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Social Impact & Philanthropy
Redefining Role: How Foundations Are Clarifying What They Are Supposed to Be in the Systems They’re Trying to Change
By: Damidera David-Olusa
For decades, the model focused on identifying social needs, funding expert organizations, and measuring outputs. This approach is now breaking down. Communities are asserting their own solutions, governments are crafting policy with or without philanthropic input, and public trust in large institutions is declining. This creates strategic ambiguity, evident in inconsistent engagement with grantees, unclear decision rights, and tension across governance and management. The question is no longer whether foundations are doing enough, but whether they are doing the right things in the right role.
The Roots of the Role Ambiguity
The environment in which philanthropy operates has materially changed over the past decade. The landscape of actors has diversified: social enterprises, impact investors, corporate sustainability ventures, and grassroots movements now operate in spaces once dominated by nonprofits funded by philanthropy. Power is shifting toward communities and local institutions, creating demand for locally led solutions. Societal problems have become more interconnected, requiring cross-sectoral, policy-driven action where grantmaking is one tool among many. Private sector participation in social outcomes has increased, though coordination remains uneven, further complicating roles and expectations.
These changes have rendered the traditional “benefactor” model insufficient. Foundations have expanded activities beyond funding, often incrementally and in response to opportunities or crises rather than through deliberate role definition.
Operating across multiple roles without explicit decisions creates gaps, even when intent and resources are strong. Leadership must now deploy capital, influence, and convening power intentionally, responding to boards seeking clearer impact links, partners requiring defined decision rights, and communities expecting consistency.
Three forces blurring foundations’ roles
1. Expectations have expanded faster than mandates
Foundations historically gained legitimacy as funders, relying on resource allocation, independence, and a long-term perspective. Today, they are expected to coordinate ecosystems, accelerate innovation, influence policy, and support organizational capacity. Many have not updated mandates, governance, or operating assumptions, leaving staff to interpret their role in each situation. Without an explicit view, foundations risk oscillating between passivity and overreach.
2. Misalignment between authority and responsibility
Institutions often take responsibility for outcomes they do not directly control. They fund initiatives, convene coalitions, and set agendas, but rely on partners for execution. Some respond by becoming more directive; others retreat. Both reflect unclear boundaries between influence and control.
3. Ambiguity about system stewardship
Few entities define what system stewardship entails, setting direction, maintaining coordination, resolving trade-offs, or sustaining momentum. As a result, initiatives often lack ownership. Convenings produce alignment in principle but not execution. Pilot projects proliferate without clear pathways to scale. Assuming systems self-organize without aligned incentives creates gaps in coordination.
Implications for foundation leadership and governance
These tensions translate into real consequences for boards, executives, and partners
- Boards: Unclear roles complicate oversight, especially when success depends on informal influence rather than defined responsibilities. Strategic discussions become reactive rather than guided by internal coherence.
- Executives: Ambiguity slows decision-making and diffuses focus. Staffing, partnerships, and risk decisions are handled case by case.
- Partners and grantees: Inconsistency creates uncertainty, making planning difficult and weakening trust when foundations alternate between hands-off funding and active direction without clear guidance.
Over time, these dynamics reduce the effectiveness of philanthropic efforts, even when resources are substantial.
Strategic questions leadership can no longer defer
Addressing role confusion does not require a wholesale reinvention of philanthropy. It requires disciplined reflection and alignment. Senior leaders should consider a small number of foundational questions:
- In which contexts do we intend to lead, and in which do we intend to enable?
- What decisions are we prepared to influence, and which do we explicitly leave to partners?
- How do our governance structures support or constrain the role we are playing?
- Where are we taking responsibility for outcomes without corresponding authority?
- How do our partners understand our role, and where does that differ from our own view?
These questions are strategic, not rhetorical. Answering them requires engagement across boards, management, and key stakeholders.
Steps foundations are taking to restore organizational coherence
Institutions making progress treat role clarity as an organizational design challenge rather than a communications exercise or one-time strategy decision. In practice, this approach is reflected in five areas.
Portfolio-Level Role Definition
Rather than assuming a single posture across all activities, leading foundations explicitly determine where they will lead, enable, or fund, clarifying primary and secondary roles to avoid diluted focus and mismatched expectations. These decisions are made at the portfolio level, reflecting differences in system maturity, partner capacity, and risk tolerance.
Governance Alignment
Role clarity is reinforced through governance structures. Boards and committees determine which decisions require oversight, which are delegated to management, and which fall outside the foundation’s remit. Management teams align incentives, performance metrics, and escalation paths with the chosen mode of engagement, whether directive, participatory, or responsive, to ensure consistency and maintain trust.
Partnership Calibration
Existing partnerships are reviewed not only for performance, but for alignment with the foundation’s intended role. This includes clarifying decision rights, responsibilities, and boundaries. In some cases, this results in adjustments to engagement models or disengagement from partnerships the foundation is not positioned to sustain.
Building Internal Capability
Clear role choices place new demands on staff. Foundations strengthen capabilities in areas such as system analysis, stakeholder coordination, and adaptive governance, often accompanied by changes in team structure and decision processes.
Dynamic Role Iteration.
Role definition is treated as a dynamic choice rather than a fixed stance. Periodic reviews help ensure roles remain appropriate as systems mature, partners change, and external conditions shift.
These steps do not eliminate complexity, but they materially reduce friction and improve strategic consistency across the organization.
Clarity of role will separate effective foundations from the rest
Philanthropy operates in systems that are becoming more demanding, not less. As expectations continue to expand, foundations that do not define their role risk being pulled in multiple directions, with diminishing returns.
The question is no longer whether foundations should engage deeply in the systems they seek to change. Many already do. The question is whether they will do so deliberately, with clarity about their role, or continue to rely on implicit assumptions that no longer hold.
Foundations that address this issue directly will be better positioned to align resources, partners, and governance around sustained impact. Those that do not may find that despite increased activity, their influence continues to diffuse rather than compound.
