Can Civil Society Be Inclusive? Strategies for Endowed Foundations

Abstract

Literature on inclusion and exclusion within civil society distinguishes two broad approaches: the managerial, based on the private sphere, and the democratic, based upon the public sphere. Regardless of the approach, however, the influence of cultural distance or proximity between endowed foundations and grassroots associations has remained understudied. This article shares results of a quantitative comparison of the patterns of funding awarded by a regional endowed foundation in the Netherlands to immigrant grassroots associations and to other grassroots organizations. The results reveal differences in funding despite the foundation’s inclusive strategy. While the literature on the nonprofit sector is increasingly dominated by a businesslike approach, such practices may not necessarily improve grantmaking for endowed foundations. The galvanizing public murder of George Floyd and the disproportionate impact of COVID-19 on Black and Hispanic people have put structural racism and its influence on wealth inequality in the U.S. into stark relief. As multiracial groups express outrage at these visible disparities, we risk missing the other side of the coin: that wealth inequality in turn fans structural racism. Understanding and then breaking this vicious cycle are essential to realizing our renewed commitment to a country that works for everyone. This article seeks to draw renewed attention to the damaging impacts of wealth inequality, its root causes, and strategies for overcoming it. This article specifically applies systems thinking to identify the root causes of wealth inequality, including structural racism, and then proposes four primary strategies for both fairly distributing and generating new wealth. The service areas of nonprofit infrastructure organizations can be divided into three categories: those that support the nonprofit sector as a whole, those that assist nonprofit organizations and their staffs, and those that devote their resources to the communities or region they serve. This article presents a case study of one region in which all three types of organizations were asked to share their responses to nonprofits that sought help in dealing with the coronavirus pandemic. The diversity of services and business models revealed in the sample illustrates the range of complementary resources that benefit service-delivery nonprofits and their communities. and its partners launched a systems philanthropy strategy to address income inequality and stimulate inclusive growth. The strategy involves a multipronged approach aimed at amplifying the county’s strengths, launching inclusive-growth initiatives, expanding workforce training and skill development to increase a broad target population’s earning potential and net worth, incentivizing and supporting small-business resiliency and growth, and revitalizing and reinventing struggling local industries. To measure progress, the foundation maintains quality of life indicators for data on income, equity, businesses, education, and jobs. This article shares insights into systems philanthropy, the roles played by the foundation and its business and community partners, and how funders can reduce income inequality by investing systemically in inclusive growth. Foundation practice — how a foundation goes about its work — plays a significant role in determining the results of the work, particularly for foundations that take on roles that position them as part of the action rather than solely as sources of funds. This article aims to build upon the lessons from past place-based work and provide new knowledge by examining the practices of The California Endowment as it designed, implemented, and learned from Building Healthy Communities, a $1.75 billion ten-year initiative to promote health equity. The article suggests strategies that appeared key to effective board governance of BHC over a ten-year period. The article includes reflections about what it takes for a private foundation to succeed in such a complex and long-term enterprise.