Lisa Wolverton is president of The Philanthropy Workshop Canada and is on the advisory council of the Freedom Fund, which recently launched a project to encourage donors to give directly to community organizations.
We are entering a new era of charitable giving, and it’s long overdue.
Many major philanthropic donors to Canadian and global charities are turning away from traditional ways of giving, such as funding large charities that serve marginalized groups from afar, or restricting how the charities can spend those donated funds. Instead, they are opting to donate directly to community-focused groups – with no strings attached – in an attempt to give them more control over their own futures.
This trend is part of a larger movement to “decolonize” philanthropy that has been publicly embraced by Canadian donors such as The McConnell Foundation and Inspirit Foundation, among others.
It’s not just private philanthropists who are making such moves. The federal government recently awarded $200-million to the Foundation for Black Communities to administer a Black-led Philanthropic Endowment Fund, dedicated to supporting Black-led, Black-focused and Black-serving non-profit organizations.
It’s time more donors put funds directly into the hands of local leaders, giving them crucial decision-making power. This means removing some restrictions and requirements to enable community leaders to manage and distribute funds as they see fit.
This kind of bold step requires that donors believe that, for money to have the greatest impact, it must be accompanied by trust and autonomy – an approach that has the potential to change more lives and transform our culture of giving.
And this new age of philanthropic giving is not just about how we give, but who we give funding to.
Some donors are making large gifts to groups that have historically had very little autonomy over those funds. We’re witnessing large foundations such as The McConnell Foundation transferring unprecedented amounts of capital to Indigenous-led foundations, for example.
Others are investing in collaborative funds such as the Freedom Fund, Equality Fund Canada or Co-Impact, which address issues such as gender injustice or human trafficking through the funding of grassroots groups. This movement has great potential to make a meaningful difference.
Donors are going beyond talking about shifting power to creating new giving structures, processes and expectations in order to build trust and reduce the power imbalance that is so inherent in philanthropy. They are reconsidering their roles in working toward tangible social change and building markedly different relationships with those they fund.
This is not just the right thing to do from a theoretical perspective. Throughout history, attempts to solve societal problems in a dictatorial fashion, without directly and significantly involving affected communities, have proven ineffective, unsustainable and even harmful. We know that philanthropy – and really, any attempt at social change – works best when we understand that people with lived experience of a problem are best-placed to design and implement solutions. Often, what they need most are financial and non-financial resources, the support of power holders and the freedom and space to try. Sometimes such small shifts in donor mindsets and behaviour make a big difference.
Donors must consider the practices and principles that are critical to trust-based funding. They need to explore questions like: Who are you trying to help, what do you bring to the table and who should make decisions about where your money goes. How can you make sure you are funding organizations that are authentic, and how can you end a funding relationship while minimizing harm to a community?
We also need to document the lessons learned so that other donors can replicate what works.
One thing is certain: philanthropy cannot continue as it always has.
From governments to foundations to individuals, we can all ensure that our money is giving communities the power to define their own futures and we can encourage others to do the same. We have much further to go, but we’ll know we’re there when this type of giving is the norm, not just something we hear about in big, flashy announcements.