A Midwestern Funder’s Big Racial Justice Pledge Follows Years of Work on Diversity and Equity
/
The Bush Foundation’s board of directors. Photo by jeff Achen, courtesy of the foundation.
In March, the Minnesota-based Bush Foundation announced that it would devote $100 million to increase the wealth of Black and Native American communities in the funder’s service areas of Minnesota, North and South Dakota, and the 23 Native nations within those areas.
That announcement by itself was a big deal. It’s among the largest racial equity funding initiatives in the country, especially notable coming from a regional foundation. But it truly stands out for the way this money will be moved, and the years of work foundation leadership did to reach this point. The conditions making it possible for Bush to pursue this approach may provide clues for healing the frequent staff-trustee divide on diversity, equity and inclusion, among other issues, that Inside Philanthropy reported in a series of articles last fall.
The first thing to know is that Bush’s intention for the $100 million is to seed two “community trust funds.” These will address wealth disparities caused by historic racial injustice by recruiting two local “steward organizations” to design and manage the grantmaking, according to the funder’s announcement of the gift. After the steward organizations are ready and Bush’s money is out the door, “it is their money. They will be figuring out what to do with it,” Bush Foundation President Jen Ford Reedy told Inside Philanthropy.
The funding comes from a social bond offering issued by the foundation in 2020, making it one of several philanthropies that strategically took on debt to temporarily increase giving. Bush also committed $50 million in additional racial justice funding through its regular grantmaking channels.
The second thing to know is that Bush began the process all the way back in 2012, focusing heavily on equity and taking such a hands-off approach to giving. That was two years before the Ferguson uprising, and eight years before George Floyd’s murder sparked what is hopefully an ongoing “come to Jesus” moment, in the country generally, and in philanthropy specifically.
Building a truly diverse board
Bush’s work has yielded notable results. In a field where 85% of foundation board members are white, the makeup of Bush’s board is 62% BIPOC. Given that BIPOC populations in its coverage areas comprise roughly 19% in Minnesota, 15% in North Dakota and 17% in South Dakota, the funder’s success in creating such a diverse board suggests that other foundations’ trustees remain predominantly white due either to bias or simple lack of effort.
However, Bush’s board recruitment efforts don’t focus on racial diversity alone—in fact, racial diversity is just one of its recruitment criteria. Diversity of geography and of lived experience and viewpoint are similarly important.
In a 2019 “Note from Jen” on the foundation’s website announcing the appointment of two new board members, Reedy explains that selection criteria include “race and geography and sector,” for example, people from both eastern and western North Dakota, immigrants, and people who are conservative politically.
But just as Bush looks for individuals with diverse perspectives and experiences to serve on the board, it is also looking for people who share certain character traits, including “cultural humility,” an ability to become excited supporting the ideas and efforts of others, and ability to balance active listening and contributing to discussions. Bush isn’t shy about what it’s looking for in its board members; the entire list is included in the 2019 post.
“We are really clear on what makes a good Bush board member and their specific attributes,” Reedy told me. She added that she constantly engages in outreach to identify potential board prospects before swinging into recruitment mode, rather than waiting for a position to open up. In her 2019 note, Reedy said, “At any given time, our board’s Governance Committee has a list of 10 or so prospects under active consideration, whether we have openings or not.”
This continuous process allows Reedy to filter out prospects who aren’t a good fit before approaching them about a board opening.
“I think sometimes, when people diversify boards and it doesn’t go well, it’s because they’re choosing someone just because they want to have a different race represented on that board or they’re choosing them just for their diversity,” Reedy said, instead of being “really thoughtful and intentional” about the specific attributes needed to cultivate “a highly functioning, strong board.”
Bridging the board-staff divide
Trustees and staff frequently do not see eye to eye on any number of issues. They often have different worldviews, political leanings and professional backgrounds, which can stifle a foundation’s progress or lead to outright dysfunction.
Being thoughtful about board makeup is part of the solution, but for Bush, preventing any potential rift between board members—and between the board and staff—goes well beyond recruitment. In a learning paper by Reedy and then Bush Board Chair Pam Moret, the duo spell out the entire process of how they work together. Elements include scheduling small group and paired discussions during board meetings that are designed to build “social capital” between board members; continually bringing the board and staff leadership together; and hosting annual lunches where small groups of board members and all levels of staff eat together and share “free-ranging conversation.”
The process also includes accountability—both staff accountability to the board and the board members’ accountability to the staff and to each other. Bush conducts performance reviews of its board members at each member’s one-year anniversary, and then annually after that.
“This is not a pro forma process,” Moret and Reedy say in their paper. “In the past few years, we have not renewed terms for three board members, who were all terrific people and engaged board members, but did not fit the attributes we were looking for at that time.”
As my colleague Mike Scutari reported in November, trustee accountability has emerged as an issue that needs attention if philanthropy is truly serious about making strides in the equity arena.
Diversity leads to a happy board
After working out and fine-tuning this process since Reedy became president in 2012—Bush is in the second version of its board recruitment plan, for example—Reedy told me that “the commitment to DEI within board recruitment is in a virtuous cycle phase.”
“As we bring people on that share and value this commitment, and as we practice living this commitment, it gets easier and easier to have a board culture that supports it and pushes us further,” she said.
As it turns out, Bush’s near-constant work on and with its board has also had happy returns for the members. “Our board members feel they love being on the Bush board because of the diversity of the Bush board,” not just racially, but “on so many dimensions.” Their fellow board members, Reedy said, constitute “one of the most diverse groups that [each member is] around.” And when new members join the board, Reedy said, the current members’ response is, “How are they going to challenge us? How are they going to make us better?”
If the Bush experience is any guide, the lesson seems to be that while recruiting and managing a highly diverse board is an ongoing effort, that effort pays off—both in terms of cultivating happy, productive board members and in terms of what the board allows a foundation to pursue.
“The assets belong to the community”
Which brings us back to that $100 million. Because while, according to Reedy, the funds will belong to the organizations they choose as stewards, Bush also needs to be mindful of its own obligation to use the money wisely. To meet that obligation, Reedy said that Bush is determined to find two administering organizations that can each handle and distribute $50 million (or with help become ready to do so) and “have a process and program that’s authentically community informed and engaged.”
Bush will help the chosen organizations get ready with an initial investment of up to $500,000 each, then split $50 million between the organizations over two years. They hope to cut the first $50 million in checks in 2022. Reedy said they decided to move more money quickly by issuing the bonds because, in the long run, the relatively quick infusion of cash will leave the community better off—and low interest rates mean the foundation will be making payments at a lower rate than its investments accrue more income.
The bottom line, Reedy said, is that “there’s no distinction between what’s good for the Bush foundation or what’s good for the community, right? The assets belong to the community.”
