Questions for funders to help them understand their responses
As philanthropic organisations try to navigate the uncertain times again, it is important to be aware and purposeful about what we are doing and how we are doing it. Being aware of our own actions and questioning our process is difficult.
The five practical sets of questions below can help understand the response and tensions funders have been wrestling with as they responded to COVID-19.
Do you support those that you know, or did you go broader?
We know that in a crisis there is a pressure to move fast. But you also need to have confidence in the organisations that you are funding, and want to work in a way that is both human and effective. Is this easier with organisations that you have funded previously?
Do you feel a particular duty to the bodies you have supported previously? and if so does this make you more wary of supporting the new?
Is it more difficult to respond in the same way to new and emergent organisations?
How transparent could you be in making these decisions?
How do you do your due diligence with groups and organisations new to you, especially when you are moving at pace?
How did you decide on your role and where to act?
How do you know what is the most useful place for you to be in the funding ecosystem?
Are you a first responder, providing crisis money quickly and effectively? or are you a stabiliser, making sure that important organisations weather the storm? or are you much better at helping with the long term re-imagining, the building back?
Who decides what your place is in the ecosystem? Is it determined by your board? or by the skills and attributes that you already deploy?
If you had a strategy before the pandemic, did it determine your role in the funding eco-system?
Did you need to change it? And if you changed it, did you need new and different skills and processes?
What speed is right for you? why?
At a time of crisis there is a premium on moving fast, rapid decision making and ‘getting money out the door’. Indeed a perennial complaint from applicant organisations that so much of philanthropy moves too slowly, taking too long to make apparently simple decisions. But is speed always right? and what are the risks of speed?
Short circuiting processes in the interests of pace may inadvertently result in favouring familiar organisations and types of work that are already known to the funder, but due diligence matters - no one wants to be subject to fraud.
On the other hand, endless delays are frustrating and are seen by many as simply entrenching power. What skills and different processes do you need if you intend to increase your pace?
How do you amend skills and processes at a time of rapid change?
What are the trade-offs between slower or increased speed and how do you confront these (internally and more publicly)?
How do you feel about working with other funders?
Does it slow your pace, restrict your ability to take bold decisions, and so blunt your impact? Or does it enable you to increase the money available, share knowledge and learn from each other's networks?
Is pooling funds a way of generating stronger intelligence as well as increasing the sum available? Or is it a way of shielding yourself from difficult decisions, distancing you from the field you wish to support?
Do you have systems in place to support collaboration with others, and the skills, capacities and mindsets in your teams to work in a new way?
Who takes the initiative?
It is well established that the decisions of funders send strong market signals and that care therefore needs to be taken about the nature and direction of those signals. Should it respond to government initiatives? or act in opposition to them?
Has the pandemic made it easier or harder to work, not just alongside, but also with government? Should it be responsive to the initiatives of civil society?
At a time of rapid social and economic change, the initiatives taken by philanthropic funders can profoundly shape civil society.
Does philanthropy have the legitimacy to take these initiatives? and if so how does it ensure the viability and effectiveness of these initiatives?
A bigger question of the balance of power in philanthropy - Perhaps equally important is the question of power within philanthropy.
There is a lot of talk about the amount of power held by philanthropy, and the way that decisions made by philanthropic bodies can have wide ranging ripple effects that go well beyond the intention of the funder. Just as funding priorities and preferences send strong market signals, so too can processes adopted (often for sound reasons) prove to be extractive and damaging to applicant organisations. So a focus on a shift in power, recognising the power held by the holders of capital, is valuable and overdue.
There have been practical manifestations of this shift of power in some parts of the world over the last few years, accelerated by the pandemic. These recent developments seek to ensure that power is appropriately distributed but each of these hold within them tensions and raise new questions:
A shift in decision making from trustees to programme staff about individual grant decisions is a step in the right direction, but it is not self-evident that salaried professionals will themselves be closer to the concerns and priorities of disadvantaged and excluded communities.
Changing the trustee body to ensure that it reflects better the interests and priorities of the communities which are the beneficiaries is worthwhile, but it may only increase challenges about probity and conflicted interests.
Delegating decisions to the communities that are to benefit has the advantage of harnessing their knowledge and wisdom, but can also present an intolerable, and potentially divisive burden unless done with considerable care, and high cost (including building local capability).
Crowdfunding, sometimes described as the democratisation of philanthropy, brings huge gains but will also favour the popular over the good, may protect majorities and not minorities.
Individual donors, constrained by regulation in many jurisdictions from exerting full control over their donations (charitable law frequently requiring a distance between the donor and the decision making) is nevertheless another example of how power can be concentrated. Like crowdfunding, it can bring great benefits, but can also be seen as idealistic and hard to understand.
In short, power in philanthropy is contested, and hard to unravel. Critically there is no single solution, but rather a constant interrogation. A focus on the purpose of each individual philanthropic endeavour, and the crafting of approaches to deliver that will inevitably require a focus on the nature of power, and the best way of meeting the purpose without a damaging concentration of power.