Philadelphia’s Nonprofit Human Service Organizations: How African American-Led Organizations Differ from White-Led Organizations Presentation at Philanthropy Network Jennifer Thompson, Ph.D. Vice President, Branch Associates, Inc. June 20, 2016

Branch Associates, Inc. Small minority- and woman-owned research and evaluation firm located in Philadelphia Founded by Dr. Alvia Branch in 1994 Services include: program evaluation, research, technical assistance Expertise in: Research design Qualitative data collection and analysis (interviews, focus groups, case studies, observations, document review, content analysis) Quantitative data collection and analysis (surveys, statistical analyses, secondary data analysis) Substantive areas: nonprofit capacity, workforce development, youth development, education, health, aging

Philadelphia African American Leadership Forum (PAALF) Study Our goal was to conduct independent, rigorous research to answer research questions developed with PAALF and to inform their future work

Research Methodology Surveyed a sample of Executive Directors (“EDs”) at human service- oriented nonprofits in Philadelphia drawn from list of all nonprofits from National Center for Charitable Statistics Focused on “human service” organizations including: youth development, civil rights, social action & advocacy, community improvement & capacity building, etc. Random sample of 250 organizations 166 surveys completed (49% response rate) Qualitative data collection: Two focus groups with African American EDs Four one-on-one interviews with local funders Goal: representative sample of human service nonprofits in Philadelphia Sample included organizations known by PAALF to have an AA ED Not a perfect process – lots of organizations had closed, couldn't’ find contact information Despite extensive follow-up and offering an incentive, supplemented sample with PAALF outreach to other similar organizations 49% response rate is likely conservative Survey: lengthy; 60 questions about ED, organization, board, senior staff, programs, funding, etc.

Characteristics of Sample 145 EDs: 51% (74) African American 43% (63) White 6% (8) Other Age Over 70% 45 years old or older Less than 10% under 35 years old Gender 64% female 36% male Education 64% Master’s degree or advanced degree (Ph.D., J.D., etc.) 6% (8) other includes: Hispanic/Latino (3); Other (3); and Asian/Pacific Islander (2). Too small sample size to include in analyses.

Definition of African American-Led Organization ED who completed survey for their organization self-identified as African American Refer to their organization as “AA-led” organization or nonprofit Analysis: Compared survey results for African American EDs (AA-led) and White EDs (white-led)

Findings from the Data

Similarities between AA-led and white-led organizations Background and experience of EDs (age, gender, education, years as ED, years at organization, years in nonprofit sector) How spend time as ED Age and budget of organization Gender composition of board and senior staff Expertise of board members and senior staff

AA-led organizations are more likely than white-led organizations to be small (11-49 staff) or micro (10 or fewer staff)

AA-led organizations are less likely to have cash reserves on hand: 32% have four or more months of cash reserves compared to 57% of white-led organizations

While government grants are the largest source of funding for both AA-led and white-led organizations, they are a larger percentage for AA-led organizations (35% of funding, on average, versus 22% for white-led organizations) At over one third of AA-led organizations (35%), at least half of their current funding is from government grants; this is true at 21% of white-led organizations.

AA-led organizations are more likely to have African American board members and white-led organizations are more likely to have white board members Furthermore – at over a quarter (27%) of AA-led organizations, all board members are African American. At 10% of white-led organizations, all board members are white.

AA-led organizations are more likely to have senior staff who are African American; white-led organizations are more likely to have senior staff who are white Furthermore, at almost 60% of AA-led organizations (59%), all senior staff are African Americans. Similarly, at about half of white organizations (48%), all senior staff are white.

AA-led organizations are more likely than white-led organizations to provide: after-school activities, youth development, financial literacy, and business/entrepreneurship

AA-led organizations are more likely to serve youth ages 13-18 (teens) than white-led organizations

AA-led organizations are more likely to serve African Americans than white-led organizations. White-led organizations are more likely to serve white clients than AA-led organizations.

AA-led organizations are more likely to serve low-income clients than white-led organizations

AA-led organizations are more likely than white-led organizations to be both serving and located in low-income neighborhoods (note: not statistically significant difference) Clients of AA-led organizations more likely to reside in: West Philadelphia, Olney-Oak Lane. Clients of white-led organizations more likely to reside in Center City.

AA-led organizations are more likely to track data than white-led organizations Likely related to government funding, which usually requires data collection/accountability.

AA-led organizations are more likely than white-led organizations to track program outcomes

AA-led organizations were more likely to have received TA in board development than white-led organizations; white-led organizations were more likely to have received TA in strategic planning While not statistically significant, AA-led organizations were more likely than white-led organizations to not have received any TA in last five years: 26% (AA-led) vs. 16% (white-led)

AA-led organizations were more likely than white-led organizations to name fundraising as a significant challenge

Slightly more AA EDs agreed/strongly agreed: Race/ethnicity is a barrier to my organization’s growth (note: difference was not statistically significant) AA EDs: 40% versus 32% of white EDs

Summary of Key Findings AA-led organizations are smaller and have fewer cash reserves AA-led organizations are more dependent on government grants (which may explain why they are more likely to track data and program outcomes) AA-led organizations are more likely to have African American board members and senior staff; white-led organizations are more likely to have white board members and senior staff AA-led organizations are more likely to serve teens, African Americans, and low-income residents Bullet #1 & #2: may make AA-led organizations more vulnerable to recessions and changes in government; and thus more financially precarious Bullet #3: downside to homogeneity, especially on boards, is lack of diverse professional and social networks, which can negatively impact access to funding Bullet #4: serving neediest populations in Philadelphia; also located in neediest neighborhoods (access to clients; builds trust); shows value of AA-led organizations

Additional Information Full report can be found: http://phillyaalf.org/ http://www.branchassoc.com Questions about data or findings: Jennifer Thompson jthompson@branchassoc.com

Appendix: Details on Research Methodology Started with list of all 501c3 organizations in Philadelphia from the National Center for Charitable Statistics (“sampling frame”) N=7,722 Narrowed list to “human service” organizations such as those classified as youth development, human services, civil rights, social action & advocacy, community improvement & capacity building, etc. From revised sampling frame/list (N=955), drew stratified random sample of 250 organizations (included all known AA-led organizations; stratified by assets) Emailed survey to EDs at sampled organizations; offered $10 incentive (gift card) To increase response rate, PAALF members reached out to additional human service organizations November 2014 – March 2015: 166 surveys completed Response rate: about 49% (likely a conservative estimate)