What will 2017 bring for the philanthropy sector? A difficult time, thinks philanthropy expert and Alliance editorial board member Lucy Bernholz. In the eighth annual version of her New Year predictions, she foresees more experiments with universal basic income, growing technical innovation in citizen oversight of government agencies and more money for disability rights. And above all, a looming crisis for civil society in the growth of digital data.

Among her predictions to this effect, and specifically for the US, she foresees that open 990 data (the US Internal Revenue Service’s Form 990 is the key source of public information on non-profit organizations) will be used to create indices of non-profit and foundation investment holdings.

Bernholz also foresees testing times generally for civil society under the Trump administration. She is not the first to do so, of course, but nails her colours firmly to the mast: ‘I disagree completely with the candidate and winning coalition’s proposed economic, healthcare, security, and foreign policy proposals,’ she asserts in the introduction to Philanthropy and Social Economy: Blueprint 2017 and predicts that actions taken by the federal government against journalists, non-profit organizations and non-violent activists will profoundly test Americans’ constitutional rights to peaceable assembly, a free press and free expression.

She also warns of the danger of the blurring boundaries between philanthropic and political activities, an abiding question which, she says, the US presidential election threw into higher relief.

As she puts it ‘we have neither clear rules for forms such as LLCs [limited liability companies] and donor-advised funds nor functioning oversight bodies to police the lines between philanthropic and political action.’

The result, she argues, is that both elements are badly served. The democratic basis of the political system is abused and ‘the confusion over what is appropriate and what is not makes all actors suspect, increases the transaction costs of legitimate non-profit activity, and weakens the public trust.’

This brings her back to the larger question for, meanwhile, ‘digital data practices meant to support transparency in political life can also reveal what is legitimately meant to be anonymous charitable giving.’

It now takes ‘a few clicks’ to reveal an institution’s financial activities, she says, and this is a situation that favours the dishonest, rather than the honest. As she puts it, ‘those with the motivation to do so, of course, simply get ever more creative at finding ways to keep their identities hidden, if not secret.’

In fact, she argues, ‘the very nature of civil society is changed by our dependence on digital data,’ and civil society needs to get to grips with the fact. ‘We cannot continue to act as if adapting our “analog” practices to digital resources will work… Digital infrastructure is not the same place as Speakers Corner in Hyde Park, London.

We need to create – collectively and urgently – new software code, new organizational practices, and new legal requirements if civil society is to continue to thrive in the digital age.

‘Especially in uncertain times,’ she concludes, ‘the organizations and activists who make up civil society need to understand, protect, advocate for, and use their digital data and infrastructure just as they use their financial and human resources — safely, ethically, and effectively.’

On a practical note, the report includes worksheets to help organizations conduct a digital data inventory, assess their institutional data capacity and outline their digital data and strategic planning.

Zohra Zori, Foundation Center vice president, who published the report with Bernholz on the Blueprint series, calls the report ‘a clear caution that the rules are changing and civil society has to protect its work and values.’

Click here to read or download the report.

See also
Dangers Civil Society Has to Address in 2017, Foundation Center, 14 December 2016, http://foundationcenter.org/about-us/press-room/archive/dangers-civil-society-has-to-address-in-2017

Lucy Bernholz is a senior research scholar at Stanford University’s Center on Philanthropy and Civil Society where she co-leads the Digital Civil Society Lab.
Email: lucy@lucybernholz.com