How can I improve my philanthropy impact?

One philanthropy trend that has taken centre stage in recent years is the concept of “trust-based giving”. It was something I touched on in my Outlook 2022 article, and the underlying principle is, on the one hand, that donors and their funds should mobilise more quickly in order to support social causes. We have seen this happen to good effect during the COVID-19 pandemic – 360 Giving’s COVID Tracker shows 174 funders gave £2.4 billion supporting 66,000 organisations through the COVID pandemic¹; Beacon’s philanthropy tracker shows charitable giving by the wealthy doubled at the height of the crisis in 2020².

On the other hand, the more fundamental implication is that philanthropy – even with the best intentions – creates power imbalances, exacerbating the systemic conditions that lead to inequality in the first place. The racial justice movement has brought a further dimension to this conversation, highlighting how practices in philanthropy have contributed to the underfunding of organisations supporting, and led by, black, Asian and minority ethnic people.

For a donor, be they exploring or just starting out on their philanthropy journey, evolving and seeking to be more impactful, or already leading the charge – what does this mean in practice? How do donors balance responsible due diligence, with the need to ensure that their charitable giving truly empowers?

A need for flexibility and humility

These are not new questions. In my early days of working on the frontline of social change, with small charities working with very poor communities in East Africa and Asia, we felt the effect of onerous philanthropy acutely. Efforts to raise funds often required time-consuming form-filling, with each donor desiring specific impact and a project assigned to them, asking for different information, metrics and evidence, and all too often placing an explicit cap on “admin costs”, including salaries. This felt quite unfair for an organisation of our size.

Where fundraising was unsuccessful, there was rarely feedback. Where successful, donations were often highly restrictive, time-consuming to account for, and costly to manage, leaving no ‘wiggle room’ for adaptation or investment in innovation. In reality, life doesn’t work that way. Plans often have to shift, especially when working in challenging circumstances. Organisations need to learn and adapt – and that requires funding. COVID-19 has been a sharp reminder of this.

Fortunately, things have moved on since those days. It’s now regarded as good practice to support the full costs of an organisation, including its people, and recognise that if we want to get more funds to frontline organisations working with marginalised communities, we need to do engage with greater trust, flexibility and humility.

Putting theory into practice

Beyond the hype, trust-based philanthropy is essentially about four key principles: recognising that there is a power imbalance; being curious and seeking to learn; being transparent about your giving; and valuing relationships with others.

We outline below some practical tips on how to implement the approach, wherever you are on your own philanthropy journey:

• Be open, upfront and honest about what you will, or will not, fund
• Consider giving multi-year, unrestricted funding or, at a minimum, funding that is loosely restricted and covers core operating costs
• Seek first to understand. Take some of the onus of discovery on your own shoulders where you can, by researching the organisations you’re interested in funding before engaging with them. Only ask for what you really need or cannot obtain easily for due diligence
• Keep learning. Consider where the need is, and where the funding gaps are, as part of your ongoing understanding. Are there organisations that you don’t already know working with underfunded communities?
• Consider investing in the resilience and capacity of organisations you wish to support. Funding for leadership and skills development, or for helping charities network with other potential donors, is often hard to come by and can make a significant difference
• Simplify and streamline. Ensure that reporting requirements are proportionate to the size of your donation; ideally ask for information about outcomes that are also useful to your grantee
• Collaborate. Consider joining forces to share intelligence, learn from others, pool resources, and avoid duplication of efforts (yours and the charities you may collectively fund)
• Listen and connect with beneficiary communities. More sophisticated funders with staff may consider bringing more diverse voices into decision-making processes and employment, including people with lived experience and beneficiaries. For newer donors, the key is to truly listen to the people your funding will affect, to understand their needs, and to let this inform your approach

Understanding our collective humanity

Ultimately, if we wish to get below the surface and have real impact with our giving, we need to get to the heart of what causes inequality. Modern philanthropy has an important role to play in recognising its power and taking steps to ensure that donations truly empower. 

When I was working in Africa, I learnt about the African Zulu tribe’s greeting, “Sawubona” (“I see you”) and its common reply, "Ngikhona” ("I am here"). These simple greetings beautifully symbolise the importance of giving our full attention to another person, and of seeing someone without prejudice. It reminds us to be aware of other people’s needs, the importance of presence with others, and our existence within a collective community of humanity. I can think of no better way of engendering trust through giving, than by seeing and being present with others in this way.

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