Grantmakers Must Increase Social Justice Funding to See Real Results

The concept of “strategic philanthropy” has gained much currency in recent years. While nonprofit effectiveness has likely increased because of it, it also has inhibited nonprofit impact. In practice, strategic philanthropy is often linear, technocratic and top-down, and self-limiting as a result. For example, despite grantmakers’ provision of some $10 billion in grants to environmental causes from 2000 to 2009, existing regulations have been undermined and environmental initiatives have been stalled at the federal level for decades.

At the same time, more funders are practicing “social justice” philanthropy. The Foundation Center defines social justice philanthropy as “the granting of philanthropic contributions to nonprofit organizations based in the United States and other countries that work for structural change in order to increase the opportunity of those who are the least well off politically, economically, and socially.” It is among the most effective ways that foundations leverage the impact of their giving and contribute to a more just and equitable society.

Social justice philanthropy provides a necessary corrective to strategic philanthropy. When these two movements are at their best, they are in fact one and the same:

• A clear understanding of one’s goals includes not only the desired impact but also identifies who will benefit and how.
• A commitment to evidence-based strategy does not ignore the positive impact, and frequently the necessity, of influencing public policy.
• Keeping a philanthropic strategy on course demands authentic feedback from those who stand.

Unfortunately, even as the sector becomes more organized, focused and, at least rhetorically, “strategic” in its efforts, “social justice philanthropy” has declined slightly as a share of grant dollars in recent years.

According to a new analysis of Foundation Center data by the National Committee for Responsive Philanthropy (NCRP), social justice grantmaking by U.S. foundations declined from 15 percent of grant dollars on average from 2008 to 2010 to 12 percent of grant dollars in 2011. Although grantmakers reported more than $2.9 billion for social justice funding, less than one in eight grant dollars were provided for this work in 2011.

Still, there are signs of hope.

First, these figures are based only on one year’s giving, whereas previous NCRP analyses examined average giving over three years (2004-2006 and 2008-2010). The 2011 sample includes 215 more foundations than the previous 2008-2010 and double the number of funders that reported no social justice grants. We should not read too much into the decrease just yet.

Second, a closer look at the data suggests that a cohort of foundations understands the benefits of social justice grantmaking and maintains its commitment to this kind of philanthropy. Among those foundations that report social justice grants, the median share of grant dollars classified as serving a social justice purpose increased from 4 percent on average from 2008 to 2010 to 7 percent in 2011. Further, the number of foundations that meet or exceed NCRP’s proposed benchmark of 25 percent of grant dollars for social justice has steadily increased from sample to sample: from 56 in 2004-2006 to 76 in 2008-2010 and now 94 in 2011.

The challenge ahead is encouraging others to join this cohort.

Advocacy, community organizing, and civic engagement are among the most strategic social justice tools that grantmakers can use to create a more inclusive society. Numerous studies have documented the high return on investment from funding this work, including NCRP’s Grantmaking for Community Impact Project, which found an aggregate return of $115 for every dollar invested in this way.

Any grantmaker with a change-oriented mission is doing its founders a disservice if it does not prioritize advocacy and policy engagement done by or on behalf of underserved and disenfranchised communities to address the root causes of social problems. Social justice philanthropy is a powerful way to give agency and voice to those who play a critical role in coming up with long-term solutions and yet remain disenfranchised.

Advocacy and organizing have consistently played a role in our history to create a more just and inclusive society. From the Civil Rights Movement to women’s suffrage to enacting strong environmental protections, advocacy has played a central role in ensuring that nonprofits and the communities we serve are part of our deliberative democracy. It is an integral component of our country’s history and character and one that should be supported more, not less.

More recently, grantees working to effect lasting change have had notable successes in holding corporations accountable, in securing marriage equality in several states, and working toward inclusive and comprehensive immigration reform. Yet, funding for this work remains scarce, placing an undue burden on the nonprofits in the trenches.

If today’s strategic grantmakers want to achieve real results, they must reconsider philanthropic strategy through a social justice lens. And as more grantmakers become serious about funding social justice, we will have the opportunity for transformative change that benefits all of us.

Niki Jagpal is research and policy director, and Kevin Laskowski is senior research and policy associate at the National Committee for Responsive Philanthropy. Together, they co-authored Real Results: Why Strategic Philanthropy is Social Justice Philanthropy and The Philanthropic Landscape series of studies, which looks at key giving trends among the top U.S. foundations. Follow NCRP on Twitter (@ncrp).