connections that it could make and created a far richer
storyline about the role and importance of philanthropy.

We are at a pivotal point in philanthropy globally. Global philanthropy is no longer

emergent, it is here for real playing a major role in communities everywhere. That
emergence has been driven in many cases by donors whose understanding and
expectation of philanthropy is very different. And that emergence has, or will, catch the
eye of governments everywhere.
The challenge for peak bodies or national associations will be to connect philanthropy in
new ways to improve our effectiveness, advocate for our work and our independence, and
lift up community philanthropy in way that connects our field more meaningfully to the
people we serve.
We need to get better at what we do each day.
We need to make up for what happened in Boston.
Thank you.