The Winding Path to Being a Foundation CEO

The annual Council on Foundations (COF) conference, which will kick off this weekend in Los Angeles, features an interesting new track for “aspiring” foundation CEOs. The sessions are designed, according to the COF website, for “those with more than five years of senior management experience who expect to be foundation CEOs in the next three to five years.”

I think it’s terrific that COF is seeking to cultivate future leaders in philanthropy – and taking on the issue so directly. I can think of few things more potentially significant for organized philanthropy than ensuring that the crop of future foundation CEOs is as strong as possible. Independent Sector has brought the issue of “next generation” leadership into the spotlight in recent years with its NGen Fellowship and related programming, while other organizations, such as GEO, have also focused on the issue. This spotlight on future leadership talent is welcome to anyone who cares about effectiveness.

But I wondered: Will anyone sign up, knowing that doing so signals to their colleagues their ambition to run the place? And, another question: Is cultivating the dreams of foundation staff to move to the corner office realistic or cruel – given that foundation boards often look outside their walls, and outside philanthropy, to fill the top job?

On my first question, we’ll see whether conference attendees show up for the “aspiring CEO” sessions (note: I learned yesterday that, in fact, a number have signed up) and whether, if they do, they sneak in through the side door to avoid being spotted by their colleagues. On the second question, I thought it was worth exploring the career trajectories of the current crop of CEOs of the 100 largest foundations – the very juiciest of the plum philanthropy jobs.

So I asked a CEP research analyst, An-Li Herring, to check it out. She reviewed the websites of the 100 largest foundations in the US, as listed by Foundation Center, and reviewed the biographies of CEOs for every foundation that provides one. She categorized CEOs on the basis of their immediate past position and here’s what she found:

  • The majority – 60 of the 100 CEOs – came from outside foundations.
  • Twenty-one were promoted internally – that is, their previous position was as an executive at the same foundation where they now work as CEO.
  • Seven came from another foundation – although, of those, four were CEOs of the foundations they came from (and three of those four had come to their first foundation CEO gig from outside philanthropy).
  • Four had past experience that could only be categorized as “other” from the available data.
  • Eight were unable to be categorized at all due to insufficient biographic information or lack of clarity regarding who serves as CEO.

So where did the 60 CEOs from outside the foundation world come from?

  • Twenty-seven had experience in the nonprofit sector broadly defined:
  1. Those who ran operating nonprofits (not including institutions of higher education) number 14.
  2. Those whose experience was in higher education, typically as a college president or dean, number 13.
  • Seventeen came directly from a role in business.
  • The remaining 16 CEOs who came from outside the world of organized philanthropy had positions in government, law, or other domains.

What does this all mean? I think it’s possible to draw a few conclusions from the data.

First, internal promotion to the CEO job at foundations is not that common … but it does happen. More programming like the COF sessions is a positive step, in that it can help those who might be thinking they aspire to the top job figure out how to develop in ways that will make them stronger candidates. But the data suggests that attendees at the COF sessions should keep their ambitions grounded in the reality that making it to the corner office is a long shot.

Second, foundation boards don’t much value experience at other foundations. Again, perhaps a focus on leadership development within philanthropy will change that, but moving from being a Vice President at Foundation A to CEO of Foundation B happens only very rarely (at least at the largest 100).

Third, experience as a grantee, if you exclude colleges and universities (which I’d argue are a different animal) isn’t much valued by most foundation boards when they’re searching for a CEO. It’s striking that there are more foundation CEOs who came to the position from a job in the corporate world than a job running a nonprofit (again, excluding colleges and universities).

The decision of who to hire is arguably the most important one a foundation board makes. For any given foundation, the right person might bring any of a wide range of relevant backgrounds to the role. Moreover, it probably serves foundations and the nonprofit sector to have CEOs of the largest foundations represent a diversity of experience. Just as some have raised alarms about too many foundation CEOs who are college presidents, or business types, I doubt anyone would want all the CEOs of the big foundations to be internal promotions – or even to come from the nonprofit sector.

All that said, I’d still argue that boards might want to prize operating nonprofit experience more highly than they apparently do. Leaders who have experienced the pressure to meet payroll with no endowment to fall back on, and have felt what it’s like to be on the other side of the table from foundations, bring something important. They come to the role with a hard-earned understanding of the challenges of doing the on-the-ground work foundations fund – and of what nonprofits really need from their funders.

I’d also argue that foundation board members that have reason – and data – to believe their foundation is operating effectively should make the cultivation of potential internal successors a high priority. If your foundation has clear goals, coherent strategies, is implementing those strategies well (and operating smoothly), and possesses data that suggests its strategies are working, then boards should look carefully internally.

Current CEOs can help, by making it their focus, too. After all, if they believe in the effectiveness of what they’re doing, and that belief is informed by hard data, then cultivating a successor to carry on the work is the right thing to do from an impact perspective.

A first step might be encouraging their eligible staff to attend the COF track for “aspiring CEOs” – or even paying for disguises so they can go incognito.

 

Phil Buchanan is President of CEP. Thanks to An-Li Herring for the research highlighted in this post.

 

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