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In This ‘Moment of Truth,’ Philanthropy Can and Should Get it Right

Date: May 17, 2022

Dwayne Marsh

President and CEO, Northern California Grantmakers

Kate Wilkinson

Partner, Open Impact

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Shifting philanthropy’s outmoded ways of working is the challenge that will define the sector in the coming decade. We can no longer afford inaction that perpetuates the status quo. We must pursue what evidence indicates will take us toward equitable recovery and shared prosperity.

Committing to transform our communities means that everyone rolls up their sleeves and puts the good of the whole — a shared vision of inclusive prosperity and well-being — above individual organizational mandates and missions. This requires decision-makers in philanthropy to catch up to their staff and partners, embrace new narratives of possibility and inclusive decision-making, invoke new mental models, shift organizational and sector culture, change default ways of viewing and holding power, and take bolder and more community-responsive actions. No time is more urgent than now, as Irene Wong, local grantmaking program director at The David and Lucile Packard Foundation, shared: “We’ve had a ‘philanthropic wake-up call’ of sorts as our communities and world have been upended — with COVID and our long overdue racial awakening. It’s philanthropy’s ‘moment of truth.’”

To capitalize on this moment, Open Impact and Northern California Grantmakers, supported by The David and Lucile Packard Foundation, launched a listening tour of 25 leading philanthropic practitioners based in Northern California and working in solidarity with local communities. Specifically, we sought to understand how — within a region that harbors some of the most extreme economic inequality in the nation — we might revitalize philanthropy’s vision, boost its ambitions, and reimagine how the philanthropic sector contributes to a region sustained by equitable systems. Further, how might we leverage what we learn here to inform conversations happening nationwide? We synthesized our findings in a report, Get It Right: 5 Shifts Philanthropy Must Make Toward an Equitable Region, to make the case that today is a time for audacious vision and action.

As A. Sparks, CEO of the Masto Foundation, noted: “This is a unique moment in time, funders are finally willing to listen, they are seeing the suffering that has always existed but that was hidden from philanthropy’s isolated and limited vantage point. And they are connecting the dots to systems and the movement building that will be necessary to make change.”

Most philanthropic staff, given their relative proximity to nonprofits and communities, will read this report and nod (and even wonder at the need to restate years-old guidance). In fact, the practices and strategies highlighted in Get It Right reiterate and underscore the work of many others in the sector, as captured in Trust-based Philanthropy practices and Purpose-driven Board Leadership principles, among others.

However, regional interviews affirmed what the Center for Effective Philanthropy’s (CEP) recent research found nationally; according to CEP’s report Foundations Respond to Crisis: Lasting Change, “…nearly half of leaders say that their boards are the biggest impediment to their foundation’s ability to advance racial equity.” Indeed, leaders interviewed for Get It Right affirmed that many of the most impact-centered practices and strategies have yet to be broadly adopted due to entrenched ways of working, fear of devolving decision-making power, lack of knowledge, and widespread inertia among philanthropic executives to transform these obstacles. Advancing racial equity is the defining challenge of our generation of philanthropy and this analysis provides a roadmap to action.

This report attempts to activate those holding ultimate decision-making power and responsibility — foundation CEOs and executive directors, board members and trustees, and individuals of high net worth. We seek to reach those who have yet to be convinced of the imperative to change, help them step on the pathway toward acknowledged, evidence-based practices, and realize the benefits — for communities and philanthropic entities themselves. The report’s case studies demonstrate how nonprofits, especially those led by and serving BIPOC populations, address symptoms and shift systems. “What we are trying to do is inspire outcomes that are not dependent on altruism,” shared Lateefah Simon, President of the Akonadi Foundation, “We won’t create a more equitable region until we are clear about the problems and how we can begin solving them. We need a focus on policy and warm bellies.” These organizations model evidence-based practices that, if well-resourced, will transform the lives of individuals and families with low incomes, those underestimated and held back by discrimination and systemic racism, and all who struggle to realize safety, dignity, and belonging in this place of tremendous wealth.

It’s time philanthropy joined them.

Call to Action: The 5 Shifts

  1. Center Community: Decision-makers involve those closest to problems, engage diverse communities in governance, and apply a strong racial justice frame of analysis/decision-making.
  2. Focus on Systems: Philanthropies use a holistic approach focused on underlying root causes alongside direct services.
  3. Advance Collective Action: Funders collaborate to develop robust collective strategies and approaches, actively working in concert with those driving change in other sectors.
  4. Leverage Capital Investment: Funders are realistic about the scale of the problem, understand the catalytic and risk-capital role of philanthropic dollars, and organize diverse capital sources, including their endowments, resources of peer foundations, the private sector, and government.
  5. Update Practices: Internal funder practices center on diversity, equity, and inclusion (DEI); funders follow trust-based and inclusive grantmaking practices; they demonstrate urgency while deploying funds, with an understanding of long-term systems change.

To read more about the 5 shifts, including case studies of the practices in action, read the full report: Get It Right: 5 Shifts Philanthropy Must Make Toward an Equitable Region.

Dwayne Marsh is president and CEO of Northern California Grantmakers. Northern California Grantmakers brings philanthropy together to build healthy, thriving, and just communities.

Kate Wilkinson is a partner at Open Impact. Open Impact is an advising and innovation firm that serves as a trusted guide to private donors, foundations, and networks in developing impact strategies.

Editor’s Note: CEP publishes a range of perspectives. The views expressed here are those of the authors, not necessarily those of CEP.

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