The power of community philanthropy
Thursday, 30th May 2019 at 8:39 am
Brian Frederick had been in his job for about six months when he got a call from an attorney.
The attorney explained that a local businessman Alfred Askew had passed away, leaving his entire estate of around US$350,000 to an unrestricted fund at the Community Foundation of Lorain County, where Frederick was CEO.
Frederick was ecstatic. It was the first gift he had brought into the foundation and he was going to be able to go to the board and tell them they had a significant new fund.
But when the attorney, who had been friends with Alfred, came to the office and talked about who Alfred was, Frederick learnt while the money was important the real value of a community foundation was as a steward of people’s stories.
“Alfred taught me about community foundations and I never met him,” Frederick recalls.
“We spent the entire afternoon going through a box of pictures and what I realised was, we were the last people that Alfred’s story was given to.”
Twenty years on, Frederick believes community foundations “are the best thing in the world”.
He retired in 2017 after serving nearly two decades as president and CEO of the Community Foundation of Lorain County.
On a recent trip to Australia, he spoke about the power of community philanthropy and his belief that community foundations are all special (although none are unique).
Every community foundation is made one gift at a time.
The gift can be as small as $1.
“We had a young boy who was Jewish and going through his Bar Mitzvah. As part of that he had to give back to the community. He gave us $5 for a fund that we had that was dealing with Alzheimer’s because his grandmother was suffering from Alzheimer’s,” Frederick says.
“When you add everything together you can’t differentiate that boy’s $5 from Elizabeth King’s $15 million. Now granted, we love to get $15 million gifts, but the beauty of the community foundation is that anybody can give to it and build it.”
During his tenure, the Community Foundation of Lorain County awarded US$70 million (A$101 million) in grants and another US$8 million (A$11 million) in scholarships.
Frederick says to give to a community foundation people have to know you, like you and trust you. It is a developmental process of relationship building.
“If they know you they might write you a cheque, if they like you they might give you an annual cheque and if they trust you, you might have a conversation about their estate,” he says.
The foundation builds a relationship with every donor that comes through the door.
For Frederick, the magic of a community foundation is that by combining gifts and investing them, it reaches a point of exponential growth.
“It’s going to be around and have an impact on the community long after we’re all gone. That’s pretty powerful to me,” he says.
The level of trust you can build through a community foundation, can also do “miraculous things”.
“I mean it was a vital part of the peace and reconciliation movement in Northern Ireland. And they played a critical role of brokering conversations between different groups that wouldn’t come to the table had there not been an independent organisation able to do that,” he says.
He identifies the unique values of community foundations as being local, permanent and anchored in communities, bringing both stability and flexibility to the table, and being natural collaborative partners.
He says Australia is “on the cusp” of seeing community foundations take off – with many of the foundations he spoke to during his visit, in developmental phases, putting together donors to build enough resources to have proof of concept for their community.
“I just see so many of them at that point, where they’re going to begin seeing exponential growth,” he says.
But he stresses that community foundations are not driven by linear strategic plans.
They are defined by how they respond to challenges and opportunities.
A community foundation may get a call from an attorney that a local business man has left them a large amount of money, and they have to figure out how to put it to use in the community.
That’s an opportunity.
“And those happen all the time in a community foundation because we’re planting the seeds for endowment along the way,” he says.
On the flip side, a community foundation may have great plans for the future but have to react to challenges in the community.
“They’ve got an automobile plant that closes shop, and they’ve got tremendous unemployment in the area and they know they’re going to have problems, that kind of challenge is a defining moment for a community foundation,” Frederick says.
“You don’t know when it’s going to happen. You don’t know how it’s going to happen. You don’t know what the implications are. But you know it’s going to happen at some point in time.”
His advice for Australian community foundations is to learn from what others have done and to behave like people are looking over your shoulder.
“Because they are,” he says.
“For a donor to have trust they’re watching an organisation, they’re looking at tax returns, financial statements, they want to make sure if I’m going to give a million dollars to an agency I want to darn well know that they’re going to do a good job of it.”
He says in the case of a growing community foundation the opportunities outweigh the challenges.
He encourages community foundations in Australia to be creative and think beyond cash giving.
“One of the things I encourage them is think about donor segments in the community. Think about what they’re interested in. Think about what kind of resources and what kind of gift types they might have. And then just brainstorm,” he says.
Frederick uses an example from his time at the foundation when they received a gift of farmland.
Rather than sell it immediately and use the profits to create an endowment fund, the foundation recognised that productive farmland was a diminishing asset in the community and they decided to lease the land.
It led to an entire product line for farmers.
He recalls another time, when he was contacted by an attorney leading a class action suit, who needed to give out a fixed amount of charitable money.
Together they sat down and explored some possibilities, deciding in the end to create an endowment fund which would last forever.
The attorney association now advises every year on where that money should be spent, giving them “something to brag about”, and attorneys have started adding their own money to the fund.
“He just wanted to get rid of the money and he didn’t want a bad agency getting it. What we did was we turned it into a vehicle that actually motivated more people to give,” Frederick says.
“I think part of it is just getting creative about it and thinking what could we do?”
But Frederick says you can’t get creative without storytelling.
In fact, he believes you can’t do community philanthropy if you don’t tell stories.
It is something he stressed to the foundation’s board of directors, telling them it was their role to tell stories and open doors. The foundation even had short stories online that the board could look up to help them.
“We said if you’re having lunch with someone, look up an interesting story and during lunch go ‘hey let me tell you what the community foundation is doing’, just bring it up in conversation,” he says.
The power of possibility is best relayed through story.
For Frederick, he is going to keep telling the story of Alfred.