California Foundations' Diversity Makeup and Grantmaking Questioned

The California Assembly has approved a proposal that would require the state's largest philanthropic foundations to disclose the race and gender of staff and board members, the San Jose Mercury News reports.

The proposed legislation — which will be assigned to state senate committees for consideration in coming weeks — is designed to encourage foundations to direct more of their grants to gay and lesbian, African American, Latino, Asian American, and Native American causes. According to California assemblyman Joe Coto (D-San Jose), who proposed the legislation, foundations in the state award hundreds of millions of dollars each year to nonprofit groups, but the money rarely reaches organizations led by minorities. The measure, AB 624 (5 pages, PDF), would require every private, corporate, and public foundation with assets of more than $250 million to post the composition of its staff and board on its Web site.

Foundations in California and across the country are fighting the bill, arguing that the reporting requirements are irrelevant, onerous, and violate the privacy of those who dedicate their lives to helping disadvantaged people regardless of race or ethnicity. Foundation executives also say the measure distorts the impact of philanthropy because, no matter which nonprofits receive grants, there's a high likelihood that members of minority groups will benefit from the money provided.

Others oppose the measure on grounds that the government shouldn't force foundations to consider diversity as a key part of their mission in a state whose population is 57 percent nonwhite. "Race, gender, and sexual orientation are obviously important identifiers in California and the United States and elsewhere, but they are only a part of the important issues that foundations play a role in addressing," said Paul Brest, president of the Menlo Park-based Hewlett Foundation.

A study from the Berkeley-based Greenlining Institute, which backs the legislation, found that in 2006 only 3.6 percent of grant dollars from the nation's top twenty-four private foundations went to minority-led organizations — defined as nonprofits where the total composition of staff and boards was at least 50 percent nonwhite. According to John Gamboa, executive director of the institute, the lack of funding means that minorities are being shut out from programs, services, and critical public-policy discussions. The study also found that only 10 percent of California foundations' executive directors and board members belonged to a minority group.

One of the largest coalitions of grant providers in the state, Northern California Grantmakers, is urging legislators to table the measure, fearing philanthropic organizations may choose to do their good deeds out of state. "I don't think our members or the associations are saying the collection of information or data is a bad thing," said NCG president Colin Lacon. "It's more the blanket requirement to do it."

Edwin Garcia. "Foundations' Diversity at Issue." San Jose Mercury News 03/03/2008.