Philanthropy's Problem with Power
Early in my philanthropy career in the 2000s, I served as an intermediary between major funders and the organizations they supported. I helped organizations in Central Europe and India develop strategies and demonstrate impact. But over time, I came to realize I was primarily making them “donor-palatable” rather than genuinely building capacity. It was a power trip, with philanthropy clearly in the driver’s seat.
This dynamic is widespread in the philanthropic sector. The power imbalance between funders and grantees manifests in several ways:
- Funding organizations whose leaders resemble donors
- Consuming nonprofit resources through applications and reporting requirements
- Controlling strategic decisions by conditioning funding on compliance
- Building organizational capacity primarily to satisfy donors
The COVID-19 pandemic catalyzed a shift toward more equitable philanthropic practices. Several emerging approaches are working to redistribute power:
Diversity, Equity and Inclusion: Traditional foundation leadership remains predominantly white. The D5 Coalition reports that 92% of US foundation presidents are white, while organizations led by people of color receive fewer grants and face greater scrutiny. Addressing this imbalance is foundational to shifting power dynamics in philanthropy.
Trust-Based Philanthropy: The Whitman Institute advocates relationships emphasizing transparency and flexible, long-term funding with minimal reporting burdens. This approach recognizes that grantees, not funders, are the experts on the communities they serve.
Participatory Philanthropy: Foundations like MacArthur and the Fund for an Inclusive California incorporate community members into grantmaking decisions. By ceding decision-making power to those closest to the issues, funders can ensure resources flow to where they’re most needed.
Movement Funding: Funders are increasingly supporting grassroots movements, accepting their non-traditional structures and longer timelines. This requires funders to relinquish some control and trust in the organic, emergent nature of social movements.
Direct Cash Transfers: Some foundations now provide unrestricted funds directly to individuals. This represents perhaps the most radical redistribution of philanthropic power — trusting recipients to know best how to allocate resources.
These shifts are encouraging, but the sector still has a long way to go. True power redistribution requires philanthropy to listen more, question its own expertise, and persistently explore how to share — not just wield — its considerable influence.