A Grant Maker’s View: Money Doesn’t Make Us More Powerful — or Smarter

Editor’s Note: This blog post originally appeared here. 

I’m tired of apologizing for philanthropy. For our inconsiderate behavior. For our inefficient timelines. For our opaque communication (or entire lack of communication). For our ego-driven fragmentation. And for so much more. The nonprofit world that we are part of has boundless untapped potential that is being held hostage by philanthropy’s disappointing behavior.

The time has come for all of us who are grant makers to admit to our mistakes, move past them, and unite with nonprofits toward a brighter future fueled by risk-taking, humility, and courage. We need to change ourselves first if we hope nonprofits will change with us.

Among our bad habits, we:

• Trash talk other foundations and bad-mouth nonprofits.
• Give advice without understanding context and don’t seek advice from nonprofits.
• Don’t trust nonprofits to spend the money where they see it’s most needed.
• Fail to make clear what we do or don’t fund and rarely fund for more than one year at a time.
• Operate on longer decision cycles than it takes to conceive and give birth to a baby.
• Ask for extensive individualized information and evaluation for small amounts of money.
• Allow personal interests to drive foundation strategies and set grant priorities without getting feedback from nonprofits and the people they serve.
• Punish nonprofits for accumulating too much money in their reserves.
• Act like we are superior to nonprofits.
• Exclude nonprofits from foundation gatherings because we don’t want them to pitch us.

Everyone in foundations does these things, and most of the time we don’t even realize we are doing them. So why do we act this way when we’re aiming for the same change as the nonprofits we support? One of the biggest reasons is money, and particularly the perceived ownership of money.

Whose Money Is It?

Once a person, family, or other group places assets into a foundation, it no longer belongs to individuals or families. It doesn’t belong to staff or boards or corporations or nonprofits. Nobody owns the money in a foundation. It belongs to the foundation, which is also not owned by anybody — not even the founder or the board. The funds in a foundation exist to serve the public good. It’s not our money.

Even if we know this is true, we all still act as if the money belongs to the foundation’s donor, board, or staff members.

Money = Power

Even if we’re not conscious of it, those of us close to money have more power. Because we are the people influencing where the money goes, nonprofits and others regard us as powerful people. All of us who are stewards of foundation money hold a disproportionate amount of influence, even though it is largely unearned.

Most of us let that power and influence shape our interactions with nonprofits. We decide if we want to talk with nonprofits (or not). We get to say where we meet. Most of us let that power create a destructive unspoken social contract of double standards. We often share almost nothing with nonprofits but expect them to lay bare all of their information in excruciating detail and within highly constricting character counts. We get to give regular detailed feedback, yet rarely, if ever, receive it.

Instead of using our power to streamline the use of resources and networks to solve social issues, we use our power to make nonprofit professionals spend hours removing spaces and commas from the tedious grant proposals we require them to write.

Creating change that benefits everyone takes ideas and resources from many people. Yet in philanthropy, we act as if money is the most important ingredient for social change, and we tend to disregard or undervalue leadership, labor, caring, hope, risk-taking, optimism, creativity, technology, knowledge, data, experience, and many other things that nonprofits or community leaders contribute.

Money — its perceived ownership and its position at the top of hierarchy — is the No. 1 root cause of most of the nonprofit world’s dysfunction.

Yet it doesn’t have to be this way. We can turn our disappointing behavior into something much bigger, bolder, and better by channeling our energy to efficiently tackle the real enemies: poverty, inequality, and injustice.

There Is Hope

I know we — donors and staff members of foundations — can do better. We’ve hobbled our own progress for long enough, so let’s look at what’s possible. True partnership is the card we have yet to play.

Dream with me for a moment. Imagine how we might genuinely work together with nonprofits if we equally valued all resources, especially people, time, and money, not allowing one to eclipse another in importance, power, or prestige.

It will require all of us — philanthropy professionals, founders of grant-making organizations, foundation board members — to recognize the power inherent in our proximity to wealth. Even more important, we must actively share some of that power.

So let’s start now.

If you are a foundation founder, contemplate the considerable power you hold to shift systems and services in your community. Then ask yourself how you can share this power and become true partners with the nonprofits and community you serve. What can you do to build a foundation staff or enable your existing staff to find out what real partnership might look like for the organizations and communities they support? How will you challenge them to become strong partners over time?

If you are a foundation board member, acknowledge what you know and then identify what you don’t know. List the gaps in your experience and awareness. Ask yourself who else should have a say in grant-making decisions and priorities and which community members, nonprofit leaders, faith leaders, researchers, or people who work directly on your causes would help you make better decisions. How can you add to your board to represent the broad array of people whose experience and knowledge will magnify the influence your foundation can have in the world?

If you are a foundation employee, hold a mirror up to your organizational practice and welcome observations and advice from the nonprofits you serve — both directly and anonymously. How will you ask, then listen, and, most important, do something with what you hear? In what circumstances can you be more honest if there’s something you can’t do, and how can you be open about why? If you were in a nonprofit’s shoes, what practices, behavior, and support would you be looking for to enable faster, deeper community change?

The biggest challenge of our work is not finding the right organizations; managing scores of relationships, projects, and stakeholders; or even having to politely but clearly say “No, thank you” day in day out. The most important and difficult task we have is to identify where we have power and then to share it with or even give it up to others. To supercharge philanthropy, we must add a heavy dose of humility.