What does research say?
At givingXchange, we understand the crucial role that racial equity plays in philanthropy and social change. Echoing Green and The Bridgespan Group's research in 2020 highlights two fundamental challenges in philanthropy that are deeply intertwined with race. Firstly, there's a critical need for philanthropists to grasp the role of race in the societal problems they aim to address. Secondly, the significance of race in how philanthropists identify leaders and formulate solutions is paramount. The research reveals that without applying a racial equity lens, philanthropic efforts often fail to address the core of social issues, particularly affecting the most marginalized groups. Racial inequity is ingrained in philanthropic norms, suggesting that a profound understanding of racial dynamics is essential for effective solutions and equitable outcomes. This understanding becomes particularly relevant when funding leaders of color, who often possess intimate knowledge of the racialized experiences faced by communities of color. However, trends continue to show a disparity and widening giving gap.
Further analysis of an Echoing Green’s applicant pool, comprising some of the most promising early-stage organizations, revealed that black-led organizations have significantly lower revenues and unrestricted net assets compared to their white-led counterparts. This disparity is stark, with black-led organizations having 24% smaller revenues and 76% smaller unrestricted net assets. These numbers are even more pronounced in specialized areas like the Black Male Achievement fellowship, where black-led organizations have 45% smaller revenues and 91% smaller unrestricted net assets than white-led organizations, despite working towards the same goals.
These findings underscore a critical gap in philanthropy with racial disparities persisting across various dimensions, including but not limited to leader race and education levels.
At givingXchange, we are committed to addressing these inequities and fostering a philanthropic environment where race is a central consideration while using innovative technology to drive effective and equitable social change.