In the year since COVID-19 was formally declared a pandemic, what can philanthropy say it accomplished? What have donors learned, and where could philanthropy have done better?

Asking such questions might seem to be the domain of the Monday morning quarterback, unpacking and second-guessing hard decisions that were made in real-time. But reflection, especially in philanthropy, is critical to making a positive impact.

Improving Communication, Coordination 
While philanthropy recognized COVID-19’s threat quickly and stepped up grantmaking, it is widely accepted that one of philanthropy’s biggest failings, its lack of coordination, was a big barrier to action. At the Center for Strategic Philanthropy, we heard firsthand from donors who were overwhelmed, and didn’t know where to start. Those who were brave enough to jump in described chaotic procurement practices and scattershot approaches to giving.

One year later, there have been positive changes — changes that will hopefully endure. There are nascent signs of coordination in the philanthropic sector, and an enhanced awareness of deep, systemic inequalities, racism, and gender bias. Capital has been flowing, too. In a recent report, Fidelity Charitable Investments reported that in 2020, more than $9 billion in donations came from DAFs — by far, the largest amount on record. (DAFs have been harshly criticized for their slowness in getting money to the charitable sector.)

Right now, there is even more philanthropic capital available for disbursement, given record-high investment gains over the last 12 months. What trends should continue so that  the most vulnerable people and sectors have a chance to rebuild after this troublesome year?

1. Continue and expand unrestricted giving. Funding restrictions and cumbersome reporting requirements on nonprofits were an unnecessary burden before the pandemic, and became more of a hardship during it. While the end of the pandemic is in sight, galas are still cancelled, the nonprofit sector has lost nearly one million jobs, demand for services is still high, and more organizations are rightly, and in some cases, finally, prioritizing equity and inclusion work within their existing strategies. Nonprofits are still rewriting their playbooks for fundraising, mission delivery, and organizational management, and they will need to do it all over again on the other side of the pandemic. This takes leadership, time, community engagement, trial and error, new systems and infrastructure. Unrestricted funding is needed to support it all, and it is a clear signal of trust in nonprofit leaders to get it all done.

2. Collaborate. Philanthropy has traditionally been a one-to-one, donor-grantee relationship, with little transparency. The pandemic is accelerating the transition to a many-to-many relationship, with multiple funders looking to pool expertise and coordinate resources. Until 2020, few platforms to facilitate collaboration existed. For example, with funding from the Gordon and Betty Moore Foundation, and partnership with Schmidt Futures and Open Research Funders Group, the Milken Institute launched the Philanthropy Commons, an online platform that allows funders to share projects and organizations they have supported. The goal is to form funder syndicates more quickly and give stakeholders a chance to learn from one another. Other collectives and affinity groups, ranging from learning collaboratives to pooled funds are emerging and can serve as valuable partners for smarter, faster giving.

3. Listen to what communities need. Power imbalances and information asymmetry are unfortunately too prevalent in philanthropy. Funders have the resources, but not necessarily the best information about what grantees want and need. Both of these barriers can be overcome when communities are invited into the grantmaking process. They are empowered to voice challenges and solutions, and offer input on who and what should be funded and how. Listening and following, and handing power back to communities to lead recovery is one of the best ways to ensure philanthropy is strategic and has the impact donors and the community at large wish to achieve.

As the philanthropic sector navigates the next stage of the pandemic, these are just some of the lessons and trends from 2020 that could set the stage for rebuilding a stronger, resilient, equitable world. They are far from the only ones. A V-shaped economic recovery seems to be headed our way — but it cannot permit pervasive and urgent needs to fade into the background. Instead, by building on the positives, and embracing new philanthropic practices, donors can be strategic rather reactive, and make philanthropic commitments  that yield better results.

For more on how philanthropists can invest in pandemic mitigation and recovery, please visit the Center for Strategic Philanthropy's COVID-19 resource page.