Essays on the ethics of funders and nonprofit media

Surveys can be a valuable research tool because they can offer some sense of scale. But they do not allow respondents to articulate their ideas in depth. As a consequence, we commissioned five essays from prominent stakeholders in the journalism-funding eco-system: Two are from nonprofit news outlets, two from foundations that fund media, and one from an advertising-supported media company. Some of the ideas have been referenced above where they intersected with survey results. What follows are summaries of each essay and links to the full texts:

ProPublica president Richard Tofel wrote that he believes well-established independent news values, what he refers to as the “old rules,” should govern the new relationships between donors and journalists, just as the “old rules” governed relations between newspapers and advertisers.

That means, to begin with, that transparency is critical to show who the funders and advertisers are and how much they are contributing. Likewise, neither advertisers nor donors should dictate editorial content and they shouldn’t know of it in advance. And having multiple funders, just as diversifying the number of advertisers, assures continued independence. “But no matter what you do, and what rules you have in place,” Tofel writes, “you may sometimes need to remind advertisers (i.e. donors) of the limits of their influence.”

When editors are “too eager to please funders,” he writes, “unfortunate compromises can ensue.” And “when they refuse to do so they can actually strengthen their news operations.” Tofel concludes with the classic case of General Motors when it was the largest corporation in the world. GM sought to retaliate against unfavorable reporting by the Wall Street Journal by cutting off all of its advertising. The paper held its ground, editorializing that advertising could not be allowed to dictate editorial content. GM eventually backed down, and the Journal gained prestige from the fight. “This is a tale all publishers should bear in mind when confronting pressure from advertisers — or donors,” Tofel writes. “The rewards for compromising principles are all transitory, while those from the preservation of independence and integrity can be enduring.”

Alan Rusbridger, former editor-in-chief of The Guardian, writes that even for media that accept advertising, foundations can be an important additional source of funding, particularly for newspapers like the Guardian, a commercial operation owned by a trust. The London-based newspaper has received about $13 million in philanthropic support over the last three years out of a $250 million annual budget.

A six-year grant from the Gates Foundation, for example, has been instrumental in helping the Guardian report on the U.N.’s Millennium Development Goals aimed at improving the lives of the world’s poorest people. Such foundation support to its core editorial operation has helped the Guardian produce high-impact global reporting adding to its international audience.

“Does it cause us ethical dilemmas? Well, the dangers are obvious,” Rusbridger writes. He argues that the Guardian has done its best to be transparent about philanthropic support and to create clear rules. (For example: “Any journalism produced as a result of charitable grants is completely independent and does not promote or refer to any of the activity of the funder.”) This is so people are clear about what it is they’re reading.

Before stepping down from his editor role in 2015, Rusbridger decided on more of a “campaigning approach” for some of the Guardian’s coverage – not the more classic impartial approach seen in most American news outlets. He cited the paper’s approach to global warming as an example.

But Rusbridger said the paper would not use foundation support for its campaigns.  “I think there is an important future for foundation funding of journalism,” he concludes. “It’s not a silver bullet. But it is, generally, a force of good. And no one has yet discovered the silver bullet.”

Joe Bergantino, co-founder and executive director of the New England Center for Investigative Reporting (NECIR), announced in September 2015 he was stepping down from his role in the organization he co-founded in 2008. He tells the story of an early $25,000 donation to NECIR when it was just getting started. The news organization decided to give the money back to the donor, he recalls, despite the fact the donor suggested he would be giving an additional $1 million over the next year. The reason had to do with the donor’s other activities. It turned out the donor was involved in funding a Massachusetts state senator who later went to prison for bribery. “We clearly couldn’t accept a donation from someone with a connection to a major political scandal dominating the news,” Bergantino writes, even though the donor was never named in an indictment or charged with a crime.

Accepting the money, he says, “would have tarnished our center’s name and raised questions about our ethics and integrity before we even opened our doors. So began our journey down the mine-filled road of fundraising for a nonprofit news outlet.”

For the last nearly seven years, NECIR has been cautious in its fundraising, doing background research on any donation of $1,000 or more.  Foundations, which represent the bulk of their funding, have been “totally hands off … There are no strings attached.”

There was, however, one exception, Bergantino writes. An unnamed national foundation seemed to be telling the news organization that if they reported on a particular subject with a point of view that matched that of the foundation, “it would improve our chances of securing a grant. We chose not to apply.”

In another local incident, NECIR was accused of running a story because it was critical of an office park owned by a family foundation that had rejected NECIR’s request for funding.  In fact, there was complete separation between the Center’s fundraising and its editorial decision-making behind the office park story. “The controversy pointed out just how important it is to maintain a very high wall between the journalism and the fundraising arm of a nonprofit center like ours.”

Kathy Im and Peter Slevin of the MacArthur Foundation come out strongly in support of giving unrestricted general operating funds to news organizations. Such unrestricted grants, they write, provide “a flexibility that allows professional journalists to pursue promising investigative leads not approved in advance by funders or tied to a funder’s pet issue.” Philanthropy is a crucial component of the success of nonprofit news organizations, they say. Such funding enables news organizations “to pursue important stories that do not make commercial sense, particularly in the costly realms of investigative and international reporting.”

They write that, “Many organizations would not exist, much less thrive, without such contributions.” Yet, Im and Slevin are critical of funders “who dictate how these funds can be used, pushing journalists to produce work in line with the funders’ interests.” Restricted grants work well from the funders’ perspective because they are more aligned with the funders’ strategy and program goals.

However, Im and Slevin say, “We believe it is journalists and editors themselves who are best able to identify fresh and significant stories while building an audience and sustaining a news organization. The work of the funders is to identify smart, innovative and ethical newsroom leaders and then trust them to do the right thing.” From a journalism organization’s perspective, they conclude, “restricted support can be, well, restrictive. Grants often carry built-in expectations of advocacy, starting with an answer to defend, not a question to explore.” They view unrestricted funding as vital to help nonprofit news organizations experiment and innovate.

Daniel Green, director for program advocacy and communications the Gates Foundation, one of the two foundation funders of this research, focuses on the perception that foundation support of media taints objectivity. Even though the Gates Foundation is transparent and respects the editorial integrity of the news organizations it funds, Green thinks that may not be enough “to address perceived conflicts of interest.”

Green says that, “When media organizations name their funders, some audience members will suspect an agenda in the related content: Has the funder influenced this story? Is this an advertorial?” He says a healthy relationship between funders and news organizations is like a Venn diagram, in which the desired outcome of the media and the foundation overlap “without damaging the credibility or integrity of either one.”

For all that, however, Green writes that, “The reality is that there are few hard-and-fast rules, which can sometimes complicate the relationship between media organizations and philanthropic funders.”

The principle of editorial integrity “aims to ensure that our grantees make content decisions based on editorial merit, not on the funding relationship. Grantees should not feel obligated to cover a story because of the funding source, nor should they avoid it. Yet it happens.”

Those challenges might lead some to consider two simpler options, though Green says neither one is really adequate. Funders could decide to avoid media funding entirely, thereby avoiding the complication that critics might charge them with tainting independent media. Or, with publishers more willing to sell native advertising and sponsored content, donors could push to fund more targeted, message-aligned content. But, not unlike Rusbridger, he argues that message alignment could irreparably damage the credibility of both organizations.

“I believe there is a middle ground,” Green concludes instead, “in which funding can be framed within certain respected guidelines and best practices … In that middle ground, funding to sustain coverage of important, underreported stories is a good thing; allowing funders to dictate coverage more broadly is not.”

In the end, “Publishers must protect their credibility by ensuring that any targeted funding they receive aligns with their own mission. Finding that balance is difficult but achievable. Our most credible news organizations and their editors do it pretty well every day.”