The Grants Manager in Times of Economic Crisis

I subscribe to Breaking News, a service of the Council on Foundations that provides a daily e-mail compilation of philanthropy-related articles selected from a variety of regional, national, and international sources.  In recent months, on an almost a daily basis, there have been one or more articles related to the current economic downturn and how the philanthropic sector is responding.  In the wake of the bleak economic news, foundations are responding in a number of ways -- as many and as varied as our diverse missions and types of foundations suggest.  Whether or not you are keeping up with this barrage of news, it is certain that your own foundation has been impacted.  A former colleague of mine suggested that when she starts to feel anxious about the economic news and her own retirement portfolio performance, she reminds herself that “we’re all in the same boat.”  In the case of the foundations that we as members of the Grants Managers Network (GMN) serve, this is especially true.  It is evident that foundations across the country are doing everything they can to shore up investments and ride out the storm in order to better serve communities and individuals during this time. 

While I read the articles to stay current on the decisions being made in Washington and how the economy is impacting our sector, I have no real expertise in economics, budget deficits and analysis, or even market performance.  Some of you can probably relate to not understanding the intricacies of the economy, but you do understand what it means when your foundation’s assets have declined enough that there is talk about restructuring or cut-backs.  You may even be concerned about your own position and wonder how you can document the value of the grants management professional in your foundation should it become necessary.

The Grants Managers Network and its Impact on the Field of Philanthropy

“As philanthropy has grown in the United States and elsewhere, grants management has evolved from a collection of needed but ill-defined duties to one of strategic responsibilities that impact all facets of a foundation’s work.”
Staffing Grants Management, Defining the Standards for Philanthropy
- The Grants Managers Network, Inc.

Over the last 14 years, I have held the positions of Grants Administrator, Grants Manager, Director of Grants Administration and Associate Director of Grants Administration, and have managed from zero to ten staff.  Simultaneously, I’ve watched GMN grow from a small group of individuals in one region, meeting to network and talk about common concerns of grants administrators, to a national affinity group of the Council on Foundations.  Most recently, GMN has become a well-established nonprofit organization and recognized leader in promoting effective philanthropy and best practices, and offering definitive resources for the field such as “Staffing Grants Management, Defining the Standards for Philanthropy,” “Best Practices in Grants Management” and the “GM Guide.”  Today, GMN’s membership base includes more than 1,300 grants management professionals.

“The original idea for GMN was to build a network for mutual support around various grants management issues -- finding colleagues with whom you could share practices and frustrations within your effort to serve your position.  The field’s growth has been due to the incredible members of GMN; and it is evidenced in all the networking, product sharing, leadership and professional development.  However, in this economic crisis, grants management is as subject to job elimination as is any other position within foundations.  Endowments have been slashed and no one may be considered indispensable, but the skill set that any GMN’er has acquired will equip them for many different and exciting new ventures should their employment circumstances change.”
- Margaret Egan, Co-Founder, Grants Managers Network, Inc.

In the early years of GMN, there was the need to emphasize professional development.  This was due in part to the view held by some established foundations that the grants manager was a strictly administrative position.  When serving on the first national steering committee for GMN, I recall one member announcing to the newly-formed group that her foundation had just changed her title from administrative assistant to grants manager.  This signaled that the field was beginning to recognize the value of the role.  Indeed, there have been many small steps and some very large advances toward the professionalization of the field since that time.

The Grants Manager: a Vital Resource

“Today, professional foundations recognize that grants management forms a critical component of their organization’s structure.”
Staffing Grants Management, Defining the Standards for Philanthropy
- The Grants Managers Network, Inc.

I attribute the shift in recognizing the grants manager as a key and central function of any foundation’s professional staff to the impact of GMN on the field, as well as several external factors.  First, foundations are now viewing grants management as a critical role for operations.  Even smaller staffed foundations acknowledge that whether they can afford or justify a full-time grants management position, the functionality is still built into the responsibilities of a single program officer or staff person.  Second, there has been a shift toward viewing the role of the grants manager as vital to transparency and compliance in the new world of grantmaking resulting from such external factors as the September 11th attacks, and corporate scandals in 2002 and the resulting USA Patriot Act, Sarbanes-Oxley Act, and, most recently, the 2006 Pension Protection Act.  It is the grants manager who is required to implement or even create the policies and procedures necessary to comply with new rules.

The grants manager is responsible for oversight of grant processes, integrity of grant data, and compliance with IRS rules and regulations, and thereby can ensure accountability and transparency in an environment under a great deal of scrutiny, especially with the added strains of the economy.  The economic downturn and resulting losses in endowments and investment performance make the role and function an even more vital resource to the foundation as it focuses on streamlining grant processes, and even reducing operational costs, programmatic activity, and staff.  Foundation leadership must rely heavily on the grants manager for reporting accuracy, strict adherence to IRS rules, and process compliance during these times of sharp introspection and planning. 

Changes in grant terms and conditions, nonprofits closing, reduction in capacity, and failure to meet grant obligations are issues our foundations are now facing with greater frequency.  As Kenji Treanor, Grants Manager, James Irvine Foundation, recently stated in a discussion on GIGI (Group Intelligence on Grantmaking Information), “By handling amendments and rescissions, he/she ensures that grantees are acting as appropriate stewards of the foundation’s resources during this economic crisis....The grants manager is likely better equipped to correctly amend grant contracts, to update the foundation’s payout and/or accounting figures, and to reconcile changes in other documentation/compliance systems.”

As numerous articles suggest, foundations are indeed responding to this crisis, some by reducing their payout and others by boldly stepping forward and increasing their grant giving.  Some have even shifted or set aside their strategic programming in favor of providing core operating support to their grantees.  In this climate of change, it is the skilled and professional grants manager who can assist and support the foundation as a vital resource to the communities and individuals it serves.

“In these dire economic times for individuals, nonprofits and communities, the work of philanthropy assumes an even greater significance. At our best, I think of foundations as ’knowledge centers’ that hold great stores of information about effective solutions, failed experiments and promising practices earned through the hard work of nonprofit grantees. As foundations, we have a responsibility to mine that social intelligence and share it broadly to better serve our communities. Grants managers are critical team players in the stewardship of this knowledge along with program staff, foundation leaders and board members."
 - Richard Woo, CEO, Russell Family Foundation