We are entering a new era of charitable giving – and it’s long overdue. Many major philanthropic donors of Canadian and global charities are turning away from traditional ways of giving, such as funding large charities that serve marginalized groups from afar or restricting how funds can be spent. It’s an attempt to give communities more direct control over their own futures. This trend is part of a larger movement to “decolonize” philanthropy that has been publicly embraced by Canadian donors like The McConnell Foundation and Inspirit Foundation, among others.
And it’s not just private philanthropists who are making such moves. The Canadian government recently awarded $200 million to the Fund for Black Communities to administer the Black-led Philanthropic Endowment Fund, dedicated to supporting Black-led, Black-focused and Black-serving non-profit organizations.
It’s time more donors put funds directly into the hands of local leaders, giving them crucial decision-making power. This means leaving behind some restrictions and requirements while enabling community leaders to manage and distribute funds as they see fit.
This kind of bold step requires donors to believe that for money to be truly impactful, it must be accompanied by trust and autonomy — a belief that has the potential to change lives and transform our culture of giving. This new age of philanthropic giving is not just about how we give but who we give funding to.
Some donors are making large gifts to groups that have historically had very little autonomy over resources. We’re witnessing large foundations like The McConnell Foundation transferring unprecedented amounts of capital to Indigenous-led foundations, for example. Others are investing in collaborative funds like the Freedom Fund, Equality Fund Canada or Co-Impact, which address issues like gender injustice or human trafficking through funding grassroots groups.
This movement has great potential. Donors are going beyond solely talking about “shifting power” to actively creating new giving structures, processes and expectations in order to build trust and reduce the power imbalance that is so inherent in philanthropy. They are reconsidering their roles in working towards tangible social change and building markedly different relationships with those they fund: mutually enriching partnerships built on trust, honesty and shared decision-making.
This is not just the right thing to do from a theoretical perspective. Throughout history, attempts to solve societal problems in a dictatorial fashion, without directly involving affected communities, have proven ineffective, unsustainable and even harmful. We know that philanthropy — and really, any attempt at social change — works best when we understand that people with lived experience of a problem are best-placed to design and implement solutions.
Often, what they need most are resources, both financial and otherwise, the support of power holders and the freedom and space to try. Sometimes just small shifts in donor mindsets and behaviour make a big difference.
At The Philanthropy Workshop, we encourage our donor members to consider the practices and principles that are critical to trust-based funding. We help them to explore questions like: who are you trying to help, what do you bring to the table and who should sit beside you to make decisions about where your money goes? How can you make sure you are funding organizations that are authentically rooted in lived experience? How can you end a funding relationship while minimizing harm to a community? We also need to document the lessons learned so that other donors can replicate what works.
The Freedom Fund provides a positive model. Building on a decade of partnering with more than 100 community-led organizations to address modern slavery, the Freedom Fund has launched an essential online resource to encourage other funders to fund frontline groups. From sharing key principles and challenges in frontline grant-making, to offering a wide range of case studies, templates and tools, Funding Frontline Impact contains the type of transparent, nuts-and-bolts guidance many donors and charities could learn from.
One thing is certain: philanthropy cannot continue as it always has. From governments to foundations to individuals, we all have the ability to ensure that our money is giving communities the power to define their own futures and to encourage others to do the same. We have much further to go, but we’ll know we’re there when this type of giving is the norm, not just something we hear about in big, flashy announcements.
About the author:
Lisa Wolverton is President of The Philanthropy Workshop Canada.