More than one year ago, well before the November US Presidential election, I set out to interview the CEOs of nearly two dozen leading US foundations to understand how their thinking about philanthropic strategy had changed compared to five or ten years ago.1 What I heard, again and again, was an emphasis on “systems change” as their approach to large scale social impact.2 Only recently, however, did I realize just how relevant systems change thinking is to the extraordinary challenges of pursuing social progress under the Trump presidency.3
Foundations have often relied on government as an ally to scale up and sustain the programs they pilot. The Obama Administration’s Social Innovation Fund was built on precisely this model. Yet even before the election, many systems change-oriented foundations had moved away from a strategy based on government funding to achieve scale. “Certain assumptions have been clearly disproven and invalidated,” says Darren Walker, president of the Ford Foundation, “such as the very quaint idea that we simply need to invest in an intervention, accompanied by a randomized control trial, and if it works, it will be translated into policy and scaled by government.”
The problem goes beyond the government not adopting proven programs. It’s that too often we don’t pay attention to the system itself. “Foundation-funded interventions are demonstrated using special money under special circumstances outside the normal government contracting and procurement system. Even when they work, you need to solve a whole set of system problems to implement them at scale—and a bad system always trumps a good program,” says Patrick McCarthy, president and CEO of the Annie E. Casey Foundation.
The challenge today is not merely that we have dysfunctional systems nor that we lack innovative solutions to our society’s problems. Instead, it’s that our country has no unifying narrative that binds us all to a common fate. Too many factions separated by race, gender, wealth, religion, education, politics, geography and more are working toward fundamentally incompatible goals in the false belief that their success is unaffected by the failure of others. The vision of a just and equitable society with opportunity for all is being undermined by the poisonous myth that the pursuit of prosperity depends on the eradication of compassion.
Even the most basic assumptions that many of us hold can no longer be counted on: that government will act on hard facts, respect scientific proof and democratic principles, or respond to humanitarian and environmental concerns. No mere programmatic intervention can overcome these obstacles. Instead, we need to find ways to change attitudes and relationships throughout every level of society in order to co-create a new future across our perceived differences.
This is precisely the messy and unpredictable domain of systems change. Foundations may not have the scale to remake our entire society, but they can apply a systems change approach to achieve significant impact on the issues and in the communities that they have chosen to work. “It is quite a stretch for foundations to become agents of social change and yet that is exactly what we must do,” says Risa Lavizzo-Mourey, president and CEO of the Robert Wood Johnson Foundation.
What Is Different about a Systems Change Approach?
Systems change thinking is not new. Community leaders have long advocated for systemic change to overcome structural racism and other complex barriers. Systems change also builds on a rich body of academic research, although some of it is jargon-filled and highly abstract.
Recently, several publications have even offered helpful systems change planning tools specifically for grantmakers, attesting to the growing prominence of this approach within the field.4 But without attempting to construct any comprehensive definition or model for such a complicated topic, what exactly do foundations do differently when they adopt a systems change approach?
Foundations will continue to fund nonprofits, of course, but a key differentiator for systems change foundations is that they no longer try to pilot a small-scale program first and then take it to scale later; they confront the system at scale from the start. “Scale is not a separate question, that’s what it means to solve the problem,” says Larry Kramer, president of the William and Flora Hewlett Foundation. Adds Wynn Rosser, president and CEO of T.L.L. Temple Foundation: “We’ve shifted from thinking about what’s the magic solution that we can fund and then scale up, to thinking instead about a focus on process and how to enable systems to change and operate more effectively.”
Systems change means taking into account all aspects of a problem from the start. “No matter how excited we are about a particular intervention, if the person we are trying to help actually needs three things to be in place, and we only provide two of them, it’s not going to work,” says Jennifer Ford Reedy, president of the Bush Foundation.
This means that building the capacity of individual organizations isn’t sufficient either. “It’s not just about the scale of the organization anymore,” says Sally Osberg, president and CEO of the Skoll Foundation. “You need to understand the ecosystem; who the actors are, their incentives and disincentives, the forces and levers for change.”
This understanding pushes systems change foundations to think beyond their grantees, working directly to change the behavior of other entities over which they have far less control. Their focus has shifted from programs to process, and from individual nonprofit organizations to the relationships and motivations of all participants in the broader system that shapes a specific problem. Rather than depend on government to scale up their programs, they look for leverage points to change the behavior of companies and public agencies that are already operating on a large scale. And they listen more deeply to the communities in which they work, empowering others rather than imposing solutions.
Each foundation CEO I interviewed emphasized different aspects of systems change, and no single universal model or framework emerged. Yet five specific practices were mentioned frequently, offering pragmatic guidance for other funders that may want to pursue a systems change approach:
- First, these funders work both inside and outside the nonprofit sector, leveraging the market forces that drive for-profit companies and making efforts to improve the implementation and outcomes of existing government programs.
- Second, they build common ground among key actors by forging cross-sector coalitions.
- Third, they recognize the importance of the intangible narrative that underlies the public response to our society’s problems and work actively to change that narrative.
- Fourth, they elevate the voice of lived experience in shaping solutions.
- Fifth, they reconsider their own staffing, budgeting, and operations to address racial and cultural blind spots, focus on multifaceted problems rather than separate program areas, and develop more active leadership roles for their CEOs and boards.
None of these activities are new to philanthropy, but the CEOs of systems change foundations say that they are using them in innovative ways that are distinctly different from past practice. In fact, many CEOs described this as challenging territory. “I don’t think there’s a lot of clarity on what’s most effective in systems change. We risk losing the strong tether to accountability for results,” says Sue Desmond-Hellmann, CEO of the Bill & Melinda Gates Foundation. “And it pushes you into a more horizontal way of operating. All of the issues begin to run into each other and you can end up boiling the ocean.”
And yet despite these challenges, when I circled back to many of the CEOs after the election, I found that those who had moved to a systems change approach in recent years are embracing it even more strongly as an effective strategy under the current realities of our polarized country.
Now, let’s examine each of the five common practices that these systems change foundations have embraced:
1. Working Outside the Nonprofit Sector
It is unusual for foundations to regularly look beyond the nonprofit sector in their search for solutions. “For a long time there was a sense that philanthropy should just stay in its lane,” says Rip Rapson, CEO of Kresge Foundation. “Because the public and private sectors are distinct, it tarnishes philanthropy’s work if you get too heavily involved with them—but that involvement turns out to be necessary. Cross-disciplinary, cross-sector work is fundamental to responding meaningfully to complex realities on the ground and to how we choose an intervention point.”
When funders like Rapson speak of working with companies and government, they are not merely looking for new sources of funding to support nonprofit initiatives. They want to transform the profit motive into an incentive for social progress, showing companies the economic opportunities in creating a better world. And they want to work with government to achieve better outcomes at lower cost in existing programs, rather than expecting new programs to be launched.
“We are much savvier now about the realization that government and business are key to scaling impact in a significant way,” says Skoll’s Osberg. “You have to look at all the actors in the system and understand their incentives and disincentives. You have to be able to identify where the levers for change are. And it has very little to do with whether an actor is structured as a nonprofit or a business or a government entity.” Clara Miller, director and president of the F. B. Heron Foundation adds: “We are absolutely thinking across all sectors. The nonprofit sector was not meant to be a separate sector just for the poor.”
“A big pivot is that we think much more about our role as a philanthropy as working collaboratively with—and across—the nonprofit, business and public sectors,” says Judith Rodin, former president of The Rockefeller Foundation. “It was very clear to us that if you didn’t understand the ecosystem in which the problem sits, including the government incentives and policies and market-based forces, then our interventions wouldn’t be sustainable.”
Most of the foundation leaders I spoke with point to the importance of finding ways to work with, or encourage, for-profit companies and investors to be involved in social change. “If government is broke, and philanthropy doesn’t want to pay for a program forever, the exit strategy has to be that it becomes self-sustaining, and therefore it’s got to be market-based,” says Emmett Carson, president and CEO of Silicon Valley Community Foundation.
When Rockefeller wanted to help cities around the world build their resilience to the economic and social stresses that undermine city life, the foundation funded chief resilience officers and resilience strategies in 100 cities worldwide. Their goal, however, was to reach thousands of cities. To do so, they partnered not only with nonprofits such as The Nature Conservancy, but with more than 100 for-profit enterprises—including Microsoft, Ernst & Young, Swiss Re, and Palantir—to build a platform of resilience-related goods and services that could be demonstrated in the initial 100 cities, then marketed globally. The foundation counted on their corporate partners’ profit motive to expand the program beyond the foundation’s own capacity.
This reliance on companies to expand and sustain impact was a consistent theme in many CEO interviews. “No matter how you look at it, companies that are involved in the entire chain of our food supply have a health impact that is greater than anything that RWJ can do with its funding,” says Lavizzo-Mourey. “So we need to be engaged with them. We sometimes nudge, sometimes scold, sometimes evaluate but that is a relationship we didn’t have in the past. We’re now really trying to understand what the shared value or financial benefit might be for companies that implement policies and practices to improve the health of their employees.”
Omidyar Network leverages market forces even more directly through its investments in social enterprises, but it does so with an eye toward broader systemic changes. “We’ve found that grants and for-profit investments working in combination can be quite powerful,” says Matt Bannick, Omidyar Network’s managing partner. “This hybrid model allows us to deploy investment capital to scale innovative solutions in the marketplace, while our grants help us create an environment of enabling innovation and entrepreneurship.”
Investing in new business models can have a systemic impact well beyond a single enterprise. Early investments that demonstrated the profitability of microfinance spawned an entirely new industry and, more recently, Tesla’s success has prompted every major car company to develop their own electric vehicles.
Beyond direct investment, foundations can also influence companies by changing the context in which they operate. Foundations, for example, can change the system of rules and incentives that govern corporate behavior at a national or global level. The Heron Foundation, for example, supports the Sustainability Accounting Standards Board (SASB) which is working with the US Securities Exchange Commission to require disclosure of material sustainability factors on public company financial statements in the expectation that disclosure will sway investors who, in turn, will influence corporate CEOs. And CERES, an organization supported by Skoll Foundation, has worked with state insurance regulators to require disclosure of climate risks, increasing insurance premiums for companies that generate greenhouse gasses.
In addition to working with for-profit companies, systems change foundations have found a new way to work with government, not on policy or to win new funding as many foundations have done in the past, but on improving the implementation of the government’s existing programs. “We’ve come to see that government doesn’t always have the tools, technology or budget to back up policies—there’s a role for philanthropy in enforcement and implementation,” says Carol Larson, president and CEO of the David and Lucile Packard Foundation.
These efforts improve the impact of existing programs on thousands or even millions of lives by working at an operational level far below any national or local political controversies. The Annie E. Casey Foundation has long invested in integrated data systems, leadership development, and teams of consultants to support state and local government agencies in improving outcomes for youth and families. For example, the foundation’s consultants worked on reducing pretrial detention in juvenile justice systems in more than 300 jurisdictions, and achieved a 44 percent reduction in average daily prison populations.
Similarly, Casey has been successful working with child welfare agencies to implement an approach called team decision making (TDM). TDM brings a trained facilitator together with the agency supervisor, front-line social worker, family members, and anyone else involved with the child, to consider multiple treatment plans that might keep the child safe without removing him or her from the home. Sites practicing TDM were nearly 30 percent more likely to reunite children with their families within one year.
Rockefeller found a different way to leverage the scale of government. After Hurricane Sandy, the federal government authorized $1 billion in reconstruction spending, although there was no mechanism for community engagement in the planning process. The foundation sponsored an international design competition that made resilience thinking and community input two of the key selection criteria, and persuaded the government to award the reconstruction funding to the competition winners. The foundation’s $3.5 million in funding for the competition brought deep community engagement and resilience into the entire billion-dollar reconstruction.
2. Forging Cross-Sector Coalitions
Trump’s election threw an already polarized society into open combat. But outright antagonism does not always lead to social progress. Inflamed passions and heated rhetoric are important drivers of change, but so is the quiet negotiation that can reconcile contradictory interests. In this time especially, foundations are the rare honest brokers that can command the attention of influential leaders across party lines and other sectors. Whether through simple diplomacy or more comprehensive cross-sector coalitions, foundations are finding their ability to broker public-private-nonprofit deals to be a desperately needed skill in these divisive times.
This theme was particularly resonant for place-based and community foundations. “Our highest value is brokering sustainable systems change,” says Clotilde Perez-Bode Dedecker, CEO of the Community Foundation for Greater Buffalo. “You need to be a dealmaker, putting together new constellations of public, private, and community partnerships, and then building enough community ownership to outlive the political cycles—we call it the ‘grease and glue money.’ In many places, only a foundation could do that. We also use philanthropic dollars as seed capital to shift the allocation of public dollars.”
“Everything we do is tied to a coalition in which government, private sector, philanthropy, and nonprofits all come together to build trust, discuss the issue, come to an agreement on what the issue is, and then come up with a strategy to address the issue,” adds Antonia Hernández, president and CEO of the California Community Foundation.
“For us, cross-sector is where the action is right now,” agrees Kate Wolford, president of The McKnight Foundation. She cited as an example the Central Corridor Funders Collaborative, formed in response to a new transit line that connected Minneapolis and St. Paul. When originally proposed, the line would have devastated the low-income neighborhoods in its path. Local residents rose up in heated demonstrations, and the collaborative was able to channel these social protests into social progress. It was able to coordinate the efforts of public agencies, national philanthropies, local funders, local community groups, nonprofits, and business coalitions. Different working groups tackled issues in housing, economic development, jobs, parks, and local culture.
Hundreds of small businesses in Minneapolis and St. Paul were saved from disruption, around 1,000 existing homes were preserved, and 3,600 new affordable housing units were created. Local residents were trained and hired for construction jobs. Three additional transit stops were added in low-income communities that originally had been bypassed because they failed to meet the US Department of Transportation’s Cost Effectiveness Index—and federal policy was changed for all future transit projects to consider the economic impact of local access in addition to cost effectiveness.
Similarly, in Houston a community-wide effort was launched to help the homeless. “The homeless provider system was completely fragmented,” says Ann Stern, president of The Houston Endowment. “We started by adopting a common data platform that linked the providers and created transparency about how the system was working. Almost everyone joined the initiative and adopted the data system. That enabled us to collectively look at the data, create strategies that made sense, see whether or not they worked, and continue to evolve the strategies.”
In the course of bringing together all of the organizations working with the homeless, “We learned that a number of faith-based groups were feeding people all over the city, which was creating migrations around the city throughout the day and taking people away from the places that offered the other services they needed,” says Stern. “We found duplication of services; one organization realized they were really, really good at case management, which was a huge need in the system, and they stopped doing the things they weren’t as good at. We had a few hard conversations along the way, but most organizations stepped up and asked, ‘How can we best contribute to the needs of the system?’”
3. Changing the Narrative
Changing systems means changing the behavior of individuals within the system, which in turn depends more on understanding their beliefs and attitudes than on hard data and academic studies. The narratives that drove the US election and continues to drive policy debates often run contrary to reality. Yet it is the narrative rather than the reality that often affects behavior.
“A prominent driver of inequity is the cultural narratives that actually validate and justify growing inequality,” says Ford’s Walker. “A lot of narratives are used by those at the center to justify why others are on the margins. As long as these narratives persist, behaviors will not change, and the for-profit media just drafts off of what is already accepted. We don’t really yet know how to change narratives, but we are beginning to understand its power.”
Being intentional and strategic about story telling can help reframe an issue to move policy or change systems, points out Dr. Robert Ross, president and CEO of the California Endowment. The endowment had identified sexual trafficking of young girls of color as a growing problem. Although the girls might be as young as 12, the public narrative described them as child prostitutes, and police routinely arrested them for prostitution. The endowment used billboards and other media to point out that an underage child cannot legally consent to sex: “There’s no such thing as a child prostitute.” Sex with underage girls, even if purchased, is still rape.
The endowment also garnered 15,000 signatures on Change.org to successfully persuade the Associated Press to ban the phrase “child prostitute” from its style guide, which is used by media organizations across the country. Seen through a new narrative, the Los Angeles County Sheriff’s office agreed to stop arresting the girls, referring them instead to health services, and instead started arresting the men who hired them.
Merely showing the public what is possible can also change the narrative. Cleveland children had a disproportionately high level of lead poisoning, but the residents assumed that this was inevitable. Solutions Journalism, a nonprofit organization funded by several of the foundations interviewed, encouraged the local newspaper to report on what other cities were doing to combat the problem more successfully. Once the narrative changed to show that Cleveland was underperforming its peers, the state threatened to cut off funding and the mayor replaced the head of the local health department. Solutions adopted from elsewhere, such as advance screening of children, increased home inspections, and a registry of contaminated homes barred from rental to families with children, rapidly improved the situation in Cleveland.
Narrative change does not provide a solution in the way foundations typically think; it is not an evidence-based program that delivers reliable outcomes such as better school performance or more affordable housing. It operates at a more fundamental level by motivating others to think differently and find solutions for themselves. Systems change foundations often seem willing to leave formulating solutions to others, especially to those who live within the system.
4. Trusting Lived Experience to Shape the Solutions
Foundation leaders often talk about empowering others, but systems change funders seem to work within communities at an entirely new level. “We’ve interviewed and surveyed thousands of stakeholders across the state to help shape and evaluate the progress of our programs,” explains Doug Stamm, CEO of the Meyer Memorial Trust. “We engage our stakeholders to guide what we do, what we should be funding, and how we should be funding it.”
In East Baltimore, where 752 families were being dislocated, the Casey Foundation held more than 400 community meetings about what kind of community people wanted to see built. And in Atlanta, the foundation’s team has been in the community it serves on a daily basis for over a decade. Several people on the foundation’s team grew up in that community and continue to live there, adding to the depth of their understanding. “It’s easy to give rhetorical allegiance to community engagement but much more difficult to really come up with the processes, checks and accountability to actually get broad engagement,” says McCarthy.
Giving voice to the marginalized and disenfranchised in a way that they can be heard is an important role for foundations in systems change. “Today’s environment requires us [at the California Community Foundation] to focus on protecting and giving voice to those most impacted by the proposed changes, the poor and the vulnerable,” says Antonia Hernández. “We work in solidarity with those who have the most at stake in solving the problem,” adds Skoll’s Osberg. “We need to enroll, empower, respect, listen to, and learn from the people who are the ultimate stakeholders in this change.”
The Bush Foundation’s Reedy, agrees. “It’s less about solving any particular problem as it is about engaging and energizing people to build their capacity to solve their own problems.” Adds Dedecker, of the Community Foundation for Greater Buffalo, “If you facilitate shared goals that are truly owned and co-created by those that need to change their behavior to make it happen you have a better chance of succeeding.”
5. Reshaping the Foundation
Listening accurately to voices outside the foundation and recognizing what it takes for them to be heard requires very different internal capabilities and accountabilities than the typical expertise-driven model of foundation funding. In fact, taking a systems change approach challenges the very structure of conventional foundations.
Complex systems do not break down into neatly bounded program areas. The ability to work across sectors requires an understanding of business and government that is foreign to many funders. And the demographic composition of a foundation’s leadership and staff—by race, gender, immigration status, religion, disability, age, and sexual orientation—affects both the foundation’s credibility within and its understanding of the systems it is trying to change. These new demands are reshaping the structure, operations, and hiring of systems-change foundations.
“I think anti-elite movements from traditionally liberal and conservative groups are going to deeply impact philanthropy, says Desmond-Hellmann. “We [at the Gates Foundation] see it everywhere. Social media has led to a global change in power and voice. A lot of people in philanthropy are white and from privileged backgrounds. But the people who want to benefit from the foundation’s assets come from a different point of view and they feel you should not be their spokesperson. We all grapple to understand the answers. The rules have changed overnight and even what you thought was a best practice three months ago in terms of active listening or how you show up in a way that you feel is appropriate doesn’t work anymore.”
This is being reflected in the leadership of many of the major US foundations. “Some of the largest and most influential foundations—such as Ford, Kellogg, California Endowment, Silicon Valley, Mellon, RWJ, and Knight—are all headed by people of color,” says McCarthy. “Within Annie E. Casey, 60 percent of the staff are now people of color, a significant change from five years ago.” The Packard Foundation’s Larson agrees about the importance of this change. “I believe much more than I did five years ago that paying attention to race and age in foundation leadership really matters.”
At Meyer Memorial Trust, “We are continuing on a course of deep and extensive equity training,” says CEO Doug Stamm. “We initially began using a racial framework, with all staff, and then engaged where appropriate in separate tracks for both staff and trustees, and then coming back together for shared training in a second phase. The training and honest conversations we have been engaged in have really helped shape our equity lens as individuals and as an organization. No question it’s been a game changer for how we approach our work for deeper impact.”
Over the last decade, Meyer’s board and staff have changed dramatically: The board’s composition used to be a single person of color on a six-member board. Now four out of six trustees are people of color. Meyer’s staff composition has changed from approximately 10 percent people of color to 50 percent people of color. Meyer trustees and the chief investment officer have been deliberate in both seeking and encouraged the trust’s investment managers to add women and people of color to their management teams, and that has led to changes in those organizations as a result.
The change in hiring practices at these foundations is not only a matter of racial balance. The new tools that foundations are using require new kinds of expertise, from corporate finance and venture capital to systems change and data analysis. “Foundations working on complex issues often need a more diverse set of insights and experience, bringing in people from backgrounds like journalism, systems change, finance,” says Wolford, of the McKnight Foundation. “I find our staff needs to understand market forces, think across domains, handle ambiguity and manage relationships in new ways.” Adds Hernández, “If we are going to be involved in system change, we are going to be involved in community organizing, so [at the California Community Foundation] I need to hire people with that background.”
Perhaps the biggest shift in staff qualifications is an increasing recognition that systems change requires a deep understanding of the system that can only be acquired through lived experience. “If the person has never run one of those systems, or been a client of one, the odds are very, very strong that although they may know the problem they will have no idea how to fix it,” says the Casey Foundation’s McCarthy. “You actually have to hire people who have been in the systems you want to fix.”
Although foundation leaders still recognize that domain expertise on issues such as health or education is important, the need to work across issue areas, blend together different tools, and build trusted relationships with communities has shifted the emphasis from content expertise to context expertise.
“At our foundation [the Houston Endowment], the role of the program officer has evolved considerably over the past few years,” says Stern. “In the past, program officers were viewed as the experts in their fields, which meant they were often hesitant to question each other. Today, our program officers have to be highly collaborative, to be good at convening people, to be great communicators, and to be able to build trust with people. They still need to be knowledgeable about their fields, but the personal characteristics are a lot more important than just being smart enough to evaluate a grant proposal.”
“When we began building out a health team soon after I started at Kresge, a number of people advised me to lead with unassailable sector expertise—to go hire the former head of Harvard Medical School or someone like her,” says Rapson. “But we concluded that perhaps we needed a slightly different cut at expertise—perhaps what you really need is someone who has had experience in both the public and private sectors, and is comfortable with the different tools, decision-making styles, and political realities of the different sectors. We became convinced that—at least at Kresge—we needed someone who has done problem solving in different contexts and has been forced to think about what happens when housing intersects with health which intersects with human services.”
Some foundations are now institutionalizing work across program areas. Robert Wood Johnson Foundation now holds funds in reserve outside program area budgets to incentivize interdisciplinary projects. The Ford Foundation has retained separate program areas but asks each program to make grants that further the foundation’s overarching goal of reducing inequality, whether in economic development or the arts. Other foundations have abandoned program areas altogether. The Community Foundation for Greater Buffalo has no program areas. Each employee has an annual portfolio of work and serves on an internal project team that is reevaluated every year.
“Problems no longer land in convenient packages labelled Rockefeller program areas, if they ever did,” says Rodin. “We needed to transform to a more nimble, adaptable and multidisciplinary structure.” The foundation has taken on four intersecting challenges: transforming cities, revaluing ecosystems, advancing health, and securing livelihoods. The foundation uses a four-step process of scan, search, development and execution within these four areas. Scanning involves small grants to a range of universities, think tanks, and nonprofits to highlight areas of dynamism on these topics. The search phase goes deeper, allocating additional funds to identify critical moments when intervention might be possible. A smaller number of opportunities move into the development phase, using a systems-based approach to diagnose the problem. A subset of those then go to the board to approve a funding envelope and plan for execution. Each phase has a substantially larger funding commitment than the preceding one. Staff oversee different stages of this process, or are assigned to one of the projects within a stage, rather than divided by program area.
Systems change thinking also leads to a different approach to evaluation. At Hewlett, “The evaluator is part of the program team from the beginning, and the evaluation work happens on a constant, real time basis,” says Kramer. “It’s all about learning.” At Kresge, “Evaluation has to be part of the front end of everything we do,” says Rapson. “Learning and evaluation is almost more important in terms of the deliberate thought and intentionality it imposes than the results the process produces. We began looking on a grant-by-grant basis or at clusters of grants, but now we try to look at the aggregate impact of our strategies, the robustness of networks, and whether the new narrative is getting out there.”
Leadership roles and responsibilities at these foundations are changing as well. When the foundation’s primary interaction was with grantees, program officers could handle external relations. But when the foundation is trying to mobilize community leaders, the CEO needs to step in. At Temple, “We need high-level foundation representation around the leadership tables with those who have decision-making authority, such as university presidents and government officials,” says Rosser. “It’s a whole different element of the CEO’s job—the conversations we can be in, relationships we can create, and kinds of deals we can put together that allow for scale, leverage and impact.”
The CEO’s voice is as important as his or her presence, and foundations are letting go of the traditional view that they must stay quiet and let their grantees do all the talking. “The Ford Foundation is an amazing platform that allows you to call attention and raise awareness about social justice issues that are important,” says Walker. “If we are to be effective and impactful we need to fully leverage the foundation’s platform, and the staff’s and president’s voice, to surface difficult conversations, frame the issues, and contribute to the discourse.”
Boards too are shifting their roles. Meeting their fiduciary responsibilities and approving grants with deference to the expertise of program staff has always been fairly routine. But systems change is not so easily summarized in a board book. CEOs are finding new ways to engage their boards beyond these basic tasks, bringing them into strategy development and curating their expertise. “It’s been a steady process over time of the [Casey Foundation’s] board becoming increasingly engaged in understanding and contributing to the programmatic direction of the foundation,” says McCarthy.
In sum, those foundation CEOs we spoke with that have chosen to embrace system change are finding that every aspect of their foundation needs to be reconsidered: who they hire, how they are structured and set budgets, how they think about evaluation and organizational learning, how they work with their boards, and even the role of the CEO in the community.
The foundations that have gravitated toward a systems change approach over the past several years did not do so in anticipation of Donald Trump’s election. And yet, those foundations are finding ways to achieve impact with demonstrated success that may well work even in today’s political environment.
Foundations will, indeed must, continue to fund nonprofit programs and direct services. These are part of, not separate from, systems change. The challenge we face now, however, is not merely to support good nonprofit programs or to follow a theory of change toward some targeted program goal. Instead, we must work across a fragmented and contentious society to nurture the mutual interdependence and alignment necessary to co-create a better future for all. This requires us to see our world and our relationships to each other differently.
That is a tall order for philanthropy and yet it is the essence of systems change. Beneath the intimidating jargon that is often used to describe systems change, the five specific practices described above could be adopted by any foundation. The foundations that do re-invent themselves to adopt a systems change approach, many led by the CEOs quoted above, are already discovering ways to achieve significant impact without waiting for the next election.