Foundation funding of the news media comes with a price. It quietly pushes journalism towards activism. A chapter from “Postjournalism and the death of newspapers” (2020).
Funding journalism by foundations is perceived as a positive tendency because no one’s individual corrupting will (personal or corporate) can be imposed through such a mechanism. As transactional revenue is steadily falling, foundation funding is welcomed.
However, this growing financial aid comes with a price that few in the industry and nobody in the public is aware of yet. Foundation funding incentivizes the mutation of the formerly commercial agenda-setting into sponsored propaganda.
To understand this, the specificity of allocative control employed by foundations needs to be explored. Allocative control means that foundations’ resources are directed toward certain specific topics or forms of journalism, while others are ignored. This incentivizes newsrooms to pursue projects and approaches that will most likely be approved for funding. In their zealous funding search, the media try to meet the expectations of foundations, not those of the audience, the market, or their own.
Therefore, when foundation funding is significant, topic selection becomes quietly conducted by foundations, not by the media. Journalism starts serving foundations, not the audience or society. Agenda-setting is thereby, in part, moving into foundations. A part of the media’s autonomy is surrendered because of this.
As foundations are deemed to be useful social institutions that maintain socially beneficial initiatives, no one scrutinizes their impact on the media’s autonomy. Foundations are not billionaires or corporations that need to be watched over. The creeping relocation of agenda-setting from the newsrooms to foundations remains unnoticed.
The efficiency of the news-media product funded by foundations is evaluated not by the market, but by specific forms of impact-assessment. The criteria can be different from foundation to foundation, but they generally relate to the resonance made by publication in the public sphere (often literally ‘made-up’ resonance). These criteria do not necessarily coincide with the traditional indicators of journalism success in the market, such as an increase in circulation, paid subscriptions or ad revenue.
For traditional journalism, particularly for journalism funded predominantly by advertising, the growth of the audience is an essential business goal. It increases both the sales of news to the audience and the sales of the audience to the advertisers. There are some secondary criteria, such as the affluence or loyalty of the audience, but its size is paramount.
The desire to increase circulation forced the media to address as broad an audience as possible, even within a selected stratum. Being an industrial enterprise, the media, particularly within the advertising model, sought to gather, generalize and standardize the audience. The audience might be split by consumer characteristics (income, demographics, etc.) but preferably not divided politically, as political division would diminish the audience reach of the media. Such were there technological requirements of the media business. With regard to the public service of journalism, this meant that media funded by ad money cohered, depoliticalized and united people.
Under foundation funding, the defining factor that incentivizes the media is not the size of the audience but the impact of the message. The ability to reach a broader audience also matters, but the primary goal is the value-based purity, preciseness and proselytism of the message. One study quoted a director of a non-profit TV company who said, “impact goes beyond the classic journalistic mission of simply informing the public to asking: ‘Did I change minds? Did I move legislation?’” (Benson, 2018, p. 1071). The audience gets selected and divided according to people’s readiness to join the cause, meaning according to their ability to be civically and politically engaged.
Foundations want to direct the press towards urgent social issues. This is the whole point of fundraising for journalism and funding journalism. Foundations’ agendas, even though not political, are ideologically charged and intended to make a difference, to make an impact; this results in the selection and division of people based on their receptiveness to civic ideas.
Under such conditions, the media are incentivized not to broaden the agenda in order to reach a wider and united audience, but rather to propagate the properly aligned message to a larger number of potential followers. The media do not marry the message to the audience; they marry the audience to the message. They engage in the selection of the audience, but not the message; the message has already been pre-selected. As Ben Smith from the New York Times put it, “nonprofit journalism can be boring, more attentive to its donors than its audience.”
The switch in the principles of agenda-setting from audience-driven factors to message-driven factors leads to the atomization, not the generalization, of the audience. The switch from advertising to philanthropy in funding the media means the change from consumer profiling to civic profiling of the audience. Consumer profiling was depoliticizing and uniting, while civic profiling is politicizing and dividing. By making the media focus on certain topics and divide people, foundation funding reverses the cohering effect of the advertising model. Foundation funding has the potential to contribute to polarization – not significantly, just slightly, but at the systemic level.
Perhaps foundation funding could have avoided such a downside if it had funded not ideas or formats but the profession of journalism itself. Some foundations, indeed, aim to support journalism (for example, local news). But this implies an underlying ideology anyway – it assumes some pre-selected and artificial vision of what journalism is and what ends it must serve. The formation of journalism standards abandons the newsrooms and goes to foundations. The only neutral way to support the profession of independent journalist is a market-funded paycheck; all the rest reflect the desires of someone from outside the newsroom regarding journalism.
The ways in which foundation funding reshapes mechanisms of agenda-setting in the media have started to attract the attention of media researchers. Rodney Benson of New York University conducted a study of foundation funding. He wrote that,
… Yet there has been too little critical analysis of the nonprofit alternative… We need better answers to questions like: Who exactly is in charge of these nonprofits, what are foundations asking in return for their support, and what are the material and ideological limits to reform embodied in this new organizational model of journalism? In other words, we must acknowledge the possibility that foundations are just as capable of non-democratic “media capture” on behalf of their own interests as they are of fostering civic benefits for society as a whole. (Benson, 2018, p. 1060.)
Based on the analysis of the “close intertwining of elite management and boards between foundations, nonprofits, and commercial media” and having conducted a series of interviews with them, Benson stated that,
Despite the language of civic duty that surrounds the foundation world like a golden haze, there are also often specific strings and metrics attached to grants. Foundations increasingly prefer funding specific projects to general operations, increasing the possibility of some degree of “media capture” by foundation donors <…>. Certainly, such arrangements create the possibility of a conflict of interest, or appearance of such. (Benson, 2018, p. 1073.)
He concluded that,
Foundation project-based funding has also sometimes skewed media attention towards fashionable issues favored by philanthropic donors while ignoring a range of equally or even more urgent social problems. Philanthropic support mostly reinforces and extends an upper middleclass, pro-corporate orientation in mainstream American journalism. (Benson, 2018, p. 1060.)
As foundation-funded journalism is predestined to focus on pre-selected pressing social issues, it often reiterates the themes of the mainstream media but without the panoramic view the mainstream media are expected to offer due to their market-driven news coverage.
“Even if donors don’t make clear their desire for a particular thesis or ideological slant, there are the potentials for self-censorship. Money talks,” stated James Warren in Poynter, discussing the New York Times’ plan to seek philanthropic funding. He quoted Alan Mutter, a former newspaper reporter and current industry analyst, who wrote to him that,
Third-party funding necessarily raises questions of (1) whether a topic would have been covered if the money were not available, and (2), whether the reporting and conclusions of the resulting stories were influenced by the need to please donors, especially if the publisher has a hope of obtaining future funding.
Since foundation funding incentivizes certain topics to be covered and certain approaches to be employed, newsrooms redirect their resources toward funded projects. Allocative control amplifies distortion in agendas in two ways:
1) it encourages certain topics and formats, and
2) it diverts limited newsroom resources away from other topics and formats.
It used to be the job of editors to define what social issues are pressing. Basically, this is like the job of a priest explaining the meaning of existence. To maintain this function and this institution, society paid the ‘church tax’, the institution maintenance fee, which in the case of media was buying news and ads. Castles, of course, often wanted to interfere in the practice of temples in order to get proper prophecies and interpretations, but a strong developed church could more likely than not withstand the will of the powerful and dictate its own will.
Now, the church of the media is in decline, and the parishioners are encouraged to save it by bringing their offerings to an intermediary institution that decides what themes the preacher must emphasize in order to sustain its parish. This intermediary supposedly knows better what the preacher should do and what the congregation wants.
Who are those people who are called upon for donations to support journalism? What is their social, cultural and political profile?
As they donate to the media, they most likely recognize its civic significance and would like to amplify its civic impact. So, they most likely belong to the highly ‘mediatized’ upper-middle class and/or the elite. They know what the media are there for, but among all the media functions, they most likely focus on the civic impact, not the panoramic cohering inherent to commercial journalism. They want to reinforce a message, not generalize the audience. With these motives, they must want to refine and reinforce particular topics, pre-selected from their and their mainstream media’s already-existing agenda, but without the commercial/panoramic, background. Foundation funding is an invisible amplifier of the pre-selected fragments of agenda. This is where its polarization potential comes from.
Bensons stated that,
…Nonprofit media are not likely to do any better than mainstream media in connecting to the non-urban, non-cultural elite voters whose concerns about jobs, trade, and globalization tend to be ignored or dismissed in news coverage and public policy, and who arguably as a result helped elect the “populist” Republican Donald Trump to the U.S. presidency. (Benson, 2018, p. 1067.)
Martin Scott, Mel Bunce and Kate Wright in “Foundation Funding and the Boundaries of Journalism” (2019) explored the foundation impact specifically on non-profit international news and came to similar conclusions. They found that,
… Foundations did not try to directly influence the content of the journalism they funded. However, their involvement did make a difference. It created requirements and incentives for journalists to do new, non-editorial tasks, as well as longer-form, off-agenda, “impactful” news coverage in specific thematic areas. As a result, foundations are ultimately changing the role and contribution of journalism in society. (Scott, Bunce & Wright, 2019, p. 2034.)
The authors stated that, “Foundation funding ultimately encourages journalists to focus on producing longer-form, off-agenda news coverage about topics that broadly aligned with the priorities of the most active foundations” (Scott, Bunce & Wright, 2019, p. 2035).
The pre-selected focusing of foundation-funded journalism on narrow topics at the expense of a more balanced panoramic view was also noticed. They stated that,
In the case of non-profit international news, foundations direct journalism (both intentionally and unintentionally) towards outcome-oriented, explanatory journalism in a small number of niche subject areas. (Scott, Bunce & Wright, 2019, p. 2035.)
The findings support the hypothesis that foundation funding leads journalism to focus on the message and not on the audience (as commercial journalism would do). This setting pushes journalism toward pre-selected message delivery, which is closer to marketing and propaganda than to journalism.
The for-profit media can also experience a similar temptation. Or they can be pushed to promote the agendas of someone from the outside in order to accommodate advertisers and perhaps surrender to them some of their newsroom autonomy. But it is at least noticed and criticized there. No one will criticize non-profit media for pushing important topics because of foundation funding.
When foundation funding incentivizes certain themes and diverts resources from others, it leads to the pressing, in sponsors’ opinion, social issues to be pressed even more by the journalists. The problem is that fundraising aims to solve pressing issues with financial contribution being just a means, not the goal; but for the contractor, contribution is the goal. The contractor is oftentimes more interested in the perpetuation of the funding than the solving of the issue because there will be no funding without this issue. This risk is particularly obvious when the philanthropy contractor is a media outlet because the mass media are able to induce the reality via their coverage.
For journalism, foundation funding almost inevitably creates a conflict of interest. Journalists will subliminally overemphasize the significance of those topics that are well-funded by philanthropists. Charity money creates a demand for triggering media coverage. The agenda skews towards better-funded issues not because of newsrooms’ autonomous view of what is newsworthy, but because of newsrooms’ need for available funding. At some point, the pressing social issues reported on under such incentives become not just covered, but reproduced in the agenda and, through the agenda, in the media-induced reality.
The problem is more or less known in philanthropy. In foundations, special ethical committees are often commissioned to oversee the appropriateness of expenditures so that funding does not reproduce the issues it aims to fight against.
But when it comes to crowdsourced fundraising, exemplified in the media by the membership model, the problem only grows, as there is no such ethical supervision or even public understanding of the agenda risks related to philanthropy funding.
The latest news on foundation funding:
In contrast to the business wipeout for most legacy media last year, big nonprofit local initiatives are thriving and on track for healthy growth this year, too.
“For local nonprofit news, 2020 was a very good year, and 2021 will be even better.” Rick Edmonds, Poynter, January 26, 2021.
More on the state of the arts:
 Smith, Ben. (2020, March 29). “Bail out journalists. let newspaper chains die.” The New York Times. https://www.nytimes.com/2020/03/29/business/coronavirus-journalists-newspapers.html
 Warren, James. (2017, September 3). “The New York Times is looking for nonprofit funding. Will it succeed where others have failed?” Poynter. https://www.poynter.org/business-work/2017/the-new-york-times-is-looking-for-nonprofit-funding-will-it-succeed-where-others-have-failed/