By Karen Kardos
Head of Philanthropic Advisory – North America
March 30, 2020Posted InWealth Advisory
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Philanthropic initiatives of every size and variety can play a critical role in addressing the COVID-19 pandemic and its consequences.
We are living through the most serious global pandemic in just over a century. First and foremost, COVID-19 is a human tragedy, as well as an unprecedented challenge to modern healthcare systems and the wider public. However, the virus – and the necessary measures to fight it – is also having profound economic, social, and political effects. The ramifications of these are likely to persist for many months and perhaps even for years to come.
For many of us, our first instinct in the face of the pandemic was to secure our basic needs. These included the immediate safety and wellbeing of our families and loved ones, our access to food and other essentials, and our ability to meet ongoing financial and other obligations. While uncertainty remains elevated, there are encouraging signs that many have found ways to cope and have begun to shift focus to helping others. Philanthropic individuals, families, and their philanthropic entities are at the forefront of such efforts.
As an example, major philanthropists have already helped to fund vital research into the COVID-19 virus’s genome. This work seeks a better understanding of its origins, mutation, and ultimately how we might stop it. Likewise, several large foundations have committed millions of dollars in rapid response financing to improve COVID-19 diagnosis, help mitigate its spread, and accelerate the development of a vaccine. As well as donating, wealthy individuals and their family members contribute to vital decision-making as policy advocates, board members of nonprofit organizations, leading members of the community, as well as neighbors.
Of course, the present need for philanthropic assistance extends far beyond the medical domain. Providing relief to people in hardship – including help with food, clothing, warmth, and shelter – is just one example of this. Such relief is often provided by nonprofit organizations. However, not only has COVID-19 vastly increased the number of people potentially in need of help, but it has also hindered the ability to deliver it. Key measures to help prevent the virus’s spread – including social distancing and lockdowns – are serious obstacles to many nonprofit organizations’ day-to-day operations.
In this environment, some nonprofit organizations are struggling to provide services for their underserved beneficiary populations. Even before the COVID-19 crisis, many nonprofits’ budgets were thinly stretched. Their leaders are now facing difficult questions, such as what assistance they might have to cease providing or whether they need to end operations all together. However, a consortium of some three dozen foundations that support nonprofits has started putting forward possible solutions.
To maximize their ability to help, these foundations are relaxing their usual restrictions on their support. One aim of this is to help nonprofits remain financially viable, so that they can continue providing services. For example, foundations have lifted the restrictions on grant funds to allow nonprofits to use the funds received as needed to sustain operations, instead of insisting they be spent on more specific outcomes. They have accelerated instalment payments to add to nonprofits’ ready resources. They have also issued additional general operating support grants, which allow nonprofits to use the funds to sustain operations in an effort to keep them up and running.
As well as seeking to assist nonprofits’ financial position, foundations are also trying to reduce other pressures on these entities. For example, they have eased the requirement for nonprofits to report back on how they’ve spent the programmatic support received. The aim here is to free up time so that nonprofits can focus on their core activities. Foundations are also exploring contributions to community-based response funds that seek to improve the health and wellbeing of those affected most in the current crisis, even where this may not be part of the foundation’s stated mission. It is hoped that the example that such foundations are setting will inspire others to follow suit.
Foundations are not the only major source of funding and assistance for nonprofits. Individual donors also play a major supporting role. Individual donors can a support national and international rapid relief funds. These types of funds are set up to respond to COVID-19 and are managed by experts who understand the pandemic and the needs arising from the crisis. For those that grant through their donor-advised funds, many of those organizations are providing information on national and local efforts. Local community foundations are a wealth of knowledge about nonprofit partners working at the local level that are supporting elderly, homeless, and those considered high-risk.
It is important to remember that philanthropy is ultimately about much more than sharing the fruits of success with others. It is also about sharing time and talent. We have heard countless inspiring accounts of the heroism of individuals, the dedication of our healthcare workers and first responders, and acts of people showing kindness and compassion in this difficult time. This includes taking care of those in our vicinity. We may not always be able to reach out literally to our elderly or high-risk neighbors. But we can make an effort, while maintaining social distance, to ensure they have food and other essentials. We can shop, not hoard, and abide by our local, state and federal mandates.
As the COVID-19 pandemic unfolds, philanthropy and philanthropists of all sizes and varieties have a vital role to play. Giving and serving together, we strengthen our society.