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Published in Print: February 14, 2001, as Clark Foundation Shifts Focus, Pulls Out of Education

Clark Foundation Shifts Focus, Pulls Out of Education

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After three decades as a philanthropic pioneer in systemic school reform, the Edna McConnell Clark Foundation will phase out its work in public schools. The decision was fueled in part by what foundation officials characterize as the profoundly difficult task of forging lasting improvement in a system resistant to change.

The New York City-based foundation is restructuring, a move that will mean the end of its programs in student achievement, child welfare, and New York neighborhoods by late 2003. Foundation officials say they will focus their $20 million in annual grants solely on youth development.

Michael A. Bailin, who took over as Clark's president five years ago, said in an interview that he had "pretty much ruled out funding public systems" such as schools because he doubts that such a strategy can produce the kind of social change that forms the heart of the 32-year-old foundation's mission: helping low-income people.

"You have to ask: Is investing in big systems the best way to achieve our mission? And I decided that it wasn't," Mr. Bailin said. "Because in order to do that, you have to change attitudes and behaviors of people in a whole system. And talk about something that's hard to do—try to change a system. Even under the best of circumstances, it can absorb or co-opt the energy of the reformers. It takes an awful long time to know what's happening, and how it's paying off."

The shift represents a sea change for the Clark Foundation, which had made such efforts a hallmark of its work. For example, it has spent more than $47 million in the past decade trying to improve middle schools in nine urban areas, seeking to spur districtwide change while it worked nationally to deepen understanding of what makes middle schools successful.

Among its grants to other education-related endeavors, Clark awarded $115,000 last year to Editorial Projects in Education, the publisher of Education Week and Teacher Magazine, to underwrite special coverage of middle schools.

The foundation's decision to withdraw from large- scale education funding comes as philanthropies engaged in school improvement increasingly are questioning how to effect real, lasting change in America's public schools. At an annual conference last fall, education funders listened as colleagues from the Clark, Rockfeller and Panasonic foundations—three major players in the school improvement movement—spoke of the daunting challenges inherent in that work.

"All of us in public school reform are grappling with how you bring [change] about systematically and quickly enough, because we recognize the urgency," Sophie Sa, the Panasonic Foundation's executive director, said recently.

'Investment' Approach

Clark Foundation officials say their shift away from education was not made without pangs. "Every time you choose where not to put money, it hurts," said Mr. Bailin, who spent many years in the youth-development field, both in grantmaking and in research. "But at some moment, you have to shake loose from sentiment and say, 'What's going to work best?' and focus on making that thing stronger."

Cheryl M. DeMarsh, the director of middle school instructional support for the 95,000-student Jefferson County, Ky., school system, which received funding from the Clark Foundation for 10 years, lamented the foundation's decision.

"They played a very significant role from a national perspective in raising the awareness and commitment to middle-level education," said Ms. DeMarsh, whose district includes the city of Louisville. "They provided tremendous opportunities for school districts and schools to learn and try various reform strategies. Their influence, enthusiasm, and advocacy will be missed."

'Venture Philanthropy'

Along with narrowing its philanthropic focus to a single area, the Clark Foundation is adopting a very different style of grantmaking, one modeled after the investment world.

Under that approach, the foundation becomes a hands-on business partner, supplying large, long-term "investments" and technical expertise meant not just to run a program but to expand and strengthen entire organizations. Before making such a massive commitment, foundation officials intensely analyze potential grantees, and once money flows, hold them accountable for results.

The foundation's changing style is illustrated by how it connected with one of its new "investment partners," Boston-based Citizen Schools Inc. Instead of putting out a request for proposals, Clark officials interviewed experts in the youth- development field to identify groups that already had promising strategies in place, were "highly motivated" to grow, and had the "potential to influence the national scene," said Nancy Roob, the foundation's vice president.

When Citizen Schools—a nonprofit enterprise that runs after-school programs using an apprenticeship model—emerged as such an organization, Clark began what is known in the business world as "due diligence."

Over a four-week period, Clark staff members spent 180 hours interviewing the group's officials and examining its records to learn about its finances and growth plan, Ms. Roob said. That's a radically different approach from what is typical of grantmakers, she said, noting that it is not uncommon for foundations to award grants based on a proposal, a site visit, and a few interviews.

Mr. Bailin hopes not only to strengthen organizations that provide direct services to youth—such as mentoring, recreation, and job-training programs—but to build organizations that form the infrastructure of youth development. To increase that field's viability, he said, he will need additional funders, and he hopes to use Clark's own investment as leverage to secure those partnerships.

"Mike is doing something highly consequential," said Edward Skloot, the executive director of the New York City-based Surdna Foundation. "It's a leadership role in foundations, forging alliances with others to build the field. It's going to be one of the experiments the field will learn from."

Some observers call Clark's new model a classic example of "venture philanthropy," a businesslike style of funding popularized by the new wave of philanthropists who have made their fortunes in the high-tech world. But Mr. Bailin avoids the term, noting that it carries "freight" because it connotes an emphasis on bottom-line profits. Foundations can benefit from the business world's management practices, he said, without having "its value structurethe ruthless drive to make moneyshoved down their throats."

By any name, the new model is attracting attention in the world of education philanthropy. Mr. Bailin is the first major education funder to adopt the new style of grantmaking, and other foundations are watching with interest, said Laura Fleming, the executive director of Grantmakers for Education, a San Diego, Calif.-based advocacy group whose 200 members focus heavily on supporting education.

Mark R. Kramer, a founder of the Center for Effective Philanthropy, a Boston-based nonprofit research and education group, argues that the business model benefits nonprofits by shifting the focus from the success of specific programs to the viability of the organizations that provide them.

"It sounds like a hard- hearted approach, but if your goal is to use money to deliver social benefits, you have to pay attention to how effective the nonprofit is," he said.

Praise and Concerns

But in some corners, praise for the new approach is mixed with concern. Stanley N. Katz, a professor of public and international affairs at Princeton University, says a sharper focus and better- studied grantee choices "make great sense."

Yet he worries that the businesslike approach, with its emphasis on outcomes, could subtly change what many consider one of the great legacies of the foundation world: taking risks to support prescient projects even when they lack widespread popular support.

"If you are very oriented to outcomes, you are going to be more risk- averse, and that's a shame," Mr. Katz said. "One of the great glories of philanthropy is that it has taken a lot of risk. It's done what venture capitalists have done without worrying about short-run return."

Some welcome the shifts in approach, saying that there is room for varied styles. M. Hayes Mizell, the Clark Foundation's longtime program director for student achievement, says it's good that some foundations are taking a "radical and confrontational approach" to social issues, while others "focus on building the capacity of existing systems to make the changes they must make."

In Mr. Mizell's case, that happens to mean that he will likely leave his 13-year job once the student-achievement program is phased out. "This foundation, more than most in all program areas, has focused on an issue and stuck with it through thick and thin," he said. "But I never had the illusion that it meant forever."

Vol. 20, Issue 22, Pages 6-7

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