Changes

Steve Gunderson is the new president and CEO of the Council on Foundations. After serving three terms in the Wisconsin State Legislature, Gunderson served sixteen years in the U.S. Congress, where he focused on agriculture, education, employment policy, health care, and human rights. After not seeking re-election in 1996, he served as senior consultant and managing director for the Washington office of the Greystone Group, a Michigan-based strategic management and communications consulting firm. He was also lead author of the recently published The Jobs Revolution: Changing How America Works. GIA's conversation with him began almost as soon as he was named to the Council position in late summer, 2005. He attended our conference in October 2005, shortly after assuming the position full time. We invited GIA member Nancy Fushan (senior program officer, the Bush Foundation) to interview him for the Reader. The interview took place shortly after the winter 2006 Reader went to press and not long before he attended his first Council on Foundations Annual Conference in Pittsburgh in early May.

Q: What drew you to the Council on Foundations position and to philanthropy in general at this point in your professional career?

True confessions would tell you that I did not seek this job. I didn't know it was open and I was absolutely enjoying what I was doing in my post-Congressional career doing public policy consulting in the areas of education, youth development, primarily the changing American workforce. And I literally got a phone call from the search firm asking if I would even consider putting my name in for this position. I thought about it for twenty-four hours. And I said it had everything I care about, everything those of us engaged in servant leadership believe in — making society a better place. I come from twenty-two years of elective office and ten years of public policy consulting. The reality is, whether you agree or disagree, government on the domestic side is in retreat, and that retreat has no relationship to the needs of society. On the other hand, philanthropy is a growth industry. We are growing in size. We are going to grow in service. We have the opportunity to grow in leadership. Why would you not want to a part of that growth and almost...of creating a movement. So I said sure. The interview was one of those amazing experiences. I hope everyone has a chance once in their life to have an interview where you feel everything click between you and the search committee. This one you could just feel the energy on both sides.

Q: What exactly from your background and skill sets told you this was the right thing?

I would like to think number one was vision. If there is something that is missing in many organizations today it is not just where we are, it's where we need to be and figuring out how we're going to get there. So vision, leading to strategic planning. The second is that in a 24/7 world, you can't do any of that without communication. And communication and leadership really begin with listening, being a good listener. If you are a good listener, you will also learn what are the key message points that need to be communicated. If I bring anything to this it is an understanding of what the tools are for successful leadership of an organization, almost a movement like this is: communication, vision, strategic planning, collaboration.

Q: Are you far enough along to articulate your vision?

First of all the vision for philanthropy and the vision for the Council are different. They're hopefully complementary. The Council needs to be the voice and vision of philanthropy at the national and global levels that allows us to become effective partners with the rest of philanthropy's infrastructure, whether it be the regional associations, the affinity groups, or specific foundations. When I look at philanthropy I think it needs to move from just effective grantmaking to what we call philanthropic leadership. I increasingly use the words “philanthropic architects.” We need to see ourselves more and more in a role of designing solutions to the challenges facing society and, hopefully with government and others, we can bring those effective solutions up to scale. Government is “one size fits all.” If government makes a mistake, it gets publicly repudiated. Philanthropy should take risks and even occasionally fail because we need that creativity, that innovation that is a part of this process. We have an ability to do things that the public sector in today's world cannot do.

Q: With respect to the Council and philanthropy in general, how is that different than in the past?

First of all, at the Council on Foundations we have focused on member services, we have not focused on the other side of the equation — philanthropic leadership. This is where we will get into a discussion with GIA and others about the role of affinity groups. I think affinity groups were, for the most part, appropriately created to focus on programs, on policy in a specialized area, whether the arts, health, education, etc. Because they saw the Council's purview as capacity building for effective grantmaking, rules, regulations, the legislatures, the tax codes — and not on that other, program side. I anticipate a much closer relationship with the affinity groups than this organization had in the past.

Q: What would that relationship look like?

Let me give you a couple examples. If we come to the conclusion that advocacy is an appropriate role for philanthropy, then, when we get into issues of the role for government and funding the arts, GIA and the Council ought to be partnering in ways that we haven't been in the past. Second, if you look at an example from earlier this year, we partnered with Grantmakers in Health to literally convene a strategic planning symposium on the role of philanthropy in a potential avian flu pandemic. In that example we focused on program leadership and vision and coordination and collaboration. To a certain degree in defining what our role might be, I don't think philanthropy has said. “how are we going to prepare ahead of time if this comes?” We're doing that same thing in areas of workforce investment, the philanthropic divide, and in those kinds of issues. So I see a whole series of these developing over time.

Q: Beyond the context of an annual conference?

Absolutely. I think the annual conferences play an important role, but the work of the Council and of philanthropy can't just be a one-time-a-year networking event. It has to be more urgent and relevant and dynamic.

Q: You talk about advocacy and qualify it a bit by adding — to whatever degree is appropriate. What do you see as appropriate?

We all face the issue of what is legal and what is not. I believe we can move right up to the point of political partisan engagement, and moving up to that point allows us to do almost everything we want to do. I happen to believe the old Howard K. Smith philosophy that you never want to underestimate the intelligence of the American people and never overestimate their knowledge. The degree to which we can educate the American people about specific challenges and benefits — as in the case of the arts and its specific benefits — will allow the public policy makers to usually, maybe not always, but usually make the right decisions.

I'm sitting in my office and looking at a wonderful photo funded by the National Endowment for the Arts. When Jane Alexander was head of the Endowment, she came into my district and we met with a school in La Crosse, Wisconsin that used art to explain and bridge cultural differences. The school was dealing with growing diverse populations including Hmong and Latino students and you could see the power of art in teaching cultural diversity and understanding. That's exactly the benefit of the arts and the benefit of philanthropy in serving a greater good.

Q: And some might also argue that your example points to what should be the role of the public sector, to assure sufficient support for arts education within school systems. Yet you noted earlier that the public sector is in retreat.

But that's what advocacy is all about, making clear to the public sector what their obligations are. Maybe I can say this, especially as someone with many years in politics and as a guy with an “R” beside my name: we need to make it very clear that philanthropy is not obligated to fill in where government retreats. That's not the relationship or role of philanthropy. We need to advocate that the public sector honor its appropriate commitments. If we become “government lite” we can't have the diversity, the creativity, and the flexibility to do the kinds of things that define the success and hallmarks of philanthropy.

Q: Beyond arts and education, a number of grantmakers working in the arts are trying to find ways to break down philanthropic silos and to increase the potential for cross-disciplinary discussions that might lead to new kinds of philanthropic architecture. Do you sense that as a major task ahead?

I would hope so. I don't think that any of us have figured out what are the right models or venues to use for these explorations. I think we in philanthropy will see a growing role as a convener of disparate elements of society, and I don't think we have learned the skill sets for what that may take. But it will become more and more important for us. Also, you can look at the polarization of society in almost everything from politics to religion to immigration to economics and class. How will we bridge these? Cross-sector integration becomes important here, and specifically, in every area I just articulated, art can play an important role.

Q: While art can play that role of connection, it also can be out in front of issues and, from your own experience in politics, you are no doubt aware that this may cause controversy and challenges.

And that's where philanthropy can play an important role. There will be times...and this is not just in the arts. I met recently with grantmakers working on the issues of AIDS and I advised them that they need to seriously consider what things need to be done in the fight against HIV/AIDS in America that government is either unwilling or unable to do right now. Certainly some of the most effective prevention messages to certain targeted communities are not going to make their way through the public sector. That may be a role for philanthropy. There will be some art that will be sufficiently “in your face” that it may not make it through the National Endowment's scrutiny today. That's the diversity, independence, and freedom that we in philanthropy want to honor and celebrate.

Q: And yet isn't that freedom and independence an essential element that should be encompassed in the public sector?

I think we can advocate for such a public sector, but if I learned anything in politics it is that you can't allow the failure of one sector to also define your failures or even your mission.

Q: Your political career intersected a period of controversy in the public sector's support of individual artists. In dealing with concerns of conservatives, there were attempts to abolish the National Endowment for the Arts. There was, ultimately, action taken to greatly diminish programs for individual artists, to reduce NEA's appropriation, and to significantly shift federal allocations to state agencies. That last change was something with which you had direct involvement.

If you look at that case, you will see that people can disagree with our strategies and tactics. But I don't think they can look at any of those debates on the floor of the House or in the Committee and debate our overall mission or our desire for the outcome. I remember we said that maybe what we do is direct the money back to the states recognizing that what is defined as art in Iowa may be different than what is defined as art in New York, and that we in the Congress ought not to be making that definition. But, we said, if we can get this out and let people decide for themselves what is appropriate to their culture, we can save the Endowment and save the funding because that was what we were looking at on the other side. The moderate Republicans were constantly looking for strategies that would recognize the political realities of the day, but do so in a way that would save the ultimate mission of the Endowment.

Q: Now with more than a decade since those debates and your new position, what did you take away from that experience, what did you learn about the arts and arts support?

In some ways one of the things that surprised me most when I took this job was that people raised the issue of votes that occurred more than decade ago. The fact that we still have that kind of emotion, that we will look at a vote and not have a discussion about motives and strategies, both surprised me and disappointed me. But it also educated me about the realities of trying to define the appropriate public/private partnerships and roles and images that we deal with when we're dealing any of these difficult issues, whether it be arts, HIV/AIDS, human rights, and sexual orientation.

Q: But perhaps these issues and the histories remain divisive and raise sensitivities because they go directly to fundamental beliefs about the rights of artists to express themselves, the capacity of art to be visionary and to be a voice of conscience?

But it avoids the question of the public obligation to fund that individuality and many of us tried to find that compromise. We would not allow the government to get into the business of censorship, but recognized that this funding is a public resource and the public had a right to have opinions about when and how that public resource was expended.

Q: The political decisions that flowed from that controversy put a long and difficult damper on individual artist support and, in the minds of many, left public sector support of the arts at the federal level a mere shell of what it had been. If you had known the outcome, might you have chosen a different path?

No. I absolutely am convinced that we saved the Endowment. The alternative was zeroing it out. We were dealing with a serious effort at deficit reduction. I got elected at a time when we had a deficit — ironically a deficit much smaller than it is today — but I literally got elected to Congress in 1980 on a concern about a deficit that was at $60 billion, not at $300-400 billion. So it was a very different culture and a very different time. Had we not taken that action, we would not have saved the Endowment from Bob Dornan, Phil Crane, and others in the country who literally wanted to eliminate it altogether. I'm absolutely comfortable we saved the Endowment.

Q: Turning to the current environment once again, we are building back from the post 9/11 period when recession took another toll on public sector arts support. How do we as funders deal with the balance between public and private sector funding?

One of my biggest concerns is we have to focus on funding artists, but we have to communicate to the general public the value of art. If we could figure out how to use these dollars to create access to the arts in ways that would create an appreciation and frankly a celebration of diversity, then we would benefit much more. If I have any concern about America in 2006 it is the intense polarization that is almost paralyzing the public sector at every level — federal, state, and local. We can play an important role in reaching young people who have not moved into these radical and polarized ideologies.

Q: In light of the recent renewal of the Patriot Act, what are your thoughts about the balance between security interests and civil liberties?

It's a delicate balance. I can't comment on the Patriot Act because I haven't followed the debate to know what all of the final compromises were in that recent legislation. I've been surprised by this. I told everybody that at some time in the process after 9/11, we would focus away from security back into a focus on the domestic needs of society. In some ways, I predicted that Katrina might be close to one of those powerful events that transforms the political debate. I'm not sure whether it will or will not. Only between now and November will we figure out whether that's true or not. But I've been in government and politics long enough to know there are cycles, and I think you did see that on the Patriot Act where you had some conservative Republicans saying that the legislation was going too far and we've got make adjustments. I'm enough of what I'd call a Libertarian that the risk of security has to be balanced with the protection of freedoms.

Q: You've come to the Council at a time of substantial change, controversy, and alleged operational abuses within philanthropy. What have been the most surprising or disturbing aspects of those?

I think the most surprising, and this is actually a positive, is the diversity of the field. When you come to understand the diversity of philanthropy — its skill sets, its size — trying to respond to that and serve that constituency is much more complicated than I anticipated. I think if I have a concern, it is the lack understanding of philanthropy. It's very clear that the general public and the media don't understand the difference between charity and philanthropy. You certainly go to Capitol Hill and they don't understand the specific difference. So I worry about the knowledge base that is seeking to regulate us. Then you add to that the fact that a few negative cases — the Getty, the Red Cross, American University — are being used to define regulatory attempts, legislative attempts to define all of philanthropy.

Q: So what do you see as the priority and the game plan?

Number one, a significant increase in communications. We either define philanthropy or we allow others to define it, and if we allow others to define it, it will be the media appropriately covering the sins of a few people within the sector or government seeking to get the latest headline or political press release. So we must engage much more aggressively and strategically in defining philanthropy. And then the second priority, particularly for the Council, is government relations. We can't simply wait to react to a proposal from a Senator Grassley, we have to try to define the appropriate rules, regulations, and legislation that will best enhance the growth of philanthropy.

Q: So do you see the next few months as pivotal?

I think so, but I believe the next big fraud or headline may not come at the national level. State attorneys general have figured that they have an important and legitimate role to play in the regulation and governance of philanthropy at the state level. I know from my communications with various individuals, that a number of attorneys general running for re-election in tough races this fall have decided to at least investigate, if not charge, certain foundations with misconduct. Unfortunately, I believe some of this is going to be 100 percent motivated by their re-election. We are going to be the tool they use. We've got to figure out how we prepare for and manage these stories when they come out.

Q: Do most foundations need assistance in that?

I don't think most foundations have been staffed in any way, shape, or form to deal with the politics of crisis and it becomes an obligation of the Council, regional associations, and others to be become more helpful to those foundations. If I have a disappointment in this area, it's the number of foundation people who don't understand the concept of philanthropic citizenship. Many of them participated in the Council's activities, services, and programs when they began, but have not been active in recent years. They have to understand they have a civic responsibility to their peers within our philanthropic sector.

Q: Is there, perhaps, a more intentional role that affinity groups could serve as gateways into the larger philanthropic sector for foundations that have not been active in the Council?

I'd be willing to consider that. In some cases, there absolutely is a role because affinity groups may be able to offer a topical program focus — for instance dealing with all aspects of arts funding — that can be a good beginning point.

Q: One of the values GIA has been interested in has been inclusiveness as it applies to our members' programs, staffs, and operations. Diversity also has been included in the Council's ethical practices statement. If you were preparing a report card for the foundation sector as a whole how would we rate?

I'm hesitant to answer that in that I haven't been here long enough to have done all of the research that's appropriate. I've recently been engaged in discussion about whether, when we say diversity, we mean diversity in terms of funding and programs or diversity within the field of people engaged in philanthropy. It's very clear to me that there's a consensus as of 2006 about diversity within the field. I'm not sure there's a consensus today about diversity of funding and what the criteria ought to be in that area. But when I use the term diversity here at the Council, I want to make very clear that we mean it in every sense of its definition, including ideology. The Council needs to be an umbrella that can include people whether they come from a philanthropic mission that tends to be center-left or center-right or extreme-left or extreme-right. They are still part of the philanthropic community and we need to celebrate that diversity and have room for them in this sector. For instance, at the May Conference, one day we start with George Soros and end with Newt Gingrich. That's exactly what the Council ought to be doing, making clear that there is room across the ideological spectrum because we are going to grow. We have to make sure that we have room regardless of where they choose to bring their philanthropic resources to bear.
Q: In terms of the Council's annual conference, some of those involved with affinity groups feel that it's difficult to get traction within the conference's current format. There's been information from the Council in recent weeks that you're rethinking the role of annual gatherings.

I've heard the complaints and also questions about whether change is really happening. If the complaint is there, then it's real and we've got to figure out how the politics of inclusion can start within our own sector — the regional associations, the affinity groups. We've got to solve the problem. I asked Anne Focke to bring arts into the Pittsburgh conference and GIA chose the Monday plenary session. Again, it's another start to move in the right direction.

Q: Other ideas you're contemplating for upcoming conferences?

In 2007, we are going to engage a national conversation about philanthropy and the challenges of our time. We're going to look at seven or eight specific topics and have a year-long conversation with all sectors of philanthropy. And then we will come out of Seattle with what are probably going to be the most strategic, comprehensive statements ever put together about the role of philanthropy in these issues. I know that my co-chair Ralph Smith of the Annie E. Casey Foundation has personally reached out to affinity groups on some of these topics, and to people on the left and the right to make sure they are represented so that we have the full engagement that we probably haven't had in the past.

Q: Then what comes from that national conversation?

A couple things. In 2006, we introduce the concept of philanthropic leadership. In 2007, we specifically define the role of philanthropy at, hopefully global in some cases, and certainly at national, state, and local levels. This will not only teach us the skill sets and the appropriate roles, but also I hope empower us to be more engaged in philanthropic leadership in society than in the past. This leads us to 2008: we would eliminate all of our national conferences and convene the largest gathering engaged in philanthropy from all over the world at one time, at one place. The theme will likely be “ philanthropy and civil society.” Whether you're an affinity group member, a corporate or family foundation, or an individual philanthropist without a membership in any organization.

Q: You began by talking about the need to become a philanthropic architect. Some foundations work closely with the nonprofits they fund over time; they work to share learning between grantees and themselves in order to forward work in both sectors. Do you see this as a more important working model in the future?

I see it as effective collaboration and I'm certainly for that. Do I think we ought to regulate that every foundation operate like that? That's where I'd push back. But the approach can lead to an appropriately right solution and we need to encourage that kind of interaction, research, collaboration.

Q: How would you characterize the future?

Totally optimistic. There's no question as we grow in size and we grow in service, that we will grow in scrutiny. We've got to manage that and manage it effectively. But you cannot look at this sector and not be optimistic. There are so many opportunities to make a difference in ways we never imagined possible before.

Nancy Fushan is senior program officer at the Bush Foundation.