Trends in grantmaking to causes in post-Covid

COVID-19, calls for racial justice, natural disasters and politics significantly impacted our lives, communities and the way we socialize. In 2020 we experienced in one year what felt like a decade’s worth of historical events. 2020 was a stress test for philanthropy. It was an opportunity for donors and charities to engage their highest ideals and missions - and they did. Charitable organizations have a renewed momentum and confidence in the importance of their work. Donors remain committed to supporting causes they care about and can see their impact. There is more to see from donors' generosity in the next months.

Подобно на много примери по целият свят и в България здравната криза предизвика сериозни предизвикателства и накара НПО да реорганизират бързо работата си, да пренаредят приоритетите и да се адаптират към новите условия. Донорите, които действат в страната, реагираха на спешната нужда от подкрепа като смениха целите и преформатираха правилата си. Светкавично се създадоха условия за набиране и разпределяне на дарителските средства, които в този момент идваха от компаниите и гражданите. Т.нар. "безусловни дарения" са показателни за доверието на обществото към нестопанските организации в моментите на изпитания.

Dorothy A. Johnson Center for Philanthropy in its 11 Trends in Philanthropy for 2021 Report states that many of the through-lines had been tracked in philanthropy for years have new meaning and urgency at the beginning of 2021 - but they’ve been there all along, including:

• the sprawling impacts of wealth inequality;

• significant declines in public trust in institutions and in each other;

• the bright and dark sides of technological proliferation; and

• the systemic racism permeating so many aspects of our society and democracy.

“[T]he critical questions we face in the aftermath of the chaos and trauma of 2020 are ones the sector has been wrestling with for years, but must now address more forcefully.”

In this focus the global organization CIVICUS (as one of many examples for calls for united response to crisis) states that donors can make a difference by recognizing and nurturing civil society’s essential roles and can help to enable and sustain a diverse range of civil society groups and actions. In its SOLIDARITY IN THE TIME OF COVID-19 Civil society responses to the pandemic report the CIVICUS experts suggest donors to be flexible with their support to civil society during the current period and more generally in times of crisis, and enable the rapid deployment of CSO capacities to frontline response. This entails to:

• remove restrictions and amplify the value of and contributions from civil society;

• support civil society to cover and reduce their operating costs;

• make regulatory requirements for CSOs receiving funding more flexible;

• include civil society in COVID-19 stimulus funds and subsidies;

• develop the longer-term infrastructure needed to scale up civil society efforts;

• empower civil society to develop sustainable alternatives to challenges exposed by the pandemic.

What are the trends for the new normal to philanthropy and the grantmaking practices. Here some predictions for 2021:

• Dynamic and disruptive forces are increasingly at work

Many of the forces driving the 21st century broadly are driving significant change within philanthropy’s ecosystem, as well. The wealth concentration develops so called "megadonors" and hazards the philanthropy to become yet another social realm dominated by the rich. At the same time the different funds and and online giving platforms have led to a broader array of giving mechanisms. For nonprofits, this leads to a need for increasingly sophisticated fundraising strategies that incorporate social media savvy, technological sophistication, and extensive donor cultivation work. The boundaries among the sectors continue to blur with the rise of social ventures and the blurring of roles among the business, government, and philanthropic sectors. This has created a demand for sector leaders who can negotiate new boundaries.

• The nonprofit sector has a unique opportunity to build public trust

“The nonprofit sector…is uniquely positioned to be a leader in rebuilding public trust in institutions by supporting and leading broad-based community responses to [COVID-19], fighting systemic racism, and addressing the host of challenges we face as a society.”

Presently non profit sector is tackling this task and it will be more intense in the future by: providing more transparency and thus educating the general public on how funding decisions are made, how donors are vetted, how assets are held and restricted, and how money is spent, as this might even lead to increased giving and fundraising; Increased Participation as more grant makers are looking to balance out power dynamics with nonprofit grantees and shift to more equitable funding practices. Additionally, participatory grantmaking focuses on the “nothing about us, without us” philosophy, creating critical openings for engaging community voices in the decision-making process (Behrens & Martin, 2020). A continuation of this trend will certainly help build more public trust if it helps demonstrate how philanthropy is working for the good of all rather than for the good of the few; Greater Commitment to Equity as many funders and nonprofits in 2020 adjusted their practices to afford greater flexibility, to increase investment in hardest hit communities.

These practices promote trust, both within the sector and of the sector. They not only help the public see how nonprofits and foundations are trying to remedy the issues of most concern to the public, but they move nonprofits and foundations to trust what they hear from communities about their greatest priorities. They encourage funders to trust that nonprofits will put their funds to effective use, and nonprofits to trust that funders can be genuine partners rather than managers.

• The growth of social justice funding and the risk of movement capture

Numerous large donors and foundations are increasingly supporting advocacy, including efforts to change public policy. Many foundations and charities also have loosened both the restrictions on their grants and their grantees. Responding to the COVID-19 pandemic, for example, hundreds of foundations and charities pledged to offer more “flexible funding” to nonprofit organizations in order to hasten the delivery of services and goods to people in need.

As we continue to confront long-existing injustices, donors, activists and others will champion—and challenge—philanthropy’s ability to address them. I predict donors will focus on racial and social equity and will support resolutions to the issues from which crises evolved in 2020. Disparities in education, housing, hunger and health will motivate many others. Expect activists and frontline organizations to bring their perspectives to the philanthropic conversation. Transparency and accountability will be increasingly important. Businesses too will increasingly be asked to answer not only to investors, but to their employees, customers and society at large in the overlapping areas of social justice and equity. Expect the conversation and debates in philanthropy to become even more complex in 2021.

• Philanthropy and government play increasingly overlapping roles in the public sphere

Philanthropy and government have always shared a goal to advance the public good. Historically, nonprofits often started programs in reaction to community-level needs that, when successful, the government would absorb. By replacing direct service delivery with external providers, governments pull back from spaces where they had traditionally taken a lead. Both types of government-philanthropy interaction and boundary shifting have shown up even before 2020 when in many cases NGOs has to step in, where the government is not in place. Recent Alpha Research survey showed the expectations of the society that CSO should play role in societal challenges solutions are shifting.

През 2018г. за 13 от всички тествани 15 сфери доминирашемнението, че държавата трябва да се справя с проблемите самостоятелно, без участието на гражданския сектор. Той „се допускаше“ приоритетно само в 2 сфери - природата и животните. През 2020 г. вече се настоява за участие на ГО в общо 11 сфери с изключително широк диапазон на действие – права на пациенти, права на потребители,свобода на мнение и право на справедливо правосъдие, превенция срещу насилието, предоставяне на социални услуги и защита правата на групи в риск, решаване на местни проблеми, култура, традиции. Дори и в сфери като националната и ежедневната сигурност, където на държавата продължава да се приписва почти монополна роля, е налице статистически значим ръст в подкрепата за участието и на гражданския сектор в тях.

• It’s getting harder and harder to distinguish philanthropy and business

The rise of socially responsible B Corps and increased popularity of impact investing - have also continued to spread, infusing both the consumer and investment landscapes with concerns about social responsibility while complicating further our answer to what is philanthropy and what is business. More broadly, a commitment to charitable giving and social benefit is increasingly seen as a necessary and profitable aspect of any business. CSR (corporate social responsibility) is more widespread than ever. At the same time, the pressure on nonprofits to act more “businesslike” continues apace, even leading some nonprofits to launch for-profit businesses to generate much-desired “sustainable” revenue. The pressure for nonprofits to be more businesslike has lessened a bit, it seems (if temporarily), as many nonprofits struggle to survive. They need emergency core support and cannot focus right now on long-term revenue generating ventures.

Still, there is little doubt that, once we are on the other side of our current social upheaval and uncertainty, the move to redefine the business-philanthropy boundary will continue. For one thing, we know that young people are not only comfortable with this hazy boundary, but embrace it. There is evidence that millennials and Gen Z, who seek to create change or respond to crises like those we face now, often turn to making new consumer choices as much or more than making new philanthropic choices. Younger investors are also the ones most interested in impact investing, and younger employees are the ones pushing hardest for companies to do more CSR

• From international grantmaking to the globalization of philanthropy

a dynamic process in which actors exchange ideas and practices and engage in shared learning to find forms of giving that are authentic for different cultural contexts.

• Data comes of age in philanthropy

In the last decade, data has become much like the air we breathe: it surrounds us, but often only makes itself known when it’s either polluted or there’s not enough of it. How individual organizations balance privacy and transparency, address equity of access, and act upon data to create and share actionable knowledge will be key for philanthropy going forward. Philanthropy will be even more data-driven in 2021—for donors, advisors and charities themselves. Frontline organizations in health and hunger may benefit, while arts and education, which lagged in 2020, may need to reinvent their case for support. Metrics and measurements will guide some, but not all, philanthropic dollars. We will always have—and need—those donors who can respond quickly and from the heart, especially during a crisis. There is room at the table for both giving styles, and the dollars can be equally powerful.

• Philanthropy’s Next Gen is starting to make big changes

The next-gen-driven transformations in philanthropy seem more dramatic than just normal generational succession. Today’s next gen — especially millennials and Gen Zers — is by many accounts revolutionizing giving and the nonprofit sector, while raising core questions about philanthropy itself in unprecedented ways. They are reconfiguring the donor landscape, upending norms in nonprofit organizational practice, and even blurring sector boundaries in ways that are redefining how people think of the best way to “do good.” Younger donors have a strong interest in volunteerism, advocacy and peer-to-peer fundraising in addition to charitable giving. Beyond the “how” of giving, the next gen also sees the role of the philanthropic sector fundamentally differently than previous generations. They do not consider supporting traditional nonprofits to be the only way to “do good” and advance the causes they are so passionate about. As one recent commentary notes, “millennials are everyday changemakers,” preferring to make intentional acts of social good in all aspects of their life — including in their careers, consumer decisions, and political activities

• Decision-making will diversify.

Board leadership and staff diversity in the social sector will be paramount in 2021 and beyond. Boards and executives must seek out different perspectives if they wish to truly innovate. Innovation can come from all directions in the organization, so a diversity of perspectives, backgrounds and experiences across an organization is not only an ethical imperative, but a strategic advantage. For their part, donors will continue to do their research and due diligence, not only on charities’ missions and finances, but also on their organizational makeup, governance and equity.

• The new normal will mean new norms.

In my 2020 predictions, I noted that technology would continue to make a big impact in mobilizing philanthropic capital. Digital landscapes certainly changed our social and professional lives. Technology can be expensive, and donors should consider equipping charities with tech solutions, but as Lucy Bernholz notes in her 2021 Philanthropy and Digital Civil Society Blueprint, they should also look to help them create a sustainable “digital infrastructure” that advances their mission and helps them create “community.” In 2021, people will continue to gather over Zoom, donate through social media platforms and hold virtual galas. As social distancing remains part of our reality, video streaming platforms, well-planned online events and creative new digital solicitations will raise millions of charitable dollars. Expect the fast-paced world of Fintech to further intersect with the world of philanthropy.

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Bibliography:

1| 11 Trends in Philanthropy for 2021 Report, Dorothy A. Johnson Center for Philanthropy

2| SOLIDARITY IN THE TIME OF COVID-19 Civil society responses to the pandemic, CIVICUS report, Nov. 2020

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4| Looking Ahead: 2021 Philanthropy Trends, EILEEN R. HEISMAN, PRESIDENT & CEO of National Philanthropic Fund, USA, Feb.2021