Nearly half (47%) of family foundations have assets of more than $10 million, an increase of 17% during the past 10 years. They are also spending beyond the required minimum of 5% of their corpus (71%) compared to 2020 (56%) and 2015 (55%). 

According to new data from National Center for Family Philanthropy (NCFP), in collaboration with and support from Bank of America, the number of funders with annual grantmaking greater than or equal to $1 million has grown from 23% to 36% during the past decade. 

Data in the new Trends 2025 report, shows that donors are shifting from a donor-centric mindset to a community-centric one. More donors are employing principle-based practices that incorporate accountability, equity, learning, and relationships into their governance, operations, and grantmaking. For example, donors are requiring less of their grantees, having more conversations about the origins of their wealth, and are prioritizing learning, according to the report’s authors. 

It’s not all great news. The rate at which foundations give general operating support, multiyear grants, and capacity-building grants has declined steadily since 2015. Boards primarily recruit independent board members through personal networks, which might limit their ability to reach diverse profiles and voices. Foundations communicate less than they did five years ago about giving priorities, grantmaking processes, feedback to grantees, and more. 

“Family foundations are shifting their practices, but are doing so gradually and inconsistently,” Miki Akimoto, chief impact officer at the National Center for Family Philanthropy said via a statement. “To tackle today’s complex issues such as slowing climate change, supporting a healthy democracy, and reducing economic disparities, families need to more quickly mobilize more capital in ways that truly meet the needs of communities.” 

Trends 2025 builds on previous national benchmark surveys of family foundations conducted by NCFP in 2015 and 2020. The study reflects data from a sample of more than 500 family foundations regarding family foundation governance, management, grantmaking, and more. 

“Family foundation leaders must make countless decisions at many different inflection points during the lifetime of their philanthropy,” National Center for Family Philanthropy President and CEO Nick Tedesco said via a statement. “Trends 2025 provides information that can help donors make leading-edge and data-driven decisions in ways that center the needs of their grantee partners and community members.” 

Many more foundations have decided to limit the lifespan of their philanthropy (from 9% of foundations in 2015 to 13% in 2025), or to periodically revisit the question of whether to operate in perpetuity (from 20% to 26%). The proportion of foundations operating in perpetuity has remained constant across the decade at just under three in 10, the data shows. 

There has been a decline in impact investing. Despite a rise in the 2020 figures (28%), philanthropies undertaking impact investing have returned to 2015 levels (19%). 

For the most part, families are not reporting divisions among generations. However, families do report shifts in generational dynamics that affect the philanthropy. The data shows that 35% of respondents report that younger generations have less time for their family’s philanthropy. 

One-quarter of respondents report that the cohesiveness of the philanthropy has been eroded by younger generations moving away from the primary geographical location. There is also an increase in the number of foundations reporting generational conflicts over wealth (this has doubled to 12%), social/political/religious view (doubled to 16%), and racial equity (which has almost tripled to 11%). 

The full report is available at https://www.ncfp.org/trends-2025-release/

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Source From Non Profit Times