By David Gelles Originally published in The New York Times, March 19, 2014
….Across the country, museums large and small are preparing for the eventual passing of the baton from the baby boom generation, which for decades has been the lifeblood not only of individual giving but of boardroom leadership. Yet it is far from clear whether the children of baby boomers are prepared to replicate the efforts of their parents.
While charitable giving in the United States has remained stable for the last 40 years, there is reason for concern. Boomers today control 70 percent of the nation’s disposable income, according to data compiled by the American Alliance of Museums. Millennials don’t yet have nearly as much cash on hand. And those who do, the alliance found, are increasingly drawn to social, rather than artistic, causes.
Now, as wealth becomes more concentrated, tax laws change and a younger generation develops new philanthropic priorities, museums — like other nonprofit organizations — are confronting what, if unaddressed, could become an existential crisis.
“The generational shift is something a lot of museums are talking about,” said Ford W. Bell, president of the American Alliance of Museums. “The traditional donors are either dying, stepping back or turning it over to their children or grandchildren.”
Generational change is always occurring as new blood takes the place of the old. But as the boomers’ children take over, there is concern among administrators and trustees that millennials are not poised to meet the financial and leadership demands of increasingly complex — and expensive — museums.
“We’re not just talking about replacing one generation with another generation,” said Kaywin Feldman, director of the Minneapolis Institute of Arts. “We’re talking about a new generation that behaves so differently than the last one.”
Two-thirds of millennials want specific information about how their dollars will “make a difference,” according to the 2011 Millennial Donors Report. That can pose a problem for museums, which rely on individual donations to support everyday operations and build endowments.
“Younger philanthropists and donors today are looking for measurable results,” Mr. Bell said. “It used to be you gave because it was the Metropolitan Museum of Art. But today younger donors have a lot of things they can give to. They ask what the impact is going to be and how you’re going to measure that impact. The Rockefellers gave, but they weren’t looking for specific metrics.”
Moreover, many are disinclined to contribute to long-term capital campaigns. “An older generation of philanthropists really understood the value of an endowment,” said Maureen Robinson, a member of the Museum Group, a consortium of senior museum professionals. “But endowments are looked at by younger people as dead money. They think, ‘I’m giving you a dollar to do something different.’ ”
What is more, there is a swelling debate about the merits of different types of charitable giving, with many arguing that arts institutions are less deserving than social and health causes. Writing in The New York Times last year, the philosopher Peter Singer said that “a donation to prevent trachoma offers at least 10 times the value of giving to the museum.”
This line of thinking is “a matter of some dismay to a generation that worked to build out community engagement in museums,” Ms. Robinson said. “All these things are great, but it’s as though museums appear to represent a lesser value and less moral use of time.”
And not only are 20- and 30-somethings today more interested in social causes like education, the environment and international aid than they are in the arts, but because of shifting demographics, there may simply be fewer wealthy young patrons to write checks.
“We’re seeing some significant changes in income distribution,” said Dan Monroe, director of the Peabody Essex Museum in Salem, Mass. “You’ve got a shrinking middle class. And there’s a huge amount of wealth and philanthropic capability that is centered in a smaller number of people than was previously the case.”
Already anticipating this generational changing of the guard, some museums are racing to pursue younger donors and trustees.
At the Walker Art Center in Minneapolis, 75 percent of the board membership has turned over in the last seven years. That has brought new life to the Walker, which focuses on modern and contemporary art. But it has also meant the loss of several stalwarts who could be relied on for big checks and sage advice.
“Most of the oldest generation has completely gone off,” said the Walker’s director, Olga Viso. In its place, Ms. Viso said, a group of trustees in their 50s and 60s has moved into senior leadership roles and begun giving at higher levels, while a younger group of trustees in their early 40s and even late 30s has joined the board.
Among the more youthful members Ms. Viso has recruited of late are John Christakos, founder of the furniture company Blu Dot, who is in his late 40s and serves as the Walker board’s treasurer, and Monica Nassif, the founder of the fragrance and cleaning companies Caldrea and Mrs. Meyers Clean Day.
As well as being proactive, another way to attract young donors and trustees is to be a cultural powerhouse. Many prominent art museums in major metropolitan areas, in particular, are so far navigating this transition with ease.
“The very big institutions are doing very well,” said Ms. Robinson of the Museum Group. “They have a gravitational field.”
Absent this tireless wooing of a younger generation, museums can quickly slip up. The Delaware Art Museum is facing funding challenges now, in part because of the erosion of individual giving by moneyed locals.
Wilmington, where the museum is, has fallen on hard times, and the wealthy families that once supported the arts there have seen their fortunes divided up over a number of generations.
“This is a scenario that’s playing out in other places as well,” said Mr. Bell of the American Alliance of Museums.
This year, the museum of Randolph College in Lynchburg, Va., was moved to sell a painting by George Bellows for $25.5 million to fund its endowment, a task usually met by donors.
Hoping to avoid the plight of Delaware, some museums have doubled down on recruiting new board leadership in recent years.
Donald Fisher, the late co-founder of Gap and a longtime board member of the San Francisco Museum of Modern Art, was particularly passionate about the issue.
The museum’s director, Neal Benezra, remembers that at a board meeting eight years ago, Mr. Fisher pounded his fist on the table and said: “We need to prepare for this and we shouldn’t be nominating anyone over the age of 50!”
The museum has not followed Mr. Fisher’s advice to the letter. “But it was a powerful statement,” Mr. Benezra said. “And Don, as was often the case, was not wrong.”
Since then, the museum has worked hard to rejuvenate its board, with half of the trustee positions turning over in the last 10 years. Mr. Benezra hosts regular dinners for potential young board members, introducing them to longtime trustees including Mr. Fisher’s son, Robert, and Charles Schwab, the financier.
“It’s a way of engaging in a very personal way people who are already close to the museum and getting them to understand what the experience of trusteeship might mean,” Mr. Benezra said.
Among the new faces in the San Francisco museum’s boardroom are Marissa Mayer, the Yahoo chief executive, and the prominent entrepreneur Dave Morin. Those additions represent the museum’s success in forging ties with the technology industry, which is minting thousands of new millionaires in the Bay Area.
A similar story has played out across the country in recent years. In Boston, which has also enjoyed a boom in venture capital and biotechnology investment, the Institute of Contemporary Art has embarked on a refashioning of its board at the same time it built its first permanent building ever, a waterfront structure designed by Diller Scofidio and Renfro.
“While we were building a new building, it was critical that we build a community in Boston to support contemporary art,” said the institute’s director, Jill Medvedow. “We tried to find people that were not already on other boards. We looked to the venture, tech and biotech communities. And we managed to transform the board of trustees.”
Thanks to those new faces on the board, Ms. Medvedow was also able to bolster the institute’s endowment, increasing it from $1 million when she took over in 1998 to $20 million today. Nearly half of that came from people under the age of 50, she said.
Among the younger trustees are Jonathan Seelig, co-founder of Akami Technologies; Rich Miner, a co-founder of Android, the operating system acquired by Google; and Hal Hess, an executive of American Tower, the cellphone company.
Mr. Hess was initially drawn to postwar American painting, but, with some hand-holding by the institute’s curatorial staff, grew to love contemporary art as well. He is now on the finance committee, where he has gotten to work closely with James Foster, a more seasoned board member who is chief executive of the pharmaceutical company Charles River Laboratories. “It’s given me an opportunity to be involved at much deeper level,” Mr. Hess said.
Such mentorships are a hallmark of effective board succession plans.
“You’re not born a philanthropist,” Mr. Benezra said. “With a board that’s 65 members strong, it’s very easy for new members to feel unengaged.”
To avoid any alienation, many museums encourage new trustees to join committees as a way of working with other board members and learning the ropes.
The former Wells Fargo chief executive Richard Kovacevich is chairman of the San Francisco Museum of Modern Art’s finance committee, allowing younger trustees to learn from a legend. “They observe how they think, how they act, how they interact with the staff,” Mr. Benezra said. “Mentoring is a big part of what we do. It’s how newly elected trustees find their way.”
And when the San Francisco museum realized it had to shut down its existing building to begin a huge expansion, in part to display the Fisher family collection, it turned to its board for advice on how to proceed in the interim. Instead of renting one space as a temporary home, the museum decided to engage in a series of public programs that would bring the collection into the community.
The young designer Yves Béhar, then on the board, became involved with the process and helped develop a program for Los Altos, a city in Silicon Valley, where the museum currently has 10 installations on display.
“It probably wouldn’t have happened without him,” Mr. Benezra said.
Yet as young professionals jump from job to job, taking their families across the country, many museums are having a harder time forging lasting ties with community leaders.
“It’s a significant challenge for us,” said Mr. Monroe of the Peabody Essex, noting that his museum was still fortunate to have strong support from donors in Boston.
Also exacerbating matters is that in recent decades, jobs, professionals and wealth have concentrated in urban areas, leaving smaller regional institutions in the lurch.
At the Walker, Ms. Viso had a wonderful young patron who was working at 3M and getting progressively more involved with the museum. But after a few years he accepted a job at Pepsi and moved to New York.
“In the corporate community in particular, there’s a lot more transition and change,” Ms. Viso said. “It’s not the norm for people to stay here for 20 years anymore.”
Ms. Robinson of the Museum Group noted that in some colder climates, older trustees were now fleeing during the winters, making them less reliable board members. Some of these snow birds then forge relationships with museums in balmier locations, like Miami, which has a vibrant arts community.
“The transience issue will come back to haunt everybody,” Ms. Robinson said. “Institutions need steady, lifelong relationships with supporters, and the opposite ends of the age spectrum are equally mobile, but for different reasons.”
Other demographic changes are also at play, forcing museums to rethink the future of their boards and major donor bases.
“Many museums are white both literally and figuratively,” said Mr. Bell of the American Alliance of Museums, noting a dearth of diversity at the highest levels of many museums.
And a new generation, raised on pop culture, is not always eager to support niche collections.
“If a museum’s primary collection area is antiquities, its not so easy to find young people to join that board,” said Robert Fisher of the San Francisco museum board.
All these changes are coming to a head as museums see their funding mix gradually change. Instead of relying on a handful of major donors to carry the museum each year, many are trying to nurture an “Obama fund-raising model” — smaller donations from a vastly larger audience.
Ultimately, however, museums may have to accept that the next generation coming into positions of power may simply be less generous to museums than the baby boomers have been.
“It’s one thing if you grew up in a philanthropic household,” Robert Fisher said. “But to expect that young people will turn around and start making million-dollar gifts because someone asks them to is unreasonable. Someone who’s 35 and made a lot of money may not give it away until they’re 50. It takes patience.”
Yet on balance, museum directors and their trustees think that, with time, millennials will rise to the challenge.
“I’m certainly optimistic,” said Mr. Schwab of the San Francisco museum. “If not, museums will degenerate and will eventually fall into the hands of government budgets and be in a death spiral. I hope that’s not the case.”
Correction: March 25, 2014 An article on Thursday about efforts by art museums to attract a new generation of benefactors incorrectly included the Detroit Institute of Arts among financially ailing museums that are under pressure to sell art from their collections to help fund their operations. While the Art Institute faced the threat of having part of its city-owned art collection sold, the money from the sale would have gone to the city in its bankruptcy proceedings, not to the museum itself. The article also referred incompletely to the source of pledges intended to avert such a sale. The pledges came from local and national foundations as well as from the museum itself, not just from local groups.