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Philanthropy in 2025: Work To Do

01/20/2025
Hilary Pearson

Here we are…beginning 2025. Still getting over 2024. And I thought that 2023 was a roller coaster year with more downs than ups! In January 2024, I was apprehensive but hopeful about what might happen to foundations and philanthropy in Canada. At the beginning of 2025 I am feeling perhaps more apprehension than hope.

Am I seeing the same things that others are seeing? I have looked around for predictions and guesses about what 2025 will bring (although I am not commenting on the political and economic front, important as that will be in Canada this coming year). I have listened to a few keen observers on philanthropic trends in the US and UK. Here are the most often mentioned and most worrying trends and concerns they express across borders:

  • Individual giving down overall
  • Institutional philanthropy under populist attack particularly in US
  • Deteriorating sustainability of civil society/charity organizations
  • Continuing burnout of staff
  • Pullback on ESG investing as well as equity and inclusion strategies
  • Concern about continuing and worsening inequality and global turbulence
  • Increasing concern about the impact of climate change and associated disasters
  • Uncertainty about AI and its applications in philanthropy
  • Decreases in cross-border giving by both governments and private funders

On the more hopeful side:

  • A new generation of leaders is arriving in foundations, including on boards
  • Collaborative funding (particularly for climate and social justice) is increasing
  • More funds are flowing into charitable vehicles (not just foundations)
  • Foundations are becoming (a little) more transparent and communicative
  • Underserved regions, people and issues are getting more attention
  • Foundations are adding staff and strengthening their own capacity to work on deep-rooted social challenges like addiction, homelessness, mental illness and generational poverty

As in 2024, I won’t make predictions for philanthropy (who can?) but I will suggest some wishes and worries without rating their likelihood of coming true.

In 2025, I wish that…funders will respond creatively to the pressures on civil society

  • More funders will make efforts to support social cohesion: The climate of distrust, argument and anger in Canada does seem to be worsening, with global conflicts, political rhetoric, and frustrations about the economy, fueled by disinformation. But some funders in Canada are paying attention and can show the way in countering conflict through narrative change, public journalism, citizen dialogues and convening leaders.
  • More funders will look at ways to engage in participatory grantmaking: This approach is not the same as trust-based philanthropy although it depends heavily on trusting relationships; it can be a way of including those beyond the foundation’s boundaries in the work of grantmaking. Ultimately it can lead to more shifting and equalizing of power. A global network of participatory grantmakers offers help and sheds light on promising practices.
  • More funders will fund actions to mitigate or adapt to climate change. The November 2024 announcement by Climate Champions of a total commitment of $405 million by nine private foundations and donors to actions to combat the effects of climate change provides some leadership to build on, as I noted in this blog.

I worry that…some of the risks I saw in early 2024 will become even greater

  • Funders will be even more reluctant to move into mission-driven investing. There is a backlash against ESG and “green” investing.  Major public investors and companies are pulling back. Will foundation investment committees and boards follow suit? There is more mission-related investment opportunity than ever, but it takes courage to overcome the perceptions of risk.
  • Nonprofit infrastructure in Canada will continue to weaken. Member-based networks such as Imagine Canada and the many provincial or regional networks for the Canadian social sector depend on support from within our sector, not from government; this leaves them generally underfunded. Foundations don’t like to become sustaining funders of networks. But this year might be more important than ever for collective efforts to develop policy ideas and electoral platform planks. If funders are reluctant to give support, we will all be worse off.
  • Foundations will become more hesitant to draw attention to themselves…because of criticism, because of media attacks, because of a project not going as expected. New donors might even be discouraged from starting a foundation altogether. For some encouragement I recommend listening to Beth Breeze at the end of 2024 defending philanthropy from its critics on the Giving Done Right podcast.

In what will be a turbulent year, let’s hope that foundations will be anchors of steadiness for many civil society organizations and leaders. Something we can all hold on to!

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