FA Magazine May 2023 | Page 27

Hannah Shaw Grove

How The Next Generation Will Give

A concept called “ trust-based philanthropy ” is going to resonate with younger givers .


N TRADITIONAL PHILANTHROPY , DONORS GIVE MONEY TO SOLVE specific problems . The typical fundraising model asks for X number of dollars to supply Y number of hospital beds , for example , and that offers the giver a concrete understanding of the impact they are making .
It ’ s different today . New generations come with a fresh perspective and a goal of addressing systemic inequities . In the case of overcrowded and under-resourced hospitals , that might mean looking beyond beds to understand the larger problem .
That ’ s where trust-based philanthropy comes in . When it comes to addressing the root causes of issues , many next-gen donors see this newer way of doing things as more collaborative and promising than the oldschool Band-Aid approaches .
What Is Trust-Based Philanthropy ?
In trust-based philanthropy , funders want to build relationships with their grantees , listening to their needs and ideas , and giving them more autonomy in how they use funding . It ’ s viewed by both sides as a partnership based on trust , mutual respect and transparency . The approach shifts power dynamics , where traditional grant-making models may raise barriers that can keep nonprofit organizations from reaching full potential . Advocates of this approach think nonprofits understand their own financial needs best , and that some of the most important giving isn ’ t always the easiest to see .
It ’ s different today . New generations come with a fresh perspective and a goal of addressing systemic inequities .
Shaady Salehi is the executive director of the Trust-Based Philanthropy Project , a peer-to-peer funding initiative that addresses “ the inherent power imbalances between foundations and nonprofits .”
“ Trust-based philanthropy has gained momentum in the last several years as a necessary response to the complexity and unpredictability of our world ,” Salehi says . “ By trusting the vision of leaders — and shifting philanthropic practices from transactional to more relational — donors are able to be more strategic in their giving while creating the conditions for deeper transparency and learning .”
Salehi says that many of the priorities of next-gen donors include things like systems change , climate solutions and technological advancement . These things , she says , “ require innovative and iterative action from the people working on those issues . Trust-based philanthropy frees up nonprofits so that their time can be spent on addressing these problems rather than focusing on donors ’ various and sometimes competing requirements .”
This type of philanthropic approach can take a variety of forms . Some donors want to put money toward general operating support for charities . Others may remove restrictions from their gifts , which allows nonprofit organizers to use funds on a discretionary basis when and where they are needed . One of the most generous and visible philan-