As the days of this pandemic roll on, I am spending time helping organizations craft messages about COVID-19 and how the virus is impacting their programming. Each message is unique to each nonprofit, but the one idea that appears consistently is the hope for a time when communities can come back together and fully embrace their missions in the way they had intended. This hope for a brighter future has led me to think about philanthropy in a post pandemic world—and some positive outcome this situation could have on the larger philanthropic landscape.
Wish #1: More General Operating Support
During this crisis it’s been extremely encouraging to see foundations step up to support nonprofits. By responding early they are setting the stage for individuals, government, and corporations to follow. Some foundations have worked with peers to develop COVID-19 emergency funds, and others are fast tracking donations to get cash to nonprofits sooner. The most compelling step I have seen taken is foundations releasing grantees from restrictive guidelines and allowing them to use their grant awards for general operating expenses.
Nonprofits are always looking to increase their general operating income. Yet in the pre-pandemic days, the majority of foundations gave very limited general operating gifts. More often, grants were restricted to specific programs, timing, and expenses, and then you were allowed to tack on 15% of administrative costs (aka General Operating Expenses).
I understand why foundations put parameters on grants, but during these past five years I have witnessed an incredible uptake in the hoops that nonprofits must jump through to receiving funding. Through their actions during this crisis, however, foundations basically said, “We believe in your mission and we want you to survive this crisis. We value your work, therefore, we will support your most vital needs.” I love this stance, and my wish for the post pandemic world is for this sentiment and ensuing action to continue well beyond this crisis. To simplify application procedures and to develop a grant process that is truly about engaging with a nonprofits work and championing their dreams and visions through general operating gifts—this is a future I would like to see.
Wish #2: Unapologetic Reserve Funds
Nonprofit organizations should create operating models that are prepared for crises. It’s time to change how nonprofits operate. We need nonprofits to be set up for survival under duress. How many nonprofits were prepared to function for three months without income? Without doing extensive research, I believe it’s fair to say that very few organizations were prepared. So why can’t nonprofits unapologetically fundraise for reserve funds? And why not have foundations lead the way with this? Why not consider having foundations allocate part of their grants to a reserve fund? This is my second wish—reserve funds built into a nonprofit’s budget and supported by institutional funders.
Wish #3: Corporations Step Up
This is something we have been wanting to see for quite some time. Corporations make up the smallest portion of giving in the United States compared to individuals, foundations, and bequests. And since the 2008 downturn, this trend has not improved. At this moment in our history when the entire world is digging deep to support those in need, my wish is for the large corporations across this country to step up and make some meaningful contributions to the nonprofit sector—not through corporate tax breaks, but by sharing their profits for the good of the communities they work in. While the economy is suffering, there are still many large companies that are profiting, and this is their chance to share the burden the nonprofit sector is experiencing, and prop them up for a brighter future.
Deborah Crocker is the principal of Grounded Consulting, a consulting service for non-profits.