All of us make purchase choices and decisions on criteria that are not always objective. . Where I come from it is fairly normal behavior to show a preference for doing business with people you know and oftentimes whose values you share. We shop together, our kids are in school together and many of us are in religious and civic organizations together. We buy local when we can because we want to support the people of our community. We still shop online or go to Dallas but we have a mild preference for local merchants. Some of us have the same degree of mild preference for certain services and organizations. All things being equal, we like supporting a company that devotes part of its profits to social causes or a non-profit whose people share a common and typically broadly defined faith with ours. We are not rabid or exclusive about it. We just have a preference for those faith-based providers. Is it bad? No. It’s just the way we are.

Some people take that to the next level and eliminate options that are not faith-based. They only invest with faith-based brokers, use faith-based doctors, buy shares in faith-based companies or cars from faith-based auto dealers. We have something called “The Christian Yellow Pages” for people who are determined to only trade with faith-based organizations. My suspicion is people do this because there is an implied advantage in doing so. Better stock advice, higher likelihood of getting an unusually good deal on a car, providential assistance in diagnosing illnesses. It’s not just a preference. It is an ingrained bias. It is  a belief in magic – that things will go better for you if you  associate exclusively with the faithful. Is it bad? No. It’s just extremely limiting and often disappointing.

Some of us have gone in the opposite direction and only have faith in non-faith based. We don’t trust faith-based and we only trust in the secular market. In fact, you might have something you could call “The Non-Faith Based Yellow Pages” for those determined to only support that group. In all honesty, that choice is just as limiting and narrow as the other.

In reality, we operate along a spectrum of criteria from mild preference to absolute and sometimes irrational insistence on strict limitations. That’s what I want to focus on this morning. Not an either/or choice but how we make decisions about funding organizations along a spectrum. Instead of thinking about our relationship with faith-based and secular organizations as a “wall of separation”, let’s think about it as a back fence across which we have conversations, relationships and even some common dreams. We don’t have to tear down the fence to be good neighbors. We don’t need to post sentries along a wall. Robert Frost was right. Good fences do make for good neighbors.

Let me begin with a story.

In the early 60’s and 70’s the largest privately held publisher of religious print and recorded material was Word Publishing in Waco, Texas. Founded by Jarrell McCracken, a student at Baylor University, with an inventory of one product, a record titled The Game of Life, Word grew in 25 years to a company without peer in capturing a market of evangelical Christian consumers. It would be fair to say that Word had a lock on a particular market in the religious product industry. It was not mainline denominational but what was soon to become the behemoth now described as evangelical Christianity. In the 70’s ABC/Capital Cities had determined they wanted a piece of that market and after a good deal of research decided the best way to get it was not to develop their own products but to buy a company that already had the market and understood how to develop products for that unique market. In 1974 ABC/Capital Cities gave 300,000 shares of ABC stock for Word and established a trend that would both excite and horrify many more companies –  religious and secular. In 1985, Harper-Collins paid $56 million for Zondervan for exactly the same reasons. In 1992 Thomas Nelson paid $90 million for Word and then sold it to Gaylord Entertainment for $120 million. In 1997, Rupert Murdoch bought Pat Robertson’s Family Channel for $1.9 billion to capture another lucrative market. Secular companies with very secular cultures and motivations that were clearly based not on proselytizing but on legitimate profits were entering into business relationships with companies that were both marginal and disregarded ten years before. What happened? Why is this instructive for us this morning as we look at the topic, “Why should secular foundations support faith-based organizations?” Like all analogies, it cannot be extended indefinitely without being distorted but let’s pursue it as far as it is useful.

ABC bought Word first and foremost for its strength as a company. In fact, it was the strongest company in its field. Its management was superior and its financial base was the strongest in the industry. It was not in trouble or badly run or riddled with debt. It had the best talent under contract and the leadership was focused on a particular niche that was both lucrative and beneficial. It had long term relationships with customers and had researched its markets so thoroughly that it was known to have an uncanny ability to predict what products would sell and which would languish and die on the shelves.

Second, of all the options ABC explored Word had a culture that was the most compatible with theirs. These were two notably different cultures but they were compatible because they shared enough common values and assumptions about people, business and customers. They were not identical but compatible. There was a “fit” between the two companies as different as they were.

Third, Word had a proven ability to reach a market that was an important opportunity for ABC but they could not reach themselves. Word understood the culture, the habits, and the demographics and potential of a market that ABC valued but could not reach on their own.

Fourth, ABC and Word both received benefit from a relationship of mutual advantage. Word gained access to more resources and ABC received the expertise and performance record Word had built over so many years. The relationship was reciprocal and profitable for both in learning, expansion of business and growth in depth of competence.

Fifth, ABC bought results and not just good intentions. Word  had a track record and the results they achieved were consistent with the business goals of ABC.

I would like to propose the question of today about funding faith-based organizations could be partially answered by this same analogy. Not completely but partially. In other words, it’s not so much about funding faith-based or non-faith-based as it is about finding the common opportunity in a particular relationship. That’s exactly how we do our work in our foundation as we fund organizations. We don’t focus on the question of faith or non-faith (which is a distraction oftentimes) but on the issue of mutual advantage or reciprocity and I would recommend the same to you.

Our questions are something like this:

Does this organization have strength and the ability to grow? Do they have competent and experienced leadership and structure or are they unfocused with a weak financial and talent base? Many organizations are absolutely dependent on the personal vision and energy of a single individual. Instead of being an organization with a mission it is a genius with a staff.  I like the word “amateur” – one who does it for the love of it.  Are they amateurs in the best sense of the word or are they simply career professionals?

Are we compatible with this organization and their culture? Typically, we tend to be more comfortable with some cultures and subcultures than others. It may be the leadership or the language or the liturgy. It could be any number of things  that make us feel we could or could not work with these people over the long term. Frankly, I think this is where much of the confusion about faith-based issues originates. It is not “faith” to which we have an aversion because so many foundation staff and principals are people of faith themselves. It is more likely to be our discomfort  or unfamiliarity with a particular brand of faith. We don’t like evangelicals because they are pushy or Pentecostals and charismatics as they embarrass others or us. We may not understand the complexities of decision making in Catholic organizations or the seeming lack order in ethnic churches.  Again, if we wait to find an organization that is just like us then we are very likely never going to reach or get results in anything but a very, very narrow area of interest. We learned a long time ago that our effectiveness is severely limited unless we begin to think like ABC. We were interested in low-income housing and spent time with a number of secular and faith-based organizations. We eventually made a significant investment in Habitat for Humanity because their work and their culture was more of a fit with ours and the people in the neighborhood than either a church-based housing group or a secular non-profit whose start-up we had funded in the past.

Are we interested in reaching a market that for whatever reasons we are not able to reach on our own? Does this organization have a productive relationship with that constituency that we could not reproduce? We wanted to work with Hispanic immigrants in a variety of ways and knew we could not do that directly. We were particularly interested in seeing a service provided that would help families avoid the numerous green card and naturalization scams by attorneys and others that prey on migrant workers. We investigated all the various organizations that were doing effective work and discovered a priest who had been trained to do this work through a secular organization and was providing the counseling through his church. His service was more effective and trusted than any other service – secular or faith-based – and we backed an expansion of  that work. You soon discover in working with prisons, drug and alcohol dependency and homeless issues that you are going to be working with charismatic and Pentecostal organizations. They simply are the leaders in this field. If you think the cure is worse than the disease then you are not going to be doing much to reach this market. If we are uncomfortable with Catholics then we are not going to be doing much with the market leaders in private and inner city schools or with non-profit hospitals and healthcare. If you want to effect change in the legal systems of developing countries to stop child prostitution and slavery then you want to work with International Justice Mission. Second Harvest, an outgrowth of St. Mary’s Food Bank founded by John Van Hengel in his church in Arizona, is the largest food bank system in the United States. World Vision is one of the top three relief and development agencies in the world and  a key partner with USAID in their African work. The New York  City Bowery Mission has a 98% success rate in their work with drug and alcohol addictions. While these examples are national or international organizations, the same principles can be applied easily to local organizations. Find the best of those with whom you are compatible and work with them. It’s our free choice not to work with the best…but why would we want to take that approach?

Are we in a relationship where we each benefit? If not, then we don’t believe it is healthy. We should be learning from each other because we both have resources we bring to the table. We should be growing through our relationship with the organization and they should be growing through us. Too often, it is assumed that the benefit is supposed to be one-sided and we miss out on opportunities to grow our own knowledge base, our competence as funders and as resources for other foundations and donors.  As well, the organizations we fund benefit from the expectation that they are in a teaching role as well.  It changes the relationship fundamentally.

Finally, while we cannot measure everything we know from experience we can  measure a few things that are important to us and to them. It is true, as Peter Drucker once said, there are some things that can be measured and others that can only be appraised. However, getting clear about what few essentials are important to measure for both is a valuable conversation at the very start.. Faith-based should not mean without definition or performance averse. For instance, we worked out a simple formula with Habitat that we wanted to measure just four things: number of houses built, number of volunteers, number of volunteer hours and the amount of funding raised over three years. I’ve brought a good example of measuring the results of faith-based organizations. Prison Fellowship’s program, InnerChange, is an ambitious program to reduce the recidivism rate in Texas prisons. The State of Texas has just evaluated their first 16-month program and the results are encouraging. “Offenders completing the program had significantly lower recidivism rates (8% recidivism after two years) than the comparison groups (20% for the matched group).” While it is early in the game for measurement in social services, there are almost always one or two things that can be established as important to be measured.

I hope these comments have addressed the question of why foundations should fund faith-based organizations.  Perhaps it is better to say I hope foundations would not automatically dismiss the funding of faith-based organizations.  I agree with President Bush when he said, “We will not fund the religious activities of any group, but when people of faith provide social services, we will not discriminate against them.”  I would only add that in our experience as a foundation, our best grants by far have been through being focused on organizations that are strong with the ability to grow; are compatible with our culture and values; give us access to markets we cannot reach on our own; create challenging learning opportunities for all of us; and the results can be measured.  I would hope that many more foundations would benefit from the same kind of relationship by setting aside their assumptions about separation and begin to talk across the fence with these extraordinary people and organizations.