When viewing the Center for Effective Philanthropy (CEP) report New Attitudes, Old Practices: The Provision of Multiyear General Operating Support, several findings from the research stood out to me:
- Nonprofit leaders report that receiving multiyear general operating support (GOS) would result in many benefits to the health of their organizations — many of which faced financial challenges even prior to the pandemic — and ultimately increase the impact they can have on society.
- When it comes to multiyear GOS, foundation leaders’ attitudes and practices are not well aligned. Foundation CEOs believe GOS and multiyear grants are an effective means for supporting grantees’ work, but less than 60 percent of foundations provide multiyear GOS, and those that do only provide these grants to a small percentage of the nonprofits they support.
- The disconnect between foundation leaders’ attitudes and practices does not appear to be due to foundations encountering significant barriers to providing multiyear GOS. Among the foundations in this study that do not provide multiyear GOS, the majority report not even having considered it.
- Leaders at foundations that provide more multiyear GOS than typical share a common set of values for their work. They prioritize funder and grantee impact, seek to strengthen grantee organizations, and aim to build trusting relationships with grantees.
This research illustrates the consensus thinking among participating foundation leaders that flexible and reliable funding (i.e. multiyear GOS) is a noteworthy concept that most have not applied directly into practice. Specifically, the report identifies “foundation leader attitudes and practices” as two variables that predominately influence the outcome of many grantmaking decisions (see #2 and #3 above).
As a community of funders for over two decades, Grantmakers for Effective Organizations (GEO) has noted the critical importance of competent, courageous leadership — as expressed through attitudes and practices — in shaping high-quality and generative relationships with grantees. We have learned that simply knowing better is not enough to do better, which CEP’s research also implies. Instead, being in supportive community with other grantmakers, learning alongside peers, and directing focused attention to culture — the shared values, beliefs, and goals that define our sector — are what help us achieve the changes we want to experience. This observation underscores why centering racial equity can increase the impact of any grantmaking strategy, and why it has been central to the evolution of GEO’s work.
Historical Context: Recognize the Legacy of Racial Equity Grantmaking, Advocacy, and Practice
The combined impact of COVID-19, historic levels of political vitriol, widespread economic uncertainty, and numerous racial atrocities have affixed the concept of racial equity and justice into the mainstream philanthropic imagination. However, a steady progression of activities focused on diversity, equity, and inclusion (DEI) over the past decade have precipitated this surge in interest (see the Philanthropic Initiative for Racial Equity (PRE)).
This includes a broad spectrum of case-making activities for racial equity, such as the sector-wide efforts centering Black men and boys, Black women and girls, and men and boys of color. Moreover, several efforts aimed at shifting philanthropic practice and culture have emerged more recently through the research of groups like Building Movement Project and ABFE, as well as initiatives such as the Racial Equity in Philanthropy Fund (REP), Trust-Based Philanthropy, Power Moves, and Race Forward/Government Alliance for Racial Equity (GARE).
Combined, these efforts have pointed out the critical need for grantmakers to 1) examine who we are funding and 2) increase giving to organizations led by Black, Indigenous, and other representative leaders of historically marginalized communities. Moreover, they have advocated, in accord with GEO, for developing discipline around tracking investments in a manner that provides a nuanced accounting of who receives funding, as well as the types and amounts of any investment, which reliably produces more meaningful impact.
Additionally, the question of philanthropy’s endgame is one that we, as a community of grantmakers committed to advancing philanthropic effectiveness in support of thriving communities, believe goes unanswered at our own collective peril. In fact, we find ourselves aligned in our curiosity with philanthropic leaders such as Nat Chioke Williams, CEO of Hill-Snowdon Foundation, when he asks, “Is the overall goal to right historical wrongs and combat enduring racial inequities?” The findings of CEP’s report would suggest that it is not — at least when measured by the attitudes and practices of philanthropic leaders regarding flexible, long-term support prior to the onset of COVID-19.
That said, it seems useful to consider how we might view the situation differently based on the numerous accounts of pledges and pivots in institutional practice since the onset of the triple pandemic of health crises, economic uncertainty, and racial reckoning. Does enough evidence exist currently to arrive at a different conclusion regarding “righting historical wrongs and combatting racial inequities”? It may be too early to tell. However, within the GEO community, which is expanding to include grantmakers of various ilk that earnestly grapple with the complexities of integrating equitable practices, we share Williams’ point of view that ”grantmakers must coordinate their efforts and promise to stay with the fight for as long as it takes.”
Close the Gap: Providing Unrestricted Funding is a Proxy for Trust in Nonprofits
Similar to the cadre of innovators who have advanced racial equity and justice in grantmaking over the past few decades, GEO has observed the trend that restricted dollars are disproportionately given to Black and other constituency-led nonprofits. This suppresses those grantees’ ability to adequately plan, invest in staff, and deepen the impact of their work.
Funders must correct this by giving multiyear GOS in ways that are equitable and responsive to community needs so that nonprofits are able to respond to and navigate challenges like COVID-19 or other long-lasting societal problems caused by structural, systemic racism. To this end, we appreciate the sentiments of the funders in CEP’s study who connect the use and value of unrestricted funding — a proxy for trust in grantees’ effectiveness — to promoting organizational impact, responsiveness to mission, innovation, and resilience.
Altogether, GEO’s long-term commitment to racially equitable grantmaking practices may be expressed most explicitly in our organizational mission, which emphasizes “transforming philanthropic culture and practices by connecting grantmakers to the relationships and resources necessary for thriving nonprofit grantees and communities.”
We believe this hinges on funders’ generational commitment to generational change for generational impact — an intentional response for rectifying the legacy of dehumanizing conditions imposed on generations of nonwhite communities. Likewise, we believe this is a choice to leverage one’s power as a grantmaker — a demonstration of will — which CEP’s research affirms is expressed through the attitudes and practices of philanthropic leaders.
Marcus Walton is president & CEO of Grantmakers for Effective Organizations (GEO). Follow GEO on Twitter at @GEOfunders.