Pledges will not change racial economic and wealth inequities: Nonprofit Executives of Color Can’t Afford to Wait

By: Lillian D. Singh and Ebony P. White, Prosperity Now

Corporate America has pledged billions to advance social justice since the killing of George Floyd. Some businesses have gone further, committing to concrete changes in their diversity, equity and inclusion practices. Philanthropy has committed millions in support of nonprofits globally and domestically aimed at promoting racial equity. Funder collaboratives have emerged across the country, namely Funders Organized for Rights in the Global Economy (FORGE) and California Black Freedom Fund. In addition, global challenges such as the Kellogg Foundation’s racialequity2030 have been created to address racial equity.

Many aim to build the power of workers and communities, civil society organizations, workers’ rights groups and social movements. They are working with vulnerable populations, children, families and communities to close the racial wealth divide. There is widespread acknowledgment that we must advance systemic efforts to shift the economy to help drive meaningful change for communities of color.

Advocates in the social justice movement are watching corporate America, businesses, equity investors, philanthropy and funder collaboratives as they decide who, what and where to invest. Will those working furthest from justice but closest to the brokenness of our systems and inequities be engaged? Or will they find themselves still needing to validate the viability of their methods because they are too risky for funders to be considered “investable”?

The good news is that decision-makers have more tools at their disposal than ever before. The real question is whether there is a political will to operationalize practices to reduce racial wealth inequity and advance racial wealth solutions developed by the community.

We offer a racial wealth equity-focused approach, from more than five years of learnings, through the Building High Impact Nonprofits of Color Initiative (BHINC), as another method for consideration. BHINC is a national initiative to address the racial wealth divide. Initially piloted in 2016 with 10 organizations in two cities, the Initiative expanded to eight cities and now boasts a national network of 46 nonprofits and more than 90 nonprofit leaders of color. To address the national challenge of bridging a broad and deep racial wealth divide, BHINC empowers participating nonprofit executives through a collaborative growth process of education, development and support. This is accomplished through three fundamental program strategies: (1) Leadership and organizational development, provided by consultants of color and those who work through a race-conscious lens; (2) Racial economic equity training, rooted in current local data; and (3) Leveraging of national and in-city networks for organizational growth.

BHINC is designed with an acute awareness of the systemic and institutional challenges, some implicit and others explicit, that nonprofit executives of color encounter. BHINC addresses three well-researched advert challenges:

• The Racial Organizational Capacity Gap: Disproportionately, nonprofit leaders of color are forced into a vicious cycle of attending capacity-building trainings but then receiving smaller grants as a precondition for more desirable, multi-year, unrestricted dollars.
• The Racial Leadership Gap: Systemic biases and barriers — not individual deficits — limit opportunity, access and advancement for leaders of color who aspire to executive leadership roles.
• The Racial Funding Gap: Over the last 20 years, only 10% of philanthropic dollars have gone to organizations led by people of color, despite giving increasing nearly 400% over the same period.

The Initiative’s findings elevate the current moment’s potential to directly address some of the historical practices and problematic trends that perpetuate deep and persistent economic and racial disparities that carry devastating consequences for communities of color. Our work is a proof of concept that organizations of color are assumed to lack both individual and organizational capacities, which is often used as justification to avoid investing in them. The truth is nonprofit executives that reflect their constituents’ racial and ethnic diversity are, more often than not, better positioned to serve communities of color, given their connection and understanding of the economic realities on the ground. Nonprofit leaders of color have comparable education levels as majority-led leaders and have been working, sometimes for decades, to build their base of people, knowledge and legitimacy. Finally, social networks restrict access for executives of color, allowing majority-led leaders of organizations to consolidate further their relationships with decision-makers who are disproportionately White.

The potential of the current moment can lead to meaningful, systemic change in communities and stop the cycles of inequality. No more excuses. It’s time to see the imminent value in investing and partnering with nonprofit executives of color to bring economic growth and revitalization to the communities in which they serve. What else must they prove?

Prosperity Now believes that everyone deserves a chance to prosper. Since 1979, we have helped millions of people, especially people of color and those of limited incomes, to achieve financial security, stability, and, ultimately, prosperity. We offer a unique combination of practical solutions, in-depth research and proven strategies, all aimed at building wealth for those who need it most. We recognize the devastating impact of the racial wealth divide on people and our economy, and we strive to equip organizations of color and others with the capacity, tools, and cultural competency necessary to address structural and systemic barriers facing families of color. Gary Cunningham is our President and CEO.