By Wmpearl (Own work) [CC0], via Wikimedia Commons

March 28, 2018; Jewish Telegraphic Agency and eJewish Philanthropy

Though focused on the $5.5–6 billion raised annually for Jewish causes, Giving Jewish: How Big Funders Have Transformed American Jewish Philanthropy, a new report funded by the Avi Chai Foundation, has relevance for the broader philanthropic community. Changes over the past two decades in longstanding patterns have challenged nonprofit organizations to adapt, at the risk of losing their support and their funding.

The report recapitulates findings that NPQ readers will find familiar: Larger donors, though small in number, now have an outsized impact on the service organizations they fund.

Even a superficial examination of the current scene suggests that Jewish philanthropy operates very differently in our own time…the base of support has shrunk for almost every institution.…Fewer give, but those who make grants tend to bestow large sums.

This shift has profoundly altered the ways Jewish not-for-profits conducted their business. The sharp focus on big gifts required the recruitment and training of a different kind of staffer with a core competency in major gifts fundraising.

In shifting their focus toward larger givers, nonprofits have less ability to attend to the interests and needs of smaller givers, even in greater numbers. This shift can have significant implications for community-based nonprofits and the nature of democratic governance. Jack Wertheimer, American Jewish history professor at the Jewish Theological Seminary and the report’s author, told the JTA that “the Jewish community is becoming even less of a representative democracy than it ever before. Jewish organizations are going to be far more beholden to a smaller number of donors. This consensus-driven approach to Jewish communal life is endangered by that because these larger donors want what they want.”

Not only has giving by large givers and their foundations become more of a force, the focus of their giving has changed. In the past, both small and large donors were willing to use intermediaries like Jewish Federations or the United Way to gather funds and then make decisions about how they would best be allocated. The process, with all its imperfections, allowed a measure of collective, community-based decision-making to set priorities.

Larger donors appear less and less willing to rely on these community-based mechanisms; rather, they are ready to bring their own agendas to the forefront and directly fund organizations and projects that meet their interests. The role of a broader consensus has become more limited, if not totally lost. Large donors can also bring their own professional staff to the work of ensuring that those who receive their donations respect their interests.  According to eJewish Philanthropy’s review of Giving Jewish,

Foundations are spearheading a shift from “expressive giving” (which is designed to show support for a cause or institution) to “instrumental giving” (which is about achieving a social aim or addressing a systemic problem). Funders seek evidence that programs they are supporting are making an impact in addressing larger problems.

Feeling good about doing good is being replaced with the demand for proof.

Within the Jewish community, the influence of large donors can be seen in a shift in emphasis from programs that meet the community’s social service needs to those which attempt to build Jewish identity and respond to these donors’ concern over assimilation. The conundrum for longstanding organizations is whether to retain their focus and risk their funding, or to change and follow the money. Sandy Cardin,  president of the Charles and Lynn Schusterman Family Foundation, wrote in eJewish Philanthropy, “Organizations willing to address these challenges openly, honestly, and in partnership with funders are seeing an increase in both their number of donors and amounts raised.” The fate of organizations not willing or able to give up their core missions may not be so rosy.

Giving Jewish reflects trends seen in the wider philanthropic and nonprofit community as mega-donors flex their muscles. The replacement of community wisdom with that of a small number of powerful philanthropists means fewer checks and balances to protect the common interest. It risks replacing the wisdom of professional educators, social workers, researchers, and caregivers with the less informed vision of the wealthy. It can overly value the new over the longstanding and undermine service structures that still have vital roles to play.

Wertheimer suggests that the solution to mega-donors having too much control over societal priorities lies in making the entire world of philanthropy and nonprofits more transparent and open to criticism. Cardin cautions that “expecting big givers to consistently limit their own influence may be unrealistic, no matter how well-intentioned the donor. Regulating donor influence will require the involvement and attention of the entire Jewish philanthropic ecosystem.” The question remains, will they listen to the opinions of others?—Martin Levine