Many Foundations Unsure Whether to Return to Tightened Restrictions on Grants Post-Pandemic

Most foundations say they’ve responded to the Covid-19 crisis by being more flexible and responsive with their grantees, though it remains an open question how many will continue those practices after the pandemic recedes, according to a new report from the Center for Effective Philanthropy.

The report, drawn from surveys of 236 foundations, found that 92 percent had loosened or eliminated restrictions on existing grants, 90 percent had reduced what they asked of their grantees, and 80 percent had made new grants as unrestricted as possible.

For many foundations, these were new grant-making tactics. Only 32 percent said they were already loosening restrictions on existing grants before the pandemic, 35 percent said they reduced what is asked of grantees before the pandemic, and 37 percent said they made new grants as unrestricted as possible before the pandemic.

Fifty-six percent of the foundations that made one of these changes to their practices since the start of the pandemic said the changes would be permanent, 32 percent said they were undecided, and 13 percent said the changes were not permanent.

Ellie Buteau, vice president for research at the Center for Effective Philanthropy, said the number of undecided foundations was unexpected, and more research is needed to understand what’s behind it.

“We were kind of surprised by how many foundations chose that option,” said Buteau. “They were able to make these changes pretty quickly. If they’re not sure if they’re going to keep them, what would help them make that decision? We don’t have that data.”

Seventy-five percent of foundations reported increasing their unrestricted funding compared with pre-pandemic times.

The report is the third in a three-part series from the Center for Effective Philanthropy examining how foundations have responded to the pandemic, focusing on the Council on Foundation’s “Call to Action Pledge” that pushed foundations to loosen up their grant making practices during the pandemic. More than 800 foundations have signed on to the pledge.