Last year, the Cleveland Metropolitan School District introduced an ambitious plan to improve educational opportunities for its students — and it turned to the local nonprofit community for help.
It started with CEO Eric Gordon’s goal to secure a free college education for all of CMSD’s graduates. To accomplish this, the district announced its interest in forming a partnership with Say Yes to Education, a New York-based nonprofit that, with the help of local stakeholders, provides communitywide scholarship programs.
Say Yes, which offers up to $15 million in seed money for communities to establish support services in public schools, operates in just a few U.S. cities, including Greensboro, North Carolina, and Buffalo, New York, but is looking to expand.
But before the nonprofit plants its roots here, a committee of 34 business leaders, government and school officials, parents and community activists need to evaluate the feasibility of bringing Say Yes to Cleveland, with a decision likely by November.
Significantly, about one-third of the committee members represent Northeast Ohio nonprofits, including the Cleveland Foundation, George Gund Foundation, United Way of Greater Cleveland and College Now Greater Cleveland.
The involvement of these professionals is vital to the effort, says Randell McShepard, vice president of public affairs for RPM International Inc., who was on the exploratory committee for Say Yes. “They’ve given so much to the schools and have been so active in transformation plans for the district,” he says. “They know education like few others.”
But nonprofits are responsible for implementing meaningful change through more than education. During the past decade, nonprofits have helped spearhead economic development projects, critical community initiatives like reducing infant mortality and quality-of-life efforts that include the reimagining of Irishtown Bend along the Cuyahoga River.
A quick glance at this year’s Power 100 list reflects the vital role nonprofits play in the region’s civic agenda. It starts with Ronn Richard, president and CEO of the Cleveland Foundation, who tops the rankings for the first time in his 14-year tenure in town.
Other nonprofit leaders in the top 30 include David Gilbert, president and CEO of Destination Cleveland (No. 5); Toby Cosgrove, Cleveland Clinic’s executive adviser and former CEO and president (No. 6); Tom Zenty, CEO of University Hospitals (No. 7); Joe Roman, president and CEO of Greater Cleveland Partnership (No. 9); David Abbott, executive director of the George Gund Foundation (No. 14); Marc Byrnes, board chairman of United Way of Greater Cleveland (No. 19); Dr. Akram Boutros, president and CEO of MetroHealth System (No. 22); and Art Falco, president and CEO of Playhouse Square Foundation (No. 20).
This gradual shift in power can be attributed to several factors, according to the Power 100 leaders interviewed for this story. It has roots in the public-private partnership of the George Voinovich era, the demands of the global economy on companies big and small, the fallout from the Cuyahoga County corruption scandal and, recently, the changes in corporate leadership at the highest levels.
During the past two years, Sherwin-Williams Co.’s Chris Connor, Eaton Corp.’s Sandy Cutler and Cleveland Clinic’s Cosgrove — whom have all ranked No. 1 on the Power 100 list in the past — have retired. Similarly, the city is more than 18 months removed from the heady summer of 2016 that witnessed the Cleveland Cavaliers winning the city’s first major sports championship in 52 years and the successful hosting of the Republican National Convention.
In this atmosphere, nonprofits have become well positioned as power players and thought leaders.
Some of that has to do with money. The Cleveland Foundation, for example, had assets of $2.1 billion and annual grants nearing $95 million in areas such as schools, neighborhoods, economic development, health care and arts and culture during its 2015 fiscal year.
In 2017, Cleveland Foundation assisted victims of Hurricane Maria in Puerto Rico and supported the Cleveland International Film Festival. The foundation backed the International Village, an effort to build up a West Side neighborhood, and distributed free tickets to the Cleveland Orchestra during its 100th season celebration.
“There was a time in the 1970s when Cleveland was among the top in the country for Fortune 500 headquarters,” says Richard. “A lot of those companies have left, so nonprofits have risen to the top.”
Claudia Y.W. Herrold, senior vice president of Philanthropy Ohio in Columbus, says Cleveland-area charitable organizations were responsible for about half of the $1.67 billion in foundation grants awarded statewide in 2015.
But it’s about more than dishing out financial resources. By working in a variety of fields, foundations and organizations such as the Greater Cleveland Partnership, United Way, Destination Cleveland and others have also accumulated valuable intellectual capital that can be shared more easily.
That allows for greater collaboration between industry, government and community to tackle problems and find solutions, which amplifies their clout. By tapping into the corporate executives who serve on their boards, provide direction and hire their high-powered leaders, the web of influence spiders throughout the entire community.
Prior to becoming president and CEO of the Cleveland Foundation in 2003, Richard helped bring new technologies to the CIA in his role as managing director and chief operating officer of In-Q-Tel, the agency’s venture capital fund. Before that, Richard held top management positions at Panasonic. He also was a U.S. Foreign Service officer, serving in Japan.
“I wanted a job where I could get up every day and know I was helping people, where I’m very close to the action,” Richard says of his move to the Cleveland Foundation. “Our mission is to help people, and that’s a huge source of pride and satisfaction for all of us.”
Deborah Hoover, president and CEO of the Burton D. Morgan Foundation, which promotes entrepreneurship and entrepreneurship education, says the influence of nonprofits is strong in Cleveland. It was something she learned on a 2011 educational trip to Seattle, where the nonprofit world is smaller.
“Cleveland has an industrial heritage,” she says. “But we have an abundance of philanthropy here.”
Stewart Kohl, co-CEO of private equity firm the Riverside Co., says institutions such as the Cleveland Orchestra and Cleveland Museum of Art are powerful because they are among the best arts organizations in the world, and harkens to a time when Cleveland was a top economic city.
“We see them as civic jewels that should be maintained and enhanced,” says Kohl, who ranks No. 24 on this year’s Power 100 list.
The nonprofit Cleveland Clinic, the No. 2 ranked hospital in the country according to U.S. News and World Report, continues to expand, with health centers in Las Vegas, Florida and Abu Dhabi. As Ohio’s second-largest employer, with more than 49,000 employees statewide, the Clinic attracts world-class talent to work with national health care leaders like Cosgrove. His views on heath care and improving patient outcomes are widely influential and have been quoted in The New York Times, Washington Post and Newsweek.
Although he officially retired Jan. 1, Cosgrove expects to remain active in the region.
“He’s an incredibly well-connected and powerful person,” Kohl says.
The quality of nonprofit leadership, he says, has also upped the influence of the organizations. Kohl points to the Cleveland Foundation’s hiring of Richard — “bringing in a star,” he says — as a transformative moment. “They’re willing to pay for these people,” Kohl says. “We have a lot of great ones.”
Kohl dubs these types of leaders “nonprofit entrepreneurs,” individuals who could start and grow outstanding companies but have chosen to express those talents in a different realm.
“They are wired that way and have the same abilities,” he says.
In many ways, it has been like a giant flywheel gaining momentum with each small turn. Talent attracts talent. Being involved in engaging, important work builds influence.
“It’s gratifying,” Kohl says. “Dave Abbott at the Gund Foundation has a real chance to make a difference, which I know is very important to him.”
And to tackle tough, frontline issues like education, nonprofits are collaborating with businesses and each other. “With that collaboration comes influence,” Hoover says. “It’s not casual collaboration either. It sets priorities. How do we optimize the limited resources of our region? We are starting to see the results of efforts started 10 years ago.”
Take the Fund for Our Economic Future, an alliance of funders with a mission to improve Northeast Ohio’s economy. It’s an alliance of other nonprofits that supports job creation and has given grants to organizations such as Team NEO, an organization that works to attract businesses to the region, and JumpStart, which helps entrepreneurs. These groups have intellectual capital — expertise in economic development — meant to maximize those investments.
The Burton D. Morgan Foundation supports the Fund for Our Economic Future, which has pooled more than $100 million for economic development during the past decade, says Hoover.
Fund officials met with the Manufacturing Advocacy and Growth Network, a supporter of manufacturers; BioEnterprise Corp., which grows bioscience companies; and JumpStart to gather feedback and promote strategic planning.
“Our business community does great things, but they don’t work in the same collaborative fashion,” Hoover says. “Their individual investments may do good work, but it’s not amplified by them bonding together.”
Nonprofits possess “convening power” or the ability to forge effective partnerships, McShepard adds. That’s because they consider the good of the entire community, not just one isolated group or cause. Take Say Yes, for example, which the Cleveland schools would have difficulty pulling off with its own resources alone.
“The scale of the project requires an all-hands-on-deck approach and a level of fundraising from philanthropic and private resources rarely attempted, if even possible, by a municipal school district,” McShepard says.
The Cleveland schools also need nonprofits to show them how to integrate education with social services, which are a key part of the Say Yes program.
The results can also have a multiplier effect, McShepard says. By attacking root problems such as education and housing that help citizens become more independent, nonprofits may not have to give to those same recipients repeatedly through social service programs.
“Look at anything positive happening in Cleveland in the last 10 to 15 years, and you’ll always see extensive partnerships,” McShepard says.
Are business leaders really slipping in power or are they merely repositioning themselves?
When longtime CEO Sandy Cutler retired from Eaton Corp. in 2016, Craig Arnold replaced him and became the company’s first minority CEO.
That same year, Connor retired from Sherwin-Williams after 34 years with the paint maker and was replaced by John G. Morikis, who rose through the ranks after joining in 1984 as a management trainee.
In January, Dr. Tomislav Mihaljevic, who previously served as CEO of Cleveland Clinic Abu Dhabi, succeeded Cosgrove as president and CEO of the Clinic.
“We will always miss these top leaders,” says Marc Byrnes, board chairman of United Way of Greater Cleveland. “They are remarkably gifted, talented people, and they all have core values and ethics.”
In addition to normal transitions in leadership, the nature of global business has altered how businesses engage civically.
“Part of it is the CEOs are just more and more spread thin,” says Richard Pogue, senior adviser at Jones Day, a law firm in Cleveland.
Kohl remembers when CEOs with Cleveland headquarters used to spend a lot of time in town and became involved with Cleveland-area causes. That’s no longer the case, at least not as much.
“If you run a large corporation now, it’s probably global and you’re spending a lot of time out of Cleveland,” Kohl says. “In fact, you might not even be a Clevelander.”
Still, business leaders remain widely influential in the community. Just check out the boards of nonprofits.
The Cleveland Foundation’s board includes Paul Dolan, owner, chairman and CEO of the Cleveland Indians; Hiroyuki Fujita, founder, president, CEO and chairman of Quality Electrodynamics, a global developer and maker of MRI technology; Robert Glick, founder and former CEO and chairman of Dots LLC; Sally Gries, founder and chairperson of Gries Financial; and Ernest Wilkerson Jr., managing partner of Wilkerson and Associates, a law firm in Beachwood.
“You’re only as good as your board,” Byrnes says. “We have a for-profit business community devoted to our nonprofits and wants them to do well. Business leaders help set the platform and the direction.”
Beth Mooney, chairman and CEO of KeyCorp, says business leaders might be wielding power differently these days, but she believes they are being more collaborative than ever.
“I see business leaders dedicating focus, time and treasure on education access and success,” Mooney says. “That’s powerful. I see tremendous focus from business leaders on training people in our community for jobs. That’s powerful. I see business leaders creating more diverse and inclusive workplaces. That’s powerful. I see even greater partnership between companies, civic leaders and the communities they collectively serve. That’s powerful.”
Looking ahead, Byrnes points to leaders such as Eaton’s Arnold; Jon
Pinney, managing partner at Kohrman Jackson and Krantz law firm, who was among those who brought the Republican National Convention to town; and Gregg Eisenberg, managing partner at Benesch Friedlander, Coplan and Aronoff law firm, as up-and-comers.
Hoover is excited to see what Northeast Ohio’s growing startup community will contribute.
“I’m seeing entrepreneurs drawing on experiences they’ve had growing their businesses to help the economic system in Northeast Ohio,” Hoover says. “We’re starting to have legends of entrepreneurship who are gaining gravitas from hard-earned, tough experience and knowledge.”
Count Richard, the most powerful person in Greater Cleveland this year, among those who believe startup companies are a big part of the future.
“We’re not going to get the same giant companies that have left Cleveland,” Richard says. “We have to create new ones, and the Cleveland Foundation is working to create startups in Cleveland.”
However, Richard says tomorrow’s leaders will emerge from all walks of life, so it’s important that business and nonprofit leaders understand each other and obtain experience in each other’s work.
“The way society is going, technology will eliminate so many jobs,” Richard says. “It will have huge repercussions. Corporations need to understand they have interests beyond their stakeholders, and we have to work together to stabilize our society.”