Editorial Fellowship: Transforming Funding Models

Baby Boomers are retiring. Here’s what Canada should do to put their businesses in employees’ hands — and build community wealth.

In the next decade, nearly three quarters of Canadian small business owners will retire – businesses worth over $1.5 trillion. Most will look to sell. In a country where the gap between the rich and poor is widening, and could do so exponentially in the pandemic’s aftermath, experts say this transition provides a huge opportunity to share wealth with workers.

Are Canadian foundations afraid of death?

As the COVID-19 pandemic continues to exacerbate inequality, several non-profit and grassroots leaders are calling on Canadian donors to spend down — distributing all of their foundation assets within a defined term — in order to free up capital for community impact. Some are responding, but analysis shows that systemic orientation toward perpetuity in the philanthropic sector in Canada may be preventing other philanthropists from following suit.

A short history of philanthropic perpetuity: tax havens, Catholic corruption and corporate control

The Canadian philanthropic sector is embroiled in a debate about the disbursement quota — the rate at which foundations have to give to charity. Some argue it’s fine where it is — at 3.5 percent. Others argue that this rate is “starving” non-profits across the country. To understand the context for this debate, you need to understand the history.

Who stewards 10 of Canada’s biggest community foundations’ investments? Mostly white men in finance

Canadian foundations invest far more money each year than they grant out to charities. This means that their volunteer ‘investment committees’ — the group that oversees the foundation’s investment decisions — play a considerable role in the overall impact the foundation has. Some social impact leaders say that the “monocultural” nature of these committees is limiting their capacity to create systemic impact.

They won’t take your money: Why these charities are newly restricting donations from controversial corporations

Charities need money. But they also have strong values and a reputation to protect. In light of domestic and international charity scandals; and increasingly powerful movements for racial and social justice; some charities are turning away from donations from controversial corporations — whose money, the charities see, as not worth the moral sacrifice or the public relations risk.

Thinking about using AI to fundraise? Here’s what you need to know — including the ethical questions.

40 percent of charities are still seeing decreased revenue since the start of the pandemic. In this context, fundraisers need all the help they can get. Artificial intelligence tools can help fundraisers to work smarter.

Could there be a wave of charity mergers post-COVID?

Many charities are facing a COVID-19 drop in donations and an increase in service needs from their communities. While many feel able to survive the next six months, their long-term future is more uncertain, posing a risk for communities who rely on their services.

Tired of “siloed” conversations, Justice Fund protest brings disbursement quota advocacy to the street

Grassroots groups and community-led organizations receive miniscule percentages of Canadian philanthropic dollars. Many in the philanthropic and charitable sectors want to change that — but the question of how remains.

Pushed by students, universities lead on fossil fuel divestment. Who will push foundations?

Climate change is an existential threat and it’s powered by the burning of fossil fuels. Experts say that a wave of fossil fuel divestment proclamations amongst Canadian foundations could send a powerful signal to other investors, government and media, that fossil fuels are on the way out — and could also better align foundation’s investment dollars with their social missions.

An under-the-hood look at Inspirit Foundation’s portfolio makeover: fired two investment managers, prioritized DEI

For most foundations, arguably their biggest lever for impact is their invested capital. Yet, few have moved beyond tinkering at the edges with ESG screens.

A DQ hike isn’t enough — here are 7 other things that need to change for more money to flow to Black and Indigenous groups

Funding to groups led by and serving Black, Indigenous and people of colour receive miniscule amounts of Canadian philanthropic dollars. A disbursement quota hike would not automatically mean more funding for these organizations — who are serving some of the most pressing needs.

Federal advisory committee on the charitable sector lacks transparency and diversity, say some, leading to more “conservative” finding on DQ debate

The federal Advisory Committee on the Charitable Sector (ACCS) has the ear of Diane Lebouthillier, the federal minister responsible for Canada’s charitable policy. Their findings on key policy decisions, like the disbursement quota, have the potential to shape federal policy for years to come.

Canada is cracking down on the Freedom Convoy’s finances. Here’s why that may hurt social justice movements, too.

Indigenous land defenders and other social justice movements have been labeled "extremist" in the past for their work. Subjecting their fundraising methods to additional anti-terror restrictions could make it harder for them to raise funds publicly.

$800,000 student-led impact investing fund adds new chapters in Ottawa and Victoria

Business degrees are the most sought-after post-secondary education in Canada. But if students graduate without learning about how business can be a force for good, Canada risks having a corporate class that only orients toward profit.

A flipped power dynamic: Philanthropists must apply to a council of aunties to fund these Indigenous groups

Funders and grantmakers often wield considerable power over their fundees, determining what gets funded, when and how. The Right Relations Collaborative flips this power dynamic by putting Indigenous aunties in the driver’s seat. The model is firmly rooted in a local territory, but offers a new approach to grantmaking that could inspire a shift in funding relationships across the country.

Government of Canada proposes a ‘shocking and incomprehensible’ change on funding non-qualified donees

For years, charities, non-profits, foundations and grassroots groups have called for an easier way for charities to work with “non-qualified donees” — organizations without charitable status. That seemed on the horizon with the steady progress on a senate bill, until now.

Inside the rapidly organized ‘Hill Day’ for a legislative amendment on non-qualified donees

As soon as this week, the government could pass legislation that, sector advocates say, would make it harder for charities and foundations to fund non-profits, grassroots groups and international charities — directly contravening a promise made in the federal budget.

Tentative ‘celebration’ after key amendments passed on non-qualified donees

For three weeks, charity and non-profit advocates have pushed MPs to pass amendments to legislation they say would make it harder for charities to fund non-qualified donees. Monday’s finance committee meeting was the moment to see whether their advocacy had paid off.

A $90M ESG 'Dragon's Den' competition, as industry faces public reckoning

Many Canadian foundations, pension funds and individual investors are trying to align their investments with their values by getting rid of fossil fuels or divesting stocks invested in corporate laggards. But many find it tough to assess whether their investment managers are truly investing in a values-aligned way or just “greenwashing” their portfolios.

NIMBYs. Funder hurdles. Now, rising inflation. Thunder Woman Healing Lodge Society won’t give up

Charities that run food banks and meals-on-wheels programs aren’t the only ones being hit hard by inflation. Organizations that build community infrastructure, like affordable housing or healing lodges are feeling the pinch too. Funders must close the gap created by inflation in order to realize much-needed community infrastructure projects.

'Traditional' foundation makes big bet on unrestricted giving. Will it stick post-COVID?

During the pandemic, many funders relaxed granting restrictions, allowing charities to be more adaptable and resource hard-to-fund infrastructure costs. Two years in, many charities are still struggling — with increased service demands and decreased donations — and wonder: will grantors be snapping back to program-funding business-as-usual?

The shadow side of the rise of big hospital foundation gifts: donation disparities, roller-coaster giving and donor influence

If COVID taught us anything it’s this: we need our healthcare system. And yet, Ontario’s current funding policy for capital projects — rebuilding old ambulance bays, purchasing MRI machines, and building new wings — relies, in part, on philanthropy. Some experts say that this leaves the system vulnerable to health disparities.

Calgary foundation splits with community foundation network over position on endowments

Calgary’s departure from CFC sends a strong signal to the network’s other 190-odd community foundations: if you don’t like CFC’s position on endowments, you’re not alone. The move could lead to further division on the question of foundation endowments broadly, stymying attempts to encourage philanthropic organizations to increase annual disbursements to the community.

Black philanthropy leaders transitioning from sprint to marathon

Many nonprofit teams are working hard to ensure their policies create equitable opportunities for Black colleagues. Two Black Philanthropy Month conferences offered new insights and strategies for pushing this work forward.

New Ontario Nonprofit Network report highlights Peel region’s dramatic spike in demand for non-profit services, amidst inflation and staffing woes

Non-profits provide services many families rely on: food banks, shelters, and therapy. Without a boost in funding to account for rising programming demands and increased costs due to inflation, non-profits are having to cut back on services and programs that residents rely on.

A $200 million “gamechanger” endowment is on the line; Black-led, Black-focused organizations can now apply

Black communities and Black-serving organizations are chronically underfunded by both the private and public sector, receiving about seven cents for every $100 donated to big charities in Canada. A self-sustaining fund could help change that, by providing Black-led organizations with a stable, predictable source of funding.

Another contentious DQ proposal: Should impact investments count toward the DQ?

Critics of this proposal say allowing impact investments to count toward a foundation’s disbursement quota would result in fewer granting dollars flowing to the charitable sector — at a time of high inflation when they are needed most.

Mastercard Foundation makes historic $500 million commitment to Indigenous education. Will it be Indigenous-led?

Less than 1 percent of all philanthropic donations in Canada support Indigenous charities. A new donation commitment of $500 million could provide a dramatic boost to the capacity of a cohort of Indigenous initiatives across the country.

‘Horrific' hunger crisis in Somalia being overlooked by Canadian donors — here’s why, according to fundraising experts

Many humanitarian crises are long-term in nature, affecting millions of people around the world each year. Yet, experts say these “protracted” crises get much less media coverage than “rapid-onset” disasters, limiting their capacity to raise donations, and stymying efforts to help people who need support.

York University wins Buy Social Canada social procurement award

With inflation and reduced donations, some charities are looking for new ways to earn revenue. In parallel, a growing number of big institutional purchasers are looking to “buy social” — expanding the market opportunity for charities, non-profits and social enterprises to offer products and services.

First-ever by-Indigenous for-Indigenous platform launches to help boost donations for Indigenous initiatives across the country

Many settler-led philanthropic organizations want to boost their financial support for Indigenous-led projects, but some lack relationships with Indigenous communities and don’t know where to start.

Investigation: After George Floyd was murdered, corporate Canada promised philanthropic support for Black communities. What have they disclosed donating since?

Black charities in Canada get a fraction of the donations raised by their white-led peers. When George Floyd was murdered and millions marched for Black lives in communities across North America, some Canadian corporations made six-figure donation pledges in support of Black communities. Whether they and their corporate peers have continued to give has material implications for Black Canadians across the country.

26 per cent of MacKenzie Scott's grantees are creating new endowments with the billionaire's funds, and 6 other findings from new evaluation report

A growing cohort of Canadian funders are offering unrestricted gifts to boost impact and restore a more equal power dynamic between grantor and grantee. But does the practice work? Are there unintended consequences? A new report offers insights.

For $400M Community Services Recovery Fund, feds tap Canadian Red Cross, United Way Centraide Canada, and Community Foundations as national funders

Unlike many grants on offer, the federal Community Services Recovery Fund isn’t focused on supporting new programs and services, but rather provides a much-needed injection of cash to support organizational capacity building and innovation. The organizations tapped to distribute the funds have power over who accesses support.

Ivey Foundation to ‘spend down’ $100M endowment focusing on economy-based climate solutions. Decision offers big opportunity, but also risk of 'drowning out' other approaches.

The climate crisis is urgent and the Canadian philanthropic ecosystem has billions in capital that can help. Choosing to spend down offers the Ivey foundation the chance to dramatically accelerate the environmental sector’s work to ensure a liveable future. It also gives the foundation the power to pick winners within the environmental movement, shaping what narratives are dominant and whose voices are heard loudest.

Does an ‘extraordinary’ half-billion dollar donation offer new potential for affordable housing in Winnipeg?

The Winnipeg Foundation, Canada’s largest community foundation, just announced they have been gifted one of Winnipeg’s largest apartment rental companies. How they choose to steward this asset could impact Winnipeg’s housing market in the coming years.

Campbellford/Seymour Community Foundation suspends 2023 granting to ‘protect’ endowment amidst market downturn

The financial markets have bruised many foundation’s endowments this year. So too, however, have many charities and non-profits been feeling the pinch with increased inflation and service demands. The rate at which foundations keep giving will impact how community organizations are able to support their communities.

Disbursement quota hike to 5 per cent given royal assent, now law

The disbursement quota governs the amount of money foundations must spend on charitable activities and flow to communities each year. The raise in the rate will mean more money for community service organizations moving forward.

CRA guidance on non-qualified donees a ‘good first draft’ but leaders are pushing for several big changes before government finalizes policy

For more than a decade, non-profits and grassroots groups have been stymied by CRA policy that has prevented them from getting grants from foundations. After a sustained advocacy campaign, that’s on the cusp of changing.

It’s 2023. Are you still using a ‘lip service’ land acknowledgement? There’s a better way — and a new Indigenous-led fundraising school is here to help.

Indigenous people are donors, volunteers, partners and beneficiaries in the charitable sector. Non-Indigenous teams need to be well-equipped to respectfully engage with Indigenous people in all of these roles. It’s both basic respect, and it’s mission-critical for modern charitable organizations’ funding models.

Benevity cuts 14% of workforce: A ‘canary in the coal mine’ for corporate charitable giving?

Benevity offers one of the country’s most-used giving platforms among large companies. Experts say the cuts could signal a forthcoming decline in corporate donations from some industries; and some worry the company’s layoffs could worsen customer service for charities and non-profits who receive donations through Benevity’s platform.

Meet the BC funder who’ll pay you for time you spend applying for a grant

Social purpose organizations spend thousands of hours each year applying for grants. A new practice — of grantmakers compensating for that time — could help to soften the financial impact of unsuccessful grant applications and could help increase the number of grant applications from organizations with limited fundraising capacity.

After long wait, federal government announces roster for 7-member Social Innovation Advisory Council

The seven-member Social Innovation Advisory Council will provide advice to the federal government on the implementation of its social innovation and social finance strategy, including the long-awaited $755 million Social Finance Fund.

Black Opportunity Fund calls for ‘an immediate stay’ of announcement of Black-led endowment fund RFP winner, citing concerns with process transparency

The federal government says they will soon announce the winner of a procurement process to select the steward of a $200 million endowment fund for Black communities. One proponent, the Black Opportunity Fund, says the process used to select the winning proponent, however, lacked due diligence and transparency, undermining the credibility of whichever organization is selected.

Federal government taps Foundation for Black Communities to manage $200M Black-led philanthropic endowment fund

The Foundation for Black Communities will be responsible for managing a $200 million philanthropic endowment in support of Black communities in Canada over the next decade and beyond. How they choose to invest, steward, and distribute the fund will have significant impacts for Black-led philanthropy and Black communities in Canada.

New $1.5M fund aims to give trans organizations a boost and spur additional capital to an under-resourced sector

Trans communities are facing increasing hate and have few options for institutional funding. A new $1.5 million fund aims to give trans-serving organizations a much-needed injection of capital and catalyze additional philanthropic investment in this sector.

How Greta Thunberg helped one Quebec foundation get hooked on funding social movements

Foundations have finite resources and big social policy objectives. A new report from the Broadbent Institute argues funders can make bigger strides on their social policy goals by funding social movements than they can through lobbying or research alone.

Enchanté Network pitches federal government to scope endowment fund for 2SLGBTQI+ organizations — who are “at risk of closing their doors”

Data from charity donation platform CanadaHelps shows LGBTQ charities received just 0.3 per cent of all donations on the platform in 2021.

Full transcript: Interview with Sharmila Khare, CRA’s Director General of the Charities Directorate

CRA’s Charities Directorate is, perhaps, the closest thing the charitable sector has to a “home in government” at the federal level. How the team handles key policy files — like boosting the disbursement quota rate and collecting new data on Donor Advised Funds — will affect the sector for years to come.

Interview: CRA’s Director General of charities says Non-Qualified Donee policy a key priority and Donor Advised Fund data changes coming this fall

CRA’s Charities Directorate is, perhaps, the closest thing the charitable sector has to a “home in government” at the federal level. How the team handles key policy files — like boosting the disbursement quota rate and collecting new data on Donor Advised Funds — will affect the sector for years to come.

New CanadaHelps report shows charitable sector at a ‘tipping point,’ facing inflation, staff burnout, lower volunteerism

As a result of inflation and ongoing pandemic-related struggles, more Canadians are turning to Canada’s network of 86,000 charities for support. But for some organizations, a quadruple whammy of high staff burnout, fewer volunteers, higher cost of goods and services, and lower donations, is making it tough to keep up with the pace of the need.

Full data: In 2020, which charities got the most donor advised fund grants from the country’s largest DAF foundations?

Donation patterns are changing. Affluent Canadians are increasingly giving through donor advised funds. Which organizations DAF holders are choosing to give to will influence which charities have the necessary funds to fulfill their objectives.

Analysis: Canada’s banks are outpacing community foundations in launching new donor advised funds. What does it mean for your charity and for the philanthropic sector?

Donation patterns are changing. Affluent Canadians, whose gifts form a growing share of the overall charitable pie, are increasingly giving through donor advised funds affiliated with banks and wealth management firms.

Investigation: Ontario Trillium Foundation ‘muzzled’ charities with changes to advocacy policy

The Ontario Trillium Foundation is one of the province’s — and the country’s — largest funders. Any indication the foundation disapproves of grantees engaging in advocacy, one expert says, could have a ripple effect, “chilling” advocacy among charitable organizations across the province.

1 in 5 charities received a grant from a donor advised fund in 2021, and 7 other major findings from a new landscape report

Gifts from affluent donors comprise a growing share of the total donations flowing to Canadian charities; and an increasing share of these wealthy donors are choosing to give through donor advised funds. This sea change has implications for fundraisers.

Come for the heat pump, stay for the (climate justice) revolution? A bold bet on a new kind of advocacy-focused business model

In Canada, many advocacy organizations struggle to raise the funds and grow their base to the scale where they can affect lasting policy change. Could it be because of a flaw in the traditional advocacy business model?

Non-qualified donees reap rewards after hard fought battle for regulatory change

Last June, the federal government changed the law allowing foundations across Canada to grant directly to non-charities. But are they doing it?

Exclusive: Dozens of grassroots groups cut off from funding after Ontario Trillium Foundation repealed ‘shared platform’ policy

Recent changes in federal law have made it easier for foundations to grant to grassroots organizations. But some Ontario charities say policy changes made by the Ontario Trillium Foundation in 2020 move the province in the opposite direction, making it tougher for grassroots groups to access funds.

UK’s Lankelly Chase foundation to wind down, redistribute $236M within 5 years

In Canada and abroad, philanthropic activists have called on foundations to redistribute their assets to equity-seeking groups through asset transfers and spend downs. Lankelly Chase foundation’s announcement is one of the boldest responses yet.

McConnell commits $30M in capital transfer to Indigenous-led foundations. What's a capital transfer? And will others follow?

Black and Indigenous-led foundations have called on private foundations to transfer assets to them — to put them in charge of distributing resources to their own communities. But have funders been heeding these calls?

Grassroots advocacy, charities help secure $212M in federal funding to house asylum seekers

Some charities don’t engage in advocacy believing it’s not relevant to their mission. But one expert says a recent advocacy campaign to house asylum seekers shows the big impact this work can have.

Cash crunch forces Toronto’s Artscape to list newly-built Launchpad for $22.5 million as workers seek to unionize

The COVID pandemic has been tough on many organizations that own real estate, including non-profit organizations and arts venues. Experts say Artscape’s sale may result in yet another loss of space for Toronto’s arts community.

Housing hot button: Should your foundation divest from residential REITs?

For endowed foundations, where they invest has the potential to boost their impact beyond their granting — or work at cross-purposes with it. More information would help foundations make informed decisions.

The climate crisis could break the disaster philanthropy model — what can donors do about it?

Climate-related disasters are becoming more frequent, resulting in an ever-greater need for humanitarian relief and recovery funding. But experts say the quickened pace of climate-related calamities is leading to donor fatigue and stressing the global capacity for recovery.

Ontario government abruptly ends youth funding program, leaving non-profits in lurch

Many funders have adopted trust-based philanthropy principles in recent years, working to respect grantees as equal partners, while providing clear and transparent communication. But a group of non-profits say the Ontario government and a private foundation failed to uphold this standard earlier this year — and that youth are the ones who will suffer.

This small foundation “turbocharged” its assets — but at what cost?

The growth strategies used by the Community Foundation of Orillia and Area have increased granting and improved some local charity’s investment returns. Experts are celebrating these wins, but caution there could also be downsides.

Toronto’s Centre for Social Innovation to sell Annex coworking space; cites rising interest rates, downturn in coworking revenue

Rising interest rates are making it more difficult for non-profit landlords to hang on to existing properties or create new ones, reducing the availability of commercial space for charities, non-profits and social entrepreneurs.

Number of charity donors drop for 12th straight year in Canada

The number of donors claiming a charitable tax credit has declined for more than a decade. But despite the gloom, experts say there are strategies charities can use to bring donors back.

After a banner year in 2021, Canadian giving ‘normalizes’ in 2022 — and four other findings from new federal donation data

The number of Canadian donors has declined for over a decade. But in 2022, the total amount of tax-receipted donations dropped, too. Is it part of a broader trend or just a one-year dip?

Updated charity form to deliver new investment data to Canadian government — but is it enough?

The Canada Revenue Agency has updated the T3010 form every charity must fill out annually. It will add time to the reporting process, but will it offer enough transparency?

Pressure from charities prompts feds to ease proposed tax on wealthy Canadians in Budget 2024

Canada's wealthiest make up a large share of the total donations to the charitable sector. Last year, the government proposed reducing donation tax incentives for wealthy Canadians. Many charities petitioned the government to reverse the course, fearing a drop in donations.

Boosting friendship, community events may bring back dropping donors: New report

The number of donors has declined considerably over the past decade. To make their budgets work, some charities are targeting more significant gifts from wealthy Canadians. However, new research suggests that there could be another vital way to raise revenue.

New volunteering grant program may offer surprising boost for donations: Experts

More than 65 per cent of non-profits experienced a volunteer shortage in 2022. Some experts say helping to re-engage a new cohort of helpers may also drive giving.

New toolkit aims to debunk idea that funding non-qualified donees is riskier

A hard-fought legislative change has allowed funders to grant to grassroots groups and non-profits. But without a roadmap, many may sit on the sidelines.

Canadian foundation assets up $100 billion and 5 other findings from a new landscape report

Data on the philanthropic sector is scarce. A new report aims to help fill the gap with new information on public and private foundations' granting and investments. 

How $335 million and a Wall Street-inspired funding model have raised hopes for the conservation of the Great Bear Sea

Much environmental conservation focuses on preserving land piece by piece. A new model focuses on increasing the long-term resilience of an entire region by funding it up-front.

Big donations largest driver of non-profit income growth

For more than a decade, the number of donors reporting a gift on their taxes has declined. But despite tough fundraising conditions, some organizations are continuing to grow by netting large donations.

Real estate hail mary: Centre for Social Innovation launches $10 million community bond campaign after ‘lowball’ offers

Toronto-based non-profits that own property are struggling to hang onto it amid high interest rates and inflation. Are community bonds part of the solution?