A supportive and complementary approach to fiscal sponsorship: A commentary by E. Bomani Johnson

In 2017, the Philanthropic Initiative for Racial Equity, in partnership with Race Forward and the Foundation Center, published an infographic showing that, despite population increases, annual foundation funding focused on people of color never exceeded 8.5 percent of total grantmaking between 2005 and 2014. In 2014, foundation grantmaking for people of color only accounted for 7.4 percent. During the same 10-year period, grantmaking targeted to African Americans as a percentage of giving to people of color declined from a high point of 21.8 percent in 2005 to 17.5 percent in 2014. Despite the long track record of Black-led organizations spearheading some of the most transformational culture shifts in our nation’s history, the data show that they are egregiously underfunded.

Among the many things the data reveal about the relationship between Black-led organizations and philanthropy, one thing in particular is very clear: Black-led organizations are not trusted to devise and direct their own healing.

Institutional philanthropy has long relied on the use of fiscal sponsors in awarding grants to smaller organizations regardless of their IRS status, or to groups that do not hold an IRS designation that would allow them to receive tax- or penalty-free grant funding. At Nafasi Fund, our major role as a fiscal sponsor is to provide smaller nonprofits or entities without an IRS-sanctioned designation with the financial management, legal, and administrative backing to make them “less risky” investments for individual donors, public funding sources, and private philanthropy. Given the historical and contemporary manifestations of white supremacy in the field of philanthropy and the numerous efforts to advance racial equity and racial justice to eliminate harmful policies and practices within the field, we need to take a new, supportive, and complementary approach to fiscal sponsorship. So we asked ourselves: What if our fiscal sponsorship approach was intentionally culturally restorative, instead of unintentionally harmful and extractive?...

Read the full commentary by E. Bomani Johnson, executive director of Nafasi Fund.

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