Our Commitment to Nonprofit Effectiveness

Last week, nearly 700 philanthropic leaders gathered at the Grantmakers for Effective Organizations (GEO) conference in Los Angeles. GEO, a coalition of more than 450 foundations committed to building strong and effective nonprofit organizations brought us together to wrestle with questions like: How do you incorporate values into philanthropic strategy? What are the most effective ways to scale promising interventions? How do you use new tools such as design thinking and crowdsourcing to further impact? And, perhaps most importantly, how can funders truly support and collaborate with their grantee partners, and with each other?

It was great to be a part of this gathering and to see the level of interest both in how foundations can help to build the capacity of nonprofits and in how foundations themselves can become better grantmakers. As we mark our 50th anniversary at the Packard Foundation, we celebrate with GEO this increased interest and rededicate ourselves to both goals.

In 1983, when Packard began its own grantmaking program dedicated to building the organizational capacity of our grantees, we were one of a small handful of foundations nationwide that focused funds on this.  But it was natural for us to do this kind of grantmaking. David Packard had built Hewlett-Packard by nurturing individual leadership and ideas, and providing strong management and attention to organizational dynamics. He knew that organizations are more effective when they are equipped with solid leadership, sound operations, and a clear mission. Thirty years later, we continue this grantmaking through our Organizational Effectiveness program, providing funds to help nonprofits build core strengths in areas like strategic and business planning, financial management, board and executive leadership, and communications.

In 1997, we were excited to work with a few other foundations to create Grantmakers for Effective Organizations. We are heartened by the growth in the numbers of foundations dedicated to the goals of GEO:  smarter grantmaking, stronger nonprofits, and better results. Dozens of foundations now have OE programs of their own, including leaders like the Hewlett Foundation and the Evelyn and Walter Haas Jr. Fund Flexible Leadership Awards program. Many more, such as the Annenberg Foundation and Weingart Foundation in Los Angeles, integrate capacity building into other grants that they make. We are proud to be a part of this growth. We also know that there is much more that foundations can do to help nonprofits maximize their effectiveness in a rapidly changing world.

Like others in attendance at the GEO conference, we have experience and lessons to share. Just in the last 15 years, our OE program has provided critical capacity-building support to more than 1,000 organizations. We share our experience and resources through a public wiki.

Of course, the best capacity-building grantmaking programs and the best grants are developed in good conversation with the leadership of the nonprofit organization we seek to assist. At the Packard Foundation, we work collaboratively with grantees to tailor the type of capacity-building support that will best position them to achieve their goals, rather than dictating what activities these grants should support. As the GEO conference highlighted, most of today’s capacity-building programs rest on this core commitment to good dialogue and partnership with the grantee organization.

But there is also a broader recognition among foundations that we need to overall do a much better job of soliciting and acting on feedback from our grantees—before, during, and after the grants. One of the most promising developments of the past decade has been the growing numbers of foundations who work with the Center for Effective Philanthropy (CEP) as a way to get honest feedback from grantees. Founded in 2000, CEP pioneered the use of rigorous surveys that enable foundations to ask their key constituents for candid, anonymous feedback about their work—and then compare their results to similar foundations nationwide.

Today, over 300 foundations have used CEP to help measure their performance and the quality of their interactions with grantee partners. We have supported CEP almost since its inception, and have contracted with the organization to survey all of our grantees every two years since 2004. We make the results available on our website and have made concrete improvements in response to what grantees tell us, including developing grantee experience standards  that set expectations for respectful and substantive interactions with grantees.

We are proud of our deep and impactful relationships with grantees. But as we celebrate our 50th year, we know there is much more that the Packard Foundation can do, and that philanthropy can do, to partner effectively with nonprofits and to support their success.

Over the course of this year, we will be focusing on a few key initiatives to enhance our grantee partnerships—and to live our values of respect for nonprofit leaders and mutual commitment to effectiveness. These initiatives will include:

  • Working with our Visiting Scholar Lucy Bernholz, assessing how much information we currently share with grantees and the public—particularly about areas where we are experiencing challenges or even failures–and seeing where we can open up even further.
  • Looking at new tools and technologies to do a better job of bringing the voices of constituents into our grantmaking.
  • Pioneering new approaches to remain open to new voices and ideas across all of our programs.

In the coming years, as in the past, we will not be exploring these areas alone. We hope to see hundreds of additional foundations working with organizations like GEO and CEP, and focusing on both supporting their grantees in increasing organizational capacity and becoming better grantmakers themselves.