Over this past year and a half, Echoing Green has been privileged to witness stories from our global network of social innovators combatting multiple crises from all angles through proximate and community-informed solutions. As an intermediary organization working with both funders and social innovators, however, Echoing Green has also observed the depth of inequities that continue to persist in philanthropic funding. It is imperative that this sustained moment of crisis and possibility serve as a wake-up call to philanthropy—to step up with the same boldness and vigor as grassroots movements for transformative social change.
Last year, in the second of five strategies, Echoing Green asked funders to swiftly reconsider common grantmaking practices, positing that key changes could keep the nonprofits confronting COVID-19 and structural racism afloat at a critical moment, and that longer term adjustments in philanthropy could transform the impact of the sector. We challenged funders to evaluate, what are the burdens in our grantmaking that we can eliminate? How can we further democratize our partnerships and cede power?
In a series of snap polls conducted by Peak Grantmaking in March 2020, 97% of grantmakers reported that they were considering changing their grant practices in response to the crisis, including streamlining decision-making processes, and eliminating reporting requirements as a means to expedite access to capital to communities on the frontlines of the pandemic. Despite these stated commitments, excluding the model grantmaking of MacKenzie Scott, unrestricted and flexible giving represented only 9 percent of all distributed philanthropic dollars in 2020.
Though the philanthropic community has arguably taken greater action in support of racial justice than ever before, it is vital that these changes sustain into the future and that funders hold themselves accountable. For example, there is much to learn from the 2016 Grand Bargain, where donor nations and international aid organizations came together to outline 51 commitments to improve critical issues in humanitarian financing. Yet five years later, neither the volume, flexibility, or predictability of humanitarian funding has improved. If we are to have any chance of actualizing a just future where everyone can thrive, sweeping statements must be attached to direct actions that recognize and confront racial bias and extractive dynamics in philanthropic funding. As 2010 Fellow and founder of Shining Hope for Communities (SHOFCO) Kennedy Odede wrote in The Guardian, “Addressing these systemic disparities begins with soul-searching and public declarations from funders, but it can’t stop there. Closing the race gap in philanthropy demands radical candour.”
The current state of grantmaking practices and disbursement of philanthropic funding is a lesson in the function of power and access to resources.
Despite a growing awareness of the necessity for more flexible giving, philanthropy has been slow to change. Funders still fail to see that the lived experience of leaders and organizations closest to the problems is an asset that cannot be replicated. Furthermore, arduous application processes and inflexible giving hyper-focused on risk result in funding coming at the cost of time, energy, and resources that could be spent toward maximizing impact.
As the pandemic progressed and converged with racial uprisings, Echoing Green and The Bridgespan Group released the Barriers to Capital report, exploring significant disparities in funding for leaders of color. Knowing that the pandemic would exacerbate these racialized inequities, Echoing Green assessed how we could best support the Black-led organizations on the frontlines of multiple intersecting crises. In response, we removed unnecessary barriers to entry to disburse over $300,000 USD in emergency grants—unrestricted funding—to 42 Fellow organizations supporting underserved communities around the world. While this was important short-term support to organizations delivering vital programming or working to keep their doors open, we asked ourselves what long-term support we could offer to combat barriers and hurdles in early-stage funding. Thus, we further refined our investment strategies to meet this moment. Through follow-on funding, we now support the growth and power of Fellows pursuing racial equity work by distributing unrestricted grants to alumni Fellow organizations. We also further streamlined the Fellowship cycle, reducing the number of rounds. Additionally, based on our belief that those closest to the challenges are closest to the solutions, we included Fellows as key decision-makers throughout each stage of our application cycle. To be sure, this is just the beginning of Echoing Green’s commitment to ensure that the social innovation sector makes an explicit and sustained investment in advancing racial justice.
“Philanthropy is commendable but it must not cause the philanthropist to overlook the circumstances of economic injustice which make philanthropy necessary.” – Martin Luther King Jr.
Social innovation is inherently about transforming systems, filling gaps, and creating new value. As 2018 Fellow and founder of Creative Reaction Lab Antionette Carroll states in season two of the On Course Podcast, “we have to also recognize that the systems of oppression, inequality, and inequity are by design, but that also means that they can be redesigned.” As we continue in this work, there are both immediate and long-term steps we can take to redesign narratives, mindsets, and practices in philanthropy and funding.
- Cede power to proximate Black social innovators globally
The path to global transformation will not be paved by paternalistic funders that do not disrupt the status quo. Driving change for the long-haul requires sustainable funding strategies rooted in building and redistributing political, economic, and cultural power to the communities of color changing systems. Equitably resource Black leaders and Black-led organizations in the form of flexible, multi-year grants that allow them to tackle root injustices, self-govern resources, and self-determine solutions.
- Center justice by being in true partnership with Black-led organizations
Social change does not operate on a timeline. With power-sharing partnership models, democratized decision-making, and funding that favors general operating support over special projects, proximate leaders and organizations have the flexibility to innovate approaches to the most pressing challenges of our day. Build equitable relationships with communities and cultivate trust by creating feedback loops, investing deeply in their goals, and offering additional support as needed.
- Drive dramatic, not incremental, systems-change by building a Black-led philanthropic infrastructure
The majority of social change philanthropy supports incrementalism as opposed to the dramatic systems-change needed to move our society towards equity and justice. Creating exponential change relies on centering the perspectives of Black leaders and communities boldly innovating for liberation. These leaders urge funders to actively reevaluate the role they play in upholding systemic racism through concrete actions like divesting from prisons. Leaders like Teresa Hodge who is reinventing the criminal background check to provide a more holistic view of job-seeking individuals with criminal records; and Tanay Tatum-Edwards who is transforming impact investing by evaluating the ties of top U.S. companies to mass incarceration, prison labor, and the exploitation of incarcerated folks. In service of creating a just future, funders must be held accountable to the ways they contribute to systemic harm. In April 2021, JUST Capital launched The Corporate Racial Equity Tracker to track corporate America’s commitments to advancing racial equity, from internal pay equity to systemic issues like mass incarceration.
As Edgar Villanueva asks in Decolonizing Wealth: Indigenous Wisdom to Heal Divides and Restore Balance, “how would [philanthropic spaces and organizations] be different if they were based on principles like integration and interdependence, reciprocity and relationship?” Justice is everyone’s work. To create a just future, we must root out and dismantle the power imbalances that currently exist in our work and create funding relationships grounded in trust and transparency.