AUCKLAND15–16 April 2015

news No: 65 March 2015, ISSN 1175-9151

The magazine of Philanthropy New Zealand

Philanthropy

FUNDING TO MAORIMaori missing out on philanthropic funding

GIVING TO KIDSTips on how to invest in children

INEQUALITY GOES MAINSTREAMMax Rashbrooke on the latest policy trend

FOOD FOR THOUGHTPutting the theory of collaboration into practice

Dame Anne Salmond on philanthropy and the environment

Restoration projecttakes flight

From the Chief Executive

Happy New Year – and welcome to the latest issue of Philanthropy News.

We have another exciting year ahead of us, starting, of course, with the Philanthropy Summit 2015: The Power of Strategic Giving being held in Auckland on 15 & 16 April. We have a reputation for doing great conferences, and this one is shaping up to be even more stimulating and thought-provoking than ever.

I’m really looking forward to hearing from our overseas keynote speakers, Justin Rockefeller, Mae Hong and Peter Hero, and to catching up with our Australian friend Allan English, who was named by Philanthropy Australia as the 2014 Philanthropy Leader of the Year. Allan is a passionate and eloquent advocate for the joy of giving.

The Summit is also a great opportunity to celebrate the work New Zealand grantmakers are doing to reshape philanthropy in the 21st century and make a lasting difference to the lives of thousands of ordinary Kiwis.

For keynote speaker Dame Anne Salmond, generosity in all its forms lies at the heart of a 15-year project to create the Longbush Ecosanctuary near Gisborne. As she explains in an interview on page 6, philanthropy has made it possible for this ambitious environmental project to take flight.

Wellington journalist Max Rashbrooke is one of four speakers taking part in a panel discussion looking at the factors that are driving growing inequality – both here and overseas. He’s been exploring the issue of inequality for years now, and is the author of several books on the subject. Now, much to his delight, inequality is finally going mainstream. As he writes on page 11, even banks and conservative politicians are saying something needs to be done about rising inequality.

One of the measures of success of any conference is its impact. If you want proof that Philanthropy New Zealand conferences make a lasting difference check out the story on page 13 about a new food rescue service in Hamilton that was inspired by seeing Wellington-based Kaibosh Food Rescue in action at our last conference in 2013.

See you in Auckland in April!

Tena koutou

2 Philanthropy New Zealand Toputanga Tuku Aroha o Aotearoa

In this issue…3-5 News & Events The latest news from Philanthropy New Zealand.

6-7 Restoration project takes flight Generosity in all its forms lies at the heart of the

Longbush Ecosanctuary near Gisborne created by Philanthropy Summit 2015 keynote speaker Dame Anne Salmond.

8-9 Focus on funding to Maori Research from the J R McKenzie Trust has found

that Maori are missing out on their share of philanthropic funding, and that few organisations have a policy to change this.

10 Why giving to kids makes sense New guidance being developed by Philanthropy

New Zealand and the Office of the Children’s Commissioner will help take the guesswork out of how best to invest in children.

11 Inequality goes mainstream Wellington author and journalist Max

Rashbrooke is pleased to see that even banks and conservative politicians are now saying that something needs to be done about inequality.

12 Measuring our carbon footprint We’re using the Philanthropy Summit 2015 to get

a baseline measure of our carbon footprint.

13 Food for thought Philanthropy New Zealand’s last conference in

April 2013 provided the inspiration for a new food rescue initiative in Hamilton.

14-15 Telling the full story Changes to the way that charities file their

financial returns will improve the public perception of the charitable sector and create more transparency about what charities do.

Cover Image: Dame Anne Salmond and the Longbush Ecosanctuary near Gisborne.

Liz Gibbs

News & Events

Understanding the 21st Century Donor

With a few weeks still to go until the Philanthropy Summit 2015 in Auckland on 15 & 16 April some of the workshop sessions are already full.

If you haven’t already done so, we recommend registering now to make sure you get the workshop sessions of your choice.

We have a great line-up of national and international speakers at the Summit. These include US philanthropic leaders Justin Rockefeller, Peter Hero and Mae Hong, as well as eminent New Zealanders Dame Anne Salmond – featured in this issue of Philanthropy News – Ta Mark Solomon and Professor Manuka Henare.

We also have our biggest-ever selection of investment workshops. They include Bevan Graham of AMP Capital talking about the economic and social problems left by the GFC and the growing importance of the third sector in meeting the challenges. The subjects of other workshops include responsible investing, new ways of generating income, and the governance must-haves for good investment returns.

As well as our two-day Summit for grantmakers we’re also holding a one-day event for community organisations on Friday 17 April.

The Philanthropy Summit 2015: Understanding the 21st Century Donor will feature keynote speakers Mae Hong and Peter Hero. It will also provide insights into how grantmaking is changing in the 21st century, and what not-for-profit organisations need to do to attract support from a new generation of philanthropists.

Don’t forget to let your grantees know about this unique opportunity to network with some of New Zealand’s leading grantmakers and the wider not-for-profit community.

We are grateful to the following organisations for their sponsorship of the Philanthropy Summit 2015 and for their longer-term commitment of support for Philanthropy New Zealand: AMP Capital, BNZ, Perpetual Guardian and the Rotorua Energy Charitable Trust.

The Philanthropy Summit 2015 is also supported by: AON; Continuity Capital; Direct Capital; Fisher Funds; Franklin Templeton; Harbour Asset Management; Mercer; Melville, Jessup, Weaver; PIMCO; Russell Investments; Smarty Grants; the University of Auckland and Dale Jennings.

Both Murray Jones and Lani Evans are taking part in workshops at the Philanthropy Summit 2015 – check the programme for more details

Philanthropy Summit 2015

Workshop sessions filling up

Welcome to our new board members

We’re delighted to welcome our two newest board members, Murray Jones (pictured left) and Lani Evans. They both come with a long history of working in the philanthropic sector – and they also help swell the number of South Island-based board members from just one to three.

Murray is a Christchurch businessman who set up the Dove Charitable Trust in 1981. It funds small to medium-sized organisations working in the social justice area. They include individual women’s refuges, as well as projects such as the Cannons Creek Community Pantry, where volunteers grow vegetables in community gardens to supplement traditional food parcels.

Staff at Murray’s company, Dove Electronics, are also encouraged to co-sponsor selected charitable projects, the current one of which is a World Vision project on the island of Tanna in Vanuatu. Two staff are chosen to visit the project each year.

For Murray, giving back is an integral part of running a business.

“We shouldn’t just be there to make ourselves wealthy – it’s important to share it around a bit,” he says.

And he says there is no doubt that business giving helps increase staff engagement. “The staff just love the fact that we support charitable work.”

Lani Evans is the CEO of Thankyou Payroll, a Dunedin-based social enterprise, and co-chair of the Thankyou Charitable Trust, a small grant-making organisation that is experimenting with innovative approaches to philanthropy. They include a ‘pay-it-forward’ funding model, accountability dinner parties and the development of an app to make decision-making processes easier for collation committees.

She is also on the board of the Dunedin-based Malcam Charitable Trust, and is a 2015 Winston Churchill Fellowship recipient. She will travel overseas later this year to explore the efficacy of devolved decision-making models in international philanthropy.

News & Events

4 Philanthropy New Zealand Toputanga Tuku Aroha o Aotearoa

Launch of Environmental Funders’ Network

Brand refresh

Our man in Auckland

It was great to see so many Philanthropy New Zealand members and representatives from other organisations with an interest in supporting or funding into the environment at the launch of the Environmental Funders’ Network in Auckland in November.

Altogether 23 people attended the meeting, where Ken Wilson of the Christensen Fund and Amanda Martin of the Australian Environmental Grantmakers Network talked about how similar networks operate in the United States and Australia.

Four of those who attended have now joined us in a steering group to help decide how the network will operate in the future. The next meeting of the Environmental Funders’ Network will be held in Auckland on 1 July.

Delegates at the Philanthropy Summit 2015 will notice that the Philanthropy New Zealand logo has changed.

We recently undertook a brand refresh, and we are launching the new logo at the Summit. As you can see, we’ve kept the koru which has been part of our logo for more than a decade, but in a slightly different format.

Watch out for the new logo on the Summit banners – and on all our subsequent communications.

Giving NZ to be updatedWe’re delighted to announce that we have commissioned BERL to undertake an update of Giving New Zealand: Philanthropic Funding 2011.

Giving New Zealand provides a comprehensive overview of giving by three main groups – trusts and foundations, individuals, and businesses. It has been an invaluable tool for anyone with an interest in finding out who gives what since it was published in January 2012. We’re looking forward to finding out what’s changed in the philanthropic sector since then – and what has stayed the same.

At this stage BERL plans to send the surveys out by the end of April and we hope to launch the report in September. We will be holding events throughout New Zealand to launch Giving New Zealand – we will update you soon with dates and venues.

Our newest staff member Anthony Ford (above) says the job description for the role he is taking up was a perfect match for what he was looking for.

Anthony will work 25 hours a week as a Philanthropy Advisor based in Auckland, where he will help increase Philanthropy New Zealand’s presence in the city, provide support to our Auckland members, and help promote thoughtful generosity and philanthropy.

“I was already thinking about moving into similar kind of work myself,” he says. “I have a large network of friends and corporate contacts, and I am keen on helping them to give more and to give better. When the role with Philanthropy New Zealand came up the job description pretty much matched what I was planning to do.”

Anthony has an impressive track record in philanthropy. He is currently working as general manager of First Foundation, an organisation that helps talented young people from financially disadvantaged backgrounds undertake tertiary education. He and his wife Vanessa also run the Not for Me Charitable Trust, which sources memorabilia and other items for charities to auction to raise money.

Among the more notable items they have sourced are a golf glove signed by Tiger Woods, a $5 note signed by Sir Edmund Hillary and a rugby jersey signed by Buck Shelford.

Since it was set up in 2006 the Trust has raised more than $400,000 for more than 60 charitable organisations. Anthony is now looking at refocusing the Trust’s work to allow it to develop deeper relationships with a smaller number of charities, and help add value to the work they do.

Anthony is also involved in a wide range of other philanthropic activities, ranging from youth mentoring to participating in charity fundraising events such as the Cure Kids Adventure Race. He’s now working on finishing a book about his personal giving journey that he hopes will inspire others to follow a similar path.

News & Events

Calendar of events15 & 16 April Philanthropy Summit 2015, The Power of Strategic Giving, University of Auckland

17 April Philanthropy Summit 2015, Understanding the 21st Century Donor University of Auckland

3 June Wellington Funders’ Network

17 June Canterbury Recovery Funders’ Network

24 June Auckland Funders’ Network

1 July Environmental Funders’ Network, Auckland

2 July Youth Funders’ Network, Auckland

4 August Governance for Chairs, Wellington

5 & 6 August Governance & Investment Workshops, Wellington

Governance for Chairs

Staff changes at our member organisations

US grantmakers back in the groove after GFC

This year we’re expanding our popular Governance and Investment Workshops to include a one-day event on 4 August specifically for chairs of trust and foundations.

Our governance expert Graeme Nahkies will lead a facilitated discussion where you can learn best practice, share your knowledge and learn from other board chairs.

The one-day event will be followed by our traditional two-day Governance and Investment workshops on 5 & 6 August. Mark the dates in your diaries now, and we’ll keep you posted with the details.

After “nine-and-a-half fabulous years” as Executive Director of the Todd Foundation, Kate Frykberg (left), is stepping down from the job on 2 April.

“I’ve loved working for the Foundation, but the time now feels right for new leadership at the Foundation – and for new challenges for me,” she says.

Kate will continue in her role as chair of the board of Philanthropy

New Zealand and she will be very much in evidence at the Philanthropy Summit 2015, where she is leading a workshop on generosity in everyday life.

She is also appearing at the one-day event for community organisations on April 17, where she is looking forward to providing some insights from the last nine years working in philanthropy.

Kate leaves for an overseas trip with her family shortly after the Summit and when she returns she plans to take on consulting roles related to generosity and social change. She’ll also keep writing her blog, On philanthropy and community – check it out at www.katefrykberg.co.nz. The Todd Foundation hopes to name Kate’s replacement by mid-March.

Meanwhile, a big welcome to Alastair Rhodes who has now started working as the first-ever CEO at BayTrust in Tauranga. Alastair, who was previously CEO of Rotorua Airport, took up the position in February.

He replaces Bruce Cronin, who retired at the end of last year after 18 years as Trust manager. The position of the CEO was created following an organisational restructure at BayTrust last year.

And in Wellington, Nikau Foundation CEO Kitty Hilton has also stepped down after 18 months part-time in the job. She is returning to full-time work as a fundraising contractor.

Grants for general operating support, and multiyear funding are on the rise as the US economy recovers after the global financial crisis, according to new research on philanthropic practice carried out by Grantmakers for Effective Organizations.

The research also found that US grantmakers are seeking more feedback from their grantees, with 53% of those surveyed saying they now regularly solicit feedback, compared with just 36% six years ago.

GEO carries out the research every three years. It looks at how members are changing the way they work to build stronger, more effective not-for-profit oganisations.

The survey found that the median amount grantmakers gave to support operating costs increased from 20% in 2008 and 2011 to 25% in 2014. It also found that, following the uncertainty of the recent recession, grantmakers had once again started giving multiyear grants, with 31% saying they had increased the total dollars they gave as multiyear grants.

However, it suggests that multiyear funding should not be a fairweather practice. “In tough times nonprofits need this stability more than ever. Long-term support allows nonprofits to plan with confidence and reduces the amount of time they have to spend applying and reporting on grants.”

For more information go to: www.geofunders.org

6 Philanthropy New Zealand Toputanga Tuku Aroha o Aotearoa

Generosity in all its forms lies at the heart of a 15-year project to create the Longbush Ecosanctuary near Gisborne, according to Philanthropy Summit 2015 keynote speaker Dame Anne Salmond.

When Dame Anne Salmond and her husband Jeremy bought a block of struggling native bush known as Longbush, about 9km north of Gisborne, in 2000,

they had no idea what they would do with it. They just knew they wanted to make sure the land, which

includes 11 hectares of rare lowland bush, was not used for forestry.

“We thought ‘that can’t happen – to have pine trees on Longbush would be a disaster’,” says Dame Anne. “So without really thinking about it, we bought it.”

Now, thanks to 15 years of hard restoration work by the Salmonds and an army of volunteers, as well as generous financial support from many philanthropic trusts – including Philanthropy New Zealand member the Eastland Community Trust – the once-threatened piece of land has become the Longbush Ecosanctuary.

It’s a haven for rare and endangered species of native birds, plants and animals. They include toutouwai (the North Island robin), korimako (bell birds) and titi (muttonbirds), as well as several types of native orchids, 50 species of native trees, and wildlife such as longtail bats and gecko.

PHILANTHROPY SUMMIT 2015: Keynote Speaker

“It’s quite extraordinary what happens when you start removing the predators and pests,” says Dame Anne. “We sometimes think that the birds must communicate with each other, and tell the others it’s a good spot in town because they just turn up. Plants like native orchids pop up out of the ground – we didn’t even know they were there. ”

According to Dame Anne, who was the 2013 Kiwibank New Zealander of the year, philanthropy lies at the heart of the project’s success.

“There’s a nice Maori proverb, Ma te huruhuru ka rere te manu – birds need feathers to fly,” she says. “In the case of Longbush, philanthropy has allowed our dreams to soar.”

Those ‘feathers’ include not just monetary support but also thousands of hours of voluntary support. Volunteers have helped to clear and replant the land. They’ve also carried out several building projects at the site. Last year carpentry students from the Eastland Institute of Technology built a bridge in the reserve, using material paid for by several trusts.

“The students adored the experience of being in the bush.”More than 170 people also chipped in with labour or

financial support to help build the ecosanctuary’s new

Restoration project takes flight

The Longbush Ecosanctuary near Gisborne which has been created with the help of an army of volunteers and generous support from many philanthropic trusts.

PHOTO: Simon Devitt.

PHILANTHROPY SUMMIT 2015: Keynote Speaker

welcome shelter, designed by young Auckland architect Sarosh Mulla, which opened at the end of January.

“Sarosh conceived of this thing, and he shoulder-tapped volunteers, trusts and key product makers to provide the materials. It has had a zero budget – the individual generosity has been incredible.”

For Dame Anne, preserving and restoring our natural environment is not a feel-good optional extra; it’s essential for our future economic prosperity.

“People tend to think of ecological restoration as a luxury item, but it’s not a question of the environment versus the economy. So much of our wealth depends on our land – it underpins our prosperity. People want to come here, and to invest here, because they see us as people who care about our water ways and coastline, and about our indigenous plants and animals – it’s a magnet.”

But as she has discovered, restoring degraded ecosystems is long, slow work and the amount of public money available to fund it is limited. That is why the philanthropic sector is so important.

“I think this sort of thing should be a public-private partnership – we can’t afford to do it otherwise.”

The Longbush project is one of two large restoration projects Dame Anne is associated with. She is also patron of Te Awaroa: A Thousand Rivers, which aims to restore 1000 rivers to full health by 2050. Te Awaroa is one of the first four projects to be allocated funding by the recently formed NEXT Foundation; Te Awaroa has also received funding from the Tindall Foundation.

Dame Anne is delighted by that support, not just because it will make it possible for the project to go ahead, but because it shows the philanthropic world recognises the economic importance of preserving the environment.

“Some of our most astute business people, such as Sir Stephen Tindall and the NEXT trustees, already understand that our gorgeous islands really are the fulcrum of our prosperity.”

Dame Anne Salmond will give her keynote address at 8.35am on Thursday 16 April. The title of the address is Gifts, People and the Environment – supporting the life systems that support us.

“People tend to think of ecological restoration as

a luxury item, but it’s not a question of the environment

versus the economy.”

The Longbush Welcome Shelter designed by Sarosh Mulla, which opened at the end of January. PHOTO: Simon Devitt.

Carpentry students from the Eastland Institute of Technology on their newly built bridge.

Dame Anne Salmond PHOTO: Jane Ussher.

8 Philanthropy New Zealand Toputanga Tuku Aroha o Aotearoa

Participants at a national rangatahi training hui held in Wellington by the Constitutional Transformation Working Group, which received funding from the J R McKenzie Trust.

PHILANTHROPY SUMMIT 2015: Funding to Maori

New research from the J R McKenzie Trust has found that Maori are missing out on their share of philanthropic funding, and that few organisations have a policy to change this.

Focus on funding to Maori

The J R McKenzie Trust is encouraging other philanthropic organisations to start focusing more specifically on funding to Maori, after a new report found that only one

fifth of grantmakers have a policy or strategy in place related to giving to Maori.

The report, Philanthropic Funding to Maori, published by the J R McKenzie Trust in December last year, shows that in 2012 Maori received $289m – or 12% – of all philanthropic funding. Of this, half was given to individuals for education. The total amount is lower on a per-capita basis than other population sub-groups.

The survey also found that only one fifth of grantmakers had a specific policy on giving to Maori. Of the 108 grant- makers who responded, 21% had such a policy, and nearly half did not.

Manaia King, who is deputy chair of the J R McKenzie Trust and chair of Te Kawai Toro, the Trust’s Maori development committee, says this finding did not surprise him.

“We want to start a conversation around these figures, and encourage other organisations which don’t have a Maori-specific focus to look at this as a potential investment area.”

Manaia says J R McKenzie’s own experience is a good example of a mainstream philanthropic organisation that has successfully realigned its funding strategy. In 2010 the Trust changed its focus to concentrate on two main funding areas – Maori development and disadvantaged children and their families. This followed a review of the Trust’s activities which found that only 2% to 3% of its funding went to Maori.

Around 45% of the Trust’s funding now supports Maori development. The success of this change in direction was recognised last year when the Trust received the 2014 IFIP (International Funders for Indigenous Peoples) Award, which encourages donors who fund indigenous communities worldwide.

“If J R McKenzie can do it then others can as well,” says Manaia. “We’re very happy to share our journey and what we’ve learned so far with other funders.”

He says funding to Maori makes sense for several reasons, including the fact that statistics show there is a proven need for support in many Maori communities. But it’s also a way of encouraging Maori entrepreneurialism, which has the potential to benefit all New Zealanders.

Manaia King will join Fiona Stokes of BERL at the Summit at 10.45am on Thursday 16 April to talk about the results of the survey and the need for greater collaboration in the philanthropic sector to better align investment to Maori development.

PHILANTHROPY SUMMIT 2015: Funding to Maori

“It’s a case of small steps for small organisations and bigger ones for those with more resources.”

The research, which was carried out for J R McKenzie Trust by BERL Economics, also highlighted the fact many philanthropic organisations are not currently collecting data about things such as the ethnicity, sex, age and region of their grantees.

“We need data in order to learn from what we have done in the past,” says Manaia. “It would be good for philanthropic organisations to start collecting information on things such as the number of Maori initiatives they are supporting.”

Manaia King

“It’s true that for Maori there is a lot of deficit in areas such as health and well-being, education, and employment. While many gains are being made in all these areas with the support of the government and the philanthropic sector, I believe the philanthropic sector could do more.

“For example, supporting Maori initiatives and helping grow the Maori economy will benefit not only Maori but the whole of New Zealand.”

Manaia suggests two possible approaches for organisations interested in developing a more focused policy, depending on their size.

For smaller organisations he suggests looking at developing relationships with Maori organisations that want to do something small.

However, for larger, more established organisations, he suggests funding Maori economic development initiatives that can be scaled up.

Philanthropic funding to Maori totalled $289 million

• 64% was from personal donation and bequests.

• A further 31% came from trusts and foundations.

• 6% from business.

Philanthropic funding to Maori was used across a broad range of activities

• Education and research activities (including kohanga reo; literacy programmes; life skills, leadership and professional courses; and tertiary scholarships) was the activity category receiving the largest amount of funding.

• Marae (including building) was the second largest category in terms of funding. Activities related to Maori health and to social services were the next two largest categories.

Survey responses indicate limited engagement between the philanthropic sector and Maori organisations.

• The sub-activity receiving the largest funding was for scholarships to individuals.

• Asked whether they had specific policy or strategy in place relating to giving to Maori:

– only 21% responded with a yes

– nearly a half responded no

– nearly a third did not respond.

NOTE: The results are based on an online survey sent to 4330 grantmakers and 15,119 grant recipients. Responses were received from 108 grantmakers (a response rate of 2.5%) and from 484 grant recipients (a response rate of 3.2%).

Giving to Maori: activity funded

Education

Marae

Maori Health

Social Services

Maori Business Development

Other

Yes21%

50%

15%

15%

8%

7%

5%

No49%

No Response

30%

Do you have a specific strategy/policy related to giving to Maori?

Philanthropic Funding to Maori: Main findings

they decide who, why and how they fund in order to achieve the best possible outcomes for children.

Included in the guidance is some background information on what children need to thrive and how these needs change as they progress through childhood. It identifies six basic needs which are: a stable nurturing family; a healthy, safe and affordable home; adequate income; a supportive community; education support and accessible health services.

“If children miss out on having these needs met there can be serious consequences – their health can be compromised, their learning can be compromised, and their outcomes can be compromised,” Justine says.

The guidance also identifies the four groups of children where investment can have the greatest impact. They are: very young children (pre-birth to age 5); Maori and Pasifika children; children in sole-parent families, and children in severe and persistent poverty.

Of these, investing in very young children offers the greatest return on investment.

“If you have a good start in life then even if something happens to your family that puts it under stress later, you can cope with it better because those foundations have been laid.”

Justine says that as well as scoping your community’s needs, it’s also worth finding out what other organisations are already working in this area, and whether you can work in partnership with other funders or organisations to increase the impact of your investment.

“It’s got to be horses for courses; it’s important to take a nuanced approach. Find out where the gaps are, who is doing what and what is needed. It might be that in your community families are struggling with home insulation, or they may be having difficulties engaging with health services.

“If you’re a philanthropist of any kind, whether you’re an individual or an established organisation, you need to work out where you can make the most impact. That’s where the Giving2Kids information and guidance can help you make a real and lasting difference in your community.”

10 Philanthropy New Zealand Toputanga Tuku Aroha o Aotearoa

PHILANTHROPY SUMMIT 2015: Investing in Children

New guidance being developed by Philanthropy New Zealand and the Office of the Children’s Commissioner will help make it easier for potential donors to decide how best to invest in children.

Deputy Children’s Commissioner Dr Justine Cornwall.

Justine Cornwall will join Donna Provoost, advocacy manager at the Office of the Children’s Commissioner, at the Summit at 1.30pm on Thursday 16 April to talk about the value of investing in children and the Giving2Kids project.

Giving2Kids makes sense

Politicians may quibble about exactly how many New Zealand children live in poverty, but no-one disagrees that every child deserves the best possible start in life

– and that too many of our children are not getting the start they deserve.

Nor is there any dispute about the value of investing in children. As Choose Kids, a recent discussion paper published by the Office of the Children’s Commissioner, points out, investing in children benefits all New Zealanders.

“New Zealand needs every single child to thrive in order to support a future of high productivity, innovation, economic growth and improved social cohesion,” the paper says.

The government is the biggest player when it comes to investing in children, but local communities, businesses and philanthropic organisations also have an important role to play. There has been little clear advice to help these organisations decide where to focus their efforts and investment to have the biggest impact.

And, according to deputy children’s commissioner Justine Cornwall, while many ordinary New Zealanders are keen to do their bit, they often do not know where to start.

“The issue can seem quite overwhelming,” she says. “The needs can vary a lot depending on the individual family, or the community they live in.”

In some cases, a lack of co-ordination means that service providers can end up duplicating services, or not effectively meeting the needs of their community.

“There are some great initiatives out there, but they’re not necessarily connected to what else is happening, or do not always link families very well to the range of services they might need,” Justine says.

To help ensure that organisations make cost-effective investments that truly meet the needs of their community, the Office of the Children’s Commissioner has teamed up with Philanthropy New Zealand to develop guidance for philanthropists and businesses called Giving2Kids.

The goal of Giving2Kids is to support potential funders as

PHILANTHROPY SUMMIT 2015: Income and Inequality

Even banks and conservative politicians are now saying that something needs to done about rising inequality writes Philanthropy Summit speaker Max Rashbrooke.

Inequality expert Max Rashbrooke.

Max Rashbooke is the author of the editor and co-author of Inequality: A New Zealand Crisis, and the author of The Inequality Debate: an Introduction. He will join Iain Hines of the J R McKenzie Trust and keynote speaker Mae Hong for a panel discussion on Equality in New Zealand and beyond – The quest for real impact in an unequal world at 10.45am on 15 April.

Inequality goes mainstream

On February 2 this year, ANZ Bank published a research note entitled ‘New Zealand Key Themes for 2015’. Alongside the usual issues like dairy prices

was something that banks have not normally concerned themselves with: income inequality.

“A degree of inequality can be expected (and is necessary) in any market economy,” the bank argued. “However, rising income inequality dampens economic mobility, reduces education standards, and makes an economy less flexible. Rising social tensions can also lead to political instability. There are good economic reasons for addressing inequality.”

This acceptance of the need to address big income gaps is yet another sign that inequality has gone mainstream. Around the world it is rapidly becoming the issue of the moment. Witness the media storm earlier this year when Oxfam revealed that the world’s wealthiest one per cent will soon own more than the rest of the globe put together.

More strikingly still, in the US, a Republican Party that has traditionally derided inequality-related arguments as ‘class warfare’ has suddenly embraced the issue, with Presidential hopefuls such as Jeb Bush setting out plans to close income gaps.

“In the two decades from 1985 onwards, we had the biggest increase in income gaps

of any developed country.”In New Zealand, too, inequality is increasingly being

discussed. And that’s no surprise, given that in the two decades from 1985 onwards, we had the biggest increase in income gaps of any developed country. Incomes for the richest Kiwis doubled, while those of the poorest stagnated. Middle income earners didn’t do too well, either.

What caused this? It’s hard to ignore the correlation between the timing of the increase and the country’s post-

1984 political revolution. New Zealand halved its top tax rate, cut benefits by up to a quarter of their value, and dramatically reduced the bargaining power – and therefore the share of national income – of ordinary workers.

Thousands of people lost their jobs as manufacturing work went overseas, and there was no significant response with increased trade training or skills programmes, a policy failure that is ongoing. At the same time, New Zealand stopped building affordable houses in any serious quantity, forcing poorer households to spend ever-increasing amounts on rent and mortgages.

None of this implies that New Zealand enjoyed a halcyon existence before the 1980s’ reforms; it didn’t. But it does imply that an alternative path towards a modern economy, one in which the benefits of growth were shared evenly, was ignored. Last year a landmark OECD report argued that our increased rich-poor divide had taken over a third off the country’s economic growth rate in the last 20 years. So a fairer reform path would actually have led to greater growth, as well as greater equality.

For this and for other reasons, alarm bells are beginning to sound. Recent polling shows three-quarters of New Zealanders think theirs is no longer an egalitarian country, and that this is a bad thing. Part of the unease stems from a realisation that big income gaps aren’t compatible with the idea that there should be an equal chance for all.

In very unequal countries like the United States, half an adult’s income can be predicted from what their parents earned. New Zealand isn’t there yet, but it does have a situation in which exclusive schools are raffling off internships at New York firms, while the parents of poor children are on such low wages that they can’t afford the electricity to keep a fridge running. Is that the quintessential Kiwi “fair go”? It’s hard to think so.

12 Philanthropy New Zealand Toputanga Tuku Aroha o Aotearoa

Delegates to the Philanthropy Summit 2015 shouldn’t be surprised if they are approached by staff from Auckland company InStep asking them what kind of transport

they used to get to the event.We want to make sure that our events programme has

as little impact on the environment as possible, and we’ve engaged InStep to monitor the two-day Summit and provide a baseline measurement of its carbon emissions. We will use the report to help plan future events.

InStep provides a range of carbon and sustainability programmes for organisations and events around the world. Other clients include the Oxfam Trailwalker in both New Zealand and Australia; the company also monitored the environmental impact of the Winter Games in Queenstown in 2013.

Our chief executive Liz Gibbs says Philanthropy New Zealand is committed to gaining a greater understanding of how our events impact on the environment and to taking action to minimise this impact.

“The environment is one of the three themes of the Summit and we think it’s important to demonstrate our commitment to sound environmental management,” she says.

InStep staff will spend the two days measuring things such as electricity use, water consumption, paper use, and wastage.

They will be largely hovering quietly in the background, but as part of the audit they will also survey 10% of delegates to find out how they travelled to Auckland. Delegate transport makes up at least 95% of the carbon footprint of most events.

The InStep report will provide a useful baseline measure about how environmentally friendly our events are. But we’re not waiting for the report to start taking steps to reduce our carbon footprint.

We’re already working to make the Summit as sustainable as possible. This includes limiting our use of paper by not having

Measuring the Summit’s carbon footprint

PHILANTHROPY SUMMIT 2015: Sustainability

We’re committed to making our events programme as environmentally friendly as possible and we’re using the Philanthropy Summit 2015 to get a baseline measure of our carbon footprint.

a printed programme. Instead, we’re using a Smartphone app called Showgizmo which delegates can download to get a personalised schedule showing their workshop choices and times. We’ll be sending information out about how to download Showgizmo closer to the Summit.

We’re also working with our caterers to minimise food wastage and to re-use leftover food wherever possible. This follows the success of Kaibosh Food Rescue at the last Philanthropy New Zealand conference in 2013 (see story next page).

Five tips to reduce your carbon footprintWe’re not suggesting that you get on your bike to help reduce your carbon footprint (though Aucklanders are welcome to do so!). But you can take a few simple steps to make sure your Summit experience has as little impact on the environment as possible.• Choose the carbon off-set option when you book

your flight.• Catch the Auckland Airport Bus rather than a taxi – it’s

not only more environmentally friendly, it’s also cheaper ($28 return for the bus vs $180 return for a taxi) – and it’s often faster.

• If you live in Auckland take the bus or train to the Summit – or carpool with other delegates.

• Bring your own water bottle – there are plenty of water stations around the Owen Glenn Building.

• Download ShowGizmo onto your smartphone for a paperless, personalised Summit schedule.

Food for thoughtPhilanthropy New Zealand’s last conference in April 2013 provided the inspiration for a new food rescue initiative in Hamilton

Three Hamilton trusts have put the theory of collaboration into practice by joining forces to help set up and provide funding for the city’s first food rescue initiative,

Kaivolution.Inspiration for the initiative came after staff and trustees

from the DV Bryant Trust, Trust Waikato and the WEL Energy Trust saw Wellington-based Kaibosh Food Rescue in action at the Philanthropy New Zealand conference held in April 2013.

Over the two days of the conference Kaibosh delivered 178 meals made from unused food to several Wellington charities, including the Soup Kitchen and the Wellington Night Shelter.

DV Bryant’s chief executive Lindsay Cumberpatch says they were all extremely impressed by what they saw.

“We were so taken by it – it’s so simple but so effective, and we asked ourselves ‘Why isn’t this happening in Hamilton?’”

In an unusual move, the three trusts decided to hold a meeting to see if there was any interest in setting up something similar in the city.

“Most of us tend to respond to requests from community organisations, but this was the other way round,” says Lindsay. “We felt it was important to make sure we weren’t imposing it on the community.”

Following a positive response the trusts then commissioned a feasibility study, which found there was a real appetite for a food rescue service among the city’s food suppliers and social service agencies.

The next step was to find funding. The Waikato Environment Centre agreed to umbrella the project, and centre manager Ruth Seabright began the process of finding money to buy a refrigerated van, build a cool room, and pay the salaries for a part-time coordinator and driver. The three trusts stepped up by agreeing to provide most of the funding, with additional grants coming from several other sources including the Tindall Foundation, Lottery Grants Board, the Sky City Foundation and the Hamilton City Council.

Top: The Kaivolution van which was partly funded by three Hamilton trusts. Bottom: Kaivolution staff in action.

“We never expected to distribute more than three

tonnes of food in just 12 weeks.”

Kaibosh in Wellington also pitched in, providing invaluable support and information about how to run a food rescue service.

Kaivolution made its first food collection in October. Since then it has rescued and redistributed more than three tonnes of food – mostly fresh fruit and vegetables from food wholesalers – to 25 charitable organisations in Hamilton. They include food banks, community houses, women’s refuges and the night shelter.

Ruth Seabright says growth has already exceeded their expectations.

“We never expected to distribute more than three tonnes of food in just 12 weeks. It has been humbling to be involved with a project which is so worthy, both environmentally and socially.”

For Lindsay Cumberpatch the initiative is a satisfying illustration of collaboration in action.

“Everyone is talking about collaboration, and I think it is the way of the future. It takes more time, and it takes more energy, but for the three trusts involved it has been a very satisfying experience to work together and see such a great outcome.”

Collaboration in Action

14 Philanthropy New Zealand Toputanga Tuku Aroha o Aotearoa

Financial Reporting

Telling the full story

New financial reporting standards for registered charities being introduced on 1 April are expected to provide information that will be useful for grantmakers

assessing funding applications.One of the significant changes in the new standards is

that charities with operating costs of less than $2 million – around 95% of all registered charities – will have to provide information about non-financial matters when they file their annual financial statements with Charities Services.

This includes “entity information” and what is known as a “statement of service performance”. Essentially this means the charities must provide information about their mission, purpose, outputs, outcomes and priorities.

According to Brayden Smith, an audit associate at Grant Thornton which ran a seminar on the new reporting standards for Philanthropy New Zealand members in Wellington in February, this change will provide funders with more meaningful information about the charities they support or are considering supporting.

“The requirements are brand new for a lot of charities, though some public benefit entities, such as schools, already prepare this type of reporting,” he says. “It will be a little more work for charities, but the new reporting will help them tell the full story. The financial side is only half the story, and for many charitable organisations it’s not even the most important half. The entity information and a statement of service performance will help show the bigger picture.”

He says as well as helping funders, the new financial reports will also make it easier for the public to assess the work of the charities they support.

“It will improve transparency by providing information about cost structures and outputs and outcomes. It also has the potential to shift donating practices, as individuals will find it easier to identify the charities that generate the most value and benefit from the resources they control.”

Mr Smith says it’s important that charities start collecting the appropriate non-financial data now in order to be able to file their next financial return, the first of which will be due in September 2016, depending on what financial year the organisation follows.

“They will need to put in place mechanisms now to track information that they may not have been recording at this level of detail before.”

An organisation that provides drug counselling services, for example, may have to start recording information about exactly how many clients it deals with.

The changes will also require smaller charities to break down their sources of income into more clearly defined categories, so that they can differentiate income from things such as subscriptions and membership fees, and income received from fundraising or donations.

According to Scott Miller of Charities Services, that means that charities will have to change the way they collect and record this information.

“These are quite fundamental shifts, and it’s important to start collecting the data now – the earlier you start the better prepared you’ll be.”

He says the changes are intended to standardise the way charities present their financial information and provide clearer, more consistent information to funders as well as to the public.

Previously, while charities had to file annual returns and financial statements, there were no rules around how they should do so.

“Many charities receive taxpayer funding, and they also get tax breaks, so they should be accountable to the public. This is seen as a way of helping to improve the public perception of the charitable sector and creating more transparency. It’s also a great opportunity for charities to more fully tell their stories while creating a level playing field; everyone will have to do the same thing.”

“It will be a little more work for charities, but the new reporting will

help them tell the full story.”

Charities Services is holding workshops for Tier 3 and Tier 4 charities throughout New Zealand from the beginning of March until the end of June, to help registered charities understand how to apply the new requirements. For more information visit www.charities.govt.nz

Changes to the way that charities file their financial returns are intended to improve the public perception of the charitable sector and create more transparency about what charities do.

No:65 March 2015 15

Financial Reporting

Cash vs accrual accountingThe financial reporting requirements for Tiers 3 and 4 are relatively similar but one important difference charities need to consider at the start of their next financial year is which type of accounting method they will use.

• Tier 3 charities use accrual accounting: Accrual-based accounting is used by organisations with a significant number of transactions, and is usually recorded using accounting software, often with the help of an accountant. Accrual-based accounting allows for concepts such as depreciation and bad debts to be included in the financial accounts.

• Tier 4 charities use cash accounting: Cash-based accounting is often used by organisations with few, relatively small transactions. These charities typically use a cash book or excel or spreadsheet to record their receipts and payments.

Charities Services recommends that organisations with expenses under $125,000 that are already using accrual accounting, or whose constitutions require them to do so, should report in Tier 3 rather than Tier 4, so they don’t have to change their accounting methods.

Providing non-financial informationUnder the changes, charities reporting in Tiers 3 and 4 must also provide non-financial information as part of their financial return. This information is separated into two sections – entity information and statement of service performance. Larger charities will also have to provide this information in the future.

A brief guide to the financial reporting changes for charitiesUnder the new financial reporting standards, registered charities have been divided into four tiers.

Tier 1: Over $30 million annual operating expenses

Tier 2: Under $30 million annual operating expenses

Tier 3: Under $2 million annual operating expenses

Tier 4: Under $125,000 annual operating payments

The vast majority of registered charities are eligible to report in Tiers 3 and 4. About 95% of New Zealand’s 27,000 registered charities have annual expenses of under $2 million.

1. Entity informationBoth Tier 3 and Tier 4 charities must provide information about their purpose and mission, how they operate (including their governance arrangements) and their main sources of cash and resources.

2. Statement of service performanceAs part of their statement of service performance, Tier 3 charities must include information about:• outputs – the goods and services they delivered during

the year• outcomes – what they want to achieve in terms of their

impact on society.Tier 4 charities must provide information about their outputs, but providing information about outcomes is optional.

Audit vs ReviewThe requirements to have their financial statements audited or reviewed varies depending on how much the charity’s annual expenses are: • There is no statutory requirement for charities with

annual expenses of less than $500,000, to have their financial statements audited or reviewed. However, funders – or the charity’s constitution – may still require an audit or a review.

• Charities with annual expenses of $500,000 to $1 million are required to have their financial statements either audited or reviewed by a qualified auditor.

• All charities with annual expenses of more than $1 million must have their financial statements audited by a qualified auditor.

Feature Interview

2014 Philanthropy New Zealand Board MembersChairperson

Kate Frykberg Thinktank Charitable Trust &

The Todd Foundation

Deputy Chair

Kim McWilliams Auckland Medical Foundation

Members

Annette Culpan Vodafone NZ Foundation

Jennifer Walsh Te Runanga o Ngai Tahu

Sandra Kai Fong Rotorua Energy Charitable Trust

Rongo Kirkwood Trust Waikato

Lani Evans Thankyou Payroll

Murray Jones Dove Charitable Trust

Jonny Gritt Graphic design by:

graphic design ltd

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