Putting Wealth to Work: Philanthropy for Today or Investing for Tomorrow?
by Joel L. Fleischman. PublicAffairs. New York, New York, 2017
The Philanthropist, a good Canadian journal on philanthropy, recently issued a book review on a book that is worth reading – Putting Wealth to Work: Philanthropy for Today or Investing for Tomorrow? by Joel Fleischmann.
The book provides a good perspective on the merits (and weaknesses) of perpetual endowment foundations and short term or ‘time limited / spend down’ foundations. It shares a balanced perspective on both approaches.
The author suggests that a benefit of perpetual foundations is that very large social issues and challenges cannot be effectively addressed within a single lifetime. Learning and applying philanthropy can grow and improve over generations.
Giving While Living
The contrast is with a younger generation perspective of ‘giving while living’ – seeking to accomplish goals within a short time frame. This is in part reflects significant growth of personal wealth and change in profile to ‘younger’ philanthropists, often emerging from the technology sector.
The book covers effectively key trends in philanthropy – from a US perspective, but the themes are applicable to Canada. It includes an interesting discussion on the role of foundations in taking positions and seeking to influence public policy decisions, something we are seeing here in Canada. Mr. Fleischmann describes well the desires and considerations of donors who wish to ‘give while living’ – foundations having a fixed life, along with the importance over time of longer perspective.
Ontario Arts Foundation The Ontario Arts Foundation falls into the latter category, we aim to grow endowment assets to provide a long term, stable and increasing source of income for arts organizations. Over time, we continue to learn about endowment and the drivers/motivations of donors.
We recommend both the publication The Philanthropist and the book.
Planning for Economic Uncertainty
December 07, 2018
Much of what we read in the financial press these past few weeks and months speaks of increasing economic volatility and political and market uncertainty. Talk is less about will there be an economic recession, but when will we see the next downturn.
Long-term Perspective At the Ontario Arts Foundation, we continue to hold a long-term perspective and our choice of investment managers and strategies is focused on a portfolio of assets well positioned to grow their businesses over time, are financially strong and able to weather the vagaries of the economy and political climate. That doesn’t mean, we won’t be subject to short term ‘swings’ in value, but a focus on capital preservation and growing it responsibly can mitigate the day to day and month to month market volatility. Most importantly, for our donors and arts organizations, our investment strategy is structured to continue to deliver a stable source of annual income, revenue arts organizations can count on for the long term.
But what should you do as an arts organization in this environment? This recent blog post Barry’s blog – “What Do You Do if the Economy Goes South”offers suggestions, that make good sense for positioning themselves for financial stability. Arts and culture organizations are often under-capitalized and may not have deep operating reserves, and earned income is often not sufficient to offset changes in other revenue sources such as government grants, performance/exhibition revenue or donor gifts. The suggestions the article offers are simple and this is a good time for arts managers and their Boards to review their financial strategies.
First Spark – A New Initiative from Canadian Heritage
November 30, 2018
Arts organizations should be encouraged by a small, but easily accessible funding program launched in November by Canadian Heritage.
The First Spark Initiative
The First Spark Initiative is intended to support arts organizations to focus on innovation in solving common business challenges. An organization can apply for a $5,000 grant to organize a collaborative problem-solving activity which seeks to address the challenge. It offers a way for an organization to get together and use creative approaches to problem solving via partnerships and knowledge sharing. The Ministry hopes that the partnerships/collaborations will develop innovative business solutions facing cultural organizations. As examples of what the program will fund, arts organizations face challenges in dealing with:
• Data management
• Digital transformation
• Governance issues
• Marketing and audience development
• Revenue diversification and fundraising
Where organizations partner to work together, creative solutions may be identified.
Application Process The application process is not complicated, and the program guidelines speak to funding decisions for the $5,000 grant to be made within six weeks of receiving an application. The initiative is time limited and will run from November 15, 2018 to November 15, 2019. Organizations may submit multiple applications, provided they are for distinctly different projects.
This is not a ‘large’ funding initiative, but one that can engage your teams, involve young and developing arts leaders, and lead to collective generation of solutions that are common to arts organizations.