One of the world’s leading philanthropic experts, Paul Brest, recently visited Australia to share his expertise with Australian philanthropists and not-for-profits.

Paul Brest

“A philanthropist who cares about outcomes will not make a distinction between direct and indirect costs, but will pay what it takes to achieve the outcomes most effectively.”

Paul Brest visited Australia as a guest of Perpetual, which has partnered with Stanford Center on Philanthropy and Civil Society (Stanford PACS) to give Australian NFPs and philanthropists access to world-class research and thinking.

A distinguished legal academic, Brest became dean of Stanford Law School in 1988. With the School struggling to keep up with competitors’ salaries and the rising cost of living and in the San Francisco Bay area, Paul embraced an unfamiliar role: fundraising. He recruited top Northwestern University fundraiser Susan Bell and in 1992 they launched a capital campaign with the largest target ever for a law school: $50 million. They doubled it.

His exit from Stanford in 1999 can be traced back more than three decades, to a time when Brest was studying liberal arts and considering an altogether different career. Upon asking his music professor about his prospects for pursuing musicology, in an cover story for Stanford Lawyer Brest recalled: “He said I might do that. Or I might try something I could be competent at.”

Competent turned out to be an understatement. Before he arrived at Stanford in 1969, the Harvard graduate moved his young family to Mississippi to work for the NAACP on cases involving desegregation in schools. He clerked for a US Supreme Court judge. He is now one of the 50 most cited legal scholars in the world, with seminal papers on America civil and constitutional law. An innovative educator, he favoured experiential learning and has mentored and inspired a generation of students, even if law turned out not to be their thing – he encouraged Amanda Chang Brown to pursue her dream; she dropped out and wrote the best-seller Legally Blonde. He championed diversity and technology. When students protested the lack of diversity in the law school, he joined them in a sit-in – in his own office. He was the first faculty member to have a personal computer, after he and his wife taught themselves programming, launched a start-up, and sold the software they developed to the company marketing the world’s first portable computer. He introduced a course on artificial intelligence and the law – in 1980.

But it was that initial career idea, which Brest left behind for the law, that bought him to philanthropy. Brest played the viola in a chamber music group with Walter Hewlett and Condoleezza Rice, who were both on the board of the William and Flora Hewlett Foundation. Co-founded by one half of Hewlett Packard, today it is one of the largest philanthropic institutions in the United States. This unusual connection let to Paul’s appointment as President of the Foundation in 2000.

He told Stanford Lawyer: “My ignorance about philanthropy may have turned out to be an advantage, analogous to my ignorance about development when I became dean,” he says. “I didn’t come to the foundation with an agenda, but rather learned by observing and listening. While I lacked expertise in the Hewlett Foundation’s areas of grant making, I brought reasonably good analytic skills to the job, as well as a broad curiosity.”

For 12 years those reasonable skills grew the Foundation to more than 100 staff and managed US$7 billion in endowments. Paul built a culture of strategic and outcome-oriented philanthropy not seen in most philanthropic organisations at that time but now considered best practice.

Paul returned to Stanford in 2012 as Faculty Co-director of Stanford PACS. He is also Co-director of the Stanford Law and Policy Lab as well as Professor Emeritus at Stanford Law School.

During his booked-out Australian tour, Paul shared his insight with F&P.

Paul on strategic philanthropy

Strategic philanthropy is really a pretty simple concept. It begins by having clear goals about what success would be like and then developing a strategy to achieve the goals – a strategy based on a set of causal links and certain activities that will lead eventually to the outcome you desire. [It involves] monitoring how you are doing along the way so you can make course corrections and assessing at the end how you have done so you can do it better again or other people can do it better in the future.

I’ve had a chance in both Sydney and Melbourne to meet with quite a few philanthropists connected with Perpetual and my sense is that they are addressing the same issues in many of the same ways that American philanthropists are. They are interested in achieving outcomes, they are outcome-oriented, they are very practical, and they are interested in developing a strategic framework to get there.

The framework I mentioned – on the one hand it’s just an abstract framework but if you follow it, and your strategy is based on evidence, then you are likely to maximise the impact.

Paul on collaboration in the sector

Collaboration is both very important to solve social problems and very difficult. It is difficult for nonprofit organisations as they are competing with each other for philanthropic funds. It is difficult for philanthropists who want to do things their own way. They are used to collaborating in business and other areas in which they made their money but learning how to collaborate in philanthropy means being willing to let go of your own ego a little bit. That’s not always easy to do.

Paul on the power imbalance between funders and grantees

I think the power imbalance is one that is very much incumbent on philanthropists to give their grantees respect and autonomy, but with the understanding that ultimately philanthropists determine what their goals are and what organisations they think can work with them to best achieve those goals. I think the tradition of philanthropists being respectful of grantees has grown over time [in the US].

Paul on the importance of the beneficiary

I think something else which is emerging is the importance – to both philanthropists and the organisations they are supporting – of listening very carefully to the voices of their beneficiaries, so that when they think they are doing good they are actually achieving the goals that the beneficiaries wish as well. This has been a growing trend. How large a trend it is I don’t know, but I think the larger foundations and the more serious philanthropists are paying a great deal of attention to beneficiaries.

Paul on funding general operational costs

A philanthropist who cares about his or her objectives, should not care about whether the costs are direct or indirect. What they should care about is how their funding can most effectively achieve their goals, and for almost every organisation there are overhead costs or indirect costs that are as essential to achieve their goals as the costs that go directly to the program. A philanthropist who cares about outcomes will not make a distinction between direct and indirect costs, but will pay what it takes to achieve the outcomes most effectively.

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Perpetual’s General Manager for Community & Social Investment, Caitriona Fay, says that Paul’s workshops and public forums have resonated with not-for-profits and given philanthropists the right tools they need to maximise their impact.

“I think Paul has made some really salient points around the need for philanthropists to be more open to funding general operations; finding great organisations and backing them with funding for general operations,” says Caitriona. “When we have someone of Paul’s calibre in the country who is able to voice that directly to the philanthropic community – that that is what constitutes best practice in philanthropy – then we are really setting the bar for foundations. It feels vital and important for the not-for-profit sector to have a leader of this calibre to be sharing his insights around that.”

Caitriona says the workshops gave philanthropists a blueprint to really focus on articulating the problems they want to solve and the tools to communicate effectively with not-for-profits to achieve their goals.

As part to Perpetual’s partnership with Stanford PACS, 10 not-for-profit CEOs will travel to Palo Alto to immerse themselves in the world-class research and thinking at PACS and Stanford’s Non-Profit Management Institute. The cohort, drawn from organisations of different sizes, across different states and working in different areas of the sector, also gain a valuable network that will inform and support them in the challenging role of an NFP leader.

Over the coming years Caitriona says the partnership, which has been extended to 2021, will continue to bring out more US experts (previous Stanford faculty to make the trip include Lucy Bernholz and Rob Reich. They will share their work on topics such as the evolution of not-for-profit organisations, systems change in philanthropy and big bet philanthropy.

“I think there has been a great appetite to hear from people of the calibre of Paul,” says Catriona. “So it’s been a great result for the sector in general.”

 

Paul is the co-author of two books: Money Well Spent: A Strategic Guide to Smart Philanthropy (2nd ed 2018) and Problem Solving, Decision Making, and Professional Judgment (2010). As well as his work at Stanford, Paul teaches a free online course, Essentials of Nonprofit Strategy, offered by Philanthropy University.

 

 

 

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