Trust Is No Substitute for Proof That Philanthropy Is Working

As recently reported in the Chronicle of Philanthropy, three trustees of the Winthrop Rockefeller Foundation have filed a lawsuit challenging the foundation’s move into trust-based philanthropy. Ideally, this case should put to rest a dangerous idea in philanthropy: that trust is somehow a substitute for accountability. It isn’t. 

In response to the case, some sector leaders are suggesting that the foundation’s approach to trust-based philanthropy has been mischaracterized. In a letter to the editor, Shaady Salehi and Pia Infante of the Trust-Based Philanthropy Project and Carrie Avery of the National Center for Family Philanthropy argue that trust-based philanthropy operates within fiduciary standards, supports accountability, and simply represents an evolution in practice. I largely disagree.

Philanthropy without accountability may feel enlightened, but in the real world, it is often just an excuse for nonprofits not to perform. And when charitable capital is being deployed to solve urgent social problems, failure to perform is not a virtue. It’s negligence. Their letter sidesteps the fundamental question: When a foundation stops defining success in measurable terms, what exactly is the board overseeing?

The question is not whether foundations should trust grantees. Of course they should, but only after thorough vetting and ongoing evidence of performance. Trust, but verify. The right questions are whether outcomes are being measured, whether the mission is staying intact, and whether the foundation is producing the best results it can with the resources it controls.

At the organization I lead, the Call of Duty Endowment, which helps place veterans in jobs, we trust our grantees deeply. We also require standardized outcome data from every one of them: cost per placement, starting salary, retention rates, financial health, and organizational integrity. We ask because without it, we cannot compare performance, identify what’s working, or make honest decisions about where charitable capital should go next.

That combination, genuine partnership and rigorous measurement, has helped place 169,000 veterans in high-quality jobs with an average starting salary of more than $76,000 last year. Our grantees achieve these results at roughly one-fourteenth the cost of comparable federal government programs with far superior outcomes, including double the starting salary. That is not a leap of faith. It’s a track record.

The authors want boards focused on strategy, mission, and impact. So do I. But all three require keeping score. Philanthropy is tax-advantaged capital for public good. That carries real obligations: to donor intent, to mission integrity, and above all to the people foundations exist to serve.

Flexible funding and genuine grantee partnership are valuable. Abandoning the scorecard is not.

Dan Goldenberg 
President
Call of Duty Endowment