As I look around at the lack of political consensus on what to do about poverty, public health or climate, and as I listen to the arguments and debates in the media, I do wonder where and whether we might have agreement on what is the common good. Is there a common good? Or are we moving to very different views of what is in the best interest of the “commons”? And if so, what can philanthropy do about it?
These questions are addressed in two recent, very thoughtful articles in journals which typically focus on philanthropy and social purpose. Alliance Magazine published a piece by the American nonprofit and philanthropic leader Clara Miller, who wrote about the erosion of what she calls the “outer commons”. The Stanford Social Innovation Review published a reflective but also passionate piece by Mark Kramer and Steve Phillips, Where Strategic Philanthropy Went Wrong. Both pieces in different ways discuss the role of philanthropy in pursuing the public good. And both would be good input for a discussion around foundation board tables.
Miller walks through historical concepts of the “common good” on the North American continent, providing an unusual perspective to the conversations in philanthropy about “public good”. Indeed, she quotes a Canadian historian Allan Greer who has written about the history of early Canada from pre-colonial to first settler days. Greer is interested in concepts of property as a way of understanding the idea of what is held “in common”. Miller quotes Greer as describing three aspects of land use, which were common to Indigenous and settler communities alike: individual spaces or homes, an “inner commons” of shared space within a community, and an “outer commons”, or lands outside a community. The outer commons, as Greer and Miller point out, were where the strongest conflicts among parties took place in pre-colonial and colonial societies. Miller notes that “the concept that everyone is entitled to a commonly held, non-proprietary resource base for the necessities of life remains the scene of conflict today”. And so, “North Americans have evolved away from an early tradition of sharing to today’s environment of continually contested values.”
Applying the idea of shared spaces to our current context, Miller suggests that the privatization of public goods such as water, the air waves, hospitals and schools (particularly in the American context) and the abandonment of unwritten rules that guided political consensus and behavior in past years constitute a violation of our “outer commons”. In this situation, the role of philanthropy is to try to restore the “outer commons” by offsetting the negative impact of privatizing social supports. She generalizes in her argument about North American philanthropy in a way that I don’t think recognizes sufficiently the different political and social approaches of Canada and the United States around the state role in maintaining the public good (through policy, funding and regulation). But she puts her finger on the pressure being felt by philanthropy in both countries to preserve or restore the “outer commons”.
What does this mean for philanthropic strategy? This is where the article by Kramer and Phillips takes Miller’s reflection further. In fact, they stand on its head the idea that philanthropy can itself do something meaningful to preserve the “outer commons”. No amount of philanthropic direct spending on the biggest social challenges we face, say Kramer and Phillips, has made “discernible progress on poverty, educational disparities, housing shortages, racial inequity and climate change.” One could dispute this at the margin, but it is true that the resources of private philanthropy will never be enough to overcome these complex problems. The whole charitable sector does not have the resources. As Kramer and Phillips point out, only government has those resources and mandate to preserve the “outer commons” for the benefit of all. But governments in the United States, the focus of the article, have made choices not to do so. In the view of the authors, this is because American governments are not representative of a multiracial population. American democracy is flawed and must be repaired.
So, what should philanthropy do? They believe that it must be redirected from the approaches of so-called strategic and top-down grantmaking philanthropy to an approach that entails three goals: “ensuring a functioning democracy that is truly representative of our population, rejecting false and misleading social narratives that misdirect public opinion, and supporting the economic self-determination of those living in poverty.” Concretely, this means funding efforts for civic and voter engagement and education, and funding community empowerment, economic self-determination, and individual agency. Kramer and Phillips reject the traditional concepts of strategy. “There are no grand strategies or elaborate theories of change. Instead, we are recommending that funders support an open-ended process that enables people to define their own goals and discover their own solutions, uniquely situated to their needs and circumstances—solutions that may never occur to wealthy donors or outside experts.”
This is a powerful shift from a consultant such as Mark Kramer who has been associated with the idea of strategic philanthropy for decades. He is pointing to an insight that many community development practitioners have long proclaimed. Philanthropy’s role should not (only) be to administer to needs (which can never be fully met by funders) but to recognize achievement, and support people on the path to success in their communities. This is another approach to bringing about systemic change….not through addressing root causes directly but through empowering people and communities to fully access and act on their democratic and human rights. Although our two North American societies differ in the degree to which the balance has tipped from public to private provision of public goods, and to conservation of the “outer commons”, the suggestions for the role and priorities of philanthropy are applicable to both countries. These two provocative and thoughtful articles are certainly food for thought in the Canadian context.
I have always been a fan of science fiction - not fantasy fiction but hard science fiction. Partly it’s because science fiction assumes that there will be a future for humanity, however strange. And partly it’s because these alternative futures are often mind-opening. William Gibson’s novel Neuromancer (published in 1984) was one of those memorable novels that first helped me visualize a world in which virtual reality and digital networks exist, long before they did. More recently, Kim Stanley Robinson’s Ministry for the Future created a vivid picture of the terrifying impact of future climate change while also bringing to life some fascinating and, dare I say, science fiction-like scenarios for creating a better future.
What does this have to do with philanthropy or foundations? The mind-opening possibilities of science fiction are like those of what people call “futures thinking”. And foundations with their flexibility, resources and long term focus are just the organizations to take advantage of futures thinking to open themselves and their partners to new opportunities. Just as Robinson’s Ministry for the Future acts on behalf of a sustainable human and planetary future, philanthropy can act to identify and promote solutions for our common future.
I was prompted in these thoughts by reading Futures Philanthropy: Anticipation for the Common Good a new guide to futures and foresight work released by Philea, the network of European foundations. This guide was developed by Philea and the Copenhagen Institute for Future Studies as a way for philanthropy “to strengthen its futures muscle”. Philanthropic organizations, it suggests, are among the freest institutions in our societies, which makes them good candidates for the development and application of a futures mindset – thinking about future scenarios in a way that helps see the present in a new way. “The future is not a distant void detached from the current moment…but no single approach to the future holds all the answers. Depending a on a single perspective can cause us to overlook the valuable insights that other viewpoints might offer. Merging futures thinking with philanthropy has the potential to address present-day crises and support long-term transformative change”.
How does one develop a futures mindset (beyond developing a taste for science fiction)? The guide offers principles and questions, most of which have to do with open, active listening, using empathy, questioning assumptions, and challenging conventional wisdom. Not easy to do but one can start with creating more diversity around a discussion table and asking more “what if?” rather than “how can” questions.
With a futures mindset, the guide offers some new (to me) tools for applying futures thinking in your organization. It sketches nine tools for provoking conversations and creating possibilities for action. This reminded me of another tool, the useful sensemaking worksheets for thinking about the future offered in Lucy Bernholz’s Blueprint 2024 which I describe in my blog post from January 2024, Thinking Ahead. The guide suggests that “by incorporating futures-driven exercises into team meetings, conference programs and boardroom discussion, you can foster an environment ripe for idea generation and deeper reflection.” Bernholz makes much the same point. There are many ways to challenge one’s thinking in philanthropy. We don’t have to revert to the “same old”.
Philea sets the scene for European philanthropy’s thinking about the future by reporting on the results of a 21st Century Philanthropy survey to which 238 philanthropy, civil society, academia, business, think tank, government and media organizations responded. This could be an interesting exercise for Canadian philanthropy too. Philea asks: In 2033, will philanthropy be a trusted legitimate partner co-shaping societal and ecosystem development, or will it be considered old-fashioned, elitist and unable to inspire debate or provide sparks for transformation? What are the most relevant structural and strategic choices philanthropic leadership is facing?
What do the survey responses indicate? The greatest opportunities for philanthropy in Europe in the next decade center on adopting systemic change approaches, moving to trust-based philanthropy, and collaborating more across sectors. The greatest risks are conservative boards and leaders, slow adaptation or short termism and a focus on the mainstream rather than on innovation. I daresay we would find the same in Canada. What else does the survey offer? The identification of 13 megatrends that will shape philanthropy’s future in the next decade, of which the top five are climate change and environmental degradation, AI and automation, concentration of wealth, climate migration and the rising influence of new governing systems (a retreat of democracy).
This data provides useful context for a foundation’s internal conversations about what will shape its work. Some of the European responses reported by Philea could feed an assessment by a Canadian foundation board and staff trying to imagine what matters in the next decade. But how does this also help us understand the implications for action in the present? What can futures thinking add to a foundation’s strategy development, practices and learning agendas? The guide provides several interesting case studies of European foundations who describe how they have used a futures lens to change their approach to the present. I came away from my dive into this guide more convinced than ever that futures thinking is a valuable addition to a philanthropic organization’s toolkit. And of course, I would suggest you add an SF novel or two to the mix to stimulate your thinking in creative ways.
Six years ago, I began reviewing books on philanthropy and social purpose leadership for The Philanthropist Journal. I can now look at a bookshelf’s worth of reviews – 16 books written by 20 authors.
These authors are all from the English-speaking world, primarily the US and the United Kingdom, joined by two Canadians, an Australian and a German. Their backgrounds range from journalism to history, from philosophy to fundraising, from research to consulting. Some are nonprofit leaders. Many are academics. They have different starting points, from ethics and morality to history and politics, and from bird’s eye to grassroots. Some write intellectual analyses, some write practical advice, some take a long view while others comment on the present moment. This diversity is an indication of the fascination and complexity of philanthropy across disciplines and perspectives.
I was curious to see if common themes emerge from these books, which were written over years during which philanthropy and nonprofit leadership have been increasingly under scrutiny. When I reread the reviews, I am struck by the optimism that all authors attach to the idea and practice of philanthropy and social purpose work. Giving for improvement of the common good is an enduring human impulse. Most of these books start from this place. They intend to inform and encourage the students and practitioners of philanthropy. The faults and negative characteristics of philanthropy are not ignored by these authors. They name issues of power, privilege and opacity. But they also share a belief that private philanthropy has value and that philanthropic practice can be improved and “modernized”. They bring thoughtfulness and rigour to our understanding of philanthropy’s role in our societies.
Networking, partnership, collaboration, participation –more than one author points philanthropy in this direction. Several of them make the case for philanthropy to remain anchored in values, moral purpose and heart – philanthropy should not be bloodless. And many believe that risk, imagination and innovation are assets that philanthropy can contribute to our shared benefit, if “done right” as Phil Buchanan would say.
If you are new to philanthropy, or a practitioner looking for inspiration, you will find much to learn from in one or several of these books. All 16 reviews are reposted on my virtual bookshelf, with thanks to The Philanthropist Journal.
Here are some quotes from my reviews to encourage your browsing.
In early April, the leaders of two relatively new Canadian foundations, Definity Insurance Foundation and Daymark Foundation, joined me at the annual conference of the Canadian Association of Gift Planners to share their experiences and insights on the evolution of strategic philanthropy. Here is some of what we talked about...
We live in a better country than we did 20 years ago, even if the media paint a different picture. For example….
In every case, a Canadian grantmaking foundation provided the seed funds, the connections, the training or the advocacy support to make it happen. And most people don’t know about it.
Why not? Foundations don’t often tell their own stories. And they need to. Because there are many other stories out there not told by foundations.
Some are benign (foundations exist to help those in need). Some are aspirational (foundations are the risk capital for much-needed social innovation). But others are conspiratorial (foundations are anti-democratic vehicles for the wealthy), or critical (foundations sequester urgently needed resources for today’s problems).
It’s true, there isn’t a single story. Philanthropic foundations are as different as the sources and uses of their capital. At the core, all foundation stories are about charity, caring for others. But foundations can also fight justice and seek equity. To do this, they must support social change.
Strategic foundations can tell a story about bringing about social change, using models and theories to determine and measure specific social outcomes and impacts. But this isn’t a story about the solo foundation in charge. That model is not ideal for social change. Even if it is appealing for a foundation to run its own show, it doesn’t open the door to more collaborative approaches. And it doesn’t consider the complexities of social change.
A strategic foundation works hand in hand with community partners to achieve mutually agreed goals, using its capital creatively and committing to active learning along the way. Definity and Daymark are this kind of foundation. The diversity of their work shows us that foundations contribute more than just financial capital. They can support knowledge-building, social research and development, network creation and convening, organization and infrastructure support. They can influence and they can advocate. They act as signals to others around innovations that may be crucial to us five or ten years from today.
In all philanthropic stories, we must acknowledge questions of power and inequality. Foundations are privileged. Their assets give them power. Foundations in Canada are being called out, as they are elsewhere, for lack of urgency in a world of rapid climate change and increasing inequality. Foundations, just like other organizations, need to be more transparent. To be accountable, foundations need to explain what change, what social impact, they seek and how they are going about it.
Arti Freeman, Chief Executive Officer of Definity Insurance Foundation, and Vani Jain, Executive Director of Daymark, are foundation leaders who know this well. They and their boards share some essential qualities with other strategic philanthropic leaders:
The Daymark Foundation is a family foundation created in 2020 to focus on mental health in two specific areas: women’s mental health (with an initial focus on perinatal mental health) and bipolar disorder. The Foundation has clearly set out its theory of change to improve outcomes in its chosen areas, in an unusually open manner. It uses a “more than money” approach, deploying intellectual, social, human and financial capital to act on its priorities. The Foundation has eliminated its grant application process in favour of an open invitation to potential partners to contact the Foundation for a call to discuss the organization’s vision for systems impact. As Vani Jain puts it, “competitive grantmaking promotes self-interest and hinders collaboration. We want to help organizations see their role within a larger system and explore the contribution they could make alongside others.” Daymark uses convening as a tool to help orient stakeholders toward these higher-level goals.
Definity Insurance Foundation is an independent foundation established and funded through the demutualization of the Economical Mutual Insurance Company. Since its public launch in February 2022, the Foundation has been focused on the roots of inequality, working particularly with Black Indigenous and racialized populations. Like Daymark, it has chosen to work with partners to advance community-led solutions that further climate, health and socio-economic justice goals. Like Daymark, Definity thinks of its capital as more than simply financial. It is also boldly moving into seeding initiatives that catalyze more private capital for the social outcomes that it seeks. It is deeply committed to providing the funds for capacity building of the partners with whom it has chosen to work. For example, it provided a $750,000 multi-year grant to the Raven Indigenous Impact Foundation, an organization focused on improving the wellbeing of Indigenous peoples, co-creating financial solutions that will result in better outcomes in climate and health for Indigenous peoples by centering the needs and voices of Indigenous communities. The Foundation provided the seed funding to design and structure the fund, hire a CIO and raise capital through investor engagement. Once the fund was in place, the Foundation also made a commitment to invest in the fund. Arti Freeman notes that this investment has a multiplier effect that accelerates impact. “If we want to achieve our mission, we can’t do it just with granting dollars,” says Arti. “We use our relational, social, intellectual and financial capital to advance solutions, and we learn as we do, always in collaboration with others, because how we show up is as important to us as what we fund”.
These two foundations exemplify a strategic approach being taken by Canadian foundations featuring innovative uses of capital, collaboration and a clear focus on outcomes. The foundation story is evolving rapidly, and we will hear more of it directly from these new leaders as a new generation comes in to Canadian philanthropy.
When should a foundation start thinking of moving from two to three? Most relations between funder and recipient are of course binary, involving two parties. But sometimes a funder might provide resources to a recipient in between the funder and another recipient. The awkward term “intermediary” is often used in these circumstances where a funder might grant to an organization which can perform diverse tasks for both the funder and an ultimate recipient: regranting, fiscal sponsorship, capacity building, platforming, fund pooling, advocacy… the list goes on.
There are many examples of intermediaries in Canada across a range of purposes. Community foundations, united ways and donor-advised fund foundations help funders by passing funds through to recipients. Organizations such as Community Foundations of Canada and MakeWay create fiscal sponsorships and capacity building platforms. The King Baudouin Foundation Canada helps donors by funding cross-border projects. Government funders also use intermediaries frequently to select recipients and distribute funds. Community Foundations Canada, United Way Canada and the Red Cross were intermediaries for the federal Community Services Recovery Fund. Another federal fund, the Investment Readiness Program, partnered with multiple nonprofit organizations as intermediaries to convene, educate and pass through funds to social purpose organizations.
There are collective or pooled funding intermediaries such as the Clean Economy Fund. There are backbone organizations such as Vibrant Communities Canada. Regional networks such as the Ontario Nonprofit Network and national groups such as Philanthropic Foundations Canada, Environment Funders Canada and Imagine Canada have also been around for years as intermediaries to convene, educate, advocate for and sometimes directly fund the charitable sector. More recently, as philanthropy in Canada has begun to focus more on racial injustice, inequality and systemic barriers, new intermediaries such as the Indigenous Peoples Resilience Fund and the Foundation for Black Communities have been launched to represent and to support Black and Indigenous organizations and communities directly.
Many charitable funders in Canada have used intermediaries as a channel to grant to non-charities. The recent changes to the Income Tax Act now provide more flexibility for charitable funders to grant directly to non-charities. But it is unlikely that the role of intermediaries will lessen in importance because of the many ways in which they can offer services that go beyond the act of re-granting. Indeed, the change in the law may provoke more foundations to ask themselves about how they can use intermediaries to grant to organizations in communities where there are few charities but where they know there is more social and systemic injustice.
Given the importance of intermediaries in philanthropy it is surprising that not more has been written about this relationship. How do you choose when and who to fund? What are the complexities involved in moving from a single relationship to multiple relationships? A topical new report Working with Intermediaries Strategically has been released by the Robert Wood Johnson Foundation, authored by Cynthia Gibson and Maria Mottola, philanthropy consultants. This report offers a new perspective and a valuable approach for Canadian foundations who might want to consider why and then how they might want to include intermediaries in their granting.
The authors reframe the question by broadening the lens from what funders want to what intermediaries and others in a community might want too. In other words, they suggest that funders should think of working with intermediaries not just in transactional but in relational terms, depending on what both the funder and the intermediary want to accomplish. They point out that “the term intermediary is itself being questioned, with some preferring the word partners to imply that the foundation and the intermediary have similar goals, intentions, and strategies and are working together to achieve them…This conceptualization sees each partner as having assets and resources as well as needs and affirms that naming and exploring these reciprocal relationships will lead to better structures and outcomes for our common mission-focused work. “
Specifically, say Gibson and Mottola, “funders need to take a more holistic view of not only what they need but also what organizations, networks, movements, and fields need to achieve their goals and then working as partners with grantees to determine how intermediaries can help do that.” Their report is based on interviews with both funders and intermediaries, from whom they quote extensively, so that much of what they have to say is drawn from experience. One respondent clearly summarizes the broader relational perspective brought by Gibson and Mottola: “funders need to start by thinking about the intersections between the issues they want to address, which will determine the kind of groups and networks to consider. Who is active in that intersection? Is it important that they have a racial justice lens? Who can we partner with? Who are other funders supporting? Where’s the energy in the donor community? Basically, what does the space or ecosystem look like as a whole and where are there gaps and opportunities to strengthen it?”
A practical contribution offered by Gibson and Mottola is a tool for funders to use in considering whether to work with a partner. The tool starts from the traditional premise of identifying a purpose for which the funder believes it needs an intermediary. This could be tactical, strategic or relational. This is already a helpful distinction to make. The tool then prompts the funder to think about questions aimed at encouraging deeper analysis about the why behind the presumed function of the intermediary. These questions will be immensely helpful to provide a deeper and more reflective conversation by foundation staff or board members as they think about when and why to seek out a third party in their philanthropy. Intermediary partners are an important component of the philanthropic ecosystem. A thoughtful approach to “third” party granting should be part of an effective philanthropic strategy.
One of the most difficult things for any organization is to think ahead, to imagine new scenarios, to picture different or more innovative strategies for your work. At the beginning of a year, there is both opportunity and temptation to draw back for a period and consider the present and the future. But how to do it well?
Just in time, two knowledgeable authors have offered nonprofit leaders some ways to think in an open-ended but rigorous way about the future. Foundation staff and board members would certainly be able to take advantage.
Jacob Harold offers a new book The Toolbox: Strategies for Crafting Social Impact. Lucy Bernholz offers her Blueprint 2024 in an online format. Both writers are longstanding observers and analysts of philanthropy and civil society, particularly in the United States (both are American). But their advice is not culturally or contextually specific, except in the sense of the types and sizes of nonprofit organizations that they address.
Harold and Bernholz have different backgrounds although both are focused on social change. Harold explicitly calls himself a social changemaker and has led several nonprofits. Bernholz has consulting and academic experience and is based at Stanford University. Both are practical and experienced writers and neither one underestimates the challenges of thinking about the future in the context of social changemaking.
Bernholz is more of a futurist than Harold. She is acutely aware of the difficulties of making forecasts about directions for philanthropy and civil society. She notes that “our current efforts at understanding the present and future are failing – largely because we’re using out-of-date data, built on assumptions that no longer hold, and with models that can’t account for the kinds of dynamics we think are coming but have yet to experience.”
Why should foundations in particular try to better understand the present and the future, given these difficulties? Because grantmaking foundations, as many (including me) have often argued, are uniquely able to take a long view and to act on it, taking greater risks and offering more patient funding. Social change is slow change, as Rebecca Solnit puts it in a recent essay. Solnit makes the case that the most radical change can be the hardest to see because it takes time to accrue, to evolve and to build. Taking a long (multi-year) view, she says, “shows you movements shifting what’s considered possible, reasonable, and necessary, setting the stage and creating the pressure for these events, offering a truer analysis of power.”
So it’s worth taking time to identify and reflect on what can be seen, even if it’s small or incremental. “Somewhere in our future”, says Bernholz,” lies the moment when the old gets outnumbered by the new”. Knowing the difficulty of hearing the signal in the noise, Bernholz has helpfully included in her Blueprint a pull-out section of what she calls ‘sensemaking worksheets”. These worksheets can be used to start sensemaking conversations. She suggests collecting a series of today’s headlines and events and trying to make sense of them in the context of your work – looking for patterns, asking how the work of philanthropy may or may not contribute to the story, thinking about how social media play into story, brainstorming wild card events and then seeing how they might affect philanthropic work., asking how AI might change stories and assumptions, etc There are many possibilities here for generative conversation.
Jacob Harold for his part has put together a book-length guide to tools that can be used for making sense of the present and the future. He suggests that these tools are “frameworks for thinking and acting”. More specifically, they are ways of understanding and shaping context, data, individual behaviour and institutional relationships. In his creatively designed book, complete with images, poetry, charts and texts, Harold describes a “toolbox”, or way of thinking about social change strategies, and nine “tools” for the box, that can be used as approaches to the work of crafting action for social change. Harold’s purpose is not purely sensemaking but helping social changemakers in their effort to create strategies for their work. But like Bernholz, many of Harold’s questions can be used for brainstorming and collective creativity. My review of Harold’s book in The Philanthropist Journal gives you a feel for the tools and the uses that can be made of them. Reading these resources reinforced my view that reflection and creative conversations can be enormously helpful to philanthropies and social sector organizations alike. We may not know what the future will bring but we can prepare ourselves by collecting evidence and asking thoughtful questions about the directions we see around us.
January rolls around once more and we try to make sense of the year behind and the year ahead. Last year, I avoided predictions, as did others, given the turbulence of our world. Instead, I listed some hopes and fears for 2023. It turned out to be a roller coaster year, with more downs than ups. Both the hopes and the fears were relevant and relatively accurate. As we move into 2024, which I expect to be no less of a roller coaster, I would like to venture some hopes but also reiterate some fears for foundations and philanthropy.
Before I get to that, I want to frame my thinking, as I did last year, around the nature of effective foundation philanthropy, which I see as an act of relationship. Not just a handover but an exchange. Not all about control but about combining resources. In this frame, both funder and “doer” (a description I like better than grantee or fund recipient) bring their value (and values) to each other in an ongoing relationship. The challenge of this is that it takes communication skills and accountability responsibilities.
In late 2022, Phil Buchanan of the Centre for Effective Philanthropy (CEP) expressed this view of philanthropy as relationship in a long public essay about big changes and big questions for philanthropy which is still very much worth reading. Commenting on what he and I and others see as the false binary of strategic versus trust-based philanthropy, he noted that “thoughtful donors and foundations reject the notion that there need be a dichotomy between strategy, assessment, evidence, and learning on the one hand and trust, listening and flexible support on the other. They recognize that trust develops over time. They embrace mutual accountability. They realize that, while the knowledge and expertise of those closest to issues should be respected, foundation staff and donors do often possess useful knowledge, too.”
Buchanan was addressing the debate that is very much on in the foundation world around the pressure to shift to “trust-based” philanthropy, or flexible giving, or unconditional funding, such as that practiced most famously by the American philanthropist MacKenzie Scott. She has been giving unsolicited and unconditional large gifts to nonprofits for several years, in an ultimate act of trust. Buchanan’s organization is studying the impact of Scott’s giving, which has up to now resulted in over US$ 16.5 Billion given to more than 1,900 nonprofit organizations. CEP’s research indicates that “Scott’s unconventional approach, unusual both for the size and unrestricted nature of the gifts, is resulting in dramatically positive effects for both recipient organizations and the work they’re doing.” While convincing on the merits of trusting recipients, this is not a model of relationship philanthropy. Scott herself and her team do not seek ongoing relationships. Her team identify recipient organizations in a quiet and anonymous process, and surprise them with offers of large and unconditional gifts. Her approach requires expertise, evidence and evaluation on the part of her team, but there is no dialogue. It’s not likely to be replicated widely, no matter how positive the outcomes for the recipients.
What is clear is that flexible or unconditional giving still needs to be based on some understanding and support for the goals, leaders and work of the organizations receiving the funds. And this to me suggests that funders, if they want to be effective, must move into closer relationships with partners, cede some control and develop the trust needed to work together. So, why are many funders and recipients resistant? Many reasons are suggested: lack of staff, time or data, desire for discretion, wish to maintain control (on both sides). But if you are interested in making social change, in having an impact on the problems you choose to focus on, you surely also want to be in dialogue, to learn, to share and to develop through greater proximity. And that means talking to the organizations you might count on to implement the strategies you believe will lead to change.
What does it take to become more comfortable in relationship? No easy answer. It takes time, attention, perseverance and yes, trust. If funders want to commit themselves to building relationships in 2024, they could start with some of the questions that Kathy Reich of the Ford Foundation posed in her recent blog Funders and NonProfit Leaders: Can We Talk? Here are some of them:
Some useful questions to begin your board discussions in 2024!
Turning now to this coming year, I hope that…
I fear that…
Let 2024 be a more hopeful than fearful year for everyone.
The conversation about the need for transformation in the practices of philanthropy continues across the philanthropy field. We hear about the what and the how of change. But we don’t hear as much about the reasons why change is so difficult. These often have to do with some of the built-in tensions and need for choices in philanthropic approaches.
In my July blog post, Transforming Philanthropy Step by Step, I highlighted the Philanthropy Transformation Initiative from WINGS, the global philanthropy network. Discussing the need for transformation, a group of experienced funders under the umbrella of WINGS contemplate what they call the “paradoxes” of philanthropy. Is philanthropy a solution to society’s challenges, or is it part of the problem? Does philanthropy, by its very nature, reflect the existing systems and structures that have allowed wealth and power to be created, and therefore stand in the way of transforming those systems?
These paradoxes are framed largely around the question of power. The WINGS funders and others suggest that foundations transform themselves by adopting practices that will shift the power, whether through more transparency, more local funding, more partnerships with others or simply more shared decision-making.
But power and what to do with it is not the only dilemma for funders to consider. Of course, money is power. And so, power may be the most prominent dimension of philanthropy. But there are other dimensions such as time and scale that are on the minds of many funders. In considering how best to achieve impact, thoughtful foundation boards and leaders consider choices such as:
These choices are well described in a recent article in Alliance magazine by Anna Hirsch-Holland of the UK-based The Partnering Initiative. She points out that “the transformation agenda” for foundations is more complex and difficult to navigate than implied by WINGS’s set of transformation principles. Much of this turns on how foundations can transform the power imbalance between themselves and grantees or partners.
WINGS and others have called for more long-term, flexible funding to more locally-led actors, and to more actors representing marginalized communities. Hirsh-Holland notes that this can be in tension with a foundation’s ambition for addressing underlying causes rather than symptoms, for greater impact. This can be translated as seeking systems change. And to truly achieve that, key actors in a system need an aligned approach.
As Hirsh-Holland explains (and I quote her at length for those who don’t subscribe to Alliance), “If funder and grantee alike truly want to work together to enable systems change they need to form a trusted partnership: agreeing on shared objectives, with shared accountability for achieving those by combining and integrating complementary resources. This can be at odds with the implicit (or sometime explicit) idea in trust-based funding practices that the grantee knows what is best, and the funder should leave them alone to get on with it. Instead, it requires finding a way to work together that builds trust.”
“In fact, systems change also needs more than a collaborative approach between funder and grantee. It requires multiple stakeholders to be ready to work with others…combining and aligning their resources in pursuit of transformational change. This is why many funders are also recognising their important role in convening and encouraging collaboration between their grantee partners and other key stakeholders.” But, as Hirsh-Holland points out, “this can be a delicate matter as donor-driven collaboration can be another way in which funders embed an unhealthy power dynamic with and among their grantees.”
She also draws attention to the tension between the “trust-based approach” that calls for minimal reporting requirements and the need for funders and partners to know what progress is being made towards systems change or to collect evidence that an approach is working. She suggests that many foundations are finding ways around this tension by “focussing on learning rather than proof and seeking to make this a collaborative effort with their partners”. But the demand for evidence can prevent funders from achieving their ambition to shift power to community organizations with limited capacity for reporting and evidence collection.
One more tension identified by Hirsh-Holland is that between the drive to partner more locally and the trend towards “big-bet, top down philanthropy”, particularly in the area of climate change work. If foundations are partnering with private investor partners to catalyze more capital for the energy transition, profit can supersede justice goals. To deal with this tension, foundations can be those actors that “build critical bridges between the profit-driven motivations of the private sector, the social goals of governments, and the justice goals of civil society actors.”
Hirsh-Holland provides a nuanced way to think through at least some of the tensions inherent in an attempt to juggle more trust-based or more locally-driven and equitable approaches with the ambition of achieving greater impact over time. She suggests her own questions to apply, along with the tips and ideas from WINGS:
Tension is often associated with stress. But tension is not inherently bad. It simply forces more concentration. Philanthropy with impact is not for the faint-hearted. Nor can it be part-time. It requires much thought and care. Luckily, funders such as the group behind the Philanthropy Transformation Initiative and the Partnering Initiative are sharing the questions and ideas that will help along the path to making good philanthropic choices.
It has been a very tough summer for the world, weather-wise. Heat, storms, floods and fires affected countries across the map. The changing climate convinces many of us that these are partly human-made, not just “natural”, disasters. This could be cause for despair. But there is still room for hope. And philanthropy can be both part of and a contributor to that hope.
We are told by ClimateWorks that philanthropy worldwide contributes less than 2% of its giving to climate mitigation funding. That suggests significant opportunity.
For many in philanthropy, the question isn’t why but how to engage in what is a very complex and quickly worsening problem. Peer sharing and encouragement can help. A global foundation movement, #PhilanthropyforClimate, is showing how through its International Philanthropy Commitment on Climate Change.
In Canada, where warming is happening twice as fast as the rest of the world, Canadian philanthropy is joining the international movement with a Canadian Philanthropy Commitment on Climate Change, which is gathering speed with almost fifty foundations signing on.
This is reason for hope. And there are many ways in which foundations can make a difference, even with limited funds. As interest and urgency grow, so too does the availability of the models and resources.
A March 2023 report from the Aspen Institute and Morgan Stanley Private Wealth Management, Funding Climate Action: A Pathway to Climate Philanthropy, takes an interesting approach to helping foundations and philanthropists think about options for climate change funding. It describes five climate funder « archetypes » to show how the various tools of philanthropy can be used according to these types. Several foundations are profiled in the report to demonstrate the ways in which archetypical funders are intervening on climate. The archetypes are: climate explorer, climate lens applier, climate philanthropy leader, investment-led philanthropist, and climate action integrator.
The report suggests that many family foundations are increasing their climate engagement by moving into the climate lens applier archetype. “Climate Lens Appliers have recognized that climate change is an important global challenge and that their own philanthropic mission will be impacted by the changing climate. While they may not have shifted their mission to focus exclusively on climate issues, they have explicitly decided to apply a climate lens to their giving.”
While it uses mainly American references, the report offers as an example of this archetype a Canadian family foundation, the Trottier Family Foundation. Eric St-Pierre, the Executive Director, describes how the Foundation is using its approach to climate in its healthcare work. “We are maintaining a focus on healthcare in Quebec, but intentionally looking at the relationship between health and the environment. We are launching both an adaptation and mitigation strategy in the context of health.”
Another very useful guidance report for climate funders was published in August 2023 by the Bridgespan Group. Winning on Climate Change offers a summary of past progress funded through philanthropy and a set of practical suggestions to climate donors. Like the Aspen report, Bridgespan interviewed many funders who are active in the climate change fight. And like Aspen, Bridgespan’s report suggests some guiding principles for climate change funders at any stage of their exploration: Invest now and early, even in small-scale efforts; collaborate with others through intermediaries and pooled funds; support the equitable implementation of existing laws, treaties and policy changes. You don’t have to do all of these things to be effective as a climate funder. But starting somewhere is the key.
Many funders will say that it is easy to get lost in the multiplicity of initiatives and efforts. How to know what is going to be most effective? On this point, one of the funders interviewed by Aspen, Chris Kohlhardt, recommends that “you have to decide if you are more afraid of analysis paralysis or potentially wasting money. Err on the side of moving money sooner and learning from your experiences.”
For those philanthropists who do want to see the pathway to a low carbon energy economy before they decide on what will be most effective, the best approach may be to fund the development of the energy transition roadmap. A great example is the German Energiewende or energy transition strategy, which was developed by an independent nonprofit think tank, Agora Energiewende, in the 2010s. Agora is a public policy consultancy which convenes stakeholders from government, political parties, universities, labour unions and industry to discuss policy solutions. According to an article by Paul Hockenos in the Fall 2023 issue of the Stanford Social Innovation Review, Plotting the Path to Carbon Neutrality, Agora’s work “over the course of a decade…has definitively framed the climate-protection agenda in Germany and Europe”. Agora’s work was funded by private philanthropy - the Mercator Foundation and the European Climate Foundation. Today, “roughly 80% of its budget comes from private foundations worldwide”.
This is another example of philanthropy’s opportunity to drive a successful climate agenda, even in the face of accelerating climate-related disasters. The Ivey Foundation in Canada, arguably an example of the climate action integrator archetype sketched by Aspen, has taken the approach of going all in on climate. Like Agora, it is working on the roadmap to transitioning to a low carbon economy. The Foundation collaborates with experts across the spectrum of academia, government, industry and NGOs and has supported many policy advances. Its role as a non-partisan funder of policy think tanks and collaborative funds shows how private philanthropy can spur public progress.
There is plenty of hope in the midst of 2023’s climate-related gloom. I take heart from the way in which philanthropy is rising to the opportunities. The tools and ideas are available. The key is to start. Note: I write about how Canadian philanthropy is rising to the challenge of climate change in my book From Charity To Change. So much more has happened since it was published in 2022!