Exponent Philanthropy’s 2022 Foundation Operations and Management Report (FOMR) continues to offer mission-critical statistics about member foundations’ boards and governance, investments, administration (including salary and benefits), and grantmaking. Thank you to the 400+ members who participated in the 2021 survey informing this report.
Below are some of its interesting and exciting findings. However, we encourage reviewing the report in full. As always, please reach out if you have questions about the results or data.
COVID-19 grantmaking in 2020
This year’s FOMR includes information on how lean funders responded to the coronavirus pandemic, a first for the report. For example, 99% of lean funders made some change to their giving; and just over 40% gave more in response to COVID.
Race equity in lean foundations
In this report, a greater percentage of lean funders identified racial equity as very relevant to their mission. In addition, more than two-thirds of Exponent Philanthropy members considered racial equity somewhat or very relevant to their foundation’s mission.
We continue to see strong correlations between good grantmaking and governance practices, and the relevance of racial equity. Some highlights include:
- CEOs whose foundations considered racial equity very relevant to their mission spent significantly more time on community engagement than those that did not.
- The most engaged board members of the foundations who said racial equity was very relevant to their mission spent more time on community engagement and generative work compared to board members of foundations that said racial equity was only somewhat or not relevant to their work.
- Foundations that rated racial equity as very relevant to their mission had more formal written policies than the foundations that rated racial equity as less relevant to their mission.
The intentional inclusion of diverse perspectives leads to better decision making, more equitable outcomes, and a greater philanthropic impact. That being said, lean foundation boards and staff are still overwhelmingly white, and the uptake of racial equity best practices is still relatively low.
Want to learn more about racial equity in philanthropy?
Mind the Gap
Exploring Racial Equity in Lean Foundations
While a growing number of lean funders are focusing on racial equity, their boards and staff are still overwhelmingly white. Lean funders who want to be allies in the movement for racial equity should first look inward. Learn more >>
Investment returns and mission investing
Participating foundations continued seeing strong investment returns. They reported mean net investment returns of 12.3% and median returns of 11.0%. Organizations with more aggressive investment strategies had higher net investment returns than those with more moderate or conservative strategies.
What’s more, we found that funders who engaged in mission investing earned, on average, the same rates of return as funders who did not. For the past several years, the percentage of foundations engaging in mission investing has remained low—less than 20%. However, members say that one of their biggest challenges with mission investing is the foundation’s belief that it will not earn the same level of returns.
We hope these findings help move more funders towards engaging in mission investing.
2022 Foundation Operations and Management Report
The Premier Benchmarking Resource for Lean Foundations
This unique benchmarking tool offers powerful insight into the grantmaking and operations of small-staffed foundations in the United States. Download >>
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About the Author
Brendan McCormick is associate director of research and publications at Exponent Philanthropy where he works with staff, members and partners to develop research and resources that relate to foundation impact and evaluation, and foundation investments. He also leads the organization’s efforts to learn more about its community of lean funders.