Funders Network Plans Expansion, Partnerships, New Ethos of Giving

Jewish philanthropists, watch out. Mark Charendoff wants you to write larger checks.

Unlike the hundreds of others vying for a piece of the Jewish pocketbook, Charendoff, the new executive director of the Jewish Funders Network, doesn’t actually want donors’ money.

Instead, he sees his 11-year-old organization, which is expanding in size this spring and opening its first Israel office, as a neutral advocate urging Jewish donors to “fund more and fund better.”

Before joining JFN in September, Charendoff was vice president of the Andrea and Charles Bronfman Philanthropies, one of the largest Jewish foundations in the world.

JFN is “in a unique position because we’re not seeking funds,” Charendoff said. “We don’t have any affiliations to any nonprofits, so we can be honest brokers.”

JFN is preparing to dramatically expand, both in North America and internationally. With more than $2 million in “capacity building” funds collected since Sept. 11, the group has doubled its operating budget, and it wants to increase membership, influence and services.

The funders group, which will hold its annual conference in Houston in March, sees its expanded role as four-fold:

Serving as a “virtual staff” to Jewish family foundations, the majority of which are too small to hire professionals. JFN consultants will help foundations with such things as strategic planning, evaluation, crafting a mission statement and planning retreats.

Educating donors about needs, trends and opportunities in the field, as well as ways of being more effective or strategic in their giving.

Convening and facilitating partnerships in specific funding areas.

Advocating for increased giving, as well as “more effective, thoughtful and ethical Jewish philanthropy.”

Approximately 900 people from over 300 foundations currently are JFN members.

Until now, members of the group, which was founded by a handful of left-leaning philanthropists, were recruited mainly through word of mouth. But the JFN plans to market itself more aggressively.

Despite the recession, there is a vast untapped market of people to target.

The number of Jewish family foundations and endowments has grown in recent years. In fact, Charendoff estimates they have more than doubled in the past five years, and he puts their assets at $25 billion.

Only a fraction of that money is allocated each year, however, and less than half of it goes to Jewish causes.

Nonetheless, 6,814 U.S. foundations list Jewish causes as one of their funding interests. An estimated 250 Jewish family foundations in the United States give away $200,000 or more each year to Jewish causes, totaling slightly under $250 million a year.

Some estimate that foundation giving to Jewish causes soon will eclipse Jewish federation campaigns. Already, many major initiatives in the Jewish community — such as Birthright Israel, the program sending young people on free trips to Israel — have been launched out of partnerships among private foundations rather than federations.

The federation system and the Israeli government subsequently joined Birthright, becoming three-part partners.

Some federations once saw the independent funds as a threat to their communally allocated campaigns. Now, as the foundations’ clout grows, their ties with federations appear to be growing closer, and the boundaries between the two are blurring.

Many Jewish foundations that are JFN members are Jewish federation “supporting foundations.” That means that the family decides how to allocate funds, but the federation manages the assets and provides other staff support.

A professional from Cleveland’s Jewish federation sits on JFN’s board. And when Charles Bronfman — Charendoff’s former boss and a major player in the Jewish foundation world — recently stepped down as chairman of the federation system’s United Jewish Communities, he called in his parting speech for more partnerships between federations and foundations.

“We have a good relationship with federations in general and the folks at UJC,” Charendoff said. “Not only are we not competing, but I’ve taken a strong stand with members that being a responsible philanthropist also means supporting your local federation.”

Stephen Hoffman, president and CEO of the UJC, said he views JFN not as competition but as a “partner” that “can only help Jewish donors in making thoughtful decisions about how to help the Jewish community grow.”

In addition to the growing number of North American Jewish foundations, Israel’s philanthropic sector also is growing.

JFN hopes the Jerusalem office it is opening this spring will assist Israeli funders, forge partnerships between Israeli donors and Diaspora ones, enable the network to provide Diaspora funders with more information about Israeli projects and serve as a base for working with European Jewish philanthropists.

On the advocacy front, the JFN is urging foundations to allocate more than the 5 percent of assets the U.S. government requires of them.

While many foundations automatically give away 5 percent of their assets, “It’s no averah” — a Hebrew word for sin — “to give away 7, 8 or 10 percent,” Charendoff said.

JFN also is questioning the assumption that money should be kept in a permanent trust in which the principle is never touched, allowing programs to be funded indefinitely.

In contrast, “spending down” means that the bulk of the money gets used now, rather than sitting in the bank.

If foundations doubled their allocations, “this could change the economy of the Jewish world, certainly in North America,” Charendoff said.

Jack Wertheimer, provost of the Conservative movement’s Jewish Theological Seminary, recently wrote a paper estimating that the field of Jewish education needs more than $2.5 billion if it is to stem high rates of assimilation. He welcomed the call to spend down trusts.

“Given the enormous needs of the present and given the very serious challenges that go under the rubric of Jewish continuity,” he asked, “does it really make sense for the Jewish community to put so much of its resources into endowments when the needs are so pressing now and we don’t even know if there will be Jews who need these resources down the road?”

The UJC’s Hoffman said the Jewish community needs both long-term endowments for the future and major cash infusions for the present.

“Some areas cry out for huge investments probably far beyond the 5 percent target,” he said. “At the same time, I’d like to know there will be big foundations around later.”