EFC: indispensable partner in the ecosystem of philanthropy

Amazing to realise that this year it is 30 years ago that, following the fall of the Berlin Wall, the EFC was created. I have participated 29 times in the EFC’s annual conference. Not 30 times, because when I started as Executive Director of the Bernard van Leer Foundation (BVLF) on 1 January 1989, my predecessor, Willem Welling, honestly felt that it was the Hague Club, founded by a few European foundations like the BVLF, that would be the key player for organised philanthropy in Europe and not “that initiative of John Richardson and Raymond Georis supported by Mott” (as he would refer with a certain “disdain” to the EFC). It took me one year to convince the board of BVLF, that we should belong to both the Hague Club and the EFC.

Networks of foundations are important, because they help individual foundations to achieve their objectives. Networks can stimulate foundations, allow them to grow and to learn, to form partnerships on content or methodology and to leverage their resources. Networks imply that by joining forces you can protect yourself as individual foundations and as a sector against threats from the outside (e.g. from the erratic decisions of the political system).

For me the Hague Club, a selective club of about 30 executives, offered the intimacy, the comfortable space to discuss common challenges. The EFC, not a club but a much broader membership organisation, was for me the knowledge centre, the generator of new ideas, the voice of philanthropy in Europe and the broker with the international world outside Europe on issues of philanthropy. I enjoyed these last 29 years and was active in the board of the EFC, the International Committee, chairing the first Code of Conduct Committee, chairing the Nomination Committee, founding the European Foundation Financial and Investment Officers Group (EFFIO) and being active in many other ways. I enjoyed working together with John Richardson and subsequently with my friend, Gerry Salole, and with the staff of the EFC over the years.

Thirty years have passed, and rather than looking back and feeling gratified by the many good things that the EFC brought to European and global philanthropy, I want to look forward. I know that, at the time of writing, there is a report in the making about the European infrastructure of organisations like the EFC, DAFNE, EVPA, NEF and others. I do not want to be influenced in writing this blog by such reports when they get published and just want to share – based on practical experience – my personal thoughts on the present situation and the way forward for the EFC (because this piece is specifically meant for the 30th anniversary of EFC).

I would like to pay attention to two distinct and relevant developments that will, in my opinion, influence the next stage of the EFC. First of all, the context within which philanthropy is functioning has changed dramatically. Foundations have become more relevant and more visible. There has been a rapid growth in the number and types of foundations inside and outside Europe. And foundations are increasingly seen as an important stakeholder in addressing complex problems of our society. However, this positive development has also led to more distrust from politicians, media and the general public. Questions are being raised about the legitimacy of using private money (particularly when there is a tax break) for the public good. During the World Economic Forum in Davos at the start of this year a Dutch journalist (Rutger Bregman) raised, in one of the panels, the issue of large-scale tax avoidance by wealthy people presenting themselves as philanthropists. Although one could easily challenge this position, the mere existence of such allegations begs the question: What indeed is our added value? Why is private money for the public good sometimes better for society than having more tax money available on the side of the government?

The second equally important development deals with the landscape of philanthropy infrastructure (including venture philanthropy and social investments). The landscape of networks has changed dramatically over the last years. While the EFC was in 1989, perhaps with the exception of the Hague Club, the main player of the philanthropy infrastructure in Europe, at this moment we are experiencing a fragmented picture with a wide array of organisations. I am not just referring to DAFNE, but also to organisations that either appeal to foundations because they represent a thematic interest (like Ariadne) or that appeal because they represent an approach or style of grantmaking or investing (like EVPA and Edge Funders). Unfortunately, this landscape is quite confusing, even for the foundations that are supposed to fund these networks. Organisations compete with each other for scarce financial resources and hegemony in the European ecosystem of philanthropy. Resources are scarce, because foundations (except for a very few enlightened ones) unfortunately do not look at financial contributions to associations and support organisations as a valuable investment to relevant infrastructure. No, on the contrary, they regard it often as an administrative cost, while there are strict rules (though often self-imposed) on the maximum level of such administrative costs/overhead for a foundation. And strangely enough, overhead is seen as negative, as a burden instead of contributing to the environment in which one operates. The fragmentation of the landscape with organisations like the EFC, EVPA, DAFNE, NEF, Ariadne, Edge Funders and others competing with each other, means that we do not have an ecosystem of philanthropic infrastructural organisations in Europe, because, for me, an ecosystem assumes coherency. And we lack coherency and a capability to work together. Networks should step beyond their own ego and figure out what it takes to arrive at a decent and effective ecosystem.

The combination of these two developments provide in my opinion the beginning of a discussion about the future role of the EFC, because foundations deserve a well-functioning coherent ecosystem of philanthropy to address the existential questions they and the sector are confronted with. I want now to concentrate my contribution on the relation between DAFNE and the EFC. DAFNE is a great organisation that has helped me tremendously in my past role as Chair of the Association of Foundations in the Netherlands. DAFNE is in a good position to represent European foundations and to be their voice because of the number of foundations related to the national associations that form their constituency. However, in order to represent and to be the voice you also need substance and elaborated content. This is where the EFC comes in, not only because of its accumulated wealth of knowledge, but also because the funding base of the EFC is different from the one of DAFNE. The core funding resource of DAFNE are the contributions of the national associations that by their nature will be limited. Individual foundations, like at present, may top it up but one may seriously wonder whether this is a sustainable funding model. The EFC on the other hand can draw on much higher membership fees of foundations as core funding.

Hence my opinion is that DAFNE and the EFC are equally dependent on each other and ought to work together much more closely, being aware of their complementarity. Together they could be a powerful player combining representation with content – a killer combination!

Let me make some final remarks on why, in my opinion, loading content is fundamental for the functioning of networks. There is a tremendous need to add relevant content to the debates foundations have both internally, and with each other and with other stakeholders. Networks provide a platform for foundations to meet, to allow for peer-to-peer learning and to advance the body of knowledge. I regret to say that over the years I have been many times involved in discussions of infrastructural organisations, where I did not have the impression that I could advance on the learning curve of philanthropy and social investment. Too many times the exact same discussions were held, treated as if they were brand new and the same arguments were exchanged without any progress in the body of knowledge available. It seems that we can stay forever in circular arguments and keep reinventing the same things, as if they were new and cutting edge. Hence there is a huge need to add, with respect for the past, high quality content to debates organised by networks.

That is why my dream for the immediate future of the EFC would be to exploit the experiential knowledge and academic knowledge of the sector and focus on issues like the legitimacy of the sector vis-à-vis government and the corporate sector; to deal with thematic issues in depth (like migration, independence of public media); to deal with dimensions of philanthropy like endowment management (e.g. EFFIO) and with data mining (with the US Candid as an example).

There is a huge need for an organisation that could provide the substantive underpinnings to our discourse in the future. The EFC could be exactly that kind of an organisation.