Philanthropy, Power and New Challenges

Philanthropy, Power and New Challenges: Insights from a global call between WINGS and SIX networks

On 25 June, WINGS and SIX brought together 17 philanthropic leaders from around the world in a reflective conversation to explore which methods and models philanthropy should be engaging with in order to shift power, and to uncover the ways in which new crises like COVID-19 are influencing the practices and power dynamics within the sector. 

Three key questions guided this global conversation: 

  • How might philanthropic governance structures evolve to respond to both shifting power dynamics and the new challenges we face?
  • Which methods and models are foundations embedding into their strategy to disrupt pre-existing power dynamics?
  • What is the role of philanthropy infrastructure in contributing to shifting the power?

Despite the diversity of the participating foundations, we’ve shared common themes in the three short summaries below:

There is huge power in money – do you clear your conscience by becoming a philanthropist?

1 – Diverse relationships are what power and trust are about

2020 has been a year where the need for diversity at every level has really come into play. The Black Lives Matter protests around the world have shown that diversity within organisations is not a luxury, but a necessity. A report by Emerald Publishing stated that in 2020 “racial/ethnic discrimination was the second biggest global factor in preventing an inclusive society for all; second only to poverty.”

  • Relationship building is at the core of philanthropic work so we need to learn better what it means to share power and work in partnerships. Foundations need to be aware of whether they are adding value or doing harm. How are they leveraging other partners and adding value?
  • Foundations are moving fast and adapting quickly to the “response mode”. The pandemic has been an important opportunity to accelerate (honest) conversations around principles and values, like co-design, radical inclusion, participation and trust.
  • If you don’t have diversity in your organisation, you will never recognise the needs of communities and therefore you won’t be able to support them properly. This diversity must be reflected at the level where decisions are made, which for many philanthropic organisations means the Board level not just staff.

Independent of size or cultural context, it is always important to think about power dynamics in Boards.

2 – Sharing vs transferring power – Boards, organisation, and grantees

Power sits in different places in different institutions – in the foundation teams doing the work, in key individuals and in Boards. We must pay attention to who has the decision making power on strategy and on funding.

Power is connected to money, knowledge and role. Rather than just democratising power and knowledge through organisations, would it be more useful to delineate what the Board’s role is?

The question of the board

  • Boards are often without subject matter experts or NPO experience or can be misaligned; corporate oversight is “too heavy” and focused on narrow legal and fiduciary requirements
  • If we are thinking about transferring power from Boards, we need to think about who power is transferred to – and this doesn’t mean giving it to the best paid person on the staff team – e.g. the CEO
  • How do we increase exposure of boards to the field without introducing personal politics and preferences? (Whereby board members end up ‘patronising’ — or disliking — the their experiences on field projects based on personal interactions, rather than impact

Do we need Boards? What are other oversight options?

3 – It’s about time… What is the effect of time on how we fund?

There’s power in both short-term spend down and perpetual models. But foundations that seek to exist in perpetuity will have a different sense of urgency and a different approach to how they share power and take risks.

  • We must stay accountable: Longer time horizons enable focus on impact, whereas short time horizons don’t give systemic results enough time to manifest…
  • There can be major advantages of 5-10 year strategies accompanied by learning teams. However, organisations can become wrapped up in design over substance… Over process creates silos and stuckness.
4 – Distributing and surrendering power

There seems to be a tension between risk-taking innovation and distributed power…How can foundations take a more dispersed and networked approach to power at the same time as encouraging risk taking and innovation? Additionally, we don’t just need to decentralise power within and around institutions but also give some of that power away.

Practices to take forwards:

  • Devolve power to staff: Organisations could decentralise power to their staff whilst not losing sight of board composition. But then who owns the problem? Once the board devolves its power to staff, the staff too must reflect the diversity of the problem and capability to address it..
  • Staff hold community votes on grant decisions: Philanthropy must engage with new ways of giving, like participatory grantmaking, that give more power to communities. This must be thought of as an iterative approach, rather than an out-of-the-box method. We must consider potential unintended consequences, such as increased competition between organisations or replicating the marginalisation of minorities
  • Advocate for tax restructuring: Most foundations or trusts continue to accumulate wealth for their endowments to exist in perpetuity — an approach that contributes to a core threat to social cohesion: inequality. Funders are positioned to lead by considering the social return of their investments or even spending down. How do we  enable spend-down or larger gift strategies? How can we align incentive for what must change — incentives against outcomes

The biggest ‘shift the power’ practice is promoting investing in the sector not just changing funding/grantmaking practices.