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Is Philanthropy's Clock 'Ticking Away'? : Strategy: As charitable groups gathered in L.A. to discuss an uncertain future, the buzzword was diversity .


In a best-of-times, worst-of-times climate, representatives of more than 400 grant makers and grant recipients nationwide gathered this week in Los Angeles to plot strategies for keeping philanthropy healthy in the face of federal budget cutbacks and staggering social problems.

Delegates to the 10th-anniversary meeting of the Independent Sector were buoyed by some good news: A survey conducted for their coalition by the Gallup Organization shows that more Americans are contributing more money and time to causes and, significantly, those between the ages of 25 and 44, often depicted as me-first materialists, are leading the way in giving.

Still, there was a pessimistic edge to messages delivered by speakers during the four-day session. The buzzword was diversity --the imperative for not-for-profit groups to diversify their boards and their programs to meet the needs of a population that is increasingly multiethnic, multiracial, and split into haves and have-nots.

As Independent Sector President Brian O'Connell said in an interview, "We are doomed to failure when people who don't know the problems first-hand plan for 'those poor folks.' "

Those problems include escalating poverty, hunger, homelessness and crime.

Linda Wong, president of California Tomorrow, addressing the opening session, described a society in which there is an urgent need to rethink social, economic and political values and, at the same time, growing fragmentation and separation.

In California, she pointed out, the majority of voters are 40 or older, white, with incomes of at least $40,000, while 40% of the population are people of color, poorer and younger.

Will existing organizations be able to retool themselves to respond to meet the needs of the latter? "The clock is ticking away," Wong said.

Raul Yzaguirre, president of the National Council of La Raza, zeroed in on predictable consequences of "undereducation" of blacks and Latinos. In 1988, he pointed out, three of four whites were high school graduates, but only five of eight blacks and one of two Latinos were. But by the year 2,000, he noted, only one in seven jobs will not require a diploma.

The United States faces "a major mismatch" between needs and skills in the work force, Yzaguirre said.

He called on foundations and corporations to fund public-policy analysis leading to educational reform, quality day-care programs and job training, with efforts concentrated on "the working poor."

Peter F. Drucker, author and management consultant and a professor at Claremont Graduate School, told the nonprofit groups that they must sharpen their management skills and run their organizations "better than businesses." Whereas good intentions once were thought to be enough, he said, "Somehow, the Good Lord likes competence."

He announced the formation of the Peter F. Drucker Foundation for Nonprofit Management, headed by Frances Hesselbein, formerly chief executive officer of Girl Scouts of the U.S.A. The foundation, funded by private gifts and royalties from Drucker's books and book cassettes, will reward an innovative nonprofit organization with a $25,000 award each year, starting in 1991.

For the nonprofit sector, Drucker told the conference, the "key to survival" is to make donors active partners in decision-making.

In the past, he told a news conference, people would be urged: "Join our board. You'll never have to do any work." Today, he said, a prospective board member demands a clear understanding of the mission and of his or her role in that mission.

By an economic yardstick, nonprofits "are a declining industry," still getting only 2% of the Gross National Product, a percentage unchanged since 1830. Because "the biggest givers are older people," he added, "we face a sharp decline. If we don't reverse this . . . we'll be in serious trouble."

The overall disintegration of community has drastically affected traditional ways of fund raising, Drucker said. "Even in a small town in Nebraska," he observed, today "nobody raises an eyebrow if you don't go to church"--and put something on the plate.

He spoke of the specter of a cut in allowable deductions to charities, one of the federal budget deficit-trimming proposals: "This is basically a way to enable the rich to be richer . . . now (they) have an excellent reason for not giving."

With 750 member groups--about evenly divided between donors (foundations and corporations) and the nonprofit groups they fund--Independent Sector represents a range of interests and causes that is, to say the least, eclectic. As one speaker put it, it ranges "all the way from soup kitchens to the Ford Foundation."

There are strange bedfellows: the American Lung Assn. and the Philip Morris Cos., the Child Welfare League of America and the National Council of Senior Citizens, the Sierra Club and the Weyerhaeuser Co. Foundation, the Fresh Air Fund and Chevron U.S.A. Inc., the Heublein Foundation and Mothers Against Drunk Driving.

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