Funder Focus: R. Michael Mears and the Calgary Foundation
September 2, 2003
By Nicole Zummach
This month in our Funder Focus, we feature the Calgary Foundation,
a community foundation that was established in 1955 by citizens who
recognized the importance of building and ensuring a healthy, safe,
and nurturing community. CharityVillage spoke with president and CEO
R. Michael Mears about the evolution of the foundation, its approach
to funding, and the necessity of collaboration within the philanthropic
sector.
CharityVillage: In recent years Calgary has experienced tremendous growth in its economy and the diversity of its population. Has this boom affected the foundation?
R. Michael Mears: In a word, yes. We believe that it is as a
result of the quality of the product and the trust and integrity that
the foundation has developed over its 48-year history that we have been
as successful as we have. Like any business - we apply business models
to our philanthropy - we believe that we display that trust element
to the community and therefore that attracts investments to the foundation
by virtue primarily, of building what I call creative philanthropy.
We are not just a cash-taker or a stock & bond. We provide to our client
base a host of options that all fall within the CCRA regulations. That
provides them the tax benefit, but also, and perhaps more importantly,
the opportunity for them to place their philanthropic dollars through
us back into the community in a way they would desire, as if it was
their own private foundation.
CV: The foundation describes itself as a 360-degree grantmaker.
What are some of the unique challenges and benefits of this all-encompassing
approach to funding?
RMM: Because we are a community foundation we have within our
group of funds a community fund. This community fund is only one component
of our asset base, representing approximately $20 million of our $180
million. About 5% of that, or about $1 million a year, is allocated
to go to the 360-degree granting cycle of charities within the Calgary
community. That doesn't mean that we specifically take dollars from
that million and allocate so much to each charity. But charities have
the prerogative to apply to the foundation for grants, depending on
their discipline.
It is challenging because some charities are much more aggressive and have more experience than others in terms of putting applications together, being creative, and so on. So we need to be able to look through all of that, even for the ones that aren't so sophisticated, who may have a very good project to support, but aren't able to express themselves in, perhaps, as sophisticated a way. We need to go out and do our homework and really delve in and look at these particular grants. So we would, in fact, go to the charities and see where their place of business is, see what they are up to, and really get a grassroots, hands-on evaluation of what they are doing in the marketplace. There are some charities that are just running on a shoestring, and they do wonderful work but they are not sophisticated. They don't necessarily even have a computer. That's why we need to get out into the community and not be sitting in our offices. We want to really understand what is going on on the front line, and we take a lot of pride in doing that.
Going hand in hand with our 360-degree approach, we are able to meet
with our larger donors, who might ask us, 'where do you think we should
put a segment of our granting this year?' This is under our donor-advised
category. We are able to suggest to them some of these unusual granting
requests, because the donors simply wouldn't be as close to the picture
as we are. In that way we get some leverage. So we might put up $10,000
for a soup kitchen and we might say to someone with a donor-advised
fund, 'why don't you match our contribution from your fund and let's
give them $20,000 because this is a really good project.'
CV: You recently refocused the application process of your community grants program. What changes were made and what prompted this action?
RMM: We are trying to do two things. First of all, we are trying to make it paperless. Everything is done electronically. Most people have a telephone, so the first step is to pick up the phone and call us. To put an application together takes time and effort, so we have a chat with every proposed applicant to see, first of all, whether they fit our guidelines, and then determine how sophisticated they are and see if we can help them along before they even get to making an application. Maybe they don't have a computer and are not able to submit electronically, in which case we can make an exception. However, in most cases we encourage them to try and do it electronically. Certainly, from our standpoint, it is more efficient, but it also pushes them to, perhaps, get into the 21st century. They must realize that they are competing with a lot of other charities. In most cases they can find a friend or someone who has that ability. We believe it is the way of the future and that it makes the process more efficient for everyone.
Still, we really concentrate on maintaining a personal touch. So when
you call us there is a real live person at the end of the line, not
just push button '1', push button '2'. That works well in some businesses,
but in our particular business we like to have the direct hands-on,
one-on-one, talking to real people.
CV: Earlier this year, the foundation announced the largest
gift in its 48-year history - $15 million from Calgarian Bob Kolstad.
How does receiving a gift of this magnitude affect the foundation and
the community?
RMM: This is what I mean about creativity and understanding the business model, which is very important. To receive the assets of an oil and gas company is wonderful, but oil and gas can be a complex business so it's important that we understand as a foundation what is being offered to us and whether we can handle it. In Bob's case he gave us his personal assets and part of that was his company. A big component of the $15 million was the company, which is made up of oil and gas royalties. The power of the gift was that we were able to acquire all of his assets and convert them gradually into cash and then put that cash into our pool funds.
Being our largest gift, we certainly marketed that in the community. Bob Kolstad was an unusual gentleman. He was a bachelor. He was very quiet. He was unknown in the community. So people are asking us the question, 'how did you find this fellow?' We worked with him for two years before he made his commitment. This comes back to what I said earlier about building confidence with the donor, or any client, and really going out of our way to help them fulfill their wishes. Bob didn't have a lot of family. He made all of his money in Alberta and he wanted to see the money he had made go back into the community at large.
CV: Each year the foundation identifies unique opportunities and pressing issues that deserve special attention. What initiatives are in the works right now?
RMM: We often get asked, 'what would be your number one project?'
and we have some wonderful donors who have done some fantastic things.
But our message this year is that the foundation is giving back to the
community what we have designated as 'quality of life'. This is a living
monument, a continuing monument, a day-to-day monument of trying to
improve the quality of life within the community.
We had a record year last year in terms of grantmaking, primarily because
of people like Bob Kolstad and many others. In fact, we brought in the
highest amount of gifts ever in our 48-year history in 2002, $36 million.
As a result, we were able to give back to the community the most we've
ever done, which was $13 million. When you put all that together there
are some wonderful stories there, so that is why we are calling it the
quality of life scenario. We are trying to build on that and let people
know that it is not a one-shot deal. It's not building a children's
hospital wing, which is wonderful, or a park, which is wonderful. We
are here for the community everyday to try and make life that much happier
and healthier.
CV: How has the foundation evolved in light of the growing emphasis on the importance of governance and accountability within the nonprofit sector. What is your approach?
RMM: Accountability is very high on our list. We've been at this
a long time and huge credit goes to my predecessors, who had the foresight
to realize how important corporate governance and ethics is. We have
extremely good corporate governance. We have a very solid board and
committee structure, and it's not just words. It's carefully laid out
so that when a new board member or committee member comes on board we
can hand him or her a manual and say 'this is what is expected of you.'
It's the same as if you are a director of a company; you have fiduciary
responsibilities legally, as you do in a charity. So we make it very
clear that there is no difference between being on a board for the Bank
of Montreal or the Calgary Foundation. The obligations are not dissimilar
between the two. It's all carefully laid out for them and we put a lot
of emphasis on that. In fact, as we speak we are writing a new ethics
manual because things have changed and we believe in keeping these things
up to date, practicing what we preach.
CV: On your web site you discuss the concept of collaborative philanthropic leadership. What does this mean for you and how important is it to the sector as a whole?
RMM: It's huge. The foundation has been built on the generosity
of individuals and we pay a lot of attention to our donors. But we realize
that that is only one segment. The corporate sector does wonderful work
in the philanthropic area, as do private foundations. So why wouldn't
we work with them to assist the kind of work that they do? For example,
it might be Petro-Canada or EnCana who have a particular focus on children,
let's say. Well, we do a lot of work with children, so why wouldn't
we talk to Petro-Canada and say, 'look, we know you are supporting this
child initiative and we have some donors who are interested in that.
Let's partner and we will match your number or a portion of it for a
particular project.'
In fact, we are about to set up what we call a corporate champions breakfast
series, where we will invite CEOs of the major corporations in town
to come and tell their stories about the great work they are doing in
the community. It's an easier sell because it is the Calgary Foundation
saying, 'come and hear about the great work that Shell or Hudson Bay
Company is doing,' as opposed to them just standing up and blowing their
own horn. This way they are being invited to blow their own horn. Those
are the kinds of things we are doing on the corporate side.
On the private foundation side, because of my knowledge about private
foundations, I can say that it's expensive to run a private foundation.
We public foundations can do everything that a private foundation can
do, so when I go and talk to private foundations I explain to them that
there are better tax breaks with a public foundation than with a private
foundation and you can have a foundation within a foundation. We have
a whole list of foundations that we look after. You can still decide
exactly what you want to do, as you would in your own private foundation.
We do all the filing and returns, we write all the cheques. Why would
you want your own private foundation?
Then there are the charities themselves. We have a number of charities that have done very well and have set up their own funds. They don't have the sophistication to manage the funds so they ask us to manage their funds for them. So we do that. We work with them and their money gets pooled with ours. They get the benefit of the volume and they save investment and custodial fees by virtue of the bigger volumes. It's big business and one needs to really listen and pay attention and I think that has, perhaps, been part of our success. We are prepared to get out and look at new opportunities and see how we can help. We love partnerships and trying to be creative.
Community Foundations of Canada, of which we are a member, does great
work for community foundations as a whole in terms of the larger picture
across the country. We don't by any means think that we have all the
answers. Very good ideas come out of other communities that have tried
things and they share those ideas with us. Certainly they need a pat
on the back for the great work they do in coordinating things on a national
basis, things that we, perhaps, wouldn't otherwise be privy to.
CV: Where would you like to see the foundation in the next few years? What's next?
RMM: Calgary is a very rapidly growing city so we need to stick to our knitting. By that I mean pay attention to what is going on in a growing metropolis. As cities grow and become more complex we need to stay tuned to that complexity. We also need to pay careful attention to understanding the different cultures that make up the mosaic of a city. We need to continue to demonstrate to our current donors that we are doing a really good job for them and they are getting a good return on their investments so that they and their children will continue to look to the Calgary Foundation as their foundation for the future. By doing that, we will build our asset base and the more we can build our asset base, the more we can help the community. So those are a few things we have our eye on for the future.
R. Michael Mears has been with the Calgary Foundation since 2002.
Prior to that he worked in the business sector and managed a private
family foundation. For more information about the foundation, visit
www.thecalgaryfoundation.org.
