Family foundations, by their very nature, are complex. With significant involvement of family members on the board and sometimes in operations as well, there can be layers of generations, widely divergent views, and the need to preserve positive family relationships. This complexity is a challenge but not an excuse for avoiding transparency or openness about how family foundations do their work.
At the recent National Forum on Family Philanthropy in Cambridge, MA sponsored by the National Center for Family Philanthropy, a session on Transparency in the Family Philanthropy Context did much to illuminate the continuum of viewpoints on the issue as well as to provide valuable resources to improve practice.
Why worry about transparency? On one end of the spectrum of views is the argument that many families prefer to do their philanthropic work quietly, with some degree of privacy for their choice of interest and funding decisions. Humility is, after all, part of the tradition of American philanthropy and too much transparency can bring interest from parties ranging from friends and business colleagues to government regulators. On the other end of the spectrum is the belief that all foundations have an obligation to be accountable to the public and that being accountable requires some degree of openness. The conversation about foundation accountability also includes the question of foundation impact. Can a foundation establish trust, create partnerships, and achieve the outcomes it desires without being transparent? With advances in technology and social media, the question today is not whether or not to be transparent, but how to be transparent – and how far to take your efforts to be fully transparent. “The data is out there…,” they say, and the most effective families invest in managing how information about their giving and practice is shared.