Giving Compass' Take:

• Atti Worku, founder and CEO of education and community development nonprofit Seeds of Africa, discusses the changes that the philanthropy ecosystem must go through to improve racial justice and equity in the sector. 

• Some of these changes include more diverse representation on philanthropic boards and within leadership teams, along with creating more access to revenue streams for Black and minority-led nonprofit organizations or social entrepreneurship ventures. What are the first steps for donors to try and make these changes or support them? 

• Read more on the importance of funding leaders of color to build equity and justice. 

American philanthropy is an economic strategy of society’s wealthiest people and institutions to “do good” while moving wealth without tax exposure. The Internal Revenue Services of the US government incentivizes charitable contributions to social causes by offering tax write-offs, which the CARES Act has recently expanded in response to the COVID-19 pandemic. Every charitable contribution made in America has multiple benefits; donors get to contribute to solving a social problem of their choosing, feel good about themselves, enjoy acclaim and honor, all while receiving much of the money they donated back from the government within one annual cycle.

In every fight for justice, change begins with the uprising of the most marginalized people. In philanthropy, Black and minority leaders are fighting to dismantle the racial inequalities and inequities that exist within the philanthropic space, while simultaneously impacting their target communities.

A lack of diverse representation in the boards and executive leadership of philanthropy perpetuates this systemic racial injustice. According to Race to Lead, people of color comprise only 20 percent of philanthropic leadership, while almost all of the work is with and for people of color. These racial inequities are compounded by the agenda-setting and decision-making processes.

Another symptom of lack of representation is the lack of access to funding for Black and minority-led nonprofit organizations or social entrepreneurship ventures. Research published by The Building Movement Project’s Race To Lead series reveals that nonprofit leaders of color face significantly more challenges in fundraising than their white counterparts who do similar work.

First, we need to renew the focus on the needs of the people we aim to help. In modern philanthropy, giving is just another market where donors are the customers in a supply and demand chain of doing good and feeling good. To transform philanthropy’s ecosystem, it is imperative that we acknowledge and bring to the forefront the real consumer: the marginalized people on the ground. We must ensure that beneficiaries are included in setting the agenda, that their needs are addressed, and that success is primarily measured from their unique point of view.

Read the full article about philanthropy's ecosystem by Atti Worku at Skoll Foundation.