**UNITED STATES AGENCY FOR INTERNATIONAL DEVELOPMENT**

**CFBCI PARTNERSHIP CONFERENCE BREAKOUT SESSION:**

**CAPACITY BUILDING RESOURCES**

**WELCOME AND MODERATOR:**

BARNEY SINGER,

PROGRAM DIRECTOR, CAPABLE PARTNERS PROGRAM,

AED CENTER FOR CIVIL SOCIETY AND GOVERNANCE

**SPEAKERS:**

ANN BELTRAN,

PUBLIC POLICY ANALYST,

NATIONAL COUNCIL OF NONPROFIT ASSOCIATIONS

SUSAN MEIER,

VICE PRESIDENT, CONSULTING AND TRAINING,

BOARDSOURCE

THOMAS CAMPBELL,

PROGRAM MANAGER, COMPASSION CAPITAL FUND,

U.S. DEPARTMENT OF HEALTH AND HUMAN SERVICES

ANETA WIERZYNSKA,

SENIOR POLICY DIRECTOR, TRANSPARENCY INTERNATIONAL

CLAUDIA HORN,

PRESIDENT, RESULTS TECHNOLOGIES SOLUTIONS

**FRIDAY, NOVEMBER 7, 2008**

*Transcript by*

*Federal News Service*

*Washington, D.C.*

BARNEY SINGER: Good afternoon, everybody. We're going to go ahead and
get started. If you would like to, you're invited to come up closer to
the front and we'll start in just about 30 seconds or so.

Welcome, everybody to this afternoon session on capacity-building. We're
going to be focusing on different aspects of capacity-building and some
resources that are available to support your work. My name is Barney
Singer and I work for an international NGO called the Academy for
Educational Development, which I'll tell you a little bit about in just
a second.

What I'd like to do today is briefly introduce the organization that I
work for because it's actually one of the intermediary organizations
that many of the speakers have talked about. So in our work in -- we're
in 200 countries around the world. We are often working with faith-based
and community organizations. So it's an example of all the types of
groups that really benefits from our engagement with those of you who
are doing work in the field. Second, I'd like to give a very brief
overview of capacity-building to answer four questions that our
panelists will look at in greater detail: what capacity-building is, why
it matters, where you should start and what resources are available. And
following that, we will hear from our wonderful panelists.

So to begin with, the Academy for Educational Development, or AED is an
NGO. We are, as you heard from the last panel, we're registered with
USAID and have been for most of our life. We're nearly 50 years old and
with many of your organizations, we started very small. We were started
by two retired Peace Corps volunteers in one of their basements and over
the years, we have grown to the point where now we are implementing
programs in every state in the United States and in 250 countries. So we
have a quite strong global presence and work with partners from every
aspect that we can.

Our mission, similar to many of yours, is really to improve people's
lives and to solve different kinds of critical problems that people
face. And so we do that by working in the areas of education, public
health, the environment, civil society, capacity-building and every
other sector in which USAID is involved. The two points that I want to
mention that I think are the reasons why I'm here speaking with you
today are that USAID and U.S. government, in general, is AED's
number-one funder. And capacity-building is built into everything that
we do during our program implementation. So over my nearly 10 years with
AED, I've had a lot of experience working with the U.S. government and
USAID in particular and I'm hopeful that the comments that I'm able to
share with you will come out of my experience and hopefully be useful as
you think about your own organizations.

So the first of my four questions is what capacity-building is. So since
we have moved into the computer age, I decided to put capacity-building
into the Google search engine, with which I'm sure most of you are
familiar. And there were 17 million hits. (Laughter.) The first one was
from the online encyclopedia, Wikipedia, which you may have heard of.
And it gives a very broad definition of capacity-building in the
international development context. And there were many others that I
thought were useful, both from my Web search and resources that I have
on my bookshelf. But the one that I think is most appropriate for our
conversation is the bottom one on the slide, which comes from a
wonderful book from Barbara Blumenthal called "Investing and Capacity
Building." And it's very simple -- actions with focus -- or excuse me,
actions that improve nonprofit effectiveness -- actions that improve
nonprofit effectiveness. So that's really our focus today. How can we
help you be the most effective organizations that you can be?

In order to that, the focus is not on capacity-building; the focus is on
capacity. So the question that you should ask yourselves when you go
back home is what kinds of capacity or what capacities you need in order
to do your work and be effective? Now, there are lots of ways that
people define capacity and there are lots of different lists that you
can find in various resources. So there's a lot of ways to slice the
pie. But the way I've chosen to define it for today is to separate it
into organizational capacity and technical capacity. Organizational
capacity speaks to things that help your organization run as an
organization. So it includes things that are on this list such as your
financial systems, your management, your human resources, monitoring and
evaluation, governance, how your organization operates, compliance was
mentioned in the last panel, how you comply with various either donor
regulations or laws in the places that you operate and external
relations.

So those, you can think of as all systems that are important to the
functioning of your operation. Each one of those is really a very broad
umbrella topic in its own right. And so for example, the area of
financial systems can be broken down into many, many parts, a few of
which might involve things like accounting and budgeting, financial
controls, financial reporting. And as you -- as organizations become
more sophisticated and if you're interested in working with and getting
funds from the U.S. government, each of these little sub-areas becomes
more and more important for your organization to consider.

The second half of the equation is the technical capacities. And really,
you can think of technical capacity as the activities or the programs or
the interventions that your organization undertakes and make a
difference. And that's really why I got into this work and I'm sure why
you got into this work because you're passionate about something. You
want to change somebody's life for the better. So the technical work
that you do is critically important, obviously. But it's, in my opinion,
it's the marriage of the technical and the organizational capacity that
is key to your sustainability as an organization, and really your
effectiveness as well.

So when we look at the technical and organizational and
capacity-building, there are many ways that you can build the capacity
of the organization. Some of those include things like technical
assistance from other people, training, mentoring and coaching, learning
from each other -- which is terribly important, and also, taking
advantage of the many, not all 17 million, but the many resources that
are available. I cannot say how surprised and pleased I am that you
know, the Internet has made so many wonderful things pretty easily
accessible. And for those places where connectivity is not yet up to
speed, there are programs and offices within USAID and organizations
like mine that kind of assist in making resources available on CD-ROMs,
for example, if not in hard copy.

So the second question is why capacity-building matter? Well, the key
reason it matters is because it -- it makes the difference for your
organization's ability to meet its mission in serving beneficiaries.
That's the number one reason why you might want to take time and
resources from delivering services to people to focus on building
capacity that's going to help you do your work better. I saw a wonderful
quote in one of the papers that I read in preparing for today by
McKinsey, a company, that "Great programs need great organizations
behind them to produce sustainable results." And I really believe that
that's true. The greatest program, as was indicated in the last session,
you know, if the funding, you know, ends or when the funding ends, if
you haven't prepared yourself organizationally, the challenges will be
much greater and we certainly don't want our beneficiaries and our
stakeholders to suffer. So what we can do is best prepare ourselves and
our organizations for our own futures, organizationally speaking.

And, finally, by building your capacity, you will position your
organization to demonstrate its potential to be an effective partner.
For those of you who may be thinking of partnering with the U.S.
government for the first time, it may or may not be easy for you to
become directly funded by the U.S. government. In fact, even if you're
working with an intermediary organization like AED, it's still really
important that you demonstrate your openness to learning the ways of
doing business that come with U.S. government funding and demonstrating
your willingness to grow and change your organization for its own future
and growth.

So where do you start? Well, I believe that you need to know where you
are in order to be clear about where you want to go. So no matter who I
work with -- and I work with organizations in many countries around the
world -- I always like to start with some kind of an assessment so that
I can figure out what the organization's strengths and weaknesses are.
And there are lots of different tools and resources that are available
to assist in doing that. There are also people and organizations and you
know, consultants, that can facilitate those kinds of processes, or it's
something that your organization can do itself, and really take an
honest look at what you're doing, where you want to go, what your
aspirations are as an organization. And so if you have a really clear
mission in mind that you want to fulfill, you need to be really honest
with yourselves about what it's going to take for you to get there and
what types of capacity-building would support you in getting there.

The next thing that I recommend people do is prioritize because you
can't do it all at once. Nobody can do it all at once. And you need to
think about what would be the next most important step that you can take
for your own organization. And if the next step involves working with
the U.S. government or working with an intermediary organization like
mine, what's the next system that you might need? What's the next
technical intervention that you might need to enhance? So be very
specific about your steps and your process because it will really
support you very well in moving farther.

And finally, prepare yourselves and be patient because building capacity
takes time and it takes dedication and as you will hear from some of our
panelists, it requires buy-in from the leadership or the organization
and the board. It requires the staff and the stakeholders. The more
people that are invested, the better your chances of success. And I
would say that the -- it's very much related to the question or
prioritization because when many of us are working on issues that we
care about deeply and are passionate about, our first priority and the
reason we got into the work, often, is to help people, to serve people.
And to take a deliberate approach to capacity-building means saying that
the sustainability of my organization and its systems also are
important. And in the long term, I'm going to be able to serve those
beneficiaries best by focusing on some of these other issues as well.

Finally, the question is, what resources are available? And there are
many, many resources that you'll hear about from my fellow panelists and
that you've heard about already during the course of the day. There are
a couple that I will mention in particular. One of the projects that I
work on is a USAID-funded program called the Capable Partners Program
and it is a capacity-building program and we work with nongovernmental
organizations of all sizes, all around the world, creating resources and
sharing resources. The place that you can find those are on a Web site
called NGOConnect and I have some cards up here, which you're welcome to
come and get at the conclusion of the day if you'd like a little
reminder about that.

The site offers resources to all the different organizational
development topics that are mentioned and it also has some resources on
specific technical areas which we've been involved. For example, we have
a lot of resources in the HIV/AIDS agreement because we've done a lot of
work there. So I think you'll find some valuable resources there that
are easily available and some tools that you can download or request as
well. This is the homepage and you'll see sort of in the top right
there, you can click on the button that says "Resources." You can also
find communities if you want to connect with individuals or our other
organizations doing similar work or that are geographically nearby. In
the bottom left, you can request membership. Membership is free. And it
gives you access to all of the materials on the site.

I also want to let you know that in January 2009, we're going to be
launching a series of short, technical papers called "NGO Tips." And
these papers are written about how to work effectively with NGOs. We
started writing these papers primarily for USAID personnel and U.S.
government folks around the world. So I appreciated the question that
was asked in the last session about, you know, how to best interact and
engage with missions because what we found is that not everybody who
works for the U.S. government really works the tremendous asset and the
tremendous value of working with community-based and faith-based
organizations. And they certainly may not understand the nuances of the
NGO community and how best to engage. So we decided to develop these
papers that look at it and we have 30 of them so far that we'll be
releasing in January so that we can provide that kind of information to
the folks that you'll be talking to so that they understand your work
better.

We also realized these are going to be tremendously valuable to you as
well because you will see the same information and you will understand
that side of the equation. So we actually had gone back and we're
redrafting some of them to balance the perspectives so that the
materials are equally useful to the development community as well as to
those of you who are working for the U.S. government. And you can look
for those starting in January -- the second week of January 2009, and
they will be available on the Web site that I just mentioned.

I also want to encourage you, when you're looking for resources, to
think outside the box. And the reason I say that is because sometimes
resources are developed for one purpose, but they actually have
tremendous applicability. Another program that I oversee is a
USAID-funded program called the New Partners Initiative Technical
Assistance Program and it's funded under PEPFAR. Is anybody familiar
with PEPFAR? Have you heard of that? We have a bunch of people. It's a
presidential initiative -- the President's Emergency Plan for AIDS
Relief and it is a five-year, multi-billion dollar program focusing on
HIV and AIDS prevention, care, and treatment in countries around the
world, really, a wonderful initiative.

Well, PEPFAR decided at the Office of the Global AIDS Coordinator,
decided to undertake something very similar to what you all are
interested in and very similar to what Karen Turner was discussing in
terms of the developing grants program. PEPFAR wanted to engage new
partners. They wanted to engage, particularly, community-based and
faith-based organizations. So they launched this initiative and AED was
asked to provide technical assistance to the organizations that were
solicited under the New Partners Initiative. Well, for that initiative,
we are creating a Web site and a set of materials that were particularly
designed for those grantees will be just as useful to anyone sitting in
this room. They focus on things like compliance and understanding the
federal government's contracting rules and really answering some basic,
important questions that will be of value to you.

So I use this example as a way of saying not only that you might be
interested and this will be another free site that you can register for
and receive access to all of the materials, but also because you should
look in unexpected places because if you're not working in the HIV/AIDS
arena, you might not think that something like this would be appropriate
or useful to you. But I think a lot of the materials that may be
produced with one kind of funding like health funding can be very useful
in sort of the more general way. And this is the second site --
npiconnect -- New Partners Initiative Connect that will be launching in
January.

So finally, I would like to welcome our panelists today. They will each
be speaking about some particular resources in their organizations that
I think will be very interesting for you. First, we will have Ann
Beltran from the National Council of Nonprofit Associations; second, Tom
Campbell from the Compassion Capital Fund; third, Susan Meier,
BoardSource; fourth, Claudia Horn, Performance Results; and finally,
Aneta Wierzynska, from Transparency International. So let me invite Ann,
please, to come forward.

ANN BELTRAN: Thank you, Barney, and welcome, everyone. My role today is
to introduce you to the National Council of Nonprofit Associations. We
need to go back. (Chuckles.) There we go. That's us. And the resources
that that provides across this country, also to provide you with some --
a takeaway with further resources and that is at the back of the room.
So before you leave today, I have about six pages of a variety of links
and resources for you to take and use to find capacity-building tools of
a variety of kinds that supplement some of things Barney talked about.
And lastly, I want to offer you a metaphor that approach to
capacity-building. I think sometimes it can be sort of a dry thing to
talk about in a room like this so I thought I'd lighten it up with a
metaphor.

So first of all, our organization is an umbrella organization. So under
NCNA are about 40 state associations of nonprofits who have members. So
at the grassroots level, we have many faith-based, community-based
organizations totaling about 24,000 who are members of our 40 state
associations, including one in the District of Columbia. And then we're
just sort of the umbrella voice coordinator for that effort. And it's at
the state association level that the interesting sources in
capacity-building really take place and depending on the state you're
in, you may have a very find state association to contact, to take
advantage of their trainings, workshops, and technical assistance. So
those would be something you could look up on our Web site. If you are
based in the district, or in Virginia or Maryland, I have also some
handouts up here on current trainings that some of the state
associations are offering here and some of the local resources. So I
have a limited number at the book, though, covering nationwide
resources. So be sure to take that before you leave.

So our mission is to advance the vital role of the sector in civil
society and then to support and grow the state and regional
associations. In achieving the first part, we actually do a nonprofit
Congress once a year. We have it coming up in May in New Orleans, where
we are slowly, over time, giving voice to the movement of nonprofits
crossing all sectors and building capacity along the way. With respect
to the state associations as I mentioned, they are on the group doing
these kinds of things. In Michigan for example, we -- our state
association has taken advantage of a compassion capital fund grant to
partner with other capacity builders in the state to reach out to over a
hundred nonprofits in that state with organizational assessments,
trainings, peer-to-peer learning, evaluation tools and so on and then to
keep that kind of capacity-building rolling. In Florida, we have an
association that has worked with many small and mid-sized NGOs. There's
a particular international flavor around our Florida association, given
its location. In a state like Mississippi, our state association has
wowed the local United Way with the kind of capacity-building resources
it can provide to nonprofits. So again, these state associations exist
in approximately 40 locations and by going to our Web sites, you can
find out if there's one in your area that you can take advantage of.

The metaphor I want to offer you this afternoon is that
capacity-building is like making a garden. And this metaphor was
inspired by this particular site, which I hope you will visit before you
leave D.C. It is the new National Outdoor Garden next to our botanical
garden. It's probably not more than a mile from here, situated between
the Capitol and the American Indian Museum. And it's a beautiful garden
and as you walk around it, it could easily demonstrate the various
assets of capacity-building. So I'm going to reinforce some of the
things that Barney was saying with this simple metaphor. A good garden
is going to work through all the changing seasons so if you visit this
garden even now or into the winter, you'll find a variety of things that
are working and that interest you and that merit your attention. So this
would true, right, or our nonprofits. If we have built our capacity
right as the times and environments change, we are still able to
perform.

So just as in the garden, when building your capacity, you need to
assess, you need to plan and model, and you need to prioritize. And
Barney has touched on these things already. In terms of assessing, think
of it as knowing the site and knowing the territory. You know, what are
the soil conditions, what's the climate, what's the environment in which
you have to function over the changing seasons? Every good nonprofit
capacity-building effort is that it begin with that assessment of the
current environment and what is going on. Often, there are just a
variety of approaches, right, to strategic planning: the typical SWAT
analysis, our strengths, our weakness, our opportunities, our threats.
You check out the environment in order that your situation, you're
telling the truth about your current situation. If you don't tell the
truth about the current situation, you can never reach your target.

And the target is like a model or plant for the garden. You know, where
are all those pathways going to lead you? Where do you need your
pathways? What's your infrastructure that's going to make your vision
come alive? And so you know, in any kind of capacity-building, you have
that tension between what exists today and where you want to go. And
most important to me in terms of bringing your strategic plan alive are
the values that you're going to incorporate into your garden, into your
plan. In the garden metaphor, are you trying to create a Versailles? Is
it going to be very formal and very structured and people come to take
organized walks in your garden? Is that the kind of nonprofit you're
building? Or are you like an English garden and you're just flopping all
over with flowers and you have all kinds of beautiful perennials and
maybe the pathways are a little harder find. Do you have the secret
fountain? What are the values that are going to guide the growth of your
nonprofit as you build its capacity to take on new programs in new
countries?

So pay attention to your values and that's where an area where the state
associations can help you. There's been a National Independent Panel
report, and perhaps Susan's going to talk more about that, that guides
the development of board, governments, best practices, ethical
practices. You really have to pay attention to this in deciding what
your strategies are and what you want to become. And then of course,
you're going to have to prioritize the work and the sequence. You can't
plant all those flowers right away, right? You have to figure out, you
know, how you're going to grow your programs. And if you just throw a
lot of plants in a bed, you know, that isn't necessarily the right way
to go. And you have to sort of think about, are you trying to get a
quick fix, like are you going to throw in some cheap annuals knowing
that by fall, they die and there's no color there for the winter? Or are
you going to kind of stretch your budget and go for those perennials and
try, over time, to really build that capacity that you need to sustain?

So those are some of the choices, the temptation of quick fixes that go
away fast or the patience to build slowly and carefully. And then you've
got all those kinds of systems you have to pay attention to, you know,
in the same way you need permits for your garden, maybe to, you know, in
terms of its adjacency to other projects, where you need legal
compliance. You need to choose the right plant for the right spot and
you have to mind your HR practices. Be careful about who you hire. Get
the right people on the bus, right? And that IT communications function
-- that's almost like the watering system. If you don't have
communications, we know that is the area that people always complain
about the most. We need those pathways open, clear, circulating so that
all that information can be shared.

So that's the metaphor and I have one more tip for you in this critical
area of sequencing and prioritizing. Often, when you work with a
capacity builder, they're going to say you might want to have a theory
of change. What is it? What's your theory about how you're going to get
from this current environment, your current situation, to your target,
to your vision, to your model? And how do you figure out where to focus?
So one example of a theory of change is the simple four elements. And I
will tell you, based on my background in a theory of change work that I
absolutely believe that these four things are part of everything.
They're a part of every single change you might contemplate. So you
might think, well, if I'm going to be a really good grantee for a USAID
grant, I really need to focus on my financial systems. And you could get
all caught up in your recordkeeping system and get very focused on that
one area about how, you know, the technology worked and so on.

But if you don't address the other things in your system change, in your
capacity-building, your gains at the systems level may be short-lived
because if you don't have a culture of ethics and integrity that
supports good recordkeeping, then it's almost like why bother to do all
this technology and changes of our records if you haven't worked on the
culture that sustains that over time, that reflects those important
values that are really what keeps the group doing what it needs to do
with the system you've given them. And that group of course, that
culture, is owned by everybody in that organization. So how do your
individual employees relate to your group culture? How are you helping
them connect their values of honesty and integrity and teamwork to the
cultures values so that when they show up and they have to learn
something new that they don't want to learn that's difficult or
technical, you can reach them at a values level, which is very
motivating. Okay?

Then, of course, they need to change some of their behaviors so you've
got to go in there with the training program, right? You've got to give
them that technical training so they don't feel dumb about the system.
So you really need to address all of these and you know, if you singled
out a different area. If you said, you know, we've got the systems but
we've got some bad apples. We've got some employees that are causing us
problems. How do you deal with those? Well, your capacity-building means
that you've got to -- you're saying their behaviors are not helping this
organization. So how do you start to change their behaviors? You
actually focus on the other three. You strengthen the culture of the
organization so that their behaviors become more visible, in the sense,
as being different. And they have to figure out, am I going to stay or
am I going to go? Do I like being with this culture that is not in sync
with who I am?

And then the culture also tends to squeeze people out who don't fit
there. So if you're concerned about individual behaviors, work on your
culture. Work on those systems that have the necessary protections and
guards in them so that their behaviors are channeled. And to the extent
possible, do that kind of one-on-one coaching. What are your values
about it and how do they connect to our culture, because if you want to
stay here, your behaviors need to come into alignment. So my advice is
when you're sequencing prioritizing, obviously, you pick the troubled
area and you think about it also in a long-term, you know,
prioritization. But once you set on something, don't ignore the other
areas because they go all together. They march in sync. And if you
neglect an aspect of it, then the part you're focused on can suffer.

So I'll just end with the message that Barney did, which is that if you
do this kind of capacity-building, this is what really strengthens your
mission. It gives you greater effectiveness. You're doing more of the
right things and you're doing them with greater efficiency. And so your
path towards your vision or your target is just very clear. So again, I
encourage you to get the resources and for those at the back of the room
and for those of you based in D.C. and Maryland, please see me, I have
some training program kinds of things available up here. Thank you.

(Applause.)

MR. SINGER: Thank you very much, Ann, and thank you for preparing those
wonderful handouts. I'm going to encourage everybody to take a look at
the materials as well. So let us move on with our next presentation. So
let me introduce Tom Campbell. He is here from the U.S. Department of
Health and Human Services. Tom is the program manager for the Compassion
Capital Fund. Tom?

THOMAS CAMPBELL: Good afternoon. Fifty-two million dollars. (Laughter.)
Just trying to get your information. It's late in the afternoon. I
understand after lunch, it's all tired, although that was the best boxed
lunch I think I may have ever had. So kudos to USAID. (Inaudible.)

I'm here to talk about the Compassion Capital Fund. The Compassion
Capital Fund is a program of the Department of Health and Human
Services. It started as an offshoot of the President's Faith-Based and
Community Initiative. It is the first program that is associated with it
that came out of the Faith-Based and Community Initiative. And the idea
behind the Faith-Based and Community Initiative was to open up
government to faith-based, small organizations in the communities that
maybe didn't have access before. And what they started by doing the
first early days was well, let's drop all these restrictions in
government. Let's get rid of all the restrictions so they can get -- so
all these organizations can have access. Well, they got rid of all the
restrictions pretty easily, but yet, still, nobody came. They opened the
door but nobody could walk through it.

And they determined that a lot of the organizations they were targeting
just simply didn't the capacity to apply, even, for a federal grant,
much less manage a federal grant. And so what they did was they designed
this Compassion Capital Fund that was really targeted at building the
capacity of small faith-based and community organizations across the
country. And so the purpose of the Compassion Capital Fund is to build
the capacity of faith-based and community organizations and other
smarter people up here on the panel have talked about what
capacity-building is and so I'm not going to get much into it, although
to say that our metaphor is always -- is not nearly as beautiful as the
garden metaphor, but it's the freezer metaphor. (Laughter.)

And we say if you're a food bank, I can give you \$5,000 and if you go
buy food with that \$5,000, that helps your clients. You can get a lot
more food to your clients, the community benefits, it's great,
wonderful. Three weeks later when the food is gone, your organization is
no better than it was before I gave you the \$5,000. If, however, you
take that \$5,000 and you buy a walk-in freezer, your organization is
stronger. You can store more kinds of food. You can store food for
longer. You can accept more kinds of food for your clients. Over time,
your organization is stronger. Your clients are better served. So that's
sort of our model, moving forward on capacity-building.

And Barney talked about how do you cut the pie. Well, this is how we cut
the pie, is a -- we talked about the five critical areas of
capacity-building. We talked about leadership development, which is
really focused on board development, things like that and how you
develop the leadership of your organization. Organizational development
that could be systems development, IT, whatever your organization needs,
program development, which is really focused on your programs, your
individual programs and how to develop those through new curricula,
through resources for those programs, or it can be helpful.

Regular development strategies -- as the federal government, we cannot
give you money to raise money. At least we can't, some programs can, but
we cannot give you funds to go out and fundraise. We can give you funds
to plan to go out and fundraise. It's a fine line, but it's a line we
can't cross. And community engagement -- engaging your community that
the bell weather of any good nonprofit in a community is how much are
they supported by the community? How many volunteers do they have? How
well does the community know them? And so community engagement, whether
it's through Web sites, through marketing campaign, however it manifests
itself, this is an area of capacity-building that we think is important.

Before I get farther into it, I want to talk about things our money
cannot be used for. We cannot fund inherently religious activities such
as worship, religious instruction, and proselytization. It took me a
long time to learn how to say it proselytization, so I'm going to say it
again -- proselytization. (Laughter.) You cannot do those things, you
cannot do the normal things that we all know you can't do. You can't buy
Bibles. You can't fund your ministry. You can't do things like that. You
have the distinction in time and location -- and/or location of those
activities. We cannot fund direct services. I can't give you \$5,000 to
buy food for your food bank. That is a direct service. That is not the
path to go. I can't do it. Direct fundraising, I talked about that.
Medical healthcare-related activities -- my office in HHS is part of the
Administration for Children and Families.

We are not part of the Medicare/Medicaid angle of things, the National
Institutes of Health angle of things. We are the administration for
children and families. We're the human services side of health and human
services. So we can't fund the health side of things. This is just our
mandate. And the last one, international programs and activities. And I
know that when they call and say you know, can you come speak to the
USAID group -- (chuckles) -- I have to say I wondered are they going to
even want to hear me speak at the USAID group because we can't fund
international programs or the capacity-building activities that benefit
international programs directly.

Let me clarify what I mean by that. And we do have grantees that you all
would recognize -- World Vision, and I'll talk about some others. But
we've had grantees that you all would recognize doing domestic work. We
cannot fund a capacity-building project that is intended to directly
benefit an international or non-domestic program or activity. So I want
to get that out there. I want to manage those expectation so no one is
disappointed down the road. So those are the things that we can't do.
How we do things, we have three different programs. We have an
intermediary program, which we call the demonstration program. It was
the first one and then we have the Communities Empowering Youth Program
and the target and capacity-building program that we affectionately call
the mini-grant program.

Now, the demonstration program funds large organizations as
intermediaries. The target the Compassion Capital Fund is to build the
capacity of small, faith-based and community organizations so what we
try to do through this program is fund intermediaries who can then
provide training and technical assistance -- see my wonderful graphic
here -- we give the money to the intermediary organizations. The
intermediary organizations then work with thousands of small
organizations, providing training and technical assistance and financial
sub-awards, competitive financial sub-awards. Now, these, we have funded
in the last six years, something on the order of 5200 sub-awards, or
120-some odd intermediaries, 5200 sub-awards. And something like 15,000
organizations have benefited from training and technical assistance.

So there is a -- this is a very powerful program. We cannot do it
directly. We give the money to intermediaries to do it. If you arrange
to be an intermediary, there's some details that you need to know. It's
half a million dollars a year for three years, that's a
million-and-a-half for the life the program. You have to give away 40
percent of that in sub-awards. The rest, you use for training and
technical assistance. And interestingly, the research that we've done
shows that the training and technical assistance peace that the
intermediaries offer to small organizations. You know, they're there on
the ground. They're in the communities. They can hold their hand and
work with these organizations. The organizations benefit and value more
the training and technical assistance than they do the financial
sub-awards.

It's more valuable to them to have somebody, a big brother -- I don't
mean in a George Orwell sense, but a big brother in the community that
you can go to and ask for help. And they do come sit with you and work
through your budget, sit with you and work through your problems with
your financial systems. And the focus of these intermediaries work with
our organizations that maybe have never gotten -- most of organizations
that have never gotten a federal grant, organizations that are probably
nowhere near having the capacity to manage, much less win a federal
grant. So this is what this program does. You have to bring a match to
the table, a cost-share, somebody mentioned earlier.

And just about anybody is eligible for this: for-profits, nonprofits,
local governments, whoever, universities. The Communities Empowering
Youth Program really targets -- and this is different than intermediary
program but it's similar enough that people get it confused. This fund's
coalitions as a lead organization, lead organization through a coalition
will apply, get funds. They will then use those funds to provide
training and technical assistance and financial assistance, not
competitively, but financial assistance to their partners in the
community. And this is really targeted coalitions that are working with
gang activity, trying to eliminate the gang activity, working with youth
violence, working with child abuse and neglect. Those three areas are
the target of this program -- those three social service areas.

Again, we're not funding the direct service. We're funding
capacity-building organizations and coalitions that are doing these
programs. And if you wish to be a CEY grantee, then here are some
details you need to know: quarter-million dollars a year for three
years, totaling \$750,000. The one group that is not eligible for this
that is eligible for the other is local governments because in this case
we're -- the lead organization builds its own capacity along with the
coalition and along with the coalition partners. And we're not in the
business of building the capacity of local governments because with
federal government you can't really do that. But the idea behind this
one is a unique collaboration focus, and that's why this is kind of an
interesting, exciting one. We're only in the third year of this one,
just now starting, so we're just no seeing some of the benefits of this
and how it can really work really well. The next one to target its
capacity-building program -- we call this the mini-grant program. This
is a direct funding of organizations to build their own
capacity-building activities. We fund -- and it's really directed to
non-profits, to small faith-based and community organizations that are
the target of the entire initiative.

This is what the graphic looks like. I was up so late last night trying
to work on this. The federal government gives money directly to
faith-based and community organizations to build their own capacity.
This is the program that the intermediary -- this is like the next step
up from the intermediary program. If you're an organization that doesn't
have the capacity to apply or to manage a federal grant, then you'll
want to go underneath an intermediary and work with them until you build
up your capacity. From there, you go to the mini-grant program because
this is one of the easiest programs to apply for in all of Health and
Human Services. I can't speak of in the federal government, but I would
imagine probably so. The application is only nine pages long. The
applications for most of our programs are 25, 50 pages long.

So this is a much easier program to build your own capacity. You have to
describe how you're going to do that. And there's no -- again, we're not
direct service. We're -- sometimes we focus on specific social service
areas that we want to target, but we're not funding those activities.
We're funding the capacity-building activities. And here it's \$50,000 a
year. It's a one-time grant; it's not over three years. It's just a
one-time; it's \$50,000. But that's why we call it a mini-grant because
it's so small, right, \$50,000. Tiny little bit of money -- to us. To
you guys, at ground level, that could be monstrous. And here the
eligibility is very limited to only non-profit organizations and some
tribal governments. It's not open to for-profits and to other types of
organizations.

Just some examples -- to say that all hope is not lost. These are
current grantees of ours. Let me just walk through them. The Somali
Bantu Association of Tucson, Arizona: There is a large Somali Bantu
refugee population that seems to have coalesced around Tucson, Arizona.
And this organization's domestically focused on the refugee problem, the
immigrant -- I don't think problem -- the refugee's problems, the
immigrant families' challenges, trying to help these families get by,
trying to get them the resources, help them however they can in the
Tucson, Arizona, area.

Boat People SOS is a similar organization except it is a national
organization that focuses on the problems that the Vietnamese --
specifically the Vietnamese and Southeast Asian refugees have in the
country. International Rescue Committee in New York focuses on a segment
of New York City and the immigrants and refugee issues that exist there.
They're not specific to a particular type of immigrant but immigrants
and refugees in general.

World Vision we talked about -- World Vision has actually had I think
three different grants of ours over the time. They were one of our first
grantees in 2002 -- or 2003. And they run a couple of different things.
In this case, they're running a program in Seattle, WA that focuses on
children and families in a gang. They're one of our CEY grantees.
They're working with a coalition in Seattle to combat the gang problem.
Nueva Esperanza is a Hispanic-focused organization working with Hispanic
communities all across the country really and again, one of our
long-term, long-time grantees.

Now, something I can offer you that's free. Free -- let me say that
again because that's a good word: free. These are resources for
capacity-building -- probably came up on your Google search I'm
guessing. The -- this is our Web site, and don't worry about writing
this Web site down. If you do a Google search for Compassion Capital
Fund, our Web site will come up. If you don't want to do that for
whatever reason, then there's our Web site there, but there's fact
sheets, funding history. You can look at descriptions of all our current
grantees, all almost 300 current grantees. Research studies that we've
done that I think are quite good. We've been really focused on research
from the beginning -- very important.

And there's lots of other resources for faith-based and community
organizations, whether they're grantees or not -- about. Here, again, in
one of these resources -- we call it a toolkit for faith-based and
community organization. It's got just -- I mean, you could spend a
couple of hours just looking through this toolkit, very, very powerful
stuff.

One of the best resources that we have developed since we began is a
series of guidebooks -- capacity-building guidebooks. And these are just
the topics of the guidebooks: best practices, establishing partnerships,
grant acquisition -- always positive -- grant management -- always
important after you acquire the grant, outcomes measurement. And let me
just say something about outcomes measurement in case you haven't heard
enough about it. Outcomes measurement is something that -- is an area of
capacity-building that if you're not focused on, you're not sustainable
as an organization, because every funder in the country if not elsewhere
is focused on outcomes measurement and often what is the value that you
are adding and bringing to your sector.

So if you're not focused on it, now's the time. Revenue sources, again,
ways of developing and diversifying your revenue streams,
diversification obviously very important. (Inaudible) -- work management
and technical assistance -- that's how to provide technical assistance
-- those are really -- those last two are focused if you want to be an
intermediary and you're interested in running your own -- (inaudible) --
program or you're interested in providing technical assistance to lots
of other organizations.

A couple of other resources, promising practices for improving your
capacity; there's a benchmarking tool that we put together through
actually a White House conference -- that's how it got started. And then
lots of links to other folks: I believe the Council for Non-Profit
Associations is one of our links as a matter of fact. And lastly, we
have a newsletter that is available. This news letter goes out to about
5,000 people every quarter. We do talk about the Compassion Capital Fund
in the newsletter, but it also provides lots of funding and training
opportunities of interest to anybody, any non-profit as well as articles
geared toward leaders of non-profits and how to build your own programs.

And there's my information; feel free to give me a call, send me an
e-mail, whatever you need. I am available for questions afterward
obviously. And I appreciate all your attention and time, and I will
quickly get off and give this to somebody else. Thank you.

(Applause.)

MR. SINGER: Thanks so much, Tom. (Inaudible.)

SUSAN MEIER: Thank you so much. Good afternoon. Can everyone hear me
okay? I've got the Lauren Bacall voice today, not that I'm lulling into
sleep, that I hope. Let me start off and ask this question. First of
all, how many of you actually have boards for your organizations? Pretty
much every hand should go up. How many of you feel you have a really,
really terrific -- I mean terrific -- board of directors? Oh, we got a
few hands. That's fabulous. How many of you think -- are we really kind
of a mess? Yup. Be honest. Okay. How many think you're somewhere in
between? Okay. Well, those who are in -- feeling their board is a mess
and those who are in between -- most of the people we talk to at
BoardSource, most of the boards we work with -- fall in that category.

And what I'd like to suggest to you today is that as you think about
capacity-building for your organization, think about the untapped asset
of your board of directors. What we see out, throughout the country, is
that arguable, the board of directors is the most underutilized asset
and resource of a non-profit organization. Because when you have a
terrific board of directors, you've got a group of anywhere from 12 to
potentially 40 people who are actually grand (?, 66:52) resources. And I
mean money, contacts, resources into your organization. You've got all
those people being your advocates up in the -- (inaudible) -- day in and
day out. A terrific board of directors is going to help you set the kind
of strategic direction you need so that you can make a competitive
difference in your community, so that you can handle the challenges
we're all facing right now and move ahead. That's what a terrific board
of directors does.

So I encourage you to think about -- when you think about
capacity-building, how can you take that group of people who are
governing your organization and help them understand what they're
supposed to be doing and how they can do it to the very best of their
ability. How many of you have heard of BoardSource? A few, not too many.
Let me tell you very quickly.

We are a non-profit organization. We're 20 years old, so we're not very
old. We're based here in Washington, D.C. And our mission is pretty
succinct. We are all about advancing the public good by building
exceptional non-profit boards and inspiring board service. So we're very
focused in what we do, and we do this in a number of ways. Bottom line
is we're going out and we're creating knowledge and research and
information that we want to get back out to you: non-profit leaders,
executives and board members who actually are making a difference in the
board room.

So we have a free Web site -- Tom's favorite word: free, free, free --
www.boardsource.org. Please use it. We have a membership that's about
\$99 a year that gives you access to more information and discounts on
publications and so on. We're the largest publisher in the world of
non-profit governance information, the largest in the world. So if you
need a book on non-profit governance to tell you or your board's share
or your board members what they're supposed to be doing or how they
might think differently about their role, chances are we've got it. We
also offer consulting and training on a fee basis. So I'm not going to
spend a lot of time on what the sector looks like today. We know what
the sector looks like for the most part.

Some of these steps will vary, depending on what your source is, but the
bottom line is, we know that the non-profit sector continues to grow.
And what does that mean? That means it's more competitive out there,
right? Resources are -- (inaudible). And more of us are trying to get
them. And of course we're in a time now where needs are increasing
dramatically. So it's important that a non-profit understands how it is
distinctively different, and a board of directors should be part of that
understanding. A board should understand how that non-profit is
distinctive in the community. This also means that -- well, what we've
seen is the average board is about 16 members, but they say there's a
minimum of 1 million board seats at a time across the country. I suspect
it's several. So we're struggling to find good board members, good
leaders who can work hand in hand with us as staff to really create
leadership and direction for an organization.

So what should non-profit leaders be thinking about? When you think
about your boards, and you think about building capacity through your
boards, what should they be thinking about? Well, we say at BoardSource
that being good is no longer good enough. You need to be great at what
you're doing -- it's just far too competitive out there. You need to
have your successes, but it's not enough any more to have one or two
successes in your community; you really need to think at the
board-level, at the leadership level about what's the impact we're
making on our communities. And thirdly, being good stewards is terribly
important, but again, it's not enough. Our boards need to know that they
need to be exceptional leaders. And they need to be leaders like that
hand in hand with you, more than ever given what we're going through
right now.

So how do you build the capacity of your board of directors? There are a
lot of things you can do. I've identified six things up here. I don't
have time to go into depth with you on any of these -- on all of them,
but I want to just point out. (Inaudible) -- people on the bus, think
about who's sitting around your board table. Are they the right people,
and if not think about improvements strategically. Do they understand
their roles and responsibilities? Educate them. Help them understand
what it is they're supposed to be doing. There are tools and resources
from BoardSource and online from consultants in your communities who can
help you do this.

Thirdly, build up strong relationship between the chief executive and
the board. Create that constructive partnership so we're really working
together. And create a level -- a high level of mutual trust in your
board room. The capacity of what people can offer you will go up
dramatically if there's a high level of trust in your board room. Focus
on what matters most. Make sure when you think about your board agendas
that you're using the very best time of those precious minutes of hours
you have with your board because you don't have many. Make sure you are
focusing on that which is most important. And finally, evaluate
performance. Make sure the board is evaluating the executive director's
performance, make sure the board as a whole is assessing itself, and
make sure you're assessing individual board members so we can all be
accountable and held to the highest level of performance.

How many of you are global or international in some way? Have some sort
of global connection? Terrific. I'm so excited to let you know that
BoardSource launched like a year or two ago this global forum. So it's
still new. It is free. Tom's magic word again: free. And we invite you
to be part of it. I apologize; the Web site is not showing up on here,
but I will repeat it to you. The online community is at
www.ngoboards.org. All these slides are on handouts in the back, so you
can get them afterwards if you'd like. The whole point of this online
community is to advance the understanding of good governance among NGOs
worldwide. And we're very excited -- we've got 500 people registered to
date. As I said, it's free. This is one of the pages so you can kind of
get a sense of how it works. We would love to have you on this, so I
invite you all to become actively involved.

There are other governance resources available to you. There's our Web
site, assessment tools, a lot of different resources for that. There are
a number of publications; you can get online with BoardSource and see
quite a few. All the ones listed here are not BoardSource. Some are
BoardSource, some are not. I just wanted to get you to -- give you a
feel. I've got two pages of resources in the back of the room for those
of you who are interested.

So we feel that exceptional boards do make a difference. That is part of
the capacity -- building the capacity of an organization, and I hope you
are thinking about how you can use your board to really be an asset for
your organization. Thank you very much, and I'll let the next speaker
come up.

(Applause.)

MR. SINGER: Thanks very much, Susan. Our next speaker is Claudia Horn
from Performance Results. You've heard already about the tremendous
importance of evaluating your work and Claudia is going to speak to us
about some ways to do that.

CLAUDIA HORN: Good afternoon. Oh, it's getting late and it's Friday.
We've been taking more than an hour here now talking at you. And I would
like for a moment for you to do something. I would like you to imagine
for a second -- perhaps close your eyes -- and consider for a minute
what success looks like. If you were to think about what success for
your organization or your program looks like, does that image come to
you pretty readily? Raise your hand if it does. Okay. If you've
identified those things that are success for your program or for your
organization, how many of those successes are actually about the people
you serve rather than what you do? People served? What you do? Well,
good. More than half of you identified the benefits to participants, and
that's what this is all about.

Evaluation or outcomes measurement really is much less about what you do
than what it is that you achieve. It is about the results of what you do
that gets measured and which is important and about the very powerful
stories that you need to communicate to those people who want to fund
you. And so you look at those things and you say, what kinds of benefits
do I deliver to a population that someone might care about? And then you
go identify the kinds of people who care about those outcomes and you go
sell your program.

As an example, we all know -- as an example -- what our budget is, at
least we should know what our budget is. Right? If we know the number of
people we serve in a given period of time, perhaps a year, and we know
the budget we have to run the program, what have we got in terms of
information? How about cost per person served? Pretty good information,
really good, but I suggest there's a better one. If your programs are
measuring outcomes and you can identify the primary outcome of your
program and you know the cost to deliver your program, now what have you
got? You've got cost per outcome. And then what you do is you go sell
outcomes? And you say to the First National Bank, it cost \$4,000 to
deliver a kid off the street. How many do you want to buy? You go to the
second national bank and you say, first national bank bought 10, how
many do you want to buy? Okay? The power of information that shows
results is -- goes far beyond simply counting people and identifying the
kinds of things that you want to do. It directly affects the kinds of
things that you want to communicate to your community and how to raise
money off of those kinds of activities.

It's really important for you. And my role, and my company's role in
this, is certainly to allow you to comply with federal agencies'
requirements to measure results, and they're there, and they're
everywhere. And you have to submit really good evaluation plans with any
grant proposal you put in. But my role, I hope, and I succeed at it -- I
think somewhat -- is to empower people to think that measuring results
is in their best interests. And if you care about the people you serve,
then you care about measuring the kind of results your programs deliver.
It's all hand in hand.

So my favorite topic is evaluation. I'm a very concrete person. I like
to see things that are obvious -- they're clear, they're
straightforward, unimaginative. Just cutting so concrete; I am so
concrete it's ridiculous. My husband says to me, honey, I love you. I
say, what does that mean? (Laughter.) Okay? That's how concrete I am. He
doesn't appreciate that. (Laughter.)

I got into this based on an experience I had in 1986 when I was working
for a national organization -- international organization that served
people with disabilities, a membership organization, very, very large.
And Congress was about to pass, or re-authorize, the Rehabilitation Act
of 1973. Before they did, they said to the government accounting agency
to go down and find out whether or not it made a difference. So they
went down to the local program level, and they collected data from local
programs to find out whether or not people with disabilities are any
better off as a result of being served in these programs. They gathered
the data, collected it, and about 18 months later, sat down in front of
Congress and reported that the Rehabilitation Act of 1973, after \$43
million spent, essentially was a no-harm program; \$43 million, and it
only proved we didn't hurt anybody. That's bad news.

So we got smart real fast and said we need to demonstrate value and
proof of benefit to people that we served. And we did. Okay? So imagine
from our point of view, we were disappointed because we knew people were
going to work, they were integrating in their communities, going on to
higher education, doing bigger and better stuff, but we had no data to
support it. But we had great stories. We had wonderful stories, but we
had no information to prove we were doing any better.

I suggest to you that you make a decision about what it is that you want
to say about what you do because I believe that if we don't go about the
business of showing other people who we are by the kind of results that
we want to achieve, we risk other people defining us for us. And right
now, as in the past as well, that's a very risky kind of position to be
in. And so the results that you demonstrate are benefits to people
served in your programs -- okay, and should be communicated as such.

So, what kind of evaluations do you need? Do you need an outside
evaluator to evaluate your program every year? The answer to that is no,
unless your funder expects it -- an outside evaluator that's objective.
More than likely, what you need is a good management process that allows
you to identify programs in your organization that you wish to measure
and consistently and productively measure the results associated with
those programs. Integrate and incorporate the process into your
organization as a means of management, and that's what this is. It's
simply management. If you could imagine for a second an organization
that doesn't have an accounting system, you'd go what? No accounting
system? Money goes in, money goes out, we don't have any idea where we
spent it, we don't know whether or not the money spent made a
difference. Well, outcomes measurement, measuring the outcomes of people
in your programs are just like an accounting system, only for human
beings. Okay?

It demonstrates the benefit of what you do in very logical and
meaningful kinds of ways. So it isn't so much about getting an outside
evaluator, but it is about incorporating a process in your organization
that consistently measures the results and the outcomes of people served
in those programs. So what kinds of decisions to make about how do we
get started, and why do we need a -- what kind of priorities do we set
in order to measure our programs' outcomes, because organizations have
multiple programs. What goes first?

And so I sort of put together a list about what that might be. If you
have an external source that requires you to evaluate a program, well,
there's a priority. That program probably goes to the top of the list.
Another consideration for measuring what program first might be the fact
that that program's value is being questioned by other people. They're
saying, why are you doing this program, what difference does it make?
And you want to run that program? And so consequently, that may be a
reason to incorporate evaluation into it. It may be your flagship
program, and you really want to prove that this is a hot program. That
may be a really good reason to put that to the top of the list. And then
the other is very important. If you are serving a fragile population,
then measuring the results of your programs' outcomes for a fragile
population is really important. Okay.

So then what do you do? What you do then is you build an evaluation plan
for each one of those programs and establish outcomes for them and then
develop the system and data reporting process that will allow you to
know that your program's making a difference. Internalize the process of
measuring results. It will really become important to you. After you do
it, you will really like the data. You will become managers of
information, which is a really good thing.

So, sources of information -- where to get help on this. Okay. On our
Web site -- performance-results.net -- we have a free tool. Emphasize --
free. It is an organizational assessment tool to determine whether or
not you are -- your organization is ready to be a grant recipient,
whether or not you have organizationally all your ducks in a row. It
covers such areas as board development, fundraising, program
administration, human resources; it covers the gamut of what an
organization needs to do or be. It's as assessment rating tool,
completely free. You rate yourself, and then when you improve other
areas -- because it gives you back a report, you go improve, and you
find out whether or not you are better than you were the first time. So
that's free to you.

Q: What was that Web site again?

MS. HORN: www.performance-results.net. Okay. You can do a search
anywhere on the Internet, and do simply a search for logic modeling,
logic models, evaluation, outcomes, and you'll get oodles of information
about the process for measuring results. And then if you are looking for
tools that will help you build a logic model, you can go to
www.resultsonline2.net, and there are tools available there as well for
helping build logic models. There's lots of information out there; this
is not a new topic. There's lots of consultants out there as well, and
you will find that in doing so, you really will be stronger for it, for
the process. So with that I think I will close and let the next speaker
come up. I appreciate your time and wish you good luck.

(Applause.)

MR. SINGER: Thanks very much. And finally, Aneta Wierzynska.

ANETA WIERZYNSKA: Good afternoon. I am the last speaker, so you can sigh
of relief, everybody, okay? I am here to speak about a very different
angle of -- slightly off topic, so I think this has been incredibly
educational for me, certainly I've learned a lot about building capacity
of my own organization. The reason why I'm here today is because I met
with Terri a couple of weeks ago, and she said, you know what?
Corruption keeps coming up as an issue for faith-based organizations
around the world. Can you help us? Can you share what you know about
what organizations can do about corruption? Well, that's what we do. My
name is Aneta Wierzynska. I am a senior policy director at Transparency
International, and I'm here to talk to you about what you can do about
the issue of corruption in your work.

Corruption is a moral issue, and it's very much within the scope of
community-based or faith-based organizations work. I just pulled a
couple different scriptures out to demonstrate to you that corruption
has always been seen, according to many faiths around the world, as a
moral problem. So it's within our ambit. Besides the texts that state
that corruption is a problem, the religious texts, we also know it as a
social justice problem. And I think this is where most of you are likely
-- why you're most concerned about this. Corruption traps millions in
poverty, it undermines democracy and the rule of law, it breeds social
and economic crises, and it even threatens any efforts to maintain
sustainable resources in our planet.

What do I mean by that? Well, let me give you an example. My background
is actually -- I used to investigate corruption in World Bank projects.
And most of the work I'll show you is based on those investigations,
which are actually public. And most donors are now realizing that
corruption is a threat to their work as well. So I just want to give you
a couple of examples.

How does corruption most often? There's different types. Certainly there
are public funds, which are managed by the government. But government
usually doesn't provide public services on its own. It typically hires
contractors, private entities, to fulfill functions. Maybe some of you
are actually fulfilling certain functions for public services within
your function. Or, you know, for example, to build bridges and schools
and waterways and sewer systems, contracts with construction companies
are hired.

What ends up happening? Well, the contractor's supposed to provide
services, public services unless there's an agreement somewhere. And
most often, agreements occur between governments and contractors. Public
procurement is actually the highest-risk form of corruption, the
grandest of corruption occurs in public procurement systems. What
happens in that kind of situation? We know that the public service
typically suffers. How, exactly, does it suffer? Well, let me give you
some actual examples -- real-life examples from real investigations of
real aid projects. There's a school in Kenya on the upper left-hand
corner, you can see the building that was constructed. However, when
investigators went inside, it was full of onions; it actually had become
an onion shed for the local government. The children, we found, were
actually studying in a mud hut behind the school.

Here's another result we got out of an investigation in India: The money
was paid to build hospitals for infants that were born in a prenatal
care unit. This is a brand-new baby warmer, believe it or not. It was
contracted and the bribe was so high that the contractor couldn't
actually manage to provide the baby warmer effectively, so they provided
this piece of equipment and they manage to forget the electrical
grounding. So when you turned on that baby warmer, the baby could get
electrocuted.

Oh goodness, I'm sorry, there's a -- that was supposed to be a
photograph of the sewage system that's falling apart -- let me just tell
you about it real quick, I don't know what happened. But basically, one
of the most classic examples of corruption affecting public services is
in construction sites where, basically, the quality of materials is so
poor that the construction falls apart very quickly.

In this case, what I was going to show you was a sewer that fell apart
and was actually flooding sewage out of a hospital, but it's also
analogous to several incidents we've heard, in the past, of schools
falling apart in China and other houses falling in India and killing
people. So what's the conclusion? Well, we're supposed to have public
funds for development, but when the money is diverted, the poor suffer.
And here's what you can do about it: Faith-based organizations are, in
fact, around the world, an agent on this issue very effectively. Here
is, actually, a prayer that we managed to cut out of a -- it was left in
a church in Nigeria. The prayer is spoken every week and it says, and
I'll just read you a sentence in the middle: "We're sorry, deeply sorry,
for our wrong use of these, your gifts and blessings through acts of
injustice, bribery and corruption, as a result of which, many of our
people are hungry, sick, ignorant and defenseless." This is absolutely a
reality for people on the ground, and churches are a place where people
can give voice to these concerns and begin to talk about the morality
and the whole impact of it.

So I'll just offer you an interest in joining with you, my organization,
Transparency International, has a vision and a mission of eliminating,
or at least minimizing, corruption around the world. And we would like
to see if we can engage in partnerships with you. Let me just give you
one quick slide about who we are. We were founded in '93, actually, by
former World Bank staff who were frustrated that corruption was hurting
public service delivery. We have around 95 chapters around the world;
most of our chapters work domestically on domestic issues, so if you're
working in Nigeria or Kenya or Cambodia or the Philippines, we've got a
chapter there. We have a secretariat in Berlin.

The thing about us is we're local, but we're also global, and certain
issues -- for example, right now, we're working on deforestation in
Asia-Pacific -- that's a global -- that's a regional problem. Trees are
cut down in Papua New Guinea, they're illegally shipped over to China,
they're processed -- every single step includes a bribe, okay? And every
single step includes fraud to cover up that bribe. And those products
are then produced, in China for example, and shipped over to the United
States, and we're among the biggest consumers of corrupt -- illegally
marked -- wood products here. So these are global issues that can't be
addressed domestically, and again, I think many of you are also global
but domestic as well and I think there's strength in that approach.

We -- just to be clear -- we're not investigators in Transparency
International. That was my previous job; I was an administrator before I
became a TI employee. We really address the systemic causes of
corruption, and I think this is where we could definitely partner with
you. Systemic causes of complacency -- that corruption is just here to
stay, and we can't do anything about it; systemic causes of a sense of
lack of transparency, of information that governments and the private
sector aren't giving the public; systemic problems such as lack of
accountability, where someone is -- (inaudible) -- that there should be
a process for changing that. We adopt a multi-stakeholder approach;
we're not here to create enemies. We're here -- everybody is part of the
solution.

The government is part of the solution, international donors are part of
the solution, faith-based organizations are part of the solution; the
people are part of the solution -- so we try to operate in a
multi-stakeholder approach and are politically nonpartisan. Here are
some ideas for partnership: One is that one of the activities TI engages
in already, is we engage in ongoing youth and public education programs
about corruption. Corruption is so endemic in most of these countries --
in many countries around the world, and even, I might have told you, in
America -- a lot of people think that corruption, sort of the grand
scale of corruption that we see in Congress -- but that's something that
we, you know, individual citizens can't do anything about. So we're
trying to combat that apathy -- that sense of helplessness and that
sense of well, you know, it's just here to stay. I think that
faith-based organizations can definitely help in doing that, like that
prayer that I showed you earlier.

We're also working on actual accountability efforts -- and what do I
mean by that? Well, we -- in our local communities around the world --
TI actually engages with local, you know, community members -- and not
just on the national level, but literally goes into villages and towns
and works with churches in some cases, to actually monitor, say, how
much money is coming from the national government to build schools in an
urban area. And, again, this is a place where we could definitely
partner with organizations. And, finally, the laws. There's nothing like
changing the incentives in the systems, sort of top-down, to create the
framework within which corruption can be addressed.

Religious leadership around the world often has a strong force -- I'm
actually of Polish descent, and I can tell you that the Pope was very --
was an incredible force in motivating reforms and actually bringing down
the communist state in Poland -- so if we can tap into the religious
leadership in a country to begin addressing the issue of corruption, we
could really make a dent. TI has promoted and actually driven the
development of international conventions against corruption and
ratification, implementation and enforcement of those conventions is an
area ripe for work right now.

One other thing, which I actually don't have a slide on, but I do want
to tell you before I go on to this, is that we have also -- TI has also
begun to work with organizations that provide humanitarian assistance,
which is to address corruption within their own work. So let me just put
it a little more directly: You, if you're working in developing
countries, you may be facing corruption problems within your own
organization. And you should consider those corruption risks, not as
something to hide, but just as the issues of capacity -- fixing your
boards, creating systems and integrity -- addressing corruption risks
ought to be just one of those things you consider. This is a common
operational risk for anybody who is working in development, and many
organizations have been very skittish about this because if there's one
corruption scandal in your organization, then that will affect your
reputation. Yes, you do have a reputational risk about corruption, but I
submit to you that you will have a greater reputational risk if it comes
out without you having tried to address it first.

And we have been working with humanitarian assistance organizations --
Save the Children, Christian Relief Services -- to map corruption
throughout their own operations. From the moment they get their money to
the moment the humanitarian assistance is given, where and what kind of
corruption risks do you face, and what do you do about that? If you're
interested in this, please let me know. And you don't have to be a
humanitarian organization, you could be any sort of organization that's
working on implementation of any sort of service abroad. I'd be very
interested in talking to you because this is something that we're all
facing and it's not unusual. We do have tools -- TI has tools -- we've
got corruption from your toolkits, we've got corruption -- we have
courses that talk about corruption per sector, so you can inform
yourself about specific sectors. We've got codes of conduct that we can
share with you and we have indices that track corruption around the
world. And that's all I have to say. I hope that was interesting. Thank
you for your time.

(Applause.)

MR. SINGER: (Inaudible, background noise) -- another important aspect
that we should all be aware of. Wasn't this a dynamite panel? Thank you
all very much. (Applause.) I think we're supposed to be taking a short
break before Terri comes back to end the conference. I know that my
colleagues and I are happy to stay and answer questions individually.
Does anybody have any questions they'd like to pose for the group? I
think we can squeeze in a couple. It's okay? We can continue? Great.
Anybody have anything they'd like to either ask or comment on?

Q: I have a question for the Council of Nonprofit -- I was looking at
your Web site over the last couple of years, and there were some changes
in the laws for nonprofits -- (inaudible).

MS. BELTRAN: Well, are you thinking about the annual reporting
requirements -- the Form 990, where you have -- yeah, that framework for
annual reporting of organizations has been transformed, mightily, over
the last couple of years and the new framework is in effect. And so what
they've done is provide different levels of reporting, depending on your
revenue size. So very, very tiny nonprofits -- under \$25,000 -- just
need to file an electronic notice. This coming year, for your reports
ending 2008 -- I'm not going to get the numbers right, but feel free to
e-mail me or go on the IRS Web site -- you get up to around, I'm going
to say \$250,000 in revenue, you can file the 990EZ. For any of you who
have filed tax returns individually, there's like the EZ form and then
there's the hard, long one -- (chuckles) -- so there is an EZ form, now,
for small to mid-size nonprofits.

And that's for, we think, a lot of our customers from the council, are
probably going to be targeted the next year, so there's new instructions
up, there's new forms and the IRS, on its Web site, has free, like,
instructional tools. They have a Web site called stayexempt.org, and
these are free little mini-sessions that you can go through in seven or
10 minutes, and they help you with a variety of things, including the
990. So that's going to be a huge switch for people this coming year;
thanks for mentioning that.

Q: Yes, I don't have a question, just have a comment. I just want to
thank you guys for sharing your information and your expertise. You've
given us a lot to process, and we really appreciate the Web sites and
information, I think. I just want to say that for me, it's been very,
very instructive, and time well-spent.

MR. SINGER: Well, thank you very much.

(Applause.)

Q: (Inaudible, off mike.)

MR. SINGER: Can you speak real loud?

Q: Can you talk about the role of advisory boards or clearing committees
as complementary to boards, in the case where, perhaps, those people may
not fit the board requirements?

MS. MEIER: Every nonprofit has one governing board. When we hear about
advisory boards, my first piece of advice is, call it an advisory
council, call it an advisory committee, call it Bob -- I don't care --
don't call it an advisory board, because therein, you begin to get
confused about what their real legal responsibility is. Advisory
councils have a different role; they are not legally responsible for the
fiduciary areas of the organization. Many advisory councils struggle
because they don't understand what their purpose is; they don't know
what they're supposed to be doing.

So a second piece of advice is, if you use advisory councils, be sure to
have clarity within that group about what their purpose is, why they
exist and who they're accountable to. It will help them function much
more effectively if they know they're there to fund-raise or if they
know they're there, truly, to be advocates in the community or if they
really are there to be advisory in some capacity. Does that help? We
have a publication on it, if that would help. You can also go on the Web
site; there might be some more information.

MR. SINGER: I guess while we're getting the microphone, one thing I want
to add, actually, to what Susan said is that the clarity of roles is
important for all of the different players, not only between boards and
advisory councils, but even between boards and the mentor of the
organization. Something that we've seen in the new partners program is
that that is often an issue for nascent organizations or those that are
expanding, because you have, you know, the impassioned leadership who've
been managing programs, and when you're moving to the next level, you
really have to be clear about segregating the day-to-day
responsibilities of program implementation and the board
responsibilities in terms of strategic direction.

Q: I just want to ask Tom a hypothetical question: Do you have to be
registered with USAID as a CBO to qualify for that?

MR. CAMPBELL: No, there's no requirement -- we're not connected at all
with USAID. So there's no requirement for you to be registered with
USAID; there's no requirement to even register with HHS; the only
eligibility requirements are of the individual programs. We do --
they're really, pretty broad and if you're looking at, say, the
mini-grant program, which has the \$50,000 limit, you don't even have to
have a 501(c)(3) to be eligible. You have to be a nonprofit, but there
are other ways to be a nonprofit; there are state ways and non-federal
501(c)(3) ways to be a nonprofit. So no, there's very -- one of the
things we've really tried to do for the program was to eliminate those
kinds of barriers and we wanted it to be as open as it could be.

MR. SINGER: Anybody else? Yes, could you bring the mike down here?

Q: I guess this question, also, would be to Tom: Is there open and close
day, or is this a continual program of grants available?

MR. CAMPBELL: This is a program that's -- usually, they want annually,
is the idea. Of course, it's always up to Congress whether they give us
money or not. Generally, what we -- did I mention \$52 million? I did, I
think. What we -- the way it generally works -- and even if I knew the
answer to this question, specifically, I couldn't tell you -- but it
generally happens that the -- we call them program announcements -- the
notices of funding availability come out and are published on grants.gov
probably in the wintertime -- sometime between January and March,
usually; maybe early spring -- and then the process starts.

Well, we accept the applications, we panel them -- and we panel them
with expert reviewers all over the country -- and we do it remotely, so
if you're interested in being a panel member and reviewing the grant
applications -- even if you apply, you can still do that -- I would
absolutely, if you're interested in any kind of federal grant, become a
panel reviewer. It's a great way to be involved; it's a great way to see
the sausage-making behind, you know, behind -- and, I mean, it's not
pretty -- (chuckles) -- but it's very informative and it's very
educational. I'm sorry?

Q: (Inaudible, off mike.)

MR. CAMPBELL: You just -- there's actually, if you go to our Web site,
there's a place that says, "Interested in being a reviewer," and you
click on that and you send your information on. Or you just send me an
e-mail or you get a card from me, you send me an e-mail, you call me or
whatever -- any other ways you can do it. We do pick people based on the
resumes, but we want a variety of people. We get folks from
universities; we get folks from nonprofits; we get grant writers; we get
folks from just the community, folks that are on boards, folks that are
on advisory committees, folks that are on, you know, any kind of
connection; people that are experts at capacity-building; people that
are experts in financial services; people that are -- I mean, really,
whatever, if you have any kind of expertise or any kind of connection
with what nonprofits are doing in the community, whether it be as a
recipient or as a practitioner or as an advisor, we want to mix up our
panels so that we get a good mix of a different variety of perspectives,
because that's tremendously important, tremendously valuable, and vital
to getting a good list, at the end of the day, of the organizations that
we're going to fund.

MR. SINGER: Well, thank you all very much. Please pick up your free
resources and handbags in the back, and, Heather, are you going to come
up and tell us what we're doing next?

MS. MACLEAN: Yeah, give us two minutes and then we'll be right back with
you.

MR. SINGER: Okay, so we'll just take a short break and then we'll have
the conclusion of the program. Thanks.

(END)