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Understanding and Transparency are Key to Funder-Grantee Relationships, New CEP Research Reveals

Date: November 14, 2017

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Media Contact: Ethan McCoy, Senior Writer – Development and Communications: 617-492-0800 x263

Cambridge, MA — Relationships between foundation funders and their nonprofit grantees are crucial because the two must work well together if they are to achieve shared goals. New research released today from the Center for Effective Philanthropy (CEP) finds that, in the eyes of nonprofits, the most powerful ways that funders can strengthen those relationships are to: 1) focus on understanding grantee organizations and the context in which they work; and 2) be transparent with grantees.

The report, titled Relationships Matter: Program Officers, Grantees, and the Keys to Success, also finds that the program officer to whom a grantee is assigned plays a crucial role in shaping how grantees experience their relationship with a funder. CEP interviewed 11 program officers whose grantees provided high ratings about their funder experience through CEP’s Grantee Perception Report (GPR), and the research highlights these program officers’ insights about how they view their role and what they believe it takes to be a good program officer.

“Like any relationship, a funder-grantee relationship is all about the people,” says CEP Vice President, Research, Ellie Buteau, who co-authored the report. “Program officers in particular play a uniquely important role in how nonprofit staff experience working with their funders, and building strong relationships with grantees is a powerful way for those program officers to help nonprofits do their best work.”

Findings in the report are based on the perspectives of nearly 20,000 grantees of 86 foundations, collected through the Grantee Perception Report (GPR). CEP’s analysis of this grantee feedback data reveals that understanding and transparency are the two most powerful predictors of strong funder-grantee relationships. Specifically, nonprofit leaders value funders’ understanding of their organizations’ goals and strategies; the challenges they face; the communities and fields in which they work; the social, cultural, and economic context in which they work; and the needs of their ultimate beneficiaries. In terms of transparency, grantees who find their funders to be transparent find them to be clear, open, and honest.

“Funder-grantee relationships are vital, yet they can easily be fraught due to the inherent power imbalance between those who have resources and those who need them,” Buteau says. “For foundation staff seeking to effectively navigate this dynamic and improve their relationships with grantees, our analysis shows that building understanding and being open and honest is a great place to start.”

Less powerful, but still important to forming strong funder–grantee relationships, are the experiences grantees have during the selection process and how open they find funders to be to their ideas about the foundation’s strategy, the research finds.

“Funder-grantee relationships are primarily shaped by program officers, but program officers cannot do their jobs well without resources and support from their foundations,” says CEP President Phil Buchanan. “We hope that this research can both help individual program officers in their work with grantees, as well as help foundation leaders as they seek to build the cultures and structures to put their staff — and their grantees — in positions to succeed.”

You can download the report here.

About the Center for Effective Philanthropy

The Center for Effective Philanthropy (CEP) is a nonprofit organization with a mission to provide data and create insight so philanthropic funders can better define, assess, and improve their effectiveness and impact. CEP received initial funding in 2001 and has offices in Cambridge, Massachusetts and San Francisco, California. For more information on CEP’s work, including its research, programming, and assessment and advisory services, see

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