Two years ago, Candid (formerly the Foundation Center and GuideStar) closed down its ten-year initiative on making foundations more transparent. The initiative had a great name, “Glasspockets,” referencing Carnegie Foundation board chair, Russell Leffingwell’s testimony before Congress during McCarthy-era hearings that the “Foundation should have glass pockets.”

We never felt that Glasspockets got the attention it deserved and its closure got even less. We’d like to give both aspects some attention today, and give Candid a chance to talk about what they are doing today on transparency. We are fortunate that Janet Camarena — one of the project’s creators and its ten-year director — was happy to reflect on the project with us.

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Q: Janet, what is the single most interesting thing that came out of Glasspockets’ work?

Janet: What probably surprises people the most is how few private foundations can be found online. When the initiative started, only 6% to 7% of foundations had websites. Now it’s perhaps 10% to 12%, which is where it was hovering when Glasspockets wound down two years ago.

This means that foundations have very limited ways to learn about what other foundations are doing, what they’ve learned from their work . . . and nonprofits should realize how limited web information is on foundations.

10 – 12% of foundations have websites

Q: Even 10% or 12% seems shockingly low! But how valuable are foundation websites, really? Many of them seem to be more about public relations than talking about what they are doing in candid enough terms to be useful.

Janet: Well, having a website is a good start towards transparency. And of course we want to encourage foundations to improve the quality of the information on their sites, which was a big part of the Glasspockets effort to provide a roadmap to how to do that.

Q: Example?

Janet: In the grant descriptions published on their websites, too often we just see “general support.” That isn’t helpful to researchers studying where funding is going, for grantseekers trying to determine if a particular funder may be a good partner, or for other foundations to identify peers, possible collaborators, and more.

Q: Glasspockets invited foundations to publish their “transparency self-assessments” and to be a recognized participant in Glasspockets. Over the ten years, how many foundations signed up?

Janet: 112. I know it sounds like a small number! [There are about 103,000 private foundations in the U.S.] But many did use the criteria to prompt discussions about what transparency might mean in their foundation.

Q: What are some of the types of information that Glasspockets promoted as transparency priorities?

Janet: Of the 20+ indicators, many were straightforward, such as do you publish a list of your board members, do you have a whistleblower policy. [Editor’s note: you can find the Glass Pockets Self Assessment Tool here.]

And at the time Glasspockets was founded, foundations were beginning to place greater emphasis on evaluation of grantee performance. When Glasspockets started, the focus for most sector conversations about transparency seemed to be about grantees but not about foundations. GlassPockets combined donor education, peer pressure, and incentives to make it more of a priority.

Q: What was the most common reason foundations gave you explaining their reluctance to be part of Glasspockets, or to be more transparent in general?

Janet: They were usually afraid that if they were more visible — say, having a website — they would be inundated by grant proposals. We were able to identify funder case studies that where having clear priorities and processes on their websites, the result was proposals that were good fits.

Q: Under the Trump Administration, many nonprofits have become worried about how transparent they are. We hear fears about language that could flag them as targets for the government or that foundations would be nervous about funding something that could make them a target. For example, I know one nonprofit that has the word “ethnic” in its name. They are thinking of changing that to “American” so as not to create a barrier for some funders.

Janet: Transparency is certainly changing! But it’s important to remember that there are risks to both transparency and opacity, and the risks of opacity are often overlooked. That’s why I’m glad you asked me to reflect on Glasspockets at this particular time because it’s a good reminder that during a period of crisis, when foundations found themselves spending most of the 1950’s testifying before Congress, they learned the hard way that if you don’t tell your story, then others will tell it for you.

New option to suppress data

Q: What concrete steps is Candid taking on transparency/opacity in this new period?

Janet: We recognize that nonprofits need the space to evaluate risks regarding public-facing data. So, we have worked quickly over the past weeks to give nonprofits the option to suppress contributed data that might pose risks to their organizations or individual staff. New at Candid is that nonprofits can now suppress data that they are no longer comfortable sharing.

For example, if there are concerns due to language in their mission statements or program activities, they can suppress their contributed data without permanently deleting it. While the data is suppressed, it will not appear in Candid’s products or be shared with any third parties. Once they’re ready to do so, nonprofits can request that Candid restore suppressed information to their profile. Even when data is suppressed, it still exists in Candid’s data systems. During that time, data points may still be used anonymously for aggregate research and statistics about the sector to shed light on key trends and provide context to our collective work. (Editor’s note: Forms 990 are still accessible through Candid.)

Q: Yes, transparency seems to be becoming weaponized.

Foundations do need to be thoughtful as well and there are some best practices to keep in mind in terms of grantee data. For example, often the list of published grants comes directly from their grants management system. You need to let your grantees know what will appear about their grant and give them the option not to make it public. They can easily add an opt-in in the grant agreement or award letter that says, “Here’s where we typically share this data. If you would prefer not to have this information published, please let us know.” (This blog post from Candid shares best practices in using grantee data responsibly.)

Q: How much of a difference would foundation transparency make, in the big picture? Suppose 75% of foundations had joined Glasspockets. What would be different today?

Janet: Endowed foundations have the power to be insular. They don’t need to do marketing to sell anything to contribute to their bottom line, they don’t need to campaign to get votes to stay in office, and they don’t need to fundraise to support their work. As a result, most don’t prioritize the kind of transparency that is a basic fact of life in most other industries.

So, if suddenly 75% of foundations had websites that they were actively working to improve, this kind of transparency would represent a big culture shift to give up some of the power of insularity. And remember that the culture of philanthropy moves slowly, so we need multiple approaches to improve sight lines in the field.

To this end, later this year Candid will be launching an improved search function, for the first time combining foundation grantmaking and nonprofit operations data to provide a full view of the work of the charitable sector.

Transparency and the Philanthropy Project?

Q: As you know, the Philanthropy Project is concerned with lack of transparency in foundations, in donor advised funds, in the business models behind donor advised funds, and more. Do you see an alignment there with the ideals of Glasspockets?

Janet: Yes, we believe transparency benefits all kinds of donors, and once donors understand those benefits, they are more likely to embrace an open approach.

Like endowed foundations, donor-advised funds are another giving vehicle available to donors and represent a fast-growing part of the field, but they don’t have the same disclosure requirements as private foundations. And, as we know, some donors believe it’s helpful to make anonymous gifts, and again, may not pause to consider the pitfalls of this approach.

We found that donor education is important to motivate donors with the benefits to them of working more openly. By understanding the connection between transparency and trust-based approaches, some donor-advised funds used Glasspockets to assess and improve their transparency, establish and improve their websites, and be public about their giving and strategies. Today, we are also working to profile more types of giving vehicles in our database, so they can be discoverable to grantseekers.

Q: Thank you, Janet! We look forward to seeing where transparency in philanthropy goes from here.

 

Janet Camarena serves as director of partnerships for Candid where she works to lead campaigns and coalitions aimed at shaping norms and practices related to the most pressing issues in our sector, such as transparency, equity, and impact. She previously served as the director of transparency initiatives for Foundation Center, and provided leadership for Glasspockets.org, which she helped to found and build in 2010.