Cultural institutions and governments across the world often look wistfully at the USA (New York City in particular).
And they look at the number of people who give large sums of money to world-famous organisations such as the Metropolitan Opera, American Museum of Natural History, and the Lincoln Centre.
Ann Ziff, Chairman of the Metropolitan Opera and a member of a number of different boards in both New York and Los Angeles, spoke at Oxford Saïd on 5 October 2017 about philanthropy, fundraising, and volunteering.
America’s philanthropic culture
The great collections in Europe, Russia, and China were amassed in the 17th, 18th, and 19th centuries, along with the huge palaces and grand estates that were built to house them. They were primarily created for the personal enjoyment of royalty and the aristocracy, and the palaces and estates were their homes. Eventually the collections were shared with the public in major museums supported first by royalty and eventually by the government.
The USA may have been a young country but it wanted the same great ‘megacultural institutions’ as those in Britain and the rest of Europe, said Ziff. ‘But in America the great concert halls, museums and opera houses had to be dreamed up and created by our own wealthy citizens – the hyper wealthy robber barons of the eighteen-hundreds, the Carnegies, Vanderbilts, and Rockefellers. Philanthropy of that type is basically in the American DNA, it’s part of our heritage because it’s the way the country was born.’
The people of Britain, Europe, Russia, China, and now the Middle East, on the other hand, are used to their governments paying for these institutions. It is therefore not easy, she suggested, to ask private citizens to give money to something they’ve been given and taken for granted for generations.
Ziff emphasised the point that philanthropy is in America’s DNA with the story of Smile Train, a charity that provides funds for free cleft lip and cleft palate surgery in developing countries. When the charity was first launched, in the 1990s, it was with full-page advertisements in newspapers and magazines. As a result, they received countless unsolicited donations, many of them relatively small. And of those small donations, of around $10 or less, a surprisingly large number came from prisoners in jails up and down the country who had seen the advertisements and felt compelled to give something.
Membership of boards
The most striking feature of an American non-profit board – at least to administrators of similar institutions in the UK – is the expectation of a financial commitment.
As Ziff explained, in small organisations the financial commitments made by board members are also small. But the expected contributions grow relative to the size and status of the organisation. All boards on which she sits require an annual contribution of between 100 thousand and 500 thousand dollars. In addition, some require a capital donation within the first few years of board service of as much as 5 million dollars. So, she said wryly, ‘A lot of people are not able to be on those boards’.
She explained that when recruiting board members, she will inform them of the financial requirements, length of term, and how many meetings they would be expected to attend. There is a discussion of their interests and what they hope to contribute in terms of time and expertise. ‘We want people from very different professions, not just because they have different areas of knowledge and expertise, but because they represent different areas to draw on to populate future boards, and to broaden the donation base,’ she said.
While people on boards should be like-minded in the sense of agreeing with the organisation’s values and goals, they are not necessarily like-minded in terms of their personal lives – or their politics, especially today.
Governance of non-profit boards
Because offering board membership is in part a fundraising exercise, boards can get rather large – some have as many as 80 people on them. However, Ziff explained, most of the work of such a large board is done by an executive committee – usually 10 or 12 people, perhaps as many as 20 for a very large board.
The executive committee typically meets every month to discuss key issues. The decisions are then presented to the whole board for voting.
However, not being on the executive committee does not excuse board members from active contribution. ‘On every board, there are some worker bees and some who don’t pull their weight,’ said Ziff. ‘They start failing to turn up at meetings and failing to make their financial donations. That’s when you make the decision to remove them.’
Boards try to be as diverse as possible, within the limits imposed by the financial obligations. Ziff admitted to being challenged by a recent demand from the Mayor of New York that all boards of museums and cultural institutions should be more racially diverse, or forfeit the contribution from the city.
‘I don’t know how we’re going to deal with it,’ she said. ‘All the big cultural institutions, universities and hospitals rely on these large donations. There are very few people of these racial minorities who can pay that much.’
She explained that there had not always been a financial commitment associated with board membership of the Lincoln Centre, and it had been very difficult managing this change. ‘We don’t want to kick people off the board because they can’t afford it. We make exceptions because of celebrity status or special skills, for example. But then we don’t want to tell the others that some people have had exceptions made for them.’
A frequent misconception is that board members have influence over the programming itself. Ziff was emphatic that this is not the case: ‘Programmes and activities are decided upon by experts who are hired to fill those roles in the organisations’. But sometimes a board member who has made a significant financial contribution thinks this gives them the right to influence programmatic or artistic decisions. This, she said, can be a sensitive and difficult situation to deal with – but it’s only one of many.
For example, someone approached one board she sits on with an offer of an initial 10-million-dollar donation. ‘No one knew this person very well so we had to search around for people who had worked with him and knew him well. The information came back: he was a difficult person to deal with who insisted on getting his own way; he was disruptive in board meetings and frequently reneged on his financial promises. We made the decision that it was not worth trying to put him on the board.’
Another sticky situation came after the divorce of a couple who had both been involved with the organisation, although the bulk of the money came from the wife’s family. The man married someone else who wanted to be on the board. However, the organisation felt that they just could not accept the new wife when so much money was still being donated by the ex. Dealing with this challenge took a lot of what Ziff called ‘power schmoozing’!
Listening to the challenges and the amount of work involved with sitting on a board (‘courting’ new members can take up to 18 months), it is sometimes hard to remember that Ziff and others are operating on a purely voluntary basis. Their philanthropy is not confined to giving money, but also their time, which Ziff described as ‘the most precious thing we have’.
But the very fact that they are giving up their time may in part account for their success. ‘You want to give your time for something you are really interested in, whether it’s music or sports of children or disease. … You have to love what you’re giving your time to,’ she concluded.