New Trends in Philanthropy: Trust-based Philanthropy and Participatory Grant-Making

• As the sector of philanthropy focuses more fully on equity and inclusivity, strategic philanthropy has been criticised for putting too much power into the hands of funders and not taking local knowledge and traditional wisdom into account when determining where and how to disperse funding. Two complementary practices, trust-based philanthropy and participatory grant-making, have emerged as alternatives to strategic philanthropy.

Key findings about trust-based philanthropy: 

Trust-based philanthropy can:

• Alleviate power imbalances between donors and grantees. Trust-based philanthropy transfers power into the hands of grantees, allowing them to determine the best use of resources.
• Ensure more social, political, and economic equity by embedding trust, dialogue, and relationship-building between grantees and funders. It promotes shared decision-making and alleviates grantees’ workload.
• Promote unrestricted funding to allow flexibility and resilience in a grantee’s programme. Organisations are funded at every level of their work from capacity-building and operational support to leadership and learning.
• Promote multi-year funding. The latter is critical in supporting an organisation’s sustainability and effectiveness. Multi-year funding also allows organisations to think strategically and be pro-active, rather than reactive.
• Create more impact for beneficiaries.

Case Study: The Trust-Based Philanthropy Project was launched in 2018 by the Whitman Institutes, Robert Sterling Clark Foundation, and the Headwaters Foundation. The goal was to persuade more grant-makers to adopt trust-based philanthropy principles. These principles are multi-year unrestricted funding, simplifying the paperwork, transparency and responsiveness, offering non-monetary support, and learning from grantees and from their valuable perspective. For more information visit: Trust Based Philanthropy.

Key findings about participatory grant-making:

Participatory grant-making can:

• Transfer the decision-making power about funding, including the strategy and criteria, to the beneficiaries. People most affected by the funding get to have a voice in how financial resources are deployed.
• Provide an alternative to the ‘funder-knows-best’ model. It relies on traditional and local knowledge and aims to counter strategic philanthropy’s exclusionary practices that can fail to change conditions in communities.
• Vary in how beneficiaries and communities are engaged throughout the process with new techniques and innovative ideas emerging on how to increase public participation.
• Provide support to networked movements and empower people and communities such as the Black Lives Matter, #MeToo, and Youth Climate Strikes movements.
• Democratize philanthropy to ensure the latter is not used as a tool by the powerful to further entrench their advantage.

Case Study: The Colorado Trust has been at the forefront of deep community engagement and has been promoting participatory grant-making through its community partnerships approach. Namely, they have transferred grant-making to community groups, allowing them to decide where funding can best be utilised. For more information, you can visit: Colorado Trust.

If you are interested in learning more, please contact us at robin@theathenaadvisors.com.

Highlight Articles

• Behrens, T, & Tory, Martin. Alternatives to Strategic Philanthropy are Emerging, 2020. Johnson Center. https://johnsoncenter.org/trend-alternatives-to-strategic-philanthropy/
• Gibson, C.Participatory Grant-Making: Has its Time Come?, 2017 Ford Foundation.https://www.fordfoundation.org/media/3599/participatory_grantmaking-lmv7.pdf

Bibliography

Behrens, T, & Tory, Martin. Alternatives to Strategic Philanthropy are Emerging, 2020. Johnson Center. https://johnsoncenter.org/trend-alternatives-to-strategic-philanthropy/

Daniels, A. Trust in Grantees, not Command and Control, 2019.Chronicle of Philanthropy. https://www.philanthropy.com/article/Trust-in-Grantees-Not-Command/247618

Davies, R.Philanthropy is at a Turning Point. Here’s How it Could Go, 2019. We Forum. https://www.weforum.org/agenda/2019/04/philanthropy-turning-point-6-ways-it-could-go

Gibson, C.Participatory Grant-Making: Has its Time Come?, 2017 Ford Foundation.https://www.fordfoundation.org/media/3599/participatory_grantmaking-lmv7.pdf

Gibson, C.The Problem of Strategic Philanthropy, 2018 GrantCraft.https://www.issuelab.org/resources/32988/32988.pdf

Johnson Center. 11 Trends in Philanthropy for 2020, 2020. https://johnsoncenter.org/wp-content/uploads/2020/01/11-Trends-for-2020-Report.pdf

Schambra, W. The problem of strategic philanthropy, 2013 Nonprofit Quarterly.https://nonprofitquarterly.org/the-problem-of-strategic-philanthropy

Trust Based Philanthropy Project Website. https://trustbasedphilanthropy.org/

Trust-Based Philanthropy: Imagining Better, more Effective Partnerships Between Funders and Nonprofits, 2020. Non-Profit. https://nonprofitaf.com/2020/01/trust-based-philanthropy-imagining-better-more-effective-partnerships-between-funders-and-nonprofits/