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Open Philanthropy: Maximising the impact of philanthropy

By Michelle Man 19 February 2021

Philanthropy is weak and fragmented. Business as usual is no longer an option.

In the face of increasingly complex global challenges, individual actors lack the resource to tackle the scale and scope of urgent problems. Closed practices drive a lack of information in the field. Individualism undermines coordination. And these dynamics in philanthropy drive competition between charities. There is growing recognition that philanthropy arises from inequality, funding practices can reinforce inequities, and philanthropists can be a key part of the problems they exist to solve.

As problems grow in complexity, scale and uncertainty, the need for effective philanthropy has never been greater. So what needs to change?

Open philanthropy offers opportunities to maximise impact.

At NPC, we are exploring how greater openness in philanthropy can ensure that resources are deployed well, and with maximum impact.

Currently, the closed nature of philanthropy means that charities are having to guess what funders want, and how to adapt their work to tap into funder interest. For funders, this can limit scope for impact by reducing awareness of what others are doing and narrowing down insights that are crucial for decision-making. Increasing transparency and inclusion is key for creating more equitable and effective partnerships across the social sector. Greater openness can increase efficiency, by saving time and resources. It can lead to better outcomes, due to better information and insight, and more creativity and innovation. It can enable more democratic decision-making and organising. Ultimately, it offers the antidote to the inequities and power dynamics that are holding our sector back.

We are already seeing interest in elements of Open Philanthropy. This includes calls for greater transparency via initiatives such as 360Giving, and inclusion via participatory grant-making. But this is a narrow lens on openness. If we take the analogy of democracy, voting is just one mechanism for redistributing power.

NPC’s Open Philanthropy programme.

Our Open Philanthropy programme aims for grant-makers to rethink all of their activities, systems and processes, to explore how they can be made more open. It identifies opportunities for increasing transparency—visibility and sharing of information—and inclusion—involvement of people in activities—across philanthropy. It raises important questions about power and control—for example, who orchestrates or controls participation? It explores the dynamic nature of openness—rather than a binary choice between closed and open, openness is a spectrum that can fluctuate over time and differ across areas of work. We also examine the risks and challenges—such as reduced efficiency, and exacerbating inequities among participants.

Ultimately, the goal of Open Philanthropy is to power-up grant-making so that it is better informed, better coordinated, more efficient, and more equal to the task of tackling major issues and opportunities.

Our team are exploring, prototyping and testing the principles of Open Philanthropy so we can share practical insights, guidance and advice. If you’re interested in this work, we’d love to hear from you.