Grantee Voice: Improve Funder Approaches to Grantmaking Goals and Strategies

Naomi Orensten

This is the third post in a six-part series on what nonprofit leaders think foundation funders could improve upon in their work. Findings are based on survey responses from 244 nonprofit leaders who have agreed to be a part of CEP’s Grantee Voice Panel a nationally representative sample of leaders of U.S. nonprofits across a broad range of geographies, fields/issues, and sizes who confidentially provide CEP with their perspectives working with foundations.

In our recent survey of CEP’s Grantee Voice Panel, nearly 20 percent of nonprofit leaders identify opportunity for funders to improve aspects of their grantmaking approach and strategy, making it the second most frequently cited theme.

Nonprofit leaders frequently lament funder-initiated, top-down approaches. They note that funders, on the whole, should hear more from the nonprofits and constituents they seek to serve.  One leader asks that funders “stop changing funding priorities through the echo chamber that is the Board of Trustees meeting,” and instead “use the communities they serve to guide foundation priorities.” (This, by the way, is the topic of two CEP research reports: Staying Connected: How Five Foundations Understand Those They Seek to Help and Hearing from Those we Seek to Help: Nonprofit Practices and Perspectives in Beneficiary Feedback.)

The nonprofit leaders surveyed for this study also raise concerns that funder expectations for change are not realistic, that funders are too focused on short-term change, and that funders too often are “looking for long-term goals in a short-term fix” without recognizing that substantial change takes time. As one leader puts it to funders, “Stop funding short-term, low-results work and start investing in real change that takes time.”

Relatedly, some nonprofit leaders have a sense that funders have unrealistic expectations for outcomes given the funds available. “When we have lots of small funding sources that all want different things, we become beholden to the funders, not our missions, which is a mistake for everyone (and a waste of money),” one says. 

Many nonprofit CEOs see funder priorities as being too easily distracted by “the latest trends” or the prospect of supporting “headline-grabbing projects,” sometimes at the expense of programs that work. One nonprofit leader, connecting this issue with the challenges of restricted grants, mentions how they “would like for foundations to stop funding new and ‘sexy’ sounding programs, causing nonprofits to chase dollars by creating new programs which in turn take time and resources away from current essential programs.” Another CEO wishes “foundation funders [would] ask questions about the effectiveness of our programs and how they meet needs, and then fund strong programs rather than new ones.” Another, sharing this sentiment, notes: “It is okay to fund good work that successfully serves an important purpose for a long time in the same way as long as that mission has important impact.”

Finally, some nonprofit leaders observe that “more and more funders prohibit unsolicited proposals,” which can often function as a leg up for “well-networked nonprofits.” As one leader points out, “This is difficult for smaller organizations that do not have the clout and resources to spend on getting ‘in’ with foundations.”

Again, as with other themes that emerged in our analysis, this isn’t news.

Reflecting on all this feedback, it is clear that nonprofit leaders would like for their funders’ grantmaking approaches and strategies to help them make progress on their work and their pursuit of shared goals. This is the goal of many foundations, as well — and from our experience at CEP, we know that many funders see their grantees as partners in achieving their shared goals. But grantees think funders have a long way to go.

We have some ideas for where funders can start.

We believe there are some essential elements of effectiveness for all funders, regardless of size, geography, or issue area. For one, in CEP’s definition of philanthropic effectiveness, one component of effectiveness is that strategy is “informed by input from organizations and individuals closest to the issue, including those directly affected.” We also advocate for longer grants that fund organizations rather than programs, when appropriate, because we consistently see that these actions have a positive effect on grantee experience.

To foundation staff, we offer some discussion questions to consider as you reflect on these suggestions and think about how your grantmaking approaches can help you and your grantees better achieve shared goals:

  • In what ways is your grantmaking approach informed by those you seek to help?
  • In what ways are you hearing from your grantees about opportunities to improve your approach to grantmaking?
  • Are your expectations for outcomes and change realistic given the resources you provide, relative to the scope/magnitude of the issue being addressed? Is this taken into consideration in your assessment and evaluation efforts?
  • In what ways is your grantmaking supporting organizations with demonstrated/likely success? Where might there be opportunities to provide ongoing long-term support to effective programs and organizations, especially those whose work is core to your strategy? At the same time, in what ways are you learning about new and promising initiatives/practices?

See all posts in the series here.

Naomi Orensten is director, research, at CEP. Matthew H Leiwant is a former associate manager, research, at CEP.

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