In 2013, a Center for Effective Philanthropy (CEP) survey of nonprofit leaders found 62% did not believe most of their foundation funders had a deep understanding of the communities they sought to benefit. That lack of understanding, they said, was reflected in foundations’ funding priorities and strategies. Now, a new survey of both nonprofit and foundation leaders reveals that while most foundation leaders believe their work reflects a deep understanding of the needs of the people and communities they seek to benefit, only 33% of nonprofit leaders believe that most or all of their funders have a strong understanding of those needs.
Further, nonprofit leaders suggest their funders would be better able to support their organizations if they better understood the communities they seek to benefit. This 2024 survey data indicates not much has changed in how nonprofits see foundations’ limited understanding of the communities they seek to serve and how it shapes their priorities.
Funders’ priorities don’t reflect a deep understanding of community and nonprofit needs
This misalignment of foundations’ and nonprofits’ perceptions and experiences when it comes to understanding those they seek to serve, and of funder priorities with nonprofit needs, is at the heart of this new report from CEP, funded in part by Fund for Shared Insight. Key findings about foundation and nonprofit listening practices include:
- Seventy-one percent of foundation leaders surveyed believe their funding priorities are “very well aligned” with community needs, yet only 24% of nonprofit leaders say most or all of their funders have funding priorities that reflect a deep understanding of those they seek to benefit.
- Ninety-two percent of foundation leaders cite their nonprofit partners’ expertise as one of the most useful sources of information to shape their work—compared with 81% who say the same of their own staff expertise.
- More than half (56%) of nonprofit leaders say none of their funders provide assistance for feedback collection, and 40% of foundation leaders say they do not provide any assistance for the specific purpose of collecting feedback.
- Notably, 39% of nonprofit leaders cite “lack of capacity” as the top challenge when it comes to collecting community feedback, up significantly from 11% in 2013.
The practice of listening to—and deeply understanding—the people and communities that a funder or nonprofit seeks to serve is not just about checking a box or “virtue signaling”; it’s a fundamental first step toward effectiveness. Without a deep understanding of the strengths, challenges, needs, and opportunities within a community, how can a nonprofit aim to support that community? How can a funder direct resources effectively?
Some funders and nonprofits are working to close the gap in listening practices
The gaps between how funders see themselves and how they’re perceived by grantees, and between what funders say they value and what they choose to support, won’t come as a surprise to most funders or nonprofits. But we also see a growing number of funders and nonprofits working to address those disconnects. For example, more than 100 funders have supported the feedback capacity-building program Listen4Good, which was created by Fund for Shared Insight in 2016 and is now an independent organization.
Many funders are also beginning to embed listening practices more deeply in their work. Fund for Shared Insight’s Funder Listening Action Menu highlights examples of how funders are showing up differently. Foundations are hosting community forums to inform strategy priorities and strategy decisions, embedding community liaisons within their organizations, and including people with lived experience on their boards and decision-making committees.
The Mortensen Family Foundation, for example, restructured its grantmaking committees so that community leaders hold the majority of seats, ensuring that community members weren’t being asked to “sit at a table already set.” In another example, Inatai Foundation’s leadership spent 18 months visiting all 39 counties in Washington, challenging institutional assumptions and building relationships that fundamentally shaped their approach.
These examples reflect a broader shift toward listening as a core philanthropic practice. While the work is ongoing, the field now has significantly more tools, models, and shared learning to guide these efforts, such as the Trust-Based Philanthropy Project’s Principles and Practices, Grantmakers for Effective Organizations’ Community-Driven Philanthropy framework, and assessment tools such as the Advancing Participation in Philanthropy Tool and CEP’s Grantee Perception Report.
While the work is ongoing, these tools and models provide pathways for foundations ready to elevate the voices and perspectives of those most impacted by the systems and structures philanthropy seeks to change.
Our sector is at a critical juncture, with the communities at the heart of our work in crisis. As written in a recent CEP blog, listening is like turning on your car headlights as you prepare to address an emergency. If you don’t take a few seconds to turn on your headlights, you’re driving blind. This survey data is a keen reminder of the importance of funders prioritizing their own listening practices as well as investing in the capacity of nonprofits to listen.
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