OP-ED: Grants, Grantors, Grantees

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The following essay was prepared for a discussion on the relationship between grantors and grantees in philanthropy—part of a series of six discussions entitled "The Dialogues on Civic Philanthropy: Perfecting Our Grants" (2005-2006). By clicking the links to the right, you can access more information on this series, learn about the Dialogues project as a whole, read other prepared essays, and download discussion transcripts.

SEVERAL YEARS ago when bumper stickers were ubiquitous, a favorite in the field of philanthropy asked: “Have You Hugged A 501(c)3 Today?”(1) That question caused many donors and grant makers, including me, to ponder their roles and relationships in the field of philanthropy. The question reminded those who had or controlled philanthropic resources that unless we intended to create and manage our own programs, we could accomplish nothing without directing those resources through credible nonprofit organizations. In fact, the bumper sticker defined “philanthropy” in a new way for me, as a simple equation (A + B = C) where “A” represents the grantor, and “B” represents the grantee, and both working together equal “C” or philanthropy. The statement confirmed that philanthropy is in the “relationship” business.

Yet in my experience, too many grantors have viewed potential grantees as “the enemy,” i.e., people who simply want what the grantor has, namely, dollars. Too many grantors resist building relationships with their grantees. Too few realize that simply being respectful is, in fact, a crucial precondition for effective philanthropic outcomes.

American society is witnessing an unprecedented period of wealth creation and the looming intergenerational transfer of this wealth is a matter of great speculation. No doubt some of that wealth will be directed toward philanthropy. For, as Peter Drucker has observed, individuals of accomplishment tend to want to grow “from success, to satisfaction, to significance.” And the desired significance can be found through “giving back,” however the donor chooses to act. So, arguably, now more than ever it is incumbent on those of us in the field to set an example about how best to order relations with grantees.

This is, of course, not an altogether new problem. The process of giving has gradually evolved, which evolution has had important consequences for the relationship between grantors and their grantees, not always for the better.  Taking our bearings from Britain and America, in the 18th Century, for example, giving was generally regarded as “a charitable attitude or feeling toward others that prompted benevolent behavior.” Beyond compassion, there was little that tied the giver to the receiver, and most anyone so moved to give might be regarded as a philanthropist. But by the late 19th Century, philanthropists were part of a more exclusive group, recognizable by their efforts to “impose their vision of a good society on others.” To do so, these people mobilized their own abundant resources and directed them to the improvement of particular people. Later, still philanthropists directed their resources to the reform of institutions. (2)

In her article “The Pursuit of a Virtuous People,” Susan Wisely makes clear that some philanthropists, do, in fact, recapitulate the history of philanthropy during the course of their own giving careers. For example, Eli Lilly, one of America’s most noteworthy philanthropists in the 20th Century, like many individuals, first practiced his philanthropy as “relief,” (or “charity”). Operating on the principle of compassion, his aim was alleviate suffering. But realizing, eventually