Over the summer, trustees of the Surdna Foundation put the final touches on a plan to focus all of the philanthropy’s grant making on racial equity. And they had found the person they thought was perfect to put it in motion.
But their pick, a Ford Foundation veteran, Don Chen, immediately found himself in the center of a family squabble over the direction of the century-old philanthropy, which is among the nation’s largest, with more than $1 billion in assets. It’s a dispute that cuts to the heart of questions about donor intent and about whether philanthropy should focus most of its energy and resources on advocacy fights that upend the social order — or on largess to benefit traditional nonprofits like schools and hospitals.
Even before Chen was picked, some of the 380 living adult descendants of the founder had put the grant maker’s board on notice.
In May nearly two dozen of them signed a letter entreating the board to pick a president who would steer the grant maker in the direction they think was originally charted by John E. Andrus, who founded it (using his family name spelled backwards) before he died in 1934. Spearheaded by two cousins from the Minneapolis area, Carolyn Jones and Kelly Jasper, the dissatisfied contingent believes the foundation’s focus on building social-justice movements is a far cry from John Andrus’s original intent to support hospitals, schools, churches, and orphanages. Surdna’s work, they charge, is a political “hijacking” of Andrus’s original intent.
In a reply, Peter Benedict II, Surdna’s board chair and a former private-school executive, this summer told Jasper and Jones that a legal review of the foundation’s articles of incorporation found that Andrus gave his descendants great latitude for how they spend his fortune. Benedict, who is Andrus’s great-great grandson, quoted those documents, which say the foundation was intended to support “religious, charitable, scientific, educational, and eleemosynary purposes or any one or more of such purposes.”
The lack of further restrictions on how grants were to be made signals that Andrus “intended to give future managers of the foundation flexibility, instead of restricting them to donate only to causes he personally supported,” Benedict’s letter states.
What’s more, Benedict told the cousins he thought Andrus would be “proud” of the current strategy, which he believes is not a departure from his original vision.
Progressive Causes
That response didn’t satisfy Jasper and Jones. Nor did the selection of Chen as president.
When the foundation announced Chen as their pick, board members touted his identity as the son of Chinese immigrants and noted he was among the first Chinese-Americans to lead a major foundation. His work as director of Ford’s Just Cities and Regions program made him a familiar face in social-justice philanthropy circles. His expertise in land use, social equity, and environmental issues, which he developed as chief executive of Smart Growth America, made him a good match to lead the foundation’s work tackling the roots of economic and social disparities.
“The hiring of Don Chen alarmed me,” Jones says. “It’s more political. He’s taken it even further and amplified the direction away from John Andrus’s intent.”
The cousins say Andrus, a Republican mayor of Yonkers and U.S. congressman, chemical manufacturer, and investor, was a capitalist to the hilt. Using he Multimillionaire Straphanger, a 1971 biography published by Wesleyan University Press as their main reference, they say their forefather believed in providing direct help to people in need.
Raising their ire in particular are Surdna-supported groups that promote progressive causes, such as the Democracy Collaborative, which works to build wealth in communities that lack investment capital and that supports the Next System Project, a program dedicated to exploring economic alternatives to capitalism. Another the grantee the cousins take issue with is the Neighborhood Funders Group, a grant making collaborative that promotes social justice.
“It’s so in his face,” Jasper says of the foundation’s grants. “Not only is it funding funders, which he never would have wanted, it’s funding the funders he never would have chosen. It’s almost a triple double-whammy.”
Responding to the cousins’ charge that Surdna supports anti-capitalist movements, Ted Howard, president of the Democracy Collaborative, says that some of the work the nonprofit is engaged in does in fact support the development of alternatives to what the group views as a failed economic system.
But the work the Surdna money goes toward is more nuts-and-bolts. The collaborative works in communities to link “anchor” institutions like hospitals, universities, and city government agencies to local groups that are trying to reduce income inequality and create jobs.
“I don’t really know about John Andrus and his life and philosophy,” Howard says. “But I suspect old-style capitalists might find this a pretty good thing to do.”
Years of Planning
Chen says the new strategy was in development for several years before his arrival, and it was the result of a thorough planning process led by the family.
“The interpretation of what John Andrus might do 100 years after the establishment of the foundation is really speculative,” he says. “The foundation and family members over a century have really tried to interpret the intent faithfully.”
The foundation’s board has 13 directors, 10 of whom are family members or spouses. The directors are voted into office by members of the foundation, a group of former directors. But information about the foundation is shared far beyond that tight circle to the hundreds of Andrus heirs.
Benedict says the foundation has gone to great lengths to educate the family about the work of the foundation through regular emails, an annual progress update, and board-preparation courses open to family members.
The foundation began to focus on social justice more than a decade ago and has been communicating with family members for years about the need to include diversity, equity, and inclusion as key pillars of its work.
Says Benedict: “There’s no whiplash here.”
Airing Grievances
In December, during a conference call of Surdna’s Board Experiential Training program, two of the family members who had signed the letter, Jack Jasper and Mitch Calhoun, aired their grievances.
Sensing that the board was unresponsive following the conference call, Jones and Jasper sent a letter to many of the Andrus descendants (they say their list may be outdated), asking them to call on the board to change course.
Given the fact that the board is created by and composed of family members who have been intimately involved in the foundation’s work over the years, its seems unlikely that the cousins will be able to make much headway unless they gather support from more members of the extended family.
The recent letter includes descriptions of specific Surdna grants they took issue with, including support of the Democracy Collaborative, the Neighborhood Funders Group, the Movement for Black Lives, and the Vera Institute of Justice.
It also included several organizations they suggested were tainted because of their association with controversial people or groups.
For instance, they said that the foundation’s support of the Center for Popular Democracy indirectly helped employees of that group who stirred up “mob politics” to sway public opinion against Brett Kavanaugh during his confirmation hearings to be a Supreme Court justice.
And they say the foundation has “aligned itself” with billionaire financier George Soros, “who is thought by some to be the driving force behind the attempt to weaken America in favor of a new world global governance” through his main philanthropy, the Open Society Foundations.
Surdna made three grants to the Center for Popular Democracy in 2018, according to Timothy Gilles, a foundation spokesman. Two of the grants went to disaster-relief efforts in Puerto Rico following Hurricane Maria, and one grant went to Local Progress, a national network of progressive municipal officials.
The foundation has made grants in tandem with a large number of grant makers, including the Open Society Foundations, said Gilles.
Many Heirs Involved
Surdna’s situation is unique. After all, there aren’t a lot of foundations — particularly high-profile grant makers like Surdna, which has more than $1 billion in assets — that are more than a century old and that have such a multitude of heirs interested in their family’s philanthropic legacy. But it is not uncommon for later generations to second guess the giving practices of a family philanthropy.
In a 1977 letter announcing his exit from the Ford Foundation’s board, Henry Ford II called the grant maker a “creature of capitalism” that had seemingly forgotten that its very existence was due to his grandfather’s success manufacturing and selling cars.
“I’m not playing the role of the hard-headed tycoon who thinks all philanthropoids are socialists and all university professors are communists,” he wrote. “I’m just suggesting to the trustees and the staff that the system that makes the foundation possible is very probably worth preserving.”
Other foundations mired in controversies over whether they were following the founder’s wishes have handled things differently. The trustees of the Daniels Fund believed the foundation had strayed from the original vision of the cable-television entrepreneur Bill Daniels (who is no relation to the author of this article).
In 2002, two years after Daniels’s death, the Colorado grant maker closed several offices, nearly halved its staff, and pumped more money into scholarships rather than developing programs with groups of nonprofits in the mountain West, says Linda Childears, the fund’s president.
“The money was spent convening people rather than helping people,” she says. “Bill was about helping people. He was not a ‘let’s get together and talk about it’ kind of guy. He was a ‘do it’ kind of guy.”
The board decided to change course after a thorough review of the foundation’s bylaws and an examination of Daniels’s writings and correspondence. The retrenchment reflected a belief that professional staff who landed jobs there after Daniels had died brought their own agenda to the foundation.
“The folks we had involved initially were really good people,” Childears says. “They were experienced in philanthropy, but being experienced in philanthropy doesn’t necessarily transfer to how our donor saw the world.”
Opportunity for Grantees
In certain respects, the family squabble at Surdna is an unintended result of the foundation’s attempts to keep John Andrus’s philanthropic legacy fresh in the minds of family members for generations, says Virginia Esposito, president of the National Center for Family Philanthropy. (Kelly Nowlin, a Surdna board member also sits on the center’s board.) She says the frequent updates from the Surdna board gave family members a sense they could help direct the foundation’s work.
“When you’re kept up to date, you’re going to feel more of a sense of ownership,” she says.
Over the past year, Esposito’s group has held 17 family philanthropy focus groups. The one issue that came up consistently was how families could incorporate diversity, equity, and inclusion into their work and navigate family disagreements about what it means to make grants that promote social justice.
Esposito says the issue is a family matter — that the disagreement only becomes a governance issue if there is a split among current board members. But she says it’s possible that even a large family can find common ground. Too often, she says, people see social justice as something that divides people ideologically.
“I hope they don’t assume their work in this area can’t be value-centric and that it has to be partisan,” she says. (The Surdna Foundation does make grants to organizations that lobby, but they restrict all of their grants to nonlobbying activity.)
Michael Moody, the Frey Foundation Chair at Grand Valley State University’s Dorothy A. Johnson Center for Philanthropy, suggests that the kind of disagreement roiling the Andrus family may present an opportunity for grantees.
If they are invited to speak with family members as partners of the foundation, they might be able to help find common ground. While Moody said he has not been involved in any Andrus family work and was speaking about disagreements at family foundations generally, he noted that “conflicts on strategy and tactics can hide what connects people in terms of values.” He adds: “That’s difficult to see when you’re in a conflict mindset. Given an opening, grantees could provide some interesting and helpful feedback.”
Giving People a Voice
Benedict remains confident that the foundation’s work enjoys strong support from family members. He says the board is preparing a communication to the entire clan to address the issues raised in the cousins’ most recent letter.
“Situations evolve and circumstances evolve,” he says. “When John Andrus was interested in supporting orphans, he was supporting people who didn’t have a voice or people who may not have been captured in the safety nets that were present at the time. One-hundred years later Surdna continues to support folks who don’t necessarily have a voice and where the various social structures and safety nets of our society may not capture them as well. There’s a tremendous continuum.”
It’s highly unlikely that everyone in a 400-member clan spread throughout the country will agree on everything, says Phil Henderson, who was Surdna’s president for 11 years ending in September.
“We had a pretty good finger on the pulse of the family writ large,” he says. “But the idea that we’d expect unanimous consent on anything — whether to butter the bread at dinner or otherwise — we weren’t naive about that.”
