Foundations Respond to Crisis: Toward Greater Flexibility and Responsiveness?
In light of the crises of 2020—a global health pandemic and resulting economic crisis, which have exacerbated long-standing inequities in our society, as well as a nationwide reckoning with anti-Black racism—nonprofits and funders alike have called on foundations to change the way they work to meet the needs of the moment. They have urged funders to recognize the unprecedented needs and increased demand for services and provide nonprofits with maximum flexibility to respond to these crises. They have challenged foundations to provide more flexible funding, reduce what they ask of grantees, and shift power dynamics by putting greater trust in the nonprofits that are working under great pressure to serve communities. They also have encouraged funders to do more to advance equity, particularly racial equity, and to be guided by the needs of communities most affected.
Advocacy for more funders to adopt these practices is hardly new. Yet, evidence suggests that past calls for change have not been widely followed. Despite increasingly favorable attitudes toward multiyear general operating support, these grants are more the exception than the rule. Similarly, requests for foundations to streamline and improve their processes have been growing over the years, but research indicates that grantees aren’t spending any less time on application and reporting processes now than in the past. As funders step up and demonstrate greater flexibility and responsiveness, the question then becomes: Is their response merely a momentary adjustment, or will the crises of 2020 spur substantive, long-term change in how funders approach their work?
In this report—the final of this three-part series— the Center for Effective Philanthropy (CEP) explores the extent to which foundations are being more flexible and responsive, including loosening grant restrictions, reducing what is asked of grantees, and providing more unrestricted support.
The findings presented in this report are based on survey and in-depth interview data collected and analyzed by CEP. In July and August 2020, we surveyed more than 800 foundations. We received responses from 236 foundations —170 of which had signed Philanthropy’s Commitment During COVID-19 Pledge and 66 of which had not. Additionally, 41 foundations that signed the pledge participated in hour-long in-depth interviews with CEP.