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Robert Egger

Can the Nonprofit Sector Stand Up for Itself?

There is something really interesting going on in the world of nonprofit advocacy. And I don’t mean advocacy for a specific cause. Rather, I’m talking about advocating for the nonprofit sector as a whole. Three new efforts underway in recent months are vying to be the voice of the nonprofit sector. And the firestorm brewing is interesting to watch.

Robert Egger kicked it off a year ago when he formed CForward an advocacy organization that champions the economic role of the nonprofit sector and supports political candidates who include the nonprofit sector in their plans to rebuild the economy. You can read my interview with Robert about why he launched CForward here. Robert’s video about the need to advocate for the nonprofit sector is below (or here if you are reading this in an email):

And then in the last couple of months there have been two similar movements to better advocate for the nonprofit sector. Dan Pallotta released a new book last month called Charity Case: How the Nonprofit Community Can Stand Up for Itself and Change the World where he announces the creation of his new entity, the Charity Defense Council, which is also aimed at advocating for the nonprofit sector, via five efforts:

  1. An “anti-defamation league” to respond to and rectify inaccurate reports about the sector in the media
  2. Big public advertising campaigns for the sector
  3. A “legal defense fund” to challenge unproductive laws against the sector
  4. Work to create a “National Civil Rights Act for Charity and Social Enterprise” to support the sector
  5. Grassroots organizing of the sector as a whole, including a national database of every nonprofit in the country

And then the third grand effort to advocate for the nonprofit sector comes from Independent Sector, the organization formed in 1980 to “advance the common good by leading, strengthening, and mobilizing the nonprofit and philanthropic community.” Their new report “Beyond the Cause,” which interviewed 100 nonprofit organizations, recommends the creation of a national organization (probably run by Independent Sector) to push a nonprofit agenda, costing $20 million over 4 years. For Independent Sector the key issues that such an entity would address are:

  1. Changes that could limit the organizations eligible for charity status
  2. Threats to charitable tax deductions for donors
  3. A need to clarify advocacy and lobbying rules for charities and private foundations
  4. Changes to Internal Revenue Service disclosure forms that could hamper nonprofit operations
  5. Burdensome paperwork and red tape involving government contracts with nonprofits
  6. Lack of government-financed research on the nonprofit world

While CForward seems to be largely supported in their work, both Pallotta’s and Independent Sector’s efforts are drawing fire. Phil Buchanan, president of the Center for Effective Philanthropy, writes a scathing review of Pallotta’s new book and advocacy effort and concludes that “Mr. Pallotta is selling is himself—as both the nonprofit world’s messiah and its advertising agency,” and suggests that people support CForward and Independent Sector instead of Pallotta’s Charity Defense Council.

Similarly, Pablo Eisenberg, senior fellow at the Georgetown Public Policy Institute, dislikes Independent Sector’s effort to coalesce the nonprofit sector arguing that “nonprofits will never share a broad consensus about which issues are most important. The best that nonprofits can accomplish is to strengthen their individual advocacy and lobbying activities and join with other organizations in coalitions that fight for specific policy changes.”

It is really a fascinating and multi-layered debate. I strongly agree that the nonprofit sector is often dismissed in the policies of the day. But if organizations like Independent Sector have been working to create a common voice for the sector for more than 30 years with little improvement, I’m not sure what will change. Especially if 3 separate entities are all singing different verses of the same tune. They will be competing for dollars, mind-share, and the ears of policy makers. But I am a huge advocate for fixing a broken sector, so let’s see how this all plays out.

What do you think? How do we get policy makers to recognize the importance and value of the nonprofit sector?

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Nonprofits as Equal Partners in the Economy: An Interview with Robert Egger

Robert EggerIn this month’s Social Velocity blog interview, we’re talking with Robert Egger. Robert is the Founder and President of the DC Central Kitchen, the country’s first “community kitchen”, where food donated by hospitality businesses and farms is used to fuel a nationally recognized culinary arts job training program. In addition, Robert is the Founder and President of the just launched CForward, an advocacy organization that rallies employees of nonprofits to educate candidates about the economic role that nonprofits play in every community, and to support candidates who have detailed plans to strengthen the economy that includes nonprofits. Robert was included in the Non Profit Times list of the “50 Most Powerful and Influential” nonprofit leaders from 2006-2009, and speaks throughout the country and internationally on the subjects of hunger, sustainability, nonprofit political engagement and social enterprise.

You can read past interviews in our Social Innovation Interview Series here.

Nell: You have argued that nonprofits need to more assertively demonstrate how they are changing things (jobs created, dollars saved by society, etc), but this necessitates an understanding of and ability to articulate and track performance. Do you think the nonprofit sector as a whole is ready for that?

Robert: I don’t think we have a choice. There are external forces that will not allow organizations to go-it-alone, or do what they’ve always done, indefinitely, any longer. The “era of extra” in America, when our manufacturing economy produced enough extra money to sustain (however anemically) the hundreds of thousands of nonprofits, has passed. Plus, donors are more and more demanding of groups now. They want results.

And while many groups may struggle to move beyond antidotes to better articulate their already amazing economic results, there are assets available in every community that can help speed up the transition.

EVERY university and college is brimming with a generation raised doing service, and they would readily embrace the opportunity to help groups measure, and then use new media outlets to market themselves, with gusto.

There are also well-skilled Baby Boomers surging into the sector, equally anxious to be part of rocking their community. The only thing we have to fear is the fear of opening up to change and embracing new ideas. That will be particularly hard for older leaders, or founders who have so much invested in their vision or systems. I understand that trepidation… up to a point.

To be honest, human service nonprofits ask for that kind of courage everyday from the people we serve. Since 1989, we at the DC Central Kitchen have asked that of the recovering addicts and ex-cons who come looking for a second or third chance at change. Shouldn’t we in the sector be equally willing to let go of old habits and be open to new ways of making money? I think so.

Nell: You have worked in social services, feeding and finding jobs for the homeless. Are social problems like hunger, homelessness, poverty ever solvable without fixing the underlying infrastructure inequalities that caused them in the first place? How can and should a nonprofit work to solve something that has a much larger underlying cause?

Robert: I divide my time 49/51.

49% is spent helping colleagues at The Kitchen, or any nonprofit, work stronger, better, faster. But that’s all I’ll give to traditional charity, no matter how bold the effort.

Why? Because grant-funded charity cannot solve the problem. It’s beyond the ability of nonprofits—socially, politically and economically.

That’s why I devote 51% of my energy to forwarding tactics and strategies that help us as a sector (and we as a country) develop the civic courage, economic open-mindedness and political will required to finally root out, root causes.

That was why I Co-Convened the first Nonprofit Congress in 2006. I wanted to challenge the canard that the sector is too diverse to find common ground. I wanted to help inspire groups to climb out of their individual silos and embrace our shared opportunity to change the rules of the game, versus continuing to play by outdated (and economically flawed) dictates.

Most of all, I wanted us to be directly involved in the wide-open Presidential race of 2007 and the dozens of Governor’s races of 2010. I wanted to challenge candidates to vie for our votes, not take them for granted. I still believe that this is the strategy we need to take.

That is why, on Nov 4th, I launched CForward, a PAC (political action committee) for nonprofits. Our goal—to openly support and help elect a new generation of legislators who show up on day one, fully invested in partnering with nonprofits to strengthen the economy.

Admittedly, CForward is a long term strategy for change, but I advance immediate, on-the-ground tactics with equal audacity.

One of many ideas I think could move the dime involves mergers. Not in the two-become-one model, although that’s essential in the current economic climate. No, I’m talking about merging things that matter. If, for example, the top 25 nonprofits in any town merged their banking business and shopped their combined cash-flow, they could leverage their assets and advocate for seats on the board of the bank and work for access to capital (rather than remain encumbered by the grant system).

Another version–what if we developed a “nonprofit seal of approval” for businesses? We could suggest that if citizens wanted to decrease the need for charity, or lower taxes—they could support businesses that we identified as providing good wages, healthcare or other benefits that would decrease demand for services and increase independence. Imagine if we directed our 90 million volunteers to see daily commerce as philanthropy!!

That’s what interests me. What resources do we have and how we can use them differently?

Nell: You are sometimes viewed as a renegade in the nonprofit sector, in that you are not happy with the status quo and you challenge nonprofits to do more and better. Since the nonprofit sector is such a consensus-driven, collaboration-oriented one, have your opinions served you and your work well or ill?

Robert: The better question is; “Has consensus served the sector well?” I genuflect to the power of being open and inclusive, but I think consensus has been used as an excuse for inactivity. Fraternity has been used as a shield to stifle critical review of groups or ideas whose time has passed. The perceived lack of unifying forces has left us fighting each other for scraps. And our silo mentality has left us politically weak at the very moment we should be advocating for a more pronounced role in strengthening the economy. We are 10% of America’s economy. There are 100 million people who work at, or volunteer with, a nonprofit. Of greater potential is the 90 million strong Millennial generation that has been raised doing service and who are now beginning to flood out of schools. They are out of work. They are poor, pissed-off and plugged in. And they are our natural allies in pursuing new policies.

In short—why should we occupy the streets when we can take over the town.

If the organizations that purport to lead the sector can’t bridge the barriers that divide us and help us find common ground to build upon, then I say it’s time for new leadership.

Nell: You have strong opinions about what nonprofits should do differently, but what about philanthropists and government? Where do they fit into what needs to change in the social sector?

Robert: We are ALL trapped by charity.

It is rooted in all faith traditions and deeply ingrained in the American experience. Yet, it is driven by the “redemption of the giver, versus the liberation of the receiver” power dynamic. That flawed flow cascades down from government and foundations to nonprofits, and from nonprofits down to those we “serve”. None are truly liberated, and each resents the other. What’s important to recognize is that it’s not the players who are flawed, it’s the game itself.

I work for the day when nonprofits are viewed, rightly, as equal partners in the American economy. For those who would scoff at that idea, I suggest they ask any Chamber of Commerce what makes a town or state attractive to business. You know what they will include on ANY list? Quality healthcare. Vibrant arts & culture. Access to higher education. Strong communities of faith. A clean environment and recreational space for families.

ALL nonprofits!!

Our work enables businesses to make profit, yet, we settle with token grants. We are told that we cannot be openly political when businesses can post placards in their windows for candidates who they feel represent their interests. I say it’s time to re-negotiate.

I believe our country’s economic future rests on re-aligning the sectors, and being bold enough to see opportunity beyond current constraints or lines of demarcation that divide our resources when we should be aligning our assets.

Nell: What do you think about the recent growth of double-bottomline investing and for-profit social enterprises? Do you view for-profit social entrepreneurs, and those who invest in them, as competitive or additive to the nonprofit sector?

Robert: I believe the only sustainable future for philanthropy is for cause and commerce to be interwoven.

We still cling to two ideas about money—Friedman’s notion that business exists to make money for investors, and Carnegie’s idea (still foolishly forwarded by Gates and Buffet) that you should give money back at the end of your life, often attempting to offset the damage made by the very pursuit of profit.

Both are boring, outdated, and flawed ideas…and each rests on the participation of a benign consumer, blinded by the role their purchases make in maintaining the status quo of the day.

For me, social enterprise isn’t about nonprofits making money; it’s about consumers awakening to the power of pennies. It’s Capitalism 2.0.

Gandhi used the boycott of table salt to get the British crown to the negotiating table. Dr King used the boycott of the dimes it took to ride the busses of Montgomery to crack racism in America. Chavez used the boycott of table grapes to finally get land owners to give migrant workers basic sanitation and access to education for their children.

Social enterprise builds on that proven power but flips the energy to a “buy-cott” , where we reward and incentivize corporate behavior we know will begin to offset the need for charity. It uses market forces to compel other businesses, however reluctant, to follow suit or fail based on how they make their money everyday.

Social enterprise opens that door.

But I’m also very deeply invested in new ideas about how we incentivize investment and performance in nonprofits.

For example, If you invested $1,000 in Microsoft in 1986, you now have over $500K in the bank. Yet, if you invested that same sum in the Grameen Bank, which has elevated millions of people out of poverty with micro-loans, all you were eligible for was a one-time tax deduction, because it’s a charity. Why not a new tax system where you could earn an increasing tax deduction based on the same return-on-investment formula as a dividend check if an organization can show verifiable economic return? Imagine regular people being able to attain wealth by investing in groups that make the community economically stronger or more civically secure? I do…and that’s why I think social enterprise is so exciting. It says you can develop a strong society and a vibrant, open economy at the same time.

But to move beyond social enterprise or micro-credit or empowerment driven nonprofits being a novelty, we need to elect people who understand that power, and turn to the nonprofit sector and offer opportunities and partnerships to see it grow.

That’s why I launched CForward…to work with other citizens who work at nonprofits to elect people who have that kind of foresight and courage. It’s not as hard as you might imagine, and it is so much closer than you think.

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10 Great Social Innovation Reads: May

In our ongoing blog series, 10 Great Social Innovation Reads, below are my top 10 picks for the best reads in the world of social innovation in May.

But I’m sure I missed some great stuff, so please add your favorites from the past month in the comments.

  1. Three new books released recently argue in various ways that philanthropists need to get better at giving money away. The Economist gives us the skinny: Giving for Results.
  2. News organizations are having to reinvent their funding models, some of their innovative ideas for bringing money in the door could spark some thinking in the nonprofit world: Going beyond grants: Eight new ways news nonprofits are raising revenue.
  3. The Dowser blog argues that recent efforts to re-imagine the great American city aren’t bold enough: Creating the Sustainable City: Are Imagination and Leadership Enough
  4. Newsweek investigates the philanthropic investments billionaires have made in American public schools and claims that the results of those investments have come up quite short: Back to School for the Billionaires
  5. New Google research on people’s use of smartphones holds some interesting lessons for nonprofits.
  6. Any entrepreneur, social or not, has to fight moments of depression on the road to social change, the A Smart Bear blog tells us how to Fight Mini-Burn Out.
  7. From Amy Sample Ward, nonprofit social media maven, comes a great post about crowdsourcing versus community-sourcing and how and when nonprofits should take advantage of each.
  8. In a recent interview, Robert Egger, founder of DC Central Kitchen, argues that nonprofits need to rethink how they position themselves in order to really “move the needle”
  9. Nonprofit Tech 2.0 gives us Six Online Fundraising Tools You May Never Have Heard Of
  10. The Nonprofit Finance Fund is doing something pretty exciting with capital. They are directing $10 million in “change capital” to 10 performing arts organizations to help them “prepare for future growth and make changes to the way they operate.” NFF has a special page with resources and case studies about what they are doing: The Case for Change Capital in the Arts.

Photo Credit: Robby van Moor

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