A steady drip of grant makers has signaled a commitment in recent years to funding organizations that are led by people of color and that serve them. This month, that drip became a deluge, as the Covid-19 crisis and racial-justice uprisings led many foundation leaders to acknowledge the central importance of addressing inequity.
We welcome these commitments. But we also know that similar promises in the past have not translated into real money reaching these nonprofits. A recent report by Echoing Green and Bridgespan on racial disparities in philanthropy found that among the organizations that progressed furthest in Echoing Green’s prestigious social-entrepreneur competition, early-stage white-led groups raised $20 million more than early-stage Black-led organizations.
Racial inequity is baked into philanthropic norms. Sadly, most Black leaders in the nonprofit world have come to accept that the tragic parental advice — you must work twice as hard and expect half as much — applies even in a field that increasingly expresses a commitment to racial equity. The notion still persists that investing in grassroots organizations headed by people of color is inherently risky. Despite their critical role leading social movements, women of color face especially significant barriers to funding. And a default to color-blind funding practices, while seen as a remedy, can actually steer more funding to white-led organizations.
These trends reflect the deep structural racial inequities that keep communities of color from building wealth and power. Reversing them will take widespread effort within and well beyond the walls of philanthropy. But the elevation of the Black Lives Matters movement has created compelling frameworks for action. Sidney Hargro, president of Philanthropy Network Greater Philadelphia, has called on philanthropy to focus on a goal of Black liberation, not just racial equity. Marcus Walton, CEO of Grantmakers for Effective Organizations, has urged foundations to recognize that “hope is not a strategy for change.” And Crystal Hayling, executive director of the Libra Foundation, has pleaded for a “flood of grants” to people who are “literally defending the ideals of our democracy with their bodies.”
To accomplish all of this, Black leaders need to be in charge. Whatever else grant makers do, they need to fund more Black-led organizations — and stop making excuses about why that’s hard to do. Here are five excuses we often hear from grant makers and some suggestions for how to challenge that thinking.
“We don’t know who these Black leaders are or where to find them.”
Most foundations now require diversity and equity training. However, very little has changed: Data shows76 percent of full-time staff members and 88 percent of foundation executives are white. With little diversity in leadership, or personal relationships to the communities served by most foundations, philanthropy risks being out of touch with the people working on the ground to build movements for change. What’s more, the tendency to fund organizations already vetted by others creates a “winners take all” dynamic that elevates a handful of celebrated Black-led groups while leaving many others behind.
Three simple steps will help funders break out of these patterns and challenge their approach to identifying grantees:
- Hiring Black people and moving them into leadership positions.
- Involving community organizations in funding processes.
- Requiring program officers to spend time talking to people in the communities they serve — in person and not in the office when social distancing recommendations allow.
We must begin to build new norms based on trust and a recognition that the people closest to a problem are in the best position to develop solutions. They understand the context, the challenges, the opportunity, the aspirations, and the motivations for change. Most importantly, Black community leaders have the trust of the people they serve and the sense of urgency needed to get the job done.
Ask yourself: Do the strategy and program consultants you hire have this type of real-world knowledge? Are you collaborating with organizations that have these relationships? If not, seek out these relationships, and pay them for their advice. Many are currently inundated with requests to provide free counsel.
“We’re concerned that you can’t absorb this capital, given your small budget and staff size.”
We often talk about “absorptive capacity” when expressing concern that a grantee may not be able to properly manage a grant that is large relative to its budget. The Catch-22 is that underfunded organizations often have smaller staff and budgets, which is then cited as the reason to make smaller grants. Susan Taylor Batten, CEO of the Association of Black Foundation Executives, calls this “philanthropic redlining.” This concern factors not only into grant size, but also into how funding is restricted.
Cheryl Dorsey, president of Echoing Green, calls unrestricted assets “the cushion, the breathing room that gives organizations the ability to pivot, to be entrepreneurial.” Because Black-led organizations aren’t as trusted as their white counterparts to manage unrestricted funds, they have little flexibility to divert funds where they are best spent, especially during times of crisis.
Ask yourself: If absorptive capacity is a concern, how might you assist these organizations in managing new funds, rather than ruling them out completely?
“But do you have the capacity to provide the data, metrics, stories, and reporting to demonstrate impact?”
Grants to Black-led organizations often come with arduous reporting requirements. Demonstrating impact is important, but not if it means raising the burden of proof for certain organizations. Because grants to organizations led by people of color are deemed riskier, foundations impose requirements for data that are hard to produce, especially with small teams and limited resources.
Moreover, forcing Black-led organizations to spend disproportionate amounts of time on reporting diverts resources that would be better spent on growth, responsiveness, and creativity. The Full Cost Project, led by Philanthropy California and Nonprofit Finance Fund, is demonstrating a better way to align reporting needs with the donor’s role, the intention of the grant, and an organization’s capacity.
Ask yourself: Are your reporting requirements grounded in truly seeing results or in distrust of leaders of color? What requirements would allow you to recognize and support an organization with limited staff capacity instead of forcing an organization to prove itself?
“Your methods are too radical and political.”
Organizations led by people of color consistently face criticism about their methods of enacting change. Many grant makers have explicit restrictions on funding advocacy and political action in favor of short-term, measurable programs that “avoid doing the one thing that would significantly change systems,” says nonprofit writer and speaker Vu Le. While public statements from grant makers signal a commitment to community-driven change, when it’s time to put capital behind those untested or “radical” solutions, the coffers run dry.
Ask yourself: If you’re committed to structural change, how might you prioritize long-term measurements and investments into communities that are at the forefront of this work?
“It’s too risky to support community-centered organizations that may not survive the current crisis.”
We are not the first to point out the limits of a funding system typically built around concepts of risk to the grant makers and not the people they serve. But that orientation is a major barrier to engaging Black-led community organizations. Grant makers need to question their concerns for their own reputations or their foundations’ longevity, and truly understand the risk to a community when the groups that serve it lack resources to address injustice, oppression, and unmet needs. We have seen in our organizations how recruiting people of color and nonprofit leaders to boards can elevate the importance of taking risks to serve mission.
Ask yourself: How are you accountable to the communities you aim to serve? How do you bring their perspective into risk calculations about grants you make (and do not make)?
If we are serious about redressing racial inequities in the United States, we need to fundamentally shift how we fund Black-led organizations. We know this work is hard. We both lead organizations that are still figuring out how to lift up community-centered groups while challenging established approaches that stand in the way of that goal. If you’re a grant maker or donor looking to be an ally with Black people in this moment, your task is simple: Fund and invest in Black-led institutions focused on equity and justice. Your financial resources could unlock the potential of their leadership to show us the way forward in these dark times. These barriers are not insurmountable. The norms we live by can be uprooted.