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Chapter 4: National and Global Engagement

Growing Programs to National and International Scale

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Several of Michigan’s initiatives were created to meet specific problems and opportunities in the state. Frequently joint ventures, these projects were either major innovations on ideas popular at the time, or were new creative ventures to meet Michigan’s needs.

Some of these projects were designed to be national models or to be scaled to reach a national audience. The majority were projects that were successful in Michigan and, as a result of that success, grew to national and/or international scale without prompting.

VideoVideo:  Watch leaders discuss the national and global effects of Michigan’s philanthropy.

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The following are brief descriptions of these projects and joint ventures.

Michigan AIDS Fund

LOCAL GOAL: Provide services and support in the face of a new epidemic; provide a way for foundations to make grants to address an emerging issue where they had little expertise and that did not fit any of their grantmaking guidelines.

NATIONAL IMPLICATION: National model for initial response to needs created by the AIDS epidemic.

AIDSA good example of a Michigan-focused project that grew to national scale is the Michigan AIDS Fund. At the start of the HIV health crisis in the 1980s, little was known about AIDS and HIV, and few foundations were providing any funding in response to the epidemic. No one foundation had program expertise or grantmaking guidelines to adequately make effective grants in this area. Michigan’s private foundations worked through the Council of Michigan Foundations to determine how private investments could make a difference.

In response, a joint funding project called the Michigan AIDS Fund was created at the Council of Michigan Foundations. The Michigan foundations pooled their grantmaking expertise and provided joint funding for programs of research, service, and advocacy – many of which were suggested by nonprofits working directly in the HIV health arena. This funding model quickly spread among other foundations and became a national model.

At the start of the Michigan AIDS Fund, there was not an intention of building a national model; the intention was to solve a local problem, and the solution grew into a national model. Find out more about the Michigan AIDS Fund.

Historical_DocsHistorical Document: Read notes from a 1990 Council of Michigan Foundations board meeting where trustees discussed the formation of the Michigan AIDS Fund.

VideoVideo:  Watch leaders discuss the Michigan AIDS Fund.

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Michigan Community Foundations’ Youth Project

LOCAL GOAL:  Cover entire state with access to community foundation services, while engaging youth in making grants from permanently endowed youth funds of up to $1 million in corpus.

NATIONAL IMPLICATION: Implementation of a youth grantmaking model.

Over the course of 20 years, the Council of Michigan Foundations (CMF) – in partnership with the W.K. Kellogg Foundation, the Charles Stewart Mott Foundation, and community leaders in every corner of Michigan – launched the Michigan Community Foundations’ Youth Project. With aspirational goals, supported by long-term and major investments, the Michigan philanthropic landscape was changed forever through this particular project.

youthThe Michigan Community Foundations’ Youth Project (affectionately named “MCFYP” and pronounced “mick-fip”) was launched to bring community foundation services to all residents of the state, and especially to engage youth as grantmakers. Michigan leaders believed empowering youth and providing an authentic experience in grantmaking would encourage each youth participant’s personal investment of time, money, and know-how for future generations.

VideoVideo:  Watch leaders discuss the mission of the Michigan Community Foundations’ Youth Project.

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This multi-generational, statewide commitment to grow Michigan’s philanthropy was a success beyond all initial expectations. Well over $100 million in permanent assets held in community foundation endowments were generated; over 1,500 young people (under age 21) each year are still engaged as grantmakers throughout the state. The youth grantmakers have returned more grant dollars to fund youth-related needs than the original gift they received, and the permanent endowed assets continue to grow.

MCFYP was not designed as a national or international model. In fact, the W.K. Kellogg Foundation program officer, Dr. Joel J. Orosz, was explicitly clear that the foundation would not support such a similar effort in any other place. The scale of the grant, the flexibility, and the changing of state ecology was a part of the Kellogg Foundation’s historic commitment to the state of Michigan and would not be funded for replication in other places.

Due to the excitement surrounding youth grantmaking and the outcomes from the community foundation development work, however, elements of MCFYP have now been replicated nationally and internationally.

Michigan has been pragmatic and opportunistic in its work. The lessons, challenges, and opportunities that emerged while implementing MCFYP led to a number of “spin-off” projects that have also grown to national and international scale themselves.

The figure below highlights the spin-off initiatives that have grown to national/international scale, sparked by the success of the Michigan Community Foundations’ Youth Project. Find out more about the Michigan Community Foundations’ Youth Project.

MCFYP_Infographic

Historical_DocsHistorical Document: Read notes from a 1996 Council of Michigan Foundations board meeting that provide a summary and overview of the Michigan Community Foundations’ Youth Project.

CMF MCFYP

VideoVideo:  Watch leaders discuss the success of the Michigan Community Foundations’ Youth Project (MCFYP).

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Michigan Community Foundation Tax Credit

LOCAL GOAL: Create an individual and single business tax credit for gifts to endowments of local community foundations in Michigan.

NATIONAL IMPLICATION: The passage of similar community foundation tax credits in other states, based on Michigan’s model.

In Michigan, public broadcasting stations and private colleges benefited from a limited tax credit for private donations. As MCFYP was implemented, the decision was made to try to obtain a similar tax credit for gifts to community foundations. Taking what was known about the public broadcasting tax credit, the Council of Michigan Foundations, with the support of all of its members (community, corporate, family, and independent private foundations) proposed a similar tax credit for gifts to the permanent endowment of community foundations. The Michigan Community Foundation Tax Credit passed in 1988, and lasted until 2012.

Because MCFYP’s community foundation strategy was based on the mechanism of a challenge grant, the Michigan Community Foundation Tax Credit provided a leveraging opportunity for the community foundations to reach out to smaller donors. For MCFYP, a $1 gift from a donor generated a $1 tax credit from the state, and $.50 matching gift from the Kellogg Foundation. There was a cap upon the tax credit of $100 for individuals, $200 for couples filing jointly, and up to $5,000 for corporations – or 10% of Michigan business tax liability – whichever was less.

VideoVideo:  Watch leaders discuss the challenge grant for Michigan community foundations.

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In response to concerns from other nonprofits, the community foundations developed policies, procedures, and marketing materials that encouraged local nonprofits to develop permanent endowment funds within their local community foundation, which then extended the tax credit benefit to all charitable nonprofits. In 2012, the Michigan Community Foundation Tax Credit was ended in order to help reduce Michigan’s chronic budget deficit.

The tax credit continued to have a national effect, as the idea of a tax credit for community foundations was picked up by the states of Montana, North Dakota, Iowa, and Arizona. Find out more about the Michigan Community Foundation Tax Credit.

Historical_DocsHistorical Document: Read notes from a 1987 Council of Michigan Foundations board meeting that provide a background for the Michigan Community Foundation Tax Credit.

VideoVideo:  Watch Jim McHale discuss the national and global effects of the Michigan Community Foundation Tax Credit.

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Michigan Community Foundations’ Computer Project

LOCAL GOAL: Find a software system that supports community foundation functions, regardless of foundation size.

NATIONAL IMPLICATION: Development of a software system that works for all community foundations, regardless of size or location.

At the launch of MCFYP, administrative systems for community foundations and computer technology were both in the early stages of development. The goals of MCFYP required each community foundation to operate at a minimum level of organizational viability or higher in order to adequately serve their community. Computer solutions were sought to assist the small staffs of community foundations in Michigan with consistent handling of their administrative tasks.

computersSome of the largest Michigan community foundations had started to develop their own “in house” custom solutions, just as the need for a sector-wide solution became apparent. Working together, the community foundations sought a common computer program that could scale to their size and complexity, and would support all of the components of a community foundation – integrated donor relations, grantmaking, scholarships, leadership projects, finance, and administration.

The Michigan foundations first looked across the country for examples of community foundations using generic (not custom designed) successful programs. They found none. The larger community foundations were using expensive customized programs. The smaller foundations were using pieces of commercial software (Word, Excel, Quicken, etc.). The collaboration was extraordinary. For the first time, Michigan’s community foundations hammered out agreements on the internal functioning of their organizations, and through this process common software was developed and adopted. Together, Michigan community foundations selected a small vendor that designed a customized system for the community foundations.

Working closely with NPO Solutions (now a part of MicroEdge), the Michigan community foundations helped develop an information management computer system that would scale variably to meet the needs of both the smallest and the largest community foundations. The resulting system was called Foundation Information Management Systems (FIMS). Implementation of the FIMS system was funded in 1993 by a grant from the Kellogg Foundation, Dr. Joel J. Orosz, program director.

While focused on the needs of the Michigan community foundations, FIMS became one of the primary computer software programs used by community foundations across the country. The original intent was not to solve a national problem, but simply to address the needs of Michigan foundations. The benefit of this work was multiplied by the number of states who also adopted this computer software system. Find out more about the Michigan Community Foundations’ Computer Project.

VideoVideo:  Watch leaders discuss the implementation of the Foundation Information Management System (FIMS).

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Legal and Behavioral Definition of a Community Foundation

LOCAL GOAL: Ensure the Michigan Department of Treasury was not burdened by groups who are not community foundations looking for a tax credit.

NATIONAL IMPLICATION: The definition of a community foundation was utilized for uniform tax purposes and helped define community foundations nationally.

With the advent of the Michigan Community Foundations’ Youth Project challenge grant program from the W.K. Kellogg Foundation, technical assistance from the Charles Stewart Mott Foundation, and the Michigan Community Foundation Tax Credit, it became important to more closely define the operating characteristics of a community foundation.

Historical_DocsHistorical Document: Read notes from a Council of Michigan Foundations board meeting about the community foundation grants received from the W.K. Kellogg Foundation and the Charles Stewart Mott Foundation.

The Tax Reform Act of 1969 had defined community foundations as public charities with general characteristics that could be claimed by a number of organizations. In particular, civic foundations organized by cities solely to fund services (such as parks and recreation or the arts) felt they were “community” foundations – foundations that served their community.

VideoVideo:  Watch leaders discuss the Tax Reform Act of 1969.

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Again, Michigan looked to the outside to find a definition. What was available at the time was the definition from the Internal Revenue Service Code, namely in its 501(c)(3) regulations. This provided a framework, but was not specific enough to assist Michigan’s Department of Treasury in certifying which organizations were eligible for the tax credit and which were simply adding the words “community foundation” to their name – with no intention of functioning like a community foundation.

Community Foundation Definition: A community foundation is a tax-exempt, nonprofit, autonomous, publicly supported, nonsectarian philanthropic institution with a long term goal of building permanent, named component funds established by many separate donors to carry out their charitable interests and for the broad-based charitable interest of and for the benefit of residents of a defined geographic area, typically no larger than a state. – “Definition of ‘Community Foundation” (2008), Council of Foundations.

Because no detailed operational description existed, Michigan community foundations and the Council of Michigan Foundations created a definition in 1990 based on objective criteria. The definition of a community foundation was generated in response to the Michigan Community Foundation Tax Credit, which in turn contributed to the development of the national definition of a community foundation. Find out more about the Legal and Behavioral Definition of a Community Foundation.

VideoVideo:  Watch leaders discuss the standardized definition of “community foundation.”

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Development of Standards and Certification of Best Practices for Community Foundations

LOCAL GOAL: Support community foundations in their quest to be efficient and effective; assure the organizations that carry the same “brand” deliver the same quality of services.

NATIONAL IMPLICATION: Michigan leadership and significant input into the development of National Standards for Community Foundations.

MCFYP’s goal to expand the service of community foundations to serve the whole state raised many questions about the capacity, efficiency, and efficacy of smaller community foundations. Larger, older, and mainly urban community foundations from across the country expressed concern that these new and small community foundations might inadvertently do something wrong, which would raise oversight issues with the Internal Revenue Service and federal regulators.

With the start of the Michigan Community Foundation Tax Credit, the CMF community foundation members sought to develop a common “brand,” joint public relations, and standardized marketing strategies. It also became important to assure potential donors that every organization calling itself a community foundation could deliver a similar quality of “product.” The opportunity to engage in joint marketing (see the Branding Project) helped motivate Michigan community foundations to define what services should be offered to a community and to develop operating standards for the field.

Because conversations regarding the creation of standards moved slowly at the national level, the Council of Michigan Foundations, through the Community Foundation Committee, created the first set of operating principles in 1999. These Michigan principles offered a model for the continued development of national standards. Find out more about the Standards and Certification of Best Practices for Community Foundations.

VideoVideo:  Watch leaders discuss the development of national community foundations standards.

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Community Foundation Branding Project

LOCAL GOAL: Educate and engage potential new donors on the role of community foundations.

NATIONAL IMPLICATION: “For good. For Ever.” tagline developed and common public relations materials created.

To meet the W.K. Kellogg Foundation’s Michigan Community Foundations’ Youth Project challenge, prospective donors needed to become curious about the role of a community foundation, educated about its features and benefits, and moved to provide a gift. The Michigan community foundations came together to work on a community foundation branding project that would help to interest and educate donors.

There were several failed attempts to solve the branding challenge. National public relations experts were consulted, but the proposals received did not capture the essence of community foundations, nor understand the community foundation culture in Michigan. Joint advertising strategies and materials were not accepted by the foundations. Finally, the Michigan community foundations, working through CMF, hired a regional marketing firm who took on the branding task more directly. This work was funded by the Kellogg Foundation, with Dr. Joel J. Orosz as program director.

Together, Michigan community foundations and The Williams Group marketing firm came up with the slogan “For Good. For Ever.” and a package of public relations and marketing products were created. This marketing slogan and the public relations materials were launched in Michigan, for a specific Michigan purpose, but were quickly adopted – through a partnership with the National Council on Foundations – by community foundations across the nation. Find out more about the Community Foundation Branding Project.

VideoVideo:  Watch leaders discuss the Branding Project.

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Youth On Board Legislation Act

LOCAL GOAL: Provide legal authority for young people in Michigan to serve on nonprofit boards with a vote.

NATIONAL IMPLICATION: Provided a model for legislation and experience with youth board members for future national replication.

With opportunities to serve on a Youth Advisory Committee (YAC), young grantmakers in Michigan had gained valuable experience in a fiduciary role as advisors to their local community foundation board of trustees. In 1997 and 1998, Michigan’s young people involved with community foundations successfully lobbied for the Michigan Youth on Boards Act , which provided youth the legal authority to serve and vote on nonprofit boards.

The experience in writing legislation and working for its passage was an important step for those involved, and the resulting legislation has recognized the skills and maturity of Michigan youth grantmakers.

Roughly half of Michigan community foundations now have at least one youth board member with a vote. The states of Minnesota and New York have enacted similar laws. Legal concerns regarding liability and the untested nature of youth boardsmanship have raised enough issues that other states have not yet followed suit. Find out more about the Youth On Board Legislation Act.

VideoVideo:  Watch leaders discuss the movement to give youth a voice in the public and nonprofit sectors.

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Office of Foundation Liaison (OFL)

LOCAL GOAL: Identify and broker partnerships and collaborations between Michigan’s state government and Michigan’s grantmaking foundations.

NATIONAL IMPLICATION: The first of its kind in the nation, OFL has been used as a model for other state associations.

Launched in 2003, with Hudson-Webber Foundation CEO, David Egner, providing key leadership, the Governor’s Office of Foundation Liaison was created to support partnerships between state government and Michigan’s philanthropic foundation community. This cabinet-level position provides a nonpartisan bridge to serve the people of Michigan.

The Charles Stewart Mott Foundation has provided a loaned executive, Karen Aldridge-Eason, as the founding foundation liaison with an office at the Capital. Foundations pay for the salaries and operating expense, and the state provides an office and supplies. This model has been replicated across the United States. Find out more about the Office of Foundation Liaison.

VideoVideo:  Watch leaders discuss the Governor’s Office of Foundation Liaison.

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RAGs on the Hill

LOCAL GOAL: Inform, educate, and partner with Michigan’s federal legislators regarding policies to support philanthropy and volunteering.

NATIONAL IMPLICATION: Other regional associations of grantmakers have used this model to encourage communication with their policy makers.

The burdens imposed on philanthropy by the Tax Reform Act of 1969 helped to motivate the formation of the Council of Michigan Foundations (CMF). Public policy advocacy has been at the core of CMF’s work since its inception. Early in the development of the legislative agenda for CMF, Margaret “Ranny” Riecker of the Herbert H. and Grace A. Dow Foundation brought her political organizing skills to CMF. One of the organization’s major public policy initiatives was to identify the foundations in each legislative district, then to go as a group to Washington to meet with their local representatives. The first such visit of Michigan grantmakers to Washington occurred in 1977.

While effective in educating and developing relationships with Michigan’s delegation, it became clear that to effect national policy, there needed to be a nationwide organization and visitation to Washington at least one time per year. Over the years, from its first occurrence in 1977, this visit was affectionately called “RAGs on the Hill” (short for Regional Associations of Grantmakers on Capitol Hill). The current title for the program is “Foundations on the Hill.” Since 2003, the Council on Foundations and the Forum of Regional Associations of Grantmakers have cosponsored the national Foundations on the Hill on an annual basis.  Find out more about Foundations on the Hill.

RAGS v 2

VideoVideo:  Watch leaders discuss RAGS on the Hill.

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Learning to Give

LOCAL GOAL: Infuse the teaching of philanthropy into the core academic curriculum of K-12 schools – giving, serving, and private citizen action intended for the common good.

NATIONAL IMPLICATION: All educational lessons plans and materials are available online for free to classroom teachers everywhere – with all lessons coded to each state’s academic standards.

CMF’s Learning to Give (LTG) is a Michigan program that was designed for the purpose of going to national scale. Conversations regarding the planning for LTG started as a pragmatic decision to extend the support for MCFYP youth grantmakers. When national research uncovered the fact that there was no K-12 academic curriculum that taught the history, theory, and practice of the philanthropic sector, the decision was made to create the program in Michigan with an ultimate goal of making the materials available internationally via the Internet.

LTG was launched in 1997 under the leadership of Dr. Kathy Agard, who had previously led the Michigan Community Foundations’ Youth Project (MCFYP) to its great success, and funded by the Kellogg Foundation, with Dr. Joel J. Orosz as program director.

Learning to Give now reaches over one million users per year via the Internet, and includes visits from delegations hailing from around the world. LTG has been translated into Japanese and Korean. Find out more about Learning to Give.

Historical_DocsHistorical Document: Read this 2001 progress report for a history of the Learning to Give initiative.

VideoVideo:  Watch leaders discuss the mission of Learning to Give.

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Great Lakes Community Foundation Environmental Collaborative

LOCAL GOAL: Develop endowment funds in Michigan community foundations that serve lakeshore communities for the protection of the Great Lakes.

NATIONAL IMPLICATION: Assist community foundations in the United States and Canada in lakeshore communities to build environmental endowments.

Michigan citizens feel particularly protective of the Great Lakes that surround the state. Holding approximately 21% of the world’s fresh water, according to the Environmental Protection Agency, and subject to years of abuse through industrial pollution, particular concern exists about these valuable economic, recreational, and life sustaining resources.

Efforts to build endowments to support environmental organizations and initiatives required, from the beginning, an international and multi-state regional effort. In partnership with interested private foundations and environmental groups, the Collaboration, coordinated by the Council of Michigan Foundations, continues to help build the resources needed to protect the Great Lakes Basin. Find out more about the Great Lakes Community Foundation Environmental Collaborative.

Historical_DocsHistorical Document: Read notes from a 1997 Council of Michigan Foundations board meeting that discuss the Great Lakes Community Foundation Environmental Collaborative.

VideoVideo:  Watch leaders discuss the Great Lakes Community Foundation Environmental Collaborative.

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Midwest Community Foundations Ventures (MCFV)

LOCAL GOAL: Develop an organizational vehicle for community foundations in the Midwest to collaborate on joint ventures, professional development, and public relations.

NATIONAL IMPLICATION: A novel collaboration between the regional associations in the Midwest to share resources and engage in joint projects

By 2006, the Michigan Community Foundations’ Youth Project (MCFYP) came to a natural close. Its goals had been reached:

The Council of Michigan Foundations (CMF) was faced with the delightful problem of how to transition to the next challenge. The MCFYP project had been legally organized as a support organization of CMF (with its own budget, board, and programming, managed by CMF staff and responsible to the CMF board of trustees). The community foundations had been extremely successful in using the MCFYP/CMF “platform” to work together on projects that would benefit and advance their individual communities, organizations, and philanthropy. Several community foundations in Indiana and Ohio, particularly in communities bordering Michigan, had asked for membership in CMF and frequently attended CMF-sponsored training and conferences. The Great Lakes Community Foundation Collaborative provided opportunities for the community foundations surrounding the Great Lakes to work together.

All of these factors came together and MCFYP was transitioned into a multi-state community foundation vehicle, reconstituted as the Midwest Community Foundations Ventures (MCFV) – serving the upper Midwest states of Michigan, Indiana, Ohio, and Illinois. Find out more about Midwest Community Foundations Ventures.

As Michigan gained experience in developing philanthropic resources and projects, a number of initiatives were launched with the expressed intention of reaching a national audience. The following are projects that started with a national and/or international goal in mind.

The Grantmaking School

Dr. Joel J. Orosz spent his sabbatical year in 1999 from the W.K. Kellogg Foundation researching and writing one of the first, and still one of the few, books about the skill and craft of grantmaking: The Insider’s Guide to Grantmaking: How Foundations, Find, Fund, and Manage Effective Programs. He developed a personal mission to create a grantmaking school that would help professionals (recruited to foundations because of their content expertise) to learn the sophisticated skills required to be a good grantmaker. He implemented this vision in 2004, with the creation of The Grantmaking School, the first university-based training program for grantmakers, housed at the Dorothy A. Johnson Center for Philanthropy.

While working on The Grantmaking School, Dr. Orosz wrote his second book: Effective Foundation Management: 14 Challenges of Philanthropic Leadership—and How to Outfox Them. The Grantmaking School courses are delivered nationwide by a faculty of experienced grantmakers.

In 2013, at the invitation of the W.K. Kellogg Foundation, The Grantmaking School started its work in South Africa, in partnership with the C.S. Mott Foundation, South African Grantmakers Forum, Community Development Foundation of the Western Cape, Stellenbosch University, Linawo Children’s Home, and Rhodes University. Find out more about The Grantmaking School.

VideoVideo:  Watch Joel Orosz discuss The Grantmaking School.

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Learn Philanthropy

LearnPhilanthropy is a 2014 initiative that takes advantage of the sophistication of the Internet to provide new grantmakers with tools, knowledge, and guidance from a pool of resources provided by practitioners and experienced grantmakers. A joint venture of the Council on Foundations and the Forum of Regional Associations of Grantmakers, LearnPhilanthropy is housed at the Dorothy A. Johnson Center for Philanthropy as a part of its suite of educational services to the grantmaking community.

Frey Chair in Family Philanthropy

The Frey Foundation Chair for Family Foundations and Philanthropy is the first endowed chair related to the family foundation field. Created in 2007 to be a national resource for research and support of family foundations, the Frey Chair has sponsored bi-annual National Summits on Family Philanthropy in Grand Rapids, Michigan; Chicago, Illinois; and the 2015 summit is scheduled for New York City.

W.K. Kellogg Chair in Community Philanthropy

The W.K. Kellogg Chair in Community Philanthropy was created in 2014, under the leadership of Dorothy Johnson, at the Dorothy A. Johnson Center for Philanthropy. A search is underway for the first person to hold and develop the new academic chair. The chair will explore and advance the field of community philanthropy, both nationally and internationally.

The Foundation Review

The Foundation Review is the first and only peered-reviewed journal for grantmaking foundations. Launched in 2008, the journal is written by and for foundation boards and staff. The Foundation Review is a publication of the Dorothy A. Johnson Center for Philanthropy.

WINGS and the Global Fund for Community Foundations

In 2000, the Charles Stewart Mott Foundation and the W.K. Kellogg Foundation provided funding to the Council of Michigan Foundations for Donnell Mersereau, vice president of community foundations, to work outside of Michigan on national standards, international standards, and to help grow community philanthropy worldwide. Find out more about WINGS and the Global Fund for Community Foundations.

VideoVideo:  Watch leaders discuss the national influence of both Michigan Community Foundations Ventures and WINGS.

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Summary

The four major philanthropic infrastructure organizations in Michigan have missions focused on serving the state. Yet, over the past four decades many of the projects, programs, and models created in Michigan have grown to national and international scale and have been replicated and/or modified for use in other places. Participation by Michigan nonprofit and foundation donors, board members, and staff in the complex ecosystem of local, state, and national networks facilitated this growth. A value system that celebrated sharing allowed these projects to flourish.

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