Four ‘Principles of Interpretation’ for Philanthropic and Nonprofit Leaders Navigating Crises

CEP just released a powerful and provocative survey of nonprofit and foundation leaders about the state of civil society during a time of profound disruption and destabilization. I expect these results to resonate far and wide and, as is often the case with CEP research, to prompt conversation and soul-searching across the social sector.

A key finding of the research is the depth of “existential” threat that many nonprofit organizations are facing — a threat that is not just fiscal but also related to the basic safety and security of nonprofit organizations that face everything from cybersecurity risk to physical intimidation from political activists and, in some cases, federal agencies.

Rather than offering facile and reactive “solutions” to these challenges, I’d like to introduce four principles of interpretation that could help nonprofits and foundations to work through a time of profound instability.

Principle 1: Chronicling Democratic Backsliding

A key finding in CEP’s report is that nonprofits are facing across-the-board funding cuts, including and especially from government sources, at the same time that many who provide services are facing growing demand (itself generated by other socially retrogressive cuts to federal expenditure). At the same time, nonprofits also face a new threat landscape as much of their work is politicized in the context of growing political and social strife over issues like immigration.

As a funder, this challenge almost immediately translates into an operational sentiment like “Well, we know we can’t replace government funding” followed by various versions of rhetorical handwringing. This sentiment is accurate and has operational and fiscal implications.

But it’s also a reflection of why nonprofits are facing a crisis. It’s not because this administration is simply making a policy decision to deprioritize some forms of expenditure while favoring others. It’s because this is what a war on a free, independent civil society looks like.

An article of faith in this country — one that seems to have at least some empirical support — is that the active participation of the nonprofit sector not just in civic life but in the provision of social welfare state services is an effective counterbalance to the concentration of statist power. This is an idea that has conservative and progressive adherents. Any time we talk about communities deciding for themselves or the importance of the affected shaping how they are served, we are extolling the importance in the U.S. of decentralizing the application of coercive and administrative power.

Now we face an administration bent on a remarkable degree of centralization of authority. It appears a critical stratagem in this effort is the intended hobbling of civil society. This is being done by formal and informal legal interference in nonprofits’ activity, the curtailing of the fiscal resources that make civil society possible, and the weaponization of political conflict to threaten nonprofit operations.

So, in addition to determining how funders and others can help nonprofits respond, it’s consequential that all of us bear witness to what is happening and describe it for what it really is. The truth is that we can’t monetarily resist this attack. What we can do is harden certain sectors of nonprofit activity and ensure the record of destruction is clear, disinterested, and visible to all.

Principle 2: Different Kinds of Political Speech Acts

In the last year or so, it has been common to see two kinds of funder “speech acts” in response to this moment and in response to the particular vicissitudes this survey documents. The first is increasing funding to existing activity. The second is public commentary and polemic decrying what’s happening.

These are important and, in some cases, effective forms of response. But we need more arrows in our quiver.

One arrow we must fletch in greater abundance is changing what we are funding. More of the same is a good way to protect particular organizations and activities. But it may be that the shape of this democratic crisis in certain sectors calls for new activities and new organizations. If what economists call the “marginal dollar” foundations spend in the coming year doesn’t represent significant new patterns of activity, we may not demonstrate the agility required to address a generationally unprecedented crisis.

A second arrow is prioritizing our funding commitments. It can be tempting in a time of crisis to maintain moral solidarity with a given field by spreading funding as broadly as possible. And, sometimes, this is either morally appropriate, strategically efficacious — or both. But sometimes funding the maximal number of efforts just to the point of failure is less effective than funding fewer to the full threshold of success.

I recognize that these recommendations are cold comfort to the many people and organizations who are already starved for resources and who face the prospect of closure as philanthropic funding incompletely replaces federal expenditure (and the way it ripples through state and local government funding).

What I can say is that preserving and protecting the idea that there ought to be a federally supported and protected civil society is the only chance we’ll have to protect this kind of activity into the future. Our goal has to be to turn the tide — not palliate the agony of decline and dissolution.

Principle 3: Consider Tensions Rather than Choices

As a related matter, it can be tempting during a crisis that is as moral as it is material to frame everything as a binary: good versus evil, principle versus pragmatic choice. More productive might be thinking about tensions. A few examples that have come up frequently in the last year:

• We’re a direct service organization (or funder): How do we manage the tension between slowing the contraction in services versus pivoting to advocacy?
• We’re a nonprofit (or funder) facing federal sanction: What is the tension between the resources required for public protest versus directly responding to our constituencies?
• We’re a nonprofit (or funder) sector facing the prospect of federal cuts: What is the tension between participating in the political process versus abstaining in protestation of the illiberal tactics being used?

Principle 4: Performance Versus Intention

Not surprisingly, the data reveal a gap between how well funders believe they are responding and how well their nonprofit constituents believe they are performing. Having been an employee of both grantees and funders, this gap feels familiar.

It also suggests an exercise that both funders and nonprofits can incorporate into their deliberations. Specifically, funders and nonprofits can ask two questions:

• Do we (nonprofits and funders) have alignment of intention?
• Do we (nonprofits and funders) have alignment of adequate performance around shared intentions?

The two kinds of alignment are distinct. When both are present, energy can be directed to execution. But if the first kind of alignment is absent, the second form of alignment is, at best, a crapshoot.

Crises are distorting, distracting, and overwhelming. It should be “normal” behavior during a crisis for funders and nonprofits to raise these questions expressly. Some of the answers may not be welcome — but clarity is almost always salutary.

In moving forward during these challenging times, it’s important to remember that these are principles of interpretation, not principles of action. They can change the way we think about the seemingly imponderable problems civil society is confronting. And, in the fight of our lives for our democracy, how well we think will determine how effectively we act.

As always, CEP’s data reminds us that information is an input not an edict. The question we face is what to do with it.

Sam Gill is president and CEO of the Doris Duke Foundation. Find him on LinkedIn.