Who Owns Our Federations? That is the Question.

What needs to be examined now is whether or not today’s Federation, as an organization, has been framed to fulfill the tasks it has assumed and whether it can be what it claims to be.

shutterstock_295110221By Martin Levine

It is more than a century since the concept that is the Jewish Federation took root in Jewish communities across North America. And those roots did indeed grow strong and have provided sustenance to the remarkable vibrancy of American Jewry. Few organizations of any type have been as successful as have Federations. Key to the Federation Movement’s achievements has been its resilience and ability to change its focus and interests in response to changing times and needs. But have those changes in operations been supported by changes in the governance and engagement that are in tune with these times?

The impact of millions of poor eastern European Jews immigrating to the United States threatened to overwhelm existing communal structures. They arrived before much of today’s government sponsored “safety net” were in place, leaving new comers to rely on the support, if any, of their families and extended communities. Existing Jewish organizations struggled to adapt to a new American Jewish landscape and new organizations emerged to fill gaps in the existing community network; demand stretched supply and there was a critical need for increased philanthropic support. The leadership of the established Jewish Community mobilized in response and strived to manage an increasingly chaotic “philanthropic marketplace” and reestablish communal order and regain control of fragmented communal efforts. The Federation as we know was the product of that moment.

The assumptions of organizational ownership and a governance structure that are the Federation as we know it emerged as it was formed. “In its broadest sense, the Federation form of organization is designed to constitute a coordinated program for communal philanthropic agencies by supplying a central body for the collection and distribution of funds intended for charitable purposes… Money is not democratically spread throughout the community; and, in order to secure large funds for communal enterprises it seems (sad as it is to relate, but explainable because it is human) that it is necessary to give a disproportionate representation to the wealthy element.” (Evolutionary Tendencies in the Jewish Federation Movement, Maurice B. Hexter, Jewish Communal Service Association of North America (JCSA), National Conference of Jewish Social Service, May 1926) . Emerging Federations regulated the philanthropic marketplace by coordinating the process of raising and allocating funds and retaining communal power in the hands of the wealthy and established.

The success of the Federation movement is clearly marked by how it has been able to reshape itself over the years. In response to a changing Jewish community and the great changes in the global community, Federations broadened their purpose and took on new tasks that moved it beyond “just” effectively raising funds and coordinating their allocation to organizations providing community services. If in the beginning there was a demarcation between the Federation’s role as resource developer/allocator and the role of the service organizations which performed the actual work of community service, over time that distinction has been blurred, even obliterated. Federations have become more functional and direct providers of services. They have taken on the role of community planner, priority setter and evaluator. With the growth of public support for key social and educational services, Federation has taken on the role of advocate and spokesperson for the Jewish Community as whole. As government support for a range of human services has grown, Federation has sought to speak for the Jewish Communities needs and to ensure that our community gets its share of available government funds. With the birth of Israel, Federations assumed the responsibility for building and maintaining American support for Israel’s security and political needs. With growing evidence of the decline of traditional definers of Jewish life, Federations have stepped into the vacuum and assumed the role of Jewish Community builder and sustainer.

Federations now self-describe themselves as “… the central address of North American Jewry.”

What needs to be examined now is whether or not today’s Federation, as an organization, has been framed to fulfill the tasks it has assumed and whether it can be what it claims to be. That structure has over time remained relatively static. It continues to use the quasi-democratic structures required by the laws that govern nonprofit organizations while maintaining real power and control in the hands of the wealthy and influential. Control of the purse and access to the philanthropic community is a powerful lever to maintain communal order and control.

Writing in 2002, Judith L. Millesen, associate professor at Ohio University’s Voinovich School of Leadership and Public Affairs observed that “few would argue against the notion that boards of directors are supposed to represent the interests of “owners.” Yet, despite the intuitive importance of specifying ownership, over 70 percent of nonprofit board members interviewed regarding their perspective on ownership and accountability believed that they were accountable only to their board – or to no one at all. ”

How would those who lead our Federations today answer that question? Who are the “owners” that they represent and are responsible to?

In speaking for the Jewish Community, Federations cannot see their accountability mostly to those who are contributors. The role of community leader requires more than being just another membership organization.

What is needed is a hard and dispassionate look at how the structure of Federation reflects the larger role they have assumed and wish to continue to play in Jewish Communal Life. It means being brave enough to change what is not yet fully broken. Rather than assuming today’s success justifies staying as we are, we (Federations???) need to build a structure that is more open and representative of whole community.

Reforming how Federations are governed so they are more fully aligned with the responsibilities they have assumed will not be a simple or painless endeavor. It will threaten the interests of those who lead today, it will risk losing the support of long time donors who like things as they are and it will require investing in more robust methods of engagement. With critical human needs being met by the great sums raised, Federations will need to find ways to smooth the period of change so that those who are most needy don’t become victims of change. Is greater engagement and power sharing worth that risk? I think it is.

If we stay as we are, we risk a loss of authority and effectiveness. As survey after survey has shown, those who feel disconnected and unengaged can and will just walk away. While the financial implications of this attrition may not be as great as the risk of major donors, it will weaken us as a community and defeat the goal of speaking with a single powerful voice.

If Federations wish to remain as more than fund raisers and allocators, this is a struggle worth engaging on.

Is a conversation about power sharing and an open process a conversation that Federations will be willing to have? I hope so but fear not.

Martin Levine is a Principal of Levine Partners LLP, a consulting group focusing on organizational change and improvement, realigning service system to allow them to be more responsive and effective. Prior to forming Levine Partners, Mr. Levine served as the CEO of JCC Chicago. He is an occasional contributor to Nonprofit Quarterly.