The Clinton Foundation, which readied a sweeping transition plan to dramatically pare back fundraising and program operations in case of a Hillary Clinton victory, now must write a new script that includes a stinging defeat for its founding family and a badly bruised public image.
The conflicts of interest that would have faced Ms. Clinton in public office are no longer relevant, say nonprofit tax experts who study the finances and governance of the Clinton Foundation.
“Right now, as far I can see, the foundation should absolutely go on,” said Phil Hackney, a law professor at Louisiana State University who followed the organization closely during the course of the election. “It was really quite a shame that it was going to shut down. There were many groups that were quite upset.”
One important item on the agenda as the foundation looks to its future is whether it should add to its board more people outside the Clintons’ inner circle.
“There are governance questions that have been raised about the foundation that would still be around, but these are the governance questions a lot of foundations deal with,” says Brian Mittendorf, a professor of nonprofit accounting at Ohio State University.
The Clinton Foundation did not respond to requests for comment, but in the two months preceding Election Day, Donna Shalala, the organization’s president, told The Chronicle her staff had in place a strategy for 90 percent of its portfolio that included giving over pieces of its programming to other organizations or spinning them off into stand-alone nonprofits.
The incoming president has philanthropy pondering the big changes that lie ahead in the new administration and what they mean for fundraising, tax policy, spending, immigration, regulation, advocacy efforts, and more.
“We shouldn’t be presumptuous about the campaign,” Ms. Shalala said at the time about holding off on implementing the changes until after the election. “We’re not that arrogant.”
The Clintons’ Next Move
The organization prepared to stop accepting all foreign and corporate donations if Ms. Clinton took the White House, reducing contributions to individual American donors and American foundations only. Former President Bill Clinton, who started and grew the organization from a source of funding for his presidential library into a major operating charity that delivers HIV/AIDS medicines and services to millions of poor around the world, said he would step down from the board.
Chelsea Clinton was to remain on the board regardless of the outcome of the election.
Ms. Shalala told The Chronicle last month that preparing for a major contraction at the Clinton Foundation and figuring out a new strategy for Mr. Clinton’s legacy had been “painful” for the former president and his daughter.
Presumably, say those who know the foundation well, Mr. Clinton stays on the board, and the proposed changes will not be implemented.
“I see this as the thing Hillary Clinton and Bill pour their lives back into now,” Mr. Hackney says. “I can’t imagine she is running again.”
The Clinton Foundation took in $100 million in private support in 2015, according to numbers provided to The Chronicle for its Philanthropy 400 survey, an annual ranking of the 400 biggest U.S. charities based on donations. The organization ranked No. 285.
Attacks Continue
But it won’t be easy for the organization to resume normal operations. The furious partisan attacks on the foundation and the Clinton family are unlikely to go away entirely, even though attention may move elsewhere.
“It has that reputation now of being a pay-to-play vehicle,” says William Schambra, director of the Hudson Institute’s Bradley Center for Philanthropy and Civic Renewal. “Can it recover from that? Can it look to a future in which you shed all the political baggage and you are just being evaluated as a good philanthropy? I kind of doubt that.”
While he did not conceive the concept of public-private partnerships, Mr. Clinton and the Clinton Foundation’s Clinton Global Initiative became best-in-class in attracting corporations and industry titans to tackle issues of education, health, and economic opportunity in the global south.
But it was that same magnetism, drawing some of the world’s most recognizable leaders and successful business people into the Clintons’ orbit and onto the foundation’s donor rolls, that caused the Clintons so much trouble. Political foes alleged, although never proved, that donors received special treatment while Hillary Clinton served as secretary of state.
Accusations were enough to damage the foundation. It never completely cleared them up. And even sympathetic charity leaders and nonprofit tax experts questioned why more stringent steps weren’t taken to safeguard its reputation and worried about spillover negative effects on charities more generally.
Mr. Schambra says that nonprofits are embracing the idea that there should be no boundaries among government, business, and philanthropy.
“One thing you can say about the Clinton Foundation is it did that in spades,” he says. “Now the sector has to look at that example and say, ‘Is that really what we want? Are there in fact possibly some dangers that we didn’t anticipate when we embraced this notion of sector agnosticism?’ "
Philanthropy leaders should consider what sorts of ethical boundaries need to be set, Mr. Schambra argues.
“Can the leaders in the philanthropy field take a look at that and say, ‘Wow, maybe we really do need to think through some of these ideas. When we talk about philanthropy collaborating with government, do we really mean the government of Saudi Arabia? Do we really mean the folks of Qatar?”
