4 min read
Aotearoa New Zealand has escaped the worst impacts of the COVID-19 pandemic. Our country has had comparatively few cases of COVID, and we have only experienced one major lockdown nationwide, although our biggest city Auckland has been more impacted by four lockdowns.
Nonetheless, philanthropic and grantmaking funders have witnessed significant change in the landscape. Our country is suffering from job losses and a lack of tourism income; Charities are dealing with more community need across the board.
A year ago, when we were in our first lockdown, philanthropic funders were taking urgent action to make things easier for the charities they support, such as:
- Considering whether to increase funding in the short term to respond immediately to the crisis, or to take a medium term approach
- Keeping a watching brief on Government activity, as its massive increase in spending impacts philanthropic activity;
- Preparing for significantly lower investment returns, which would mean less funding for charities
While the worst did not eventuate, it has been a grim 12 months for many.
Funders are still dealing with charities that are in more complex situations. Some charities have had to change their service delivery model; others have had their income sources impacted by COVID; and still others have either not been able to deliver on funded activities or struggle with high demand due to increasing community needs.
As we enter the new normal, the initial question of whether funders should fund the immediate response or take a more medium-term response has, in some ways, sorted itself out. Even though some funders are seeing higher demand for money, not all experience this. Greater government funding flowing to charities, and community groups taking time to consider their next step have been cited as reasons for the discrepancy in demand across funders.
Philanthropic funders are looking ahead as to how they can support the community when the government’s funding runs out. There are cases of charities upsizing their organisation due to increased demand and more government funding, but the funding may end abruptly.
The initial fear that the pool of philanthropic funding would be significantly reduced due to lower investment returns has not developed into its worst-case scenario. While some funders have lower returns, others have reported granting at the same level – or even at higher levels – due to investment returns holding up. There is anecdotal evidence that public giving remains strong. However, the situation is complex, and it is hard to discern the exact effect as we are still in the early days of the economic impact.
Aside from these short-term changes, COVID-19 has largely reinforced the key challenges and opportunities the funding sector faced prior to the pandemic.
The question of how to fund equitably has become even more urgent, as the pandemic’s impact is yet another example of how the most vulnerable communities are hit disproportionately hard.
COVID-19 has provided us with another reminder that funders need to listen and respond to the expertise of the community to find out their needs and the best way to meet them.
The pandemic has also highlighted the challenges to effective allocation of funds. As funders, government policies, and programmes are interdependent, deciding how to best allocate funds involves collaboration across different stakeholders, from other funders to community influencers.
It’s intensified the increasing awareness that funders need to think about how they use their capital; what their role is in advocacy; and how they can support system change – in addition to their traditional core role of distributing grant funding.
Besides the increased social need, we also face climate change problems. Many NZ funders have continued exploring how they can best contribute to climate action alongside addressing social needs.
With the increased complexity in the philanthropic landscape, now is a good time for New Zealand to hold its biennial Philanthropy Summit. Held on May 18-20, the programme focuses on the most urgent challenges and growing trends for the funding sector.
We encourage international funders to look into the online programme, as it covers global issues while deep diving into the unique Aotearoa New Zealand landscape. As it might be the only time this major event is held online, this year could be the best chance for a global audience to participate in this inspiring, challenging, and practical event. People can participate live or watch it later.
The Philanthropy Summit 2021 is an opportunity to exchange knowledge and ideas, and motivate other funders in the sector. This is especially crucial now, when the world needs all the help it can get.
Register for the programme now: https://avpn.asia/event/philanthropy-summit-2021/
