An In-depth Interview with Steven Hilton, President and CEO of the Conrad N. Hilton Foundation

In advance of the 2011 Global Philanthropy Forum, I conducted an in-depth interview with Steven M. Hilton, President and CEO of the Conrad N. Hilton Foundation, on the evolution of the foundation and their efforts to date, challenges and opportunities in the water and sanitation sector in the developing world, how social innovation and social enterprise has affected their grant making, the $1.5 million Hilton Humanitarian Prize, and much more.

Rahim Kanani: As a foundation established nearly 70 years ago by Conrad N. Hilton, what has been the driving vision of the foundation's efforts, and how has the work and grants awarded over the years evolved?

Steven M. Hilton: The foundation has undergone tremendous growth since the time when I came on board back in 1983. Now, as then, we find our mission and guiding philosophy in the last will and testament of our founder -- my grandfather Conrad Hilton. The will directs the foundation to relieve the suffering of disadvantaged and vulnerable people throughout the world, especially children, and to support the works of Catholic Sisters.

During my grandfather's lifetime, the foundation was primarily reactive, giving out a large number of modest grants (many as small as $50-$100) to a variety of humanitarian causes, especially Catholic-sponsored activities, including the Catholic Sisters. A self-made man, Conrad Hilton didn't believe in inherited wealth and left almost his entire fortune to the foundation upon his death in 1979, with only his will to instruct future directors. Fortunately, my predecessor, Don Hubbs, had been a close business associate of my grandfather and was able to develop an institution that fulfilled the vision and values set forth in the will. Under Don's leadership, our board adopted a proactive, long-term, major project approach that was quite precedent-setting in the philanthropy world 30 years ago, but has now been followed by many others.

Under this model, we search worldwide for projects that offer the potential to make a significant impact. Then, rather than waiting for grant applications to arrive on our doorstep, we search out the best organizations doing work in that sector and make large and multi-year funding commitments to them. Another facet of our approach is to bring in appropriate partner organizations to leverage resources and thus achieve an even larger impact. One example that comes to mind was our 10-year collaboration with the Head Start Bureau to improve the ability of Early Head Start and Migrant Head Start programs nationwide to more effectively serve infants and toddlers with disabilities and their families. We periodically commission external evaluations of these long-term projects and fine-tune our grantmaking accordingly.

Our foundation was a pioneer in another area as well: making investments in research and ideas, then testing them through prototype programs and, if proven successful, passing them on to others to scale up and continue. One example was funding the RAND Corporation to research substance abuse programs for children and to create a plan that could achieve results. Part of the research showed that the initiative needed to start at the middle school level. After testing and evaluation, the Project ALERT middle school program we started was eventually used in one quarter of U.S. school districts. It earned near-perfect scores on the National Registry of Evidence-Based Programs and Practices.

We've evolved to the point where more than half of our giving supports international efforts. This again circles back to my grandfather, whose financial success was derived from a worldwide hotel enterprise. The commitment of my father, Barron Hilton, to follow in his father's footsteps, by also leaving the bulk of his estate to the foundation, guarantees that our work will continue and expand for many years to come, further supporting our grantmaking strategy of funding for the long-term.

Rahim Kanani: What have been some of the major milestone achievements of the Foundation's efforts?

Steven M. Hilton: Establishing the Conrad N. Hilton Fund for Sisters, which has since distributed more than $84 million and enabled Sisters to serve the poor in more than 140 countries.

Providing access to safe water for 2 million people in Sub-Saharan Africa.

Building capacity for improved services and educational opportunities for blind and multi-handicapped children throughout the U.S. and in more than 60 countries.

Pioneering a nationally recognized research-based substance abuse curriculum currently used in one quarter of the nation's school districts.

Championing permanent supportive housing as a highly effective solution to chronic homelessness.

Mobilizing a community collaborative partnership to address hunger in Southern Nevada.

Conceiving of and supporting the development of a comprehensive public policy framework for family violence that became the seminal document on the subject.

Creating the Conrad N. Hilton Humanitarian Prize, the world's largest humanitarian award.

Founding the Conrad N. Hilton College of Hotel and Restaurant Management in tribute to the industry that my grandfather and family have so greatly influenced.

Rahim Kanani: With one of your priority areas focusing on lack of access to water and sanitation, and with World Water Day having just past on March 22, what are some of the most promising opportunities in this sector?

Steven M. Hilton: While access to safe water is key, it is not enough. Sanitation and hygiene are the building blocks for improving the quality of health, education, livelihoods, and overall human well being. To this end, we're working with a wide range of partners as part of a comprehensive WASH+ (Water, Sanitation, Hygiene and Livelihood) strategy that includes direct delivery of services (access to clean water), advocacy, local and national capacity building, leadership development, research, and knowledge dissemination. These efforts are playing a vital part in helping to achieve the UN Millennium Development Goal on water and sanitation and some of the other Anti-Poverty Goals.

We've been working in the water sector for a couple of decades now and I'm glad to see more segments of society recognizing access to water and sanitation as a global health problem and human right. More organizations are joining us in this critical field. None of us can solve these problems alone and we are seeing a proliferation of multi-sector partnerships and interesting synergies.

As civil society and organizations begin to bring awareness to these issues and governments increase funding, implementers on the ground have more resources to work with. There are numerous opportunities for organizations to contribute to the WASH sector, including technology research and development, pilot testing approaches, taking them to scale, and measuring and monitoring the impact of WASH programs.

Rahim Kanani: At the same time, what are some of the challenges or lessons learned that new and current actors in this space should internalize as they push forward?

Steven M. Hilton: We have learned that, because conditions differ dramatically, there is no single answer and solutions must be tailored to specific regions, population density and income levels. Africa, Mexico and India, where the Hilton Foundation works, each have different conditions and require different approaches.

While a new water supply can be installed and completed in a matter of weeks, long-term sustainability of water systems has been a problem. Hygiene and sanitation work can be a challenge and take years to achieve because it often requires that individuals and societies change long-held beliefs and customs. Other challenges can include the lack of awareness of the global water crisis, coordination, sharing of best practices and political will, as well as the imposition of policy directives and technologies by foreign donors and implementers that can undermine local ownership and responsibility.

Clean water, along with sanitation and hygiene, results in lives transformed. And you'll never look at a glass of water the same way again.

Rahim Kanani: The Global Philanthropy Forum convenes for their 10th anniversary session in a few weeks, and if you were to give a speech to all those in attendance on the most important aspect of philanthropy today, what would be your take-home message to donors, investors and philanthropists of all stripes?

Steven M. Hilton: How blessed we all are to be in a position to make positive change and to help people to reach their potential! Because none of us has the resources to single-handedly tackle the critical problems facing today's world, I'm a big believer in joining together in strategic partnerships. If you do enter into a collaboration, know what strengths and weaknesses that you bring to the table and, above all, be sure to engage key stakeholders, including those being served, in order to get better results.

Outside experts can bring much wisdom to our philanthropic efforts; at the same time, I have learned to trust my own judgment and take what is offered with the proverbial "grain of salt." Strive to achieve a balance between a compassionate heart and rigorous analysis and don't expect 100 percent success with every program you support. Nobody is perfect, no organization is perfect and plans aren't always 100 percent achieved. We at the Hilton Foundation are only as good as our grantees, and I'm constantly humbled by the many selfless people working in the trenches who have informed our giving and advanced our mission of alleviating human suffering. It is their dedication, enthusiasm and compassion that inspire me to "reach further than my grasp."

Rahim Kanani: Today, when we talk about the social sector, we often talk of social innovation and social enterprise as being at the forefront of addressing development challenges. How have these two new and emerging fields of discipline factored into your grantmaking and your own conceptions of what's possible?

Steven M. Hilton: Social innovation and social enterprise are fairly new concepts in the world of philanthropy but not to our foundation. We have been using innovative processes to serve the social good for many years. In my view, we have always tried to emulate the creative, entrepreneurial spirit of my grandfather. But using social innovation to address development challenges is not a new idea. Peter Drucker, who brought a lot of innovative ideas to nonprofit management, as well as business, suggested that social innovation be used by nonprofits in the 1960s. I have been inspired by Mr. Drucker's principles for many years and have found them valuable for me as CEO and for the foundation.

As I mentioned earlier, we have been willing to take risks by stepping out into overlooked territory and investing in research and developing models to affect the social good. One interesting example is domestic violence which the foundation addressed in the mid-1980s, before it became a mainstream issue. We presented the domestic violence field with large-scale opportunities to bring together diverse stakeholders to jointly develop informed, coordinated strategies. The foundation provided a grant to the National Council of Juvenile and Family Court Judges to draft a Model State Code on Domestic and Family Violence. It wasn't to be a uniform code because the needs were different in different states, but it could be adapted to each state's requirements. When unveiled in 1994, the Model Code not only represented consensus on the best legislation relative to this issue but also a state-of-the-art policy framework for best court practices and the ideal community response. It has been frequently cited as the nation's seminal legislative policy document on the subject and portions of the Model Code have been enacted in all 50 states. The foundation awarded subsequent funding to assist with implementation and to create the nation's only database dedicated exclusively to tracking domestic and family violence legislation.

Social innovation continues to be a factor in our grantmaking. We just announced a pledge of $50 million in grants for global water programs. A considerable amount of these funds are going to organizations to research and test new ideas and best practices. Some of these will work and others will not, but we believe that underwriting R&D, as you might call it, is a role that a foundation should play. We expect to share the results with everyone working in the sector -- from NGOs to donors to the people themselves who will enjoy clean water for the first time.

As for social enterprise, the most prominent innovator in this sphere is Muhammad Yunus, who has served on our Hilton Humanitarian Prize jury. He pioneered the concept of microcredit for the very poor in developing countries, certainly a social innovation. But now he is moving on to social enterprise, which he believes is the next big step in global social transformations. This essentially means creating a business whose profits go toward addressing a social problem and whose real bottom line is the number of lives improved. While investors may get their initial equity back, all profits are reinvested to sustain the social mission. We think this idea is an interesting one to explore and have given a grant of $300,000 to California State University Channel Islands, which houses the country's first Institute for Social Business. The program was launched last September and has been embraced very enthusiastically by faculty and students.

I also find interesting the more venture capital type philanthropy such as modeled by the Acumen Fund. It has been quite successful in funding businesses that make a return for local entrepreneurs but also provide a social good such as building a water system or building homes.

Rahim Kanani: What role has the Hilton Humanitarian Prize played in elevating some of the extraordinary work being done on the ground, and how does this prize tie into the work and efforts of the Hilton Foundation?

Steven M. Hilton: Conrad Hilton was the consummate international humanitarian. He gave his money without regard for territory, religion or ethnicity, and he directed the foundation to do so as well.

In mid-1990s, one of our board members thought it would be a fitting tribute to Conrad Hilton to establish the Conrad N. Hilton Humanitarian Prize to recognize an organization that is making extraordinary contributions toward alleviating human suffering anywhere in the world. At the time, there were no major prizes being given to organizations rather than individuals in the humanitarian field.

The goal of the Prize was threefold: to advance the work of the recipient with a large unrestricted cash prize, now $1.5 million; to call attention to the need for worldwide humanitarian aid; and to increase the visibility of the prize recipient's fine work and expand its support from other donors.

The Hilton Prize process begins with a worldwide call for nominations, involving the global humanitarian community. Every year, we are pleasantly surprised by the incredible work we learn about through these nominations, many of which are submitted by presidents, prime ministers and leading humanitarians. Our prize is often called the "Nobel of the humanitarian world" and it has become highly sought after. While the money is appreciated, it is really the international recognition and the seal of approval that the prize bestows that are transformative for an organization.

Of course, the cash value of the prize is important too, as it is unrestricted and allows recipients to invest in the structure of the organization. These are often the most needed injections of funds for nonprofits, but the least popular among those donors who want to see the impact of their investment immediately. We are focused on the long-term, so we understand this strategic thinking. As a result, the recipients often emerge as more solid organizations and can expand their scale and capacity in the field.

Until the Hilton Humanitarian Prize was launched in 1996, the foundation was not very well-known outside of our community of grantees. One of the benefits of the prize was that it raised the visibility of the foundation and propelled us into a new league.

The prize ceremonies have become a veritable "who's who" of the humanitarian world and some of the brightest minds of our generation have addressed the audience, including heads of state, Nobel Prize laureates and other high-level dignitaries.

The Hilton Humanitarian Prize is very much in line with Conrad Hilton's aim of fostering international understanding, bringing together high-level humanitarian experts who usually only meet in crisis situations.

The prize has undoubtedly informed our learning as a foundation. We have benefited from the contacts we have made over the years through the Hilton Prize events, as many of the nominees are the best of the best in their respective sectors. We have a deep understanding of the humanitarian field and know which organizations will be the best fit for partnering on our projects. I believe this enhances and strengthens our international grantmaking.

In fact, the 15 prize recipients have formed the Hilton Humanitarian Prize Laureates, an informal network that harnesses the prestige that the prize bestows upon them, finding opportunities to work together in countries where many of the organizations already have a presence. These organizations want to increase public understanding in developed nations for solutions to problems in the developing world. The fact that they are using the leverage of the prize to accomplish this goal shows its enduring impact, years after an organization has won the monetary award.

If he were alive today, I think my grandfather would be profoundly moved that so many extraordinary humanitarian organizations are working tirelessly throughout the world to alleviate human suffering.

Rahim Kanani: Lastly, what's the best advice you've ever received?

Steven M. Hilton: Before you try and save the world, first believe in yourself and trust your own instincts. And enjoy a sense of humor. The source of that advice was Conrad Hilton's personal letterhead. In the upper right-hand corner of his stationery was written: "MacDonald Streak, Of Counsel." Oh, by the way -- MacDonald Streak was Conrad Hilton's favorite horse.

Cross-posted with World Affairs Commentary.

This interview is part of an advance interview series prior to the 2011 Global Philanthropy Forum that is taking place April 13-15 in Redwood City, California. To follow the series and be notified of upcoming interviews, please click here.