annualreport2015.kresge.orgThe Kresge Foundation 2015 Annual Report

Toggle navigation Brand -- HOME Letter From The Chairwoman Letter From The President FINANCIAL REPORT OUR IMPACT THE KRESGE TOOLBOX SOCIAL INVESTMENT PRACTICE PROGRAMS Arts & Culture Detroit Education Environment Health Human Services LEARN MORE  -- It Takes Change to Create Change By Elaine D. Rosen, Chair, Board of Trustees At The Kresge Foundation, being open to new ideas and new ways of doing things is essential to our underlying philosophy to expand opportunities for low-income people in America’s cities. When Sebastian S. Kresge established the foundation in 1924, it was with a basic mission: To promote human progress. More than 90 years later, interpreting this maxim remains the responsibility of my fellow trustees and the Kresge staff as we attempt to address the systemic urban issues that affect people living in the United States. That means embracing change — and being more strategic than ever in how we studiously manage the resources that have flourished out of our founder’s initial gift to the foundation. “Money alone cannot build character or transform evil into good; it cannot restore the influence and vitality of the home; neither can it maintain the valleys and plains of peace,” Sebastian Kresge said all those years ago. “Spent alone, it might as well stay in the vaults … it cries for full partnership with leaders of character and goodwill.” These words are still so true. The problems we confront today are not neatly rooted in a single set of causes. Our interventions accordingly must be multifaceted and interbraided. And we just cannot go it alone. There is no other person who would so skillfully lead the foundation’s approach to address this reality better than Rip Rapson, who, at press time, is marking his 10th year as Kresge’s president and CEO. Day by day, month to month, year after year, Rip has consistently impelled trustees and motivated staff to embrace a broader responsibility to lead. And 2015 was especially prolific, as the foundation charted a course to truly chip away at society’s most intractable problems by further aligning grants with our mission to expand opportunity; formalizing a social investing fund; institutionalizing a research, learning and evaluation practice; and doubling down on communication strategies. Program by program, staff assessed and embraced how they might expand pathways of opportunity for people living in our nation’s urban centers. They also committed themselves to work across disciplines in a unified, comprehensive approach rather than as a collection of programs pursuing separate goals. The foundation’s latest commitment to social investments is a prime example of Rip’s determination to further explore the chemistry of philanthropic resources with those of financial, government and community partners. At his urging, the Board of Trustees enthusiastically approved an ambitious plan to invest $350 million through Kresge’s Social Investment Practice by 2020. That commitment comes with a goal to attract an additional $1 billion from other investors, and we have no doubt it will be achieved. Such monumental outward shifts demanded internal muscle building as well. The staff has become deeply conversant in the lexicon and practices of finance. And through testing the edges of risk and the complexities of working across sectors, every program has now taken part in a social investment project, many of which are highlighted in this annual report. Over the past year, a new director of strategic learning, research and evaluation was appointed to help our program and social investment teams draw lessons and share learnings within and beyond the foundation to continually assess effectiveness. And through a unified and expanded voice, the foundation is attempting to influence legislative policy, convene and work with a wide range of partners to solve problems that limit — and scale solutions that expand — opportunity. A report from the National Center for Responsive Philanthropy in October 2015 commended The Kresge Foundation for being “bold, ambitious and outspoken in ways that disrupt and provoke the philanthropic sector. Few foundations have embraced risk as profoundly and publicly as The Kresge Foundation during the past decade; indeed, the foundation has moved 180 degrees from risk avoidance to risk pursuit.” You don’t achieve that without changing your mindset. The Kresge Foundation has — and, I assure you, it’s just the beginning. Elaine D. Rosen Chair, Board of Trustees Thinking Outside the (Tool)box By Rip Rapson, President & CEO Private philanthropy has continually struggled to balance the impulse toward reflection with the realization that what’s happening on the ground requires bold action and direct engagement. That balancing is necessary and appropriate. Without thinking long term, there is little integrative problem solving. But not heeding the drumbeat of today’s urgency brings overly tentative leadership and risk aversion. Generalizations are dangerous, but it is safe to say that during the last decade, philanthropy has moved toward the less certain waters of direct engagement with the challenging problems that have come to define the 21st century: from the existential threats of climate change to the unforgivable immorality of gaping income disparities; from stagnant college access and completion rates to the collapse of robust civil discourse. For The Kresge Foundation and many of our colleagues, a growing refusal to play it safe and small has fueled a new calibration toward taking risks equal to the magnitude of those challenges. Such a posture is possible only when we extract the full advantage of each and every tool in the philanthropic toolbox. Broadening Our Perspective The Kresge Foundation I joined in 2006 was defined by one tool: the capital challenge grant, which helped nonprofits complete capital campaigns for building projects. We believed that the inflection point of a bricks and mortar campaign would not only contribute to getting a building project across the finish line, but could also serve as leverage to precipitate higher levels of individual giving that would enhance an institution’s long-term stability and capacity. With our help, thousands of organizations did exactly that. It’s a legacy we remain proud of to this day. Along the way, we honed our discernment of those who could absorb and deploy capital most effectively. We cast broadly across a wide spectrum of disciplines — health, education, the environment, arts and culture, human services, community development. As it turns out, that was valuable intellectual muscle. Because in 2006, the Kresge Board of Trustees began a concerted journey beyond the fence line of its historic approaches. We couldn’t simply abandon precipitously what had served the nonprofit community so well; instead, we had to pace our change by shedding old beliefs and behaviors as more suitable ones emerged to take their place. That took a number of forms. We moved away from a reliance on fundraising prowess, instead emphasizing projects that fit our new values. We increasingly shed our agnosticism about the mission of the institution seeking our support, and gravitated toward organizations wrestling with the most pressing, gnarly issues of their field — improving postsecondary education access and success among low-income students, building greater resilience among multiservice human service organizations, attacking health disparities, adapting to the disproportionate effects of climate change on vulnerable communities, integrating the role of arts more fully into community revitalization. We explored how we might braid all of our interest areas into a mutually reinforcing set of strategies to help bring Detroit back from the precipice of economic, social and political collapse. Different forms of grantmaking offered a variety of entry points for attacking these challenges. Grants could buttress each organization’s particular ef...