Racial Equity and Philanthropy: Disparities in Funding for Leaders of Color Leave Impact on the Table

This research, from Echoing Green and Bridgespan, lays bare the racial disparity in today’s funding environment and argues that population-level impact cannot happen without funding more leaders of color.

Echoing Green and Bridgespan collaborated to research the depth of racial inequities in philanthropic funding. Based on what we see in our work as intermediaries in the sector, two of the biggest factors holding back philanthropy’s efforts to help advance social change are rooted in race:

• Understanding the role of race in the problems philanthropists are trying to solve;
• The significance of race when it comes to how philanthropists identify leaders and find solutions.

Color-blind grantmaking, even when grounded in a well-meaning attempt at equity, is the crux of the problem. Philanthropist Jeff Raikes shares: “Tricia and I recognize that we come into this work with blind spots, as did many of our staff. Over the past few years we have challenged ourselves to better understand the ways a race-conscious approach leads to better results for the communities we want to support.”

Race is one of the most reliable predictors of life outcomes across several areas, including life expectancy, academic achievement, income, wealth, physical and mental health, and maternal mortality. If socioeconomic difference explained these inequities, then controlling for socioeconomic status would eliminate them. But it does not. This means that donors who care about supporting social change must think more intentionally and proactively about race and racial equity.

Funding leaders of color is a significant piece of this puzzle, because these leaders often bring strategies that intimately understand the racialized experiences of communities of color and the issues these communities face. Unfortunately by and large that is not happening today.

Take Echoing Green’s applicant pool, a group that is considered among the sector’s most promising early-stage organizations. Looking just at its highest qualified applicants (i.e., those who progressed to its semifinalist stage and beyond), revenues of the Black-led organizations are 24 percent smaller than the revenues of their white-led counterparts, and the unrestricted net assets of the Black-led organizations are 76 percent smaller than their white-led counterparts.

Disparities by the race of the leader repeatedly persist even when taking into account factors like issue area and education levels. For example, among organizations in Echoing Green’s Black Male Achievement fellowship, which focuses on improving the life outcomes of Black men and boys in the United States, the revenues of the Black-led organizations are 45 percent smaller than those of the white-led organizations, and the unrestricted net assets of the Black-led organizations are 91 percent smaller than the white-led organizations—despite focusing on the same work.

Population-level impact in the issues donors care about cannot happen without funding more leaders of color and funding them more deeply. The question now becomes what philanthropists are going to do about that. Are you ready to act?