A recent article in Alliance magazine was titled “Is the trust-based philanthropy bubble about to burst?” and caught my attention because, although there has been much talk about the rise of trust-based philanthropy, in practice I don’t believe it is a very big bubble just yet.
Firstly, what is trust-based philanthropy?
It is an approach to giving which runs counter to the more traditional ‘funder knows best’ approach. Instead it recognises that those funded have insight and expertise to bring. It starts with the assumption that those closest to the issue are more likely to know what might work and where the priorities lie. The Trust-based Philanthropy Project sets out these basic principles:
1. give multi-year unrestricted funds
2. do the homework (instead of placing the burden on applicants to provide information)
3. simplify and streamline paperwork
4. be transparent and responsive
5. solicit and act on feedback
6. offer support beyond the cheque
These steps are about respecting a nonprofit’s knowledge and time, and working with them in a more equal partnership. It involves listening and building relationships.
What are the criticisms of trust-based philanthropy?
In his article “It’s time to ditch the mantra of trust-based philanthropy”, Foundation CEO Simon Summer’s raised three main criticisms. I have summarised them below and included some of the responses from those defending a trust-based approach:
1. Trust-based funders are free riding on the scrutiny of others.
Trust is not about being naïve. There are plenty of examples of funders feeling able to trust organisations because they have conducted scrutiny first. Trust should enable deeper and more open and honest conversations where the true situation can be revealed and explored.
2. Trust-based approaches are too US-centric.
The Trust-based Philanthropy Project is in the US but the practice is wider, including India and the UK. And although it appears a new thing, there is a long history of similar approaches such as mutual aid.
3. It promotes inequality as it favours a few, those we trust are those like us: “a few organisations become ‘donors’ darlings’ – apparently more worthy of their trust and money than others.”
Traditional practice already leads to marginalised groups being under-served with less money going to women and girls, people experiencing racial injustice, LGBT+ and disabled communities.
Being aware of the power dynamic in philanthropy and a desire to shift this to mutual respect and understanding is actually an attempt to promote equity.
Will the bubble burst?
Trust-based philanthropy is certainly fashionable right now. It can be extended to more radical approaches such as participatory grantmaking where it is local people who decide how funds are allocated. However, its basic principles such as making applying for grants easier should not be that controversial. I for one hope the bubble keeps growing. Trust is a fundamental requirement for partnerships of mutual respect and that is exactly what we need more of if funders and the partners they fund are going to work together to address the social and environmental challenges we face.