After the global circumstances of the last two years, many foundations may just be trying to wrestle the steering wheel back into the old roadway grooves.
Mohamed El-Erian has always stood out to me as one of the most objective financial analysts out there. According to his latest article in Foreign Affairs, we are ‘on the cusp of a new era and that a mistake that forecasters and commentators are making is to think the Fed can just chart us back to pre-2020 territory.’ Further, he states, \’until analysts wake up to the probability that these trends (pandemic, war, supply chain shortages, climate change, etc.) will outlast the next business cycle, the economic hardship they cause is likely to significantly outweigh the opportunities they create.\’
His comments on change and adaptation moved me to consider how magnitudinal changes will affect philanthropy and the non-profit space because even though his comments relate to the economy, philanthropy and the non-profit sector are grappling with challenges as well. For the philanthropic and non-profit field, try inserting ‘government, foundations, donors and philanthropy’ in place of ‘the Fed’ in his quote above. With so much change and energy generated around these issues and actions, certainly our favorite sectors will not be immune from the changes outlined by El-Erian.
At a granular level, non-profit leaders are faced with the challenge of recruiting and retaining staff. Granted, not dissimilar from almost every other sector out there. But even with the scale of challenges brought on by the pandemic and the structural upheaval in almost every element of society, we (philanthropy, donors, the government, society, et al.) still live in a world where society continues to place the ultimate burden on the non-profit sector; solving the world’s problems, which have only drastically increased and can no longer be ignored, on a Ramen Noodle budget.
We should challenge ourselves right now. Do we go back to the old way and operate under the same expectations, or chart new territory and new pathways?
For a perfect example of a \’new\’ way of approaching philanthropy, look no further than recent gifts from MacKenzie Scott. We don’t all have billions to liquidate and some of us have board members to whom we need to account. That said, going back to the slow and some say ‘privileged’ speed of philanthropy should not be our north star moving forward.
General operating grants aren\’t a new concept. But providing them on such a scale as Scott is unprecedented. This is the kind of thinking and approach that will challenge the norms and create new pathways of thinking. And you never know where a new path will lead.