By MAGGIE JARUZEL POTTER
- Community foundations in CEE/Russia and Western Europe often function as “knowledge hubs,” developing and sharing expertise about the communities they serve.
- In this region, community foundations frequently create partnerships between the three sectors — public, private and nonprofit — and work toward shared community goals.
- While community foundations are local, they can achieve broad, national impact when they link with other community foundations in their country.
This article is part of an occasional series about the community foundation field and the Mott Foundation’s role in supporting and strengthening it. The series reports on what is occurring in Mott’s major geographic focus areas — Central/Eastern Europe and Russia, South Africa, and the U.S. — as well as providing information about how the field is expanding globally. Mott’s goal is to inform the public about the latest trends in the community foundation field in advance of its 100th anniversary year in 2014.
Throughout Central and Eastern Europe and Russia (CEE/Russia) and Western Europe, the same two characteristics are often cited when leaders describe what first attracted them to community foundations: The institutions are non-political and they are owned by the communities they serve.
While community foundations are now operating in more than 15 countries in CEE/Russia and Western Europe, they didn’t appear there until the late 1970s, first in Northern Ireland, then in other places throughout the United Kingdom during the 1980s. By 1991, there were so many community foundations in the U.K., a national network was created to link and support them.
In the meantime, the Berlin Wall had fallen in 1989 and Germany was reunified in 1990. Those two milestone events coincided with the collapse of communism in Central/Eastern Europe and the breakup of the former Soviet Union. Consequently, community foundations started developing throughout continental Europe during the 1990s — in Slovakia, Germany, Poland and elsewhere. The concept spread through the 2000s and continues today.
Early on, it was important for former Soviet states, including Russia, to develop philanthropic organizations that could support the civil society sector after international donors pulled out, says Avila Kilmurray, who has gained extensive, worldwide knowledge of, and experience in, the field by serving on the board of the Global Fund for Community Foundations (GFCF).
Avila Kilmurray, director of the Community Foundation for Northern Ireland and board member of the Global Fund for Community Foundations.
She also is director of the Community Foundation for Northern Ireland (CFNI). Established in 1979 and known as the Northern Ireland Voluntary Trust until 2002, CFNI is the oldest community foundation in Europe.
Although some of Northern Ireland’s societal issues are different from those of the former Soviet states, they share a common desire to use democratic decisionmaking practices, which is a hallmark of healthy community foundations, Kilmurray says.
For her and other community foundation leaders in Europe, finding ways to adapt the community foundation concept to the local context has been important — whether developing programs to reintegrate political prisoners into Irish society as CFNI has done, or keeping the local cultural heritage alive as has been done in some post-Soviet communities.
Another common characteristic of community foundations in the region is their operational transparency — something unthinkable during communist rule and still viewed with skepticism, says Natalya Kaminarskaya. She is CEO of the Russian Donors Forum, an organization that represents 128 of the nation’s approximate 300-plus grantmakers of all kinds, including community foundations.
“People still have a lack of trust in their neighbors, businesses, government officials and even non-governmental organizations (NGOs) in Russia,” Kaminarskaya said. “But things are slowly improving.”
In addition to residents’ opinions of NGOs moving “from negative to neutral,” she says, the Russian government is also changing the way it interacts with indigenous grantmakers. Five years ago the government made it easier for Russian foundations by allowing them to keep money in reserve from year-to-year for permanent endowments without having that money taxed, as had been done previously.
However, unlike in the U.S. and the United Kingdom (UK), building endowments is not yet a routine practice for community foundations in former Soviet states.
Also, a new national law in Russia became effective in 2012 providing individuals with tax incentives for donations made to community foundations and other NGOs. While these same tax incentives are not yet available for businesses and corporations, Kaminarskaya says, she is hopeful that change also will come.
Ten reasons to give through community foundations:
[Editor’s note: This list was created for residents of the United Kingdom, so not all points will apply to all community foundations worldwide.]
1. Maximum impact — Thanks to our expert guidance and in-depth local knowledge, you can achieve far more with your giving than would otherwise be possible.
2. Complete flexibility — You decide on the level of involvement that suits you. The community foundation takes responsibility for the fund on your behalf and deals with the Charity Commission and Companies’ House.
3. Minimum hassle — You can leave any time-consuming administration to us, while you focus on the causes you care about.
4. Regular feedback — We’ll keep you up to date on how your gift to the community foundation has been spent, and what recipients have achieved.
5. Active engagement — Opportunities to meet, and be involved with, the people and projects supported by your fund, if you wish.
6. Value for money — We can provide you with information on the most tax-efficient ways to give, and we keep administrative costs to a minimum.
7. Long term effectiveness — By setting up an endowed fund, you can make a real difference to people’s lives, now and for years to come.
8. Professional expertise — The professional investment managers we use will be applying their expertise to build the value of your fund.
9. Independent and “cause neutral” — In providing you with expert advice and the benefit of our local knowledge, our only agenda is to help you ensure your giving makes a lasting impact in the areas that you care about most.
10. Individual and personal — Every fund established with a community foundation is precisely that: personal to you. It is not an off-the-shelf “product”, but made to measure, to suit your particular circumstances and meet your specific priorities.
Source: Community Foundation Network, U.K
In Russia and other former Soviet countries, governments often provide a portion of the funds community foundations give out as grants. For some, the government’s percentage is quite high — unlike in the U.S. where wealthy individuals typically donate the bulk of the money given to community foundations. It is also different from South Africa where the corporate sector donates the majority of financial support to community foundations. [See related article.]
In Western Europe, community foundation funds come from a mix of all three sectors — public, private and nonprofit. However, in the UK, the local and central government have historically provided 50 percent of community foundations’ annual grantmaking budget, says Stephen Hammersley, chief executive of the Community Foundation Network (CFN).
Despite the ongoing gloomy global economic picture, he says, community foundations in the U.K. have actually increased their assets during the past few years. This growth is partially due to overall increased awareness about community foundations and partially due to the government’s previous and current matching challenge grants for the community foundation field, Hammersley says. [See related article.]
The government’s challenge grants, whether matching residents’ donations 2-to-1 or 1-to-1, have brought new donors to the community foundation field — and the current challenge, which runs through March 2015, is expected to do more of the same, he says.
“The challenge grants establish momentum for the field. Currently most community foundations have at least 30 to 40 donors, which is enough to form a critical mass of people,” Hammersley said.
Committed people — those who bring influence to the organization and those who bring a wealth of knowledge about the community and its challenges — are both crucial, non-monetary assets that community foundations need, he says.
Currently, there are 55 members of the London-based CFN, covering all of Northern Ireland, Scotland, Wales and most of England. In winter 2011-2012, CFN coordinated “Surviving Winter,” the first national community foundation fundraising campaign, which successfully collected £2.5 million ($3.8 million) from within the U.K. to provide fuel assistance for thousands of its older and vulnerable residents.
Another new CFN initiative is a partnership with the Fredericks Foundation, which empowers people to obtain financial independence through small business ownership. While CFN is helping raise money to be used as loan capital, Hammersley says, Fredericks provides the expertise in operating a micro-enterprise, micro-loan program.
“Our role at CFN is to enable more things to be done, as opposed to doing them ourselves,” he said.
The same is true for the hundreds of community foundations operating in Bulgaria, Czech Republic, Germany, Poland, Romania and Ukraine. Consequently, people working in the community foundation field welcome opportunities to learn from one another.
For example, in December 2011, Polish and Ukrainian community foundation leaders met at a conference in Kyiv, Ukraine, to share project ideas and field experiences — discussing where the successes have been and where the challenges remain.
The Trenčin Community Foundation is based in the Carpathian region and provides programs that improve life for local residents.
Photo courtesy of The Trenčin Community Foundation
“Polish community foundations are characterized by strong and functioning local partnerships,” said Maciej Mulawa, director of the Federation of Polish Community Foundations (FPCF). “These partnerships are our secret to stable development for today and tomorrow. This is how we will develop the local society in Poland.”
The federation, which serves as a support network for 26 community foundations in Poland, eagerly shares how these public-NGO partnerships were developed, Mulawa said.
In neighboring Germany, community foundations also regularly exchange field information with community foundation leaders in other countries and also with those throughout the country — because the number of community foundations in Germany is nearly 10 times as many as in Poland. With 300 community foundations nationwide, Germany ranks second only to the U.S. in sheer numbers, surpassing even Canada with its 181 members from coast to coast.
As the community foundation field in CEE/Russia and Western Europe has matured, its leaders have become increasingly interested in measuring the impact of their grantmaking, say both Hammersley and Kilmurray of CFNI.
Impact can be immediate and/or long lasting, Kilmurray says. For example, simply providing a grant to a NGO can validate that organization’s work in the eyes of the community, she says, because the community foundation is increasingly regarded as a knowledge hub, strategic leader and wise steward of its resources.
Overall, community foundations in Europe have become more intentional about their actions, including using their organizations’ influence to address important local issues. By selecting the appropriate volunteers to champion specific causes publicly, community foundations can strengthen their credibility in communities, and also open the door to maximizing their impact by linking with other organizations, Kilmurray says.
“Community foundations have a broad cross-sector of contacts,” she said. “One day they might meet with a group of Roma [minority population] and the next day they could be meeting with an archbishop, politician or a business person. Having those kinds of contacts makes building partnerships easier.”