Social Justice Philanthropy and the Current Economic Downturn

Social Justice Philanthropy and the Current Economic Downturn

September 10, 2012 | Michael Magnaye, Development Director, NCCD

Funding for the nonprofit sector experienced slight increases over the last couple of years, although not at the levels we have experienced in the years before the economic downturn. A Giving USA study indicates that $298.4 billion dollars was raised for nonprofits in 2011—an increase of 0.9% over 2010.

Funding for the nonprofit sector experienced slight increases over the last couple of years, although not at the levels we have experienced in the years before the economic downturn. A Giving USA study indicates that $298.4 billion dollars was raised for nonprofits in 2011—an increase of 0.9% over 2010.

Despite the slight increase in overall giving, foundation grants for social justice organizations continue to diminish and may continue to do so until 2015. In November 2011, the Foundation Center released a report indicating that many social justice funders have seen decreasing levels of grant making since the financial crisis of 2008. This “small but important subset of grant makers has been disproportionately impacted by the global financial crisis and their recovery remains in jeopardy.” This decrease impacts programs, policy changes, and movements in the social justice arena, ranging from civil liberties to environmental law, from poverty eradication to prison reform.

Check out the full report here: Diminishing Dollars: The Impact of the 2008 Financial Crisis on the Field of Social Justice Philanthropy

Of the social justice grants slice of the philanthropic pie, an even smaller sliver is granted to criminal and juvenile justice work. According to a recent study of the Criminal Justice Funders Network, philanthropic investment directed toward issues of crime, justice, and legal services is less than 1% of the overall philanthropic dollars distributed.

For example, in 2008, giving to crime and justice totaled $218 million compared to giving to arts and culture, which totaled $3.1 billion, or giving to public affairs, which totaled $2.4 billion.

Many foundations will continue to fund their current grantees, but at decreased levels. Funders will also refrain from seeking out new nonprofit organizations with no prior funding relationships.

Meanwhile, the need will increase, and nonprofits will have to work harder at raising more money. We will need to diversify our sources of income and augment revenue from government and foundation grants. Nonprofit organizations will need to seek out more individual donors—the checkbook activists who care deeply about social justice and their communities.

Next: Social Justice Fundraising From Individuals

Michael Magnaye is the Development Director at NCCD.