‘Big Philanthropy’ Has an Equality Problem

Grantmaking has an "equality problem" and a diversity problem

One of the biggest obstacles to foundation grantmaking is the fact that most foundations’ demographics don’t match those of the people and organizations receiving their grants.

In a recent article in The Guardian, Courtney Martin writes that philanthropic organizations like foundations seem to have a double standard when it comes to the donations they make.

Take, for example, the racial, age, sex, and socioeconomic demographics of foundation staff and boards. Three-fourths of foundations’ full-time staff are white and nearly 90 percent are over 30. Women comprise less than 30 percent of CEOs and chief growth officers. When it comes to board leadership, 85 percent of board members are white, while only 7 percent are African American and only 4 percent are Hispanic. Fewer than 10 percent of board members are under 40. It’s also presumably true that many of these philanthropists come from upper middle-class backgrounds.

“This means a lot of people who are not white, male, and older are hustling their a—es off to understand the sensibility of those who are,” Martin writes. “They are spending energy being tactical about how they talk about their work and build relationships, however transactional and tokenising.”

What’s the solution to this?

First, philanthropic organizations and boards need to actively recruit people who come from the organizations and communities they serve. This in itself will increase the diversity of grants being made, but it’s not a complete fix, since the vast majority of funding seems to go to the arts and higher education while only 12 percent goes to “human services” nonprofits. Change comes slowly when it comes to board and employee composition.

Secondly, grantmakers need to avoid having a double standard when it comes to “rich” and “poor” organizations. Gara LaMarche, for example, argued that while his peers talk a big game about sustainability, they then “essentially treating grantees like ‘the right wing would treat single mothers on welfare, imposing strict time limits and cutoffs,’” while these so-called sustainability strategies often help grantees move from dependency on one foundation to another.

Finally, philanthropists need to look at the underlying historic and structural causes of poverty, seeing beyond their own wealth and privileges. “It’s about reclaiming values that privilege often robs us of: first and foremost, humility,” Martin writes. “But also trust in the ingenuity and goodness of other people, particularly those without financial wealth.”

There are plenty of organizations that can provide examples of funding that serves the community while also taking feedback from the members of the community directly affected by funding.

Gulf South Allied Funders, formed by a group of “trust fund kids,” raised money through their own inheritances and networks and donated the total raised to the Twenty-First Century Foundation, which has been a fixture in New Orleans for many years. The Gulf South group acknowledged that they didn’t know the community and its needs as well as Twenty-First Century did, and as a result they put their resources in the hands of an organization that could make a bigger difference.

Family Independence Initiative provides financial support in the form of scholarships, small business grants and other capital, with feedback from the poor families in Boston, Detroit, and Fresno that are being served by the initiative.

Self-Help, a group of nonprofit credit unions in North Carolina, California, and Florida, counter predatory lending and check cashing businesses by providing low-interest banking and loan services, financing community development projects, and more—again, with input from the communities they serve and lessons from the history of African American credit unions in the Jim Crow era.

What do you think? How can we use our privilege to do good work that helps the “boots on the ground” organizations doing important work? How can we avoid having double standards in our funding? If you’re a nonprofit organization, what would you like grantmakers to know in order to help you with your work? Please share your thoughts in the comments.

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