Improving Today's Strategic Philanthropic Models
Few endeavors have as significant an impact on today’s world as philanthropy. Donors have the power to make powerful improvements to society’s most pressing problems. However, sometimes when generosity goes into the wrong places, there is missed opportunity for significant change. Some urgent issues include racism, economic inequity, and climate change, to name a few.
When philanthropic models are too simple, funds are not distributed to the right places, making the donations fail short of their intentions. How can foundations better utilize the money to improve philanthropy overall? The first step is pivoting to more varied philanthropic strategies so that funds go to the most pressing social issues in today’s complicated world.
A recent study by the Rockefellers Brothers Fund showed that in 2020, more than 100,000 foundations distributed a record of more than $75 billion. While the money went to several causes like education, micro-financing, investigative journalism, and medical research, these do not directly improve democracy. In the past decade, less than two percent of funds have gone toward causes such as civic involvement or voting, which are the more urgent needs of the United States to improve life for its everyday citizens.
In a strategic model, simple tasks like building hospitals are easy to achieve. However, strategic philanthropy does not work as well for more complex issues like improving health for a specific part of the population or developing vaccines. The main reason is that outcomes are forecasted and then examined after the fact, which does not allow for adjustments. Emergent philanthropy comes into play for the more complicated challenges. In the newly studied emergent model, adjustments happen during the process, making way for improvements to get a better result.
The Power of Emergent Strategy
Eradicating today’s biggest challenges requires transitioning to an emergent strategy. New philanthropic tools are needed to address today’s complex problems. Leadership teams within foundations need to be comfortable with uncertainty enough to withstand setbacks over long periods. The result of this, for better or worse, is often organizations releasing control, allowing individuals and groups to make mistakes, own them, and learn from them.
“Emergent” means learning through practice about what works and what does not. Over time, organizations can study what parts of their philanthropic strategies are successful and which are less so by observing both their actions and those of others. The result is a new strategy that continues to evolve so that funds get spent in the most fruitful ways. An emergent approach also allows tweaking the spending to the participants, place, and time at hand. Funders can then be more effective at changing activities and funding to the specific circumstances making partnerships without focusing on their control.
As 2023 gets underway, the economic forecast is murky, making many charities tighten their belts. However, continuing to give amid the lack of clarity is the key to moving forward into an emergent model of giving.
Doing thorough research, having clear goals, and creating hypotheses for solving problems are the core values of all strategic philanthropy. By implementing an emergent strategy on top of these values, foundations will be capable of even better impacts on the most pressing challenges in today’s society. Until now, the popular predictive strategy has proven too rigid to address the needs of many causes. The more detailed emergent strategy better addresses pressing social issues. Foundations have the power to make impacts beyond their grants. Learning from results is the key to success when creating a lasting difference through generosity.