Key Term

What is Trust-Based Philanthropy?

Definition

Trust-based philanthropy is a grantmaking approach that emphasizes building authentic relationships between funders and nonprofits, characterized by mutual trust, open dialogue, and reduced administrative burdens. This philosophy moves away from traditional, restrictive funding models and instead provides unrestricted, multi-year funding while simplifying application and reporting requirements, acknowledging the expertise and leadership of nonprofit organizations.

Significance

Trust-based philanthropy represents a transformative shift in how charitable giving is conducted, addressing long-standing power imbalances in the philanthropic sector. By reducing bureaucratic overhead and empowering nonprofits with greater autonomy, organizations can focus more resources on their mission rather than grant compliance. This approach typically leads to more effective outcomes, stronger partnerships, and increased innovation in addressing social challenges. It also helps break down traditional barriers that often disadvantage smaller, grassroots organizations and those led by historically marginalized communities, ultimately creating a more equitable and effective charitable giving ecosystem.