Philanthropy and Racial Equity in 2020: Moving the Needle?

Ellie Buteau

Today, CEP released the second report in a three-part series about foundations’ responses to the crises of 2020. Foundations Respond to Crisis: Toward Equity? focuses on how foundations have changed their practices to support communities most affected by the pandemic and how they have reckoned with racism in a deeper way following the murder of George Floyd and nationwide protests against racial injustice and police violence.

Foundation leaders say that the events of this year have motivated them to change their practices. Almost 90 percent of foundations we surveyed are making new efforts to support organizations serving communities particularly adversely affected by public health and economic consequences of COVID-19 caused by systemic racism — primarily Black, Latino, and lower-income communities. Compared to their pre-pandemic practices, 59 percent say they are now giving a higher percentage of grant dollars to organizations created and led by CEOs from communities most affected by the pandemic. These funders are more frequently increasing their giving to organizations created and led by individuals from Black, Latino, and lower-income communities.

Leaders at over 80 percent of foundations we interviewed said they are making changes that incorporate racial equity into their grantmaking or programmatic strategies. About two-thirds described dedicating time to learning and reflecting about racial equity at their foundation, though slightly less than half reported making changes to internal practices. More than 80 percent of interviewees raised the important role for philanthropy to play in advancing systems change and engaging in policy, especially advocacy and organizing.

These findings are most certainly encouraging. But there is still much room for progress.

More than half of the foundations represented in our survey data reported that less than 25 percent of their board members are people of color. Only 14 percent reported that the majority of their board members are people of color. And yet, leaders at only 12 percent of foundations we interviewed proactively raised the need for their board to be more racially diverse. At an additional 12 percent of foundations, interviewees said their board needs to better understand how issues of race and racism affect the work of their foundation.

Our study reveals potentially significant oversights when it comes to several communities that have also suffered disproportionately due to systemic discrimination within this year’s public health and economic crises. Native American communities, Asian-American communities, and people with disabilities have all received less support from foundations in response to the pandemic. A sizeable proportion of the population — no matter their race, ethnicity, or gender identity — have a disability, which often compounds discrimination and financial distress. Yet, not one foundation leader we interviewed for the study mentioned the topic of disability.

Foundations have made many efforts to change their processes to promote equity. They are more directly tying their programmatic work to furthering equity, and they are recognizing how racism plays a part in the issues they seek to address. But there is deeper work to be done. The changes foundations have made in 2020 certainly constitute a start, but these efforts are far from complete, as many foundation leaders openly recognize. As one says, “Racial and social justice have been part of our strategic plan, but we haven’t done enough. Everything we do will have a different lens going forward, both internally and externally: our investments, our personal policies, our grantmaking. We just have more work to do.”

While many of us are looking forward to the end of 2020 and the beginning of a better new year, many are also still reeling from the health and economic effects of COVID-19. Recovery will take a long time. This is true for individuals, communities, and small businesses or nonprofits that serve those in greatest need — the numbers of which have exponentially increased. The pandemic has shone a light on long-standing racism and prejudices in our healthcare system and in the economy, and George Floyd’s murder was an eye-opening moment for many who hadn’t before realized how deeply anti-Black racism is rooted in American society. Systemic racism received much greater national attention in 2020, but it will take much more than months of conversation for things to improve; it will take a life-long commitment on the part of foundations to help move the needle.

It remains to be seen whether the changes foundations have already made this year will stick. This point is summed up well by one leader we interviewed:

There are a lot of ways that we can virtue signal, putting out statements and saying that we stand in solidarity or using terms that everybody uses, like equity, collaboration, and community engagement. I think part of what we are seeing is the disconnect between what people say and what they do. I’m tired of the rhetoric. Talk is cheap. When they look at the future and they think about, ‘Well, how can we do this more consistently in the future?’ It’s like, just do it. What scares you? What is the thing that you think is holding you back? Just fricking do it.

The data for this study was collected through surveys of 236 foundation leaders (mainly CEOs) and interviews with leaders at 41 foundations. You can download Foundations Respond to Crisis: Toward Equity?, along with the first report in the series, here. Stay tuned for the release of the third and final report later this month.

Ellie Buteau is vice president, research, at CEP.

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