What Will Be Philanthropy’s Next Chapter?

I am often asked by nonprofit leaders, “Where are the funders who understand what nonprofits really need?” Well, they were at the Grantmakers for Effective Organizations conference (#2016GEO) last week in Minneapolis.

After attending the conference and curating a great group of bloggers who recapped each day (you can read Phil Buchanan’s Day 1 post here, Trista Harris’ Day 2 post here, and Mae Hong’s Day 3 post here), I have lots of my own thoughts percolating and wanted to share my takeaways from a great conference.

GEO is made up of 500+ member foundations that strive to be better philanthropists. They are a thoughtful bunch who seek to invest better in the nonprofits leading social change. As Linda Baker from the David and Lucile Packard Foundation said in her session on Real Costs for Real Outcomes, “We want to have authentic, trusting relationships with our grantees. We want them to have the impact they want to have in the world because that’s the only way we will have impact. It’s critical to our success.”

And that, in essence, is what GEO and its member foundations are all about. They view themselves and their money in service to those nonprofits creating social change. It is a different model than the traditional philanthropic model of nonprofits in supplication to those who hold the purse strings.

And because GEO is on the cutting edge of where philanthropy is and should be going, the conference this week encouraged philanthropists to push their work in some exciting new directions.

Here is what I saw emerging at the conference:

Philanthropy Must Embrace the National Call for Equity
From the #BlackLivesMatter movement, to student protests on college campuses, there is a growing demand across the country for equity — a level playing field — for all. And philanthropy has to get better at responding to this in the moment. As Alicia Garza founder of the #BlackLivesMatter movement said in her session, “Philanthropy is missing the opportunity to support the very change they are set up to resource.”

And the plenary panelists Peggy Flanagan, Michael McAfee, Doug Stamm and Starsky Wilson would perhaps agree and take it even further, encouraging philanthropist to re-examine the institutional racism inherent in the system. As Michael McAfee said, “I am deeply frustrated at our leadership. At the moment where consciousness about equity is elevated, we shift our priorities, our initiative, we do something to avoid the real work for this moment. We could do something if we could be more courageous.” In this moment where our country is grappling with issues of equity, philanthropy must step up and invest in the hard work of change.

Philanthropy Must Invest in Stronger Organizations

GEO members have always been on the forefront of understanding that it takes strong organizations to create real outcomes, but this conference took that to another level. From a session on unrestricted operating support, to one on supporting fundraising capacity, to one on funding nonprofits’ real costs, GEO was pushing its members, and philanthropy as a whole, to recognize that real change will only come when we support organizations, not just programs.

As one attendee put it, “The project funding paradigm ignores the health of the nonprofit organization in which the project lives.” Yes, absolutely. GEO members are recognizing–and perhaps leading the rest of philanthropy to begin recognizing–that you cannot have effective programs, strong outcomes, and ultimately social change without strong, effective organizations behind them.

And that means that philanthropy can and should lead the way in funding the full costs, including program AND operating costs, along with working capital, fixed assets, reserves, and debt. And at the same time, philanthropy must be a partner with nonprofits in figuring out how to overcome their capacity constraints, like lack of fundraising expertise, lack of management knowledge, and lack of adequate systems and infrastructure.

Philanthropy Must Humble Itself 

There is no doubt that GEO members are a humble bunch; they view their role as supportive to the real work of social change, which is different than traditional philanthropy that viewed itself as all knowing. But, perhaps there is still work to be done.

Vu Lee, blogger from Nonprofit With Balls and Executive Director of Rainier Valley Corps, spoke eloquently of philanthropy’s “trickle down” approach to working with communities of color and encouraged philanthropists to take a better approach: “We have to start changing philanthropy’s perception of what communities of color are. Instead of infantalizing communities of color, recognize that communities have the solution, they are the solution, they are the light.”

And Deepak Bhargava from Center for Community Change spoke of the typical grantor/grantee relationship being similar to a feudal relationship, where the philanthropist is the Lord and the nonprofit is the serf. Instead, he encouraged the social sector to move to a place of “public friendship” between grantor/grantee where both sides are:

• United by a vision of big change
• Accountable to each other
• Thinking of themselves as custodians of organizations leading to a better place
• Engaging in creative, generative conflict

He spoke of this ideal as something that we must “persuade a new generation of philanthropists is possible.”

And perhaps this new philanthropy is possible. GEO certainly seems to think so. So let’s hope that this new vision for philanthropy is embraced by the growing GEO membership and that that membership in turn leads philanthropy as a whole to a more effective way of investing in social change.

As Alicia Garza put it, “Effective grantmaking is moving resources to change agents AS change is happening and getting out of the way.” Amen!

Photo Credits: publicdomainpictures.net, #2016GEO