The Behavior of Grantmaking Foundations

Abstract

Any examination of issues confronting grantmaking foundations is diminished in value without a theoretical framework that gives these issues a larger meaning within the study of philanthropy and provides both scholars and practitioners a means to analyze them in some systematic way. Until recently, however, students of organizational behavior have neglected grantmaking foundations as objects of scholarly study, leaving a major theoretical lacuna for understanding and predicting the behavior of these important social institutions. The lacuna is especially evident in understanding those internal forces that shape grantmaking programs and decisions. Such a lacuna stands in stark contrast to the rich organizational theories developed to explain the behavior of for-profit firms and public agencies. As a consequence, foundations remain “black boxes,” little known and even less understood, “shrouded in mystery, inspiring in some the highest hopes and expectations and in others dark fears and resentments” (Nielsen, 1985, p. 4). This chapter’s purpose is to suggest three broad models of organizational behavior with which to begin building a theory of foundation behavior. Each model provides hypotheses that can be tested through field research and, particularly, the systematic collection of case studies. The three models are the Rational Actor Model, the Bureaucratic Politics Model, and the Organizational Process Model.