Three Ways Philanthropy is Tackling Its Race Problem
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Three Ways Philanthropy is Tackling Its Race Problem
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By Liviya David, Business Development & Research Analyst, Botho Emerging Markets Group
October 17, 2021
The revived racial justice movement in the U.S. has sparked a soul-searching moment in the global philanthropic community on the role of race, privilege, and power in giving practices. These changes are long overdue: foundations consistently give to groups led by white directors over Black directors doing similar work. These giving practices have created decades of entrenched inequity in philanthropic giving, which extends beyond American borders and into sub-Saharan Africa. Between 2011 and 2015, just 5.2% of $9 billion in US foundation’s giving to sub-Saharan Africa went to local organizations. While some philanthropies have turned to approaches like color-blind grantmaking, this strategy has notable limitations. Now, a growing number of organizations are shifting their giving strategies to African-founded organizations. Here are three examples of philanthropic organizations making dedicated efforts to integrate racial equity, particularly by funding Black-founded organizations, into their grantmaking approaches
Echoing Green’s Racial Equity Philanthropic Fund
For over 30 years, Echoing Green has operated at the nexus of justice and social entrepreneurship. Current President and Echoing Green alumna, Cheryl Dorsey, is a regular on the speaker circuit, where she discusses racial equity in philanthropy. Its fellowship program has long been lauded for the diversity of its fellows. Its most recent cohort of fellows are the inaugural group supported by the Racial Equity Fund, with 4 of the 18 fellows hailing from the continent (Kenya, Libya, Malawi, and Somalia) working on issues including LGBTQIA+ inclusion, healthcare delivery, and agriculture and income generation.
In August 2020, Echoing Green announced the creation of its Racial Equity Philanthropic Fund, a $50 million effort to fund social entrepreneurs working to advance racial equity around the world. Just four months after its launch, Echoing Green raised $40 million of its initial goal, a major feat amidst shrinking philanthropic flows due to COVID-19.
Echoing Green is taking a three-pronged approach to engage around issues of racial equity: 1) funding and scaling social enterprises focused on the issue, including offering follow-on funding to alumni of its fellowship program; 2) creating inroads into the social innovation sector with programming and workshops for 5,000 people who want to create social change using racial justice frameworks; and 3) developing ways to engage with the movement for racial equity for 10,000 corporate employees.
Where Echoing Green’s Fund is focused on racial equity globally, the Africa Visionary Fund (AVF) zeroes in on leaders on the continent. The Fund’s philosophy is that community leaders know their stakeholders’ needs and aspirations best. As such, AVF channels funding into locally-founded and -led organizations working on education, health, livelihoods, and equity and justice.
Acknowledging the challenges that African-led community and non-governmental organizations face in raising funding from foreign funders, Africa Visionary Fund develops their pipeline from a broad range of sources, including its advisory board that mainly hails from the Global South. AVF also offers on-the-ground programmatic and leadership support to its portfolio organizations and serves as a one-stop-shop information hub for funders who want to learn about African innovators. They set their portfolio organizations up for long-term sustainability and success by providing introductions to those funders, ensuring that their partners have the money they need to continue making an impact.
The Fund recently revised its grantmaking process by pivoting towards an application process. In doing so, AVF intends to remove barriers to entry for exceptional organizations that may not be in the typical referral networks of philanthropic leaders.
The Africa Visionary Fund is unique: it offers unrestricted multi-year funding, which comes with a number of benefits but is notoriously difficult for non-profit organizations to access. In layman’s terms, that means you can use the money as you see fit, including covering staff salaries, investing in program design and experimentation, and ensuring staff have the technology they need to perform in their roles. In its first year, the Fund deployed $1 million to 6 locally led organizations in Burundi, Kenya, Malawi, Tanzania, and Uganda.
In the philanthropy world, Segal Family Foundation (Segal) can send a powerful, catalytic signal: just like a start-up’s first check, Segal funding tends to show an organization’s investability to other funders and acts as a launchpad onto larger partnerships and ultimately greater impact. The proof is in the pudding: in 2020, in addition to directly funding partners with $14.5 million of their own contributions, Segal leveraged an additional $9.5 million in funding from other philanthropies to its portfolio organizations. Segal has created a model through which they cultivate local civil society leaders in East Africa through their Social Impact Incubators in different countries, welcome those leaders and their organization into the Segal Family Foundation community, and connect them to further funding and leadership development opportunities.
In recent years, Segal’s portfolio has grown to include more African-led organizations, rising from 52% in 2014 to 63% in 2019. During the COVID-19 pandemic, the foundation went so far as to offering advances to their partners so stalled or cancelled grants from other sources would not lead to a suspension in programming. This effort was especially important as many of Segal’s partners operate on tight budgets, with the median being $60,000 in 2020.
With the infrastructure in place to refocus giving practices on locally-founded and grown organizations, philanthropy can have a transformative, permanent impact on people’s lives. While systemic change does not occur overnight, a few different paths have been forged by exemplars like Echoing Green, AVF, and Segal, and it will be crucial to see how other actors in the sector follow in, or diverge from those same paths.
By Liviya David, Business Development & Research Analyst, Botho Emerging Markets Group
For more information, contact Liviya here.