Three Learnings About Trust-Based Philanthropy in an Age of Mistrust

Deep and stark divisions in the U.S. threaten the foundations of our society and democracy—systemic racism, economic inequality, partisan polarization, disbelief in facts and science, and growing political violence. Widespread and severe mistrust is at the center of this national tension—whether a cause, effect, or both. According to a September 2021 Gallup poll, U.S. adults’ trust in politicians and their fellow citizens has been steadily waning since the 1970s and has reached historic lows. Strikingly, the U.S. is the only established democracy where social trust is declining. While just the latest development in a decades-long trend, we are living in an Age of Mistrust.

In the philanthropy sector, however, there is progress to rebuild trust through a pioneering “trust-based philanthropy” approach. Defined in 2014 by The Whitman Institute’s Trust-Based Philanthropy Project, the approach advances equity by establishing mutually accountable relationships between philanthropists and community changemakers.

The prominence of mistrust across U.S. society has created an opportune time to reflect on Hirsch Philanthropy Partners’ learnings from applying trust-based principles with individuals, families, and foundations. Additionally, the nation’s confrontation with centuries-long racial violence—uplifted by the Black Lives Matter movement—has accelerated commitment from philanthropists to understand and address systemic inequities, a fundamental component of trust-based philanthropy.

The foundation of trust-based philanthropy is an acknowledgment that the sector has often contributed to systemic inequity. This includes recognition that much philanthropic wealth has been accumulated in ways that have further entrenched racism, patriarchy, and other forms of oppression. It also invites a critical look at who is considered trustworthy of philanthropic grants, who is not, and why. To work well, the approach requires reflection from philanthropists and a growth mindset that the philanthropy sector can and needs to improve significantly.

Trust-based philanthropy is a conversation about power. Who holds power in philanthropy? How is power leveraged across the sector and to what end? What are the implications of the sizable power imbalance between those who control funding and the community organizations and leaders working tirelessly to create change? These challenging questions do not have simple answers and require persistent reflection and a commitment to equity—exactly what trust-based philanthropy offers.

Trust-based philanthropy is not only an intellectual exercise; it provides specific recommended practices for philanthropists and foundations to more effectively contribute to a just and equitable nonprofit sector. These funding practices—all of which require a high level of trust in community partners—include supplying multi-year unrestricted and flexible grants, reducing repetitive or unnecessary paperwork, providing non-monetary support and access to resources, and more. While these practices are an important starting point for grantmakers, there are wide-ranging and evolving applications within the Trust-Based Philanthropy Project’s core values: work for systemic equity; redistribute power; center relationships; partner in a spirit of service; be accountable; and embrace learning.

As a philanthropic advising firm that has shared these values since our founding in 1999, Hirsch Philanthropy Partners commends The Whitman Institute’s framing of “trust-based philanthropy” to help move the sector forward. It will take commitment and action across the entire ecosystem of philanthropy to shift towards a trust-based model.

During this Age of Mistrust, as our society faces painful, existential crises, including a global pandemic, economic inequality, devastating climate events, and critically, demands for racial justice, it is painfully clear that the billions spent annually on philanthropy are not providing the solutions we need. Too many communities continue to have unmet basic needs. Philanthropy can do better, and trust-based philanthropy is a significant step in the right direction.

As we reflect on Hirsch’s experience applying trust-based principles with philanthropists, here are highlights of what we’ve learned:

There is one constant with every philanthropist we work with—a desire to create the biggest impact possible. In fact, many of our engagements with philanthropists begin with the question: how can we amplify the impact of my giving?

In our experience, the most effective solutions are not generated by the partners furthest from the issues (funders), but by those in the middle of them (community organizations). There is ample evidence that when grantmakers hold the reins too tightly about how nonprofits utilize their funding, it leads to poor investments that do not account for the unique and evolving needs of communities (see this famous example with Bill Gates).

The COVID-19 pandemic has driven home the need to entrust communities with the flexibility and power to quickly implement their own solutions. In March 2020, when Bay Area counties began shelter in place mandates, Hirsch-advised philanthropists immediately increased flexible, unrestricted funding to nonprofits. We knew the communities served by these organizations had urgent, lifesaving needs, and we respected and trusted them to effectively maximize the impact of additional funding. Many of these organizations later confided that while funders often spoke about providing rapid and nimble grants during COVID-19, few came through. Overall, our clients’ robust pandemic response contributed to $153.5M in total funds directed by Hirsch to community partners in 2020, a 22.8% increase from 2019.

The resources brought by philanthropists to social impact work are important, and they need to be shared in flexible ways that community partners are in the best position to leverage for the deepest impact.

Both long-time and new philanthropists have shown genuine interest, humility, and openness to directly engage with and learn from our community partners. This often happens when philanthropists acknowledge that they do not—and simply cannot—have all the answers when it comes to social change. This desire for collaboration naturally leads to the centering of community voices and local expertise that is vital for philanthropy to be successful.

Whenever possible, Hirsch creates direct engagement opportunities between philanthropists and community partners. These are not site visits, but experiences that build deeper understanding and relationships. For example, we invited a philanthropist we work with—who has a background in health—to attend the first Hepatitis C research symposium in San Francisco. The event was organized by End Hep C SF to raise visibility about the disease and strengthen collaboration. At the event, our client heard from practitioners and those with lived experience of Hepatitis C; expanded her knowledge of the latest research and treatment of the disease; and heard about the deep challenges and promise of eradicating the virus in San Francisco. Creating direct, authentic opportunities for philanthropists to engage directly with effective community partners not only builds trust and relationships, it also greatly enhances decision making. Direct engagement makes systemic challenges and solutions tangible and urgent, and helps grantmakers move confidently from curiosity to action.

Another key to cultivating authentic relationships with community partners is by ensuring that foundation staff, or philanthropic advisors, represent the communities they seek to support. Historically, the philanthropy sector has been under-represented in diversity of race, age, and disability. According to the Council on Foundations’ 2020 Grantmaker Salary and Benefits Report, U.S. foundation staff are less diverse than the broader population and there have been minimal changes from 2015-2020. An important goal of trust-based philanthropy is that community organizations feel seen and trusted by grantmakers. Shared identities and experiences enable more direct language and a nuanced understanding of the significant challenges and traumas facing communities. This results in less time communicating between the lines and more time collaborating to maximize the impact of the work. At Hirsch, we know that representation matters—especially when reframing grantee and funder power dynamics. This is one of the many reasons that our firm intentionally invests in top-notch talent with diverse backgrounds and lived experiences, and we are committed to continually evolving our learning about how to best represent the communities that we partner with.

Trust-based philanthropy not only advances equity by rebalancing power, it works to effectively create the desired change. A case study of trust-based philanthropy in action is the Hellman Collaborative Change Initiative, which launched in 2014 under Hirsch leadership. The initiative has granted over $10.7M in multiyear funding and an additional $1M in capacity building resources for cross-sector collaborations that address seemingly intractable systemic issues in San Francisco and Alameda counties. Since its launch, the initiative has been intentional in developing authentic relationships with representatives across the local social change ecosystem—community-based organizations, school districts, government departments, politicians, and more. Importantly, these relationships are backed by quick and flexible funding and capacity building support to provide nonprofits with the time and resources required to implement their brilliant solutions, rather than spending an inordinate amount of time networking with funders and writing grants. The initiative’s grants also include philanthropist commitments to show up with a seat at the table of community partners—offering networking and non-monetary support—not at the head of the table.

The outcomes of Hellman Collaborative Change Initiative’s grantmaking are exciting. For example, our trust-based partnership with Food As Medicine has documented significant patient- and system-oriented outcomes, including: scaling from a pilot project at a local clinic to 16 total clinics; receiving inquiries from 14 health systems across the United States about replicating the model; improving healthier eating in 92% of participants; and improving blood pressure, blood sugar, or weight loss in 47% of hypertensive and diabetic patients.

Another example of the long-term benefits of trust-based philanthropy began in 2017 with a Bay Area roundtable organized by Hirsch between a philanthropist, older adult health experts, and community leaders. The discussion surfaced prominent gaps in the lived experiences of Bay Area older adult communities and led to funding for trusted organizations and a transformational public-private partnership to address the deepest gaps. From 2017 to present, the philanthropist has granted millions in flexible funding for historically under-funded health services for older adults in the Bay Area, including a groundbreaking holistic healthcare model for older adults that is drawing national attention.

It is encouraging that largely in response to the global COVID-19 pandemic—and despite our Age of Mistrust—Americans gave a record $471.44 billion to nonprofits in 2020, a 5.1% increase from 2019. However, simply writing bigger and more checks will not solve our communities’ most urgent challenges. For philanthropy’s incredible capital to be money well spent, we must shift power from those who control wealth to the leaders whose solutions are creating real change in their communities. Trust-based philanthropy must become the status quo instead of the exception.

While a widespread shift to trust-based philanthropy will take time, that should not hinder brave and necessary conversations between philanthropists and community leaders that promote deep listening and intentional learning. As the sector evolves, we cannot expect perfection, but ongoing improvement. To do this, we recommend that philanthropists apply the values of trust-based philanthropy as a reflective guiding framework. Before making decisions, ask yourself or your team:

How are we taking an antiracist approach to integrate systemic equity into our work?
Are we intentionally redistributing power to our community partners who are closer to the issues we seek to address?
How might we center relationships with community partners to build more authenticity and trust that helps us navigate the complexities of our work?
Are we partnering in a spirit of service that prioritizes the needs of our community partners?
Are we holding ourselves accountable to those we seek to support?
Are we committed to remaining humble and embracing learning to advance our impact?

Three Learnings About Trust-Based Philanthropy in an Age of Mistrust

What is Trust-Based Philanthropy?

Our Learnings About Trust-Based Philanthropy

The Journey Ahead