COVID-19 & the non-profit sector: how can philanthropists help?

While the pandemic's exact effects on people and the non-profits who come to their support vary greatly, forward-looking philanthropic funders now have four action steps to consider:

1. Establish the point of departure. The simplest way to achieve this is by convening an extraordinary board meeting to quantify whether the foundation can keep its staff safe and continue to fulfil its mission; assess how the pandemic has affected finances and liquidity and the implications for future budgets; look at the effect of the pandemic on grantees and partners; examine how the foundation responds to restrictions on its goals and whether emergency grants should be given out.
    
2. Design your emergency response. Examine how other foundations have reacted. In the case of Foundation Lombard Odier, a rapid response was enacted to respond to the most pressing needs in areas where the foundation had a physical presence, drawing on local partnerships and focusing on donations, which would have an immediate impact.

3. Take part in supporting the recovery. Once the emergency has passed, the attention will shift to ensuring that non-profit organisations are able to support populations in need during the recovery phase. Philanthropic resources are scarce when compared to the magnitude of the problems they seek to address, and therefore need to be directed wisely. Adopt a method where the funder and foundation have the greatest potential to make a difference.
    
4. Boost grantee resilience. It is worth asking how a funder can best boost the resilience of the non-profits they fund. Non-profits go through phases of stable development and step change. In the context of COVID, it matters quite a bit whether a grantee was already in the middle of such a step change, or in a phase of relative stability.

Philanthropists can be most helpful by both offering support during the initial emergency phase, as well as reserving some of their support for targeted initiatives in the recovery and rebuilding phases. This is how we can build back better.

Examples of blueprints for impact

Looking at how peers are going about their response can serve as a valuable source of inspiration. The questions that need to be answered are how should beneficiaries be communicated with; how much funding out of a budget should be aimed at COVID relief; how should funds be deployed and what new solutions should be looked at?

Many foundations have created inspiring, practical responses to the pandemic, including:

• In Basel, Switzerland, Fondation Botnar philanthropically invests in emerging solutions to build a better future for children and young people globally. In March 2020, the Foundation responded 16 days after the World Health Organisation declared COVID-19 a pandemic, committing CHF 20 million to global research efforts.
• The Christoph Merian Stiftung, also in Basel, put together an instant relief effort, committing a total of CHF 1.45 million for the poor, and social and cultural organisations, especially those who cannot find funding elsewhere.
• The Paul Hamlyn Foundation, based in the UK is giving GBP 10,000 each to over 100 artists.
• The Geneva-based Fondation d'Harcourt funds mental health and psychosocial support and organised a call for proposals to identify new, high-impact projects.
• The Rockefeller Foundation identified testing and contact tracing as a way to help overcome the crisis and convened experts and leaders to create a practical, data-driven, actionable plan to overcome COVID-19 in America.

Your thoughtful, effective, and ambitious philanthropy is now more important than it has been for several generations. The Charities Aid Foundation found that after the 2008 financial crisis, individual giving in the UK fell by 11 percent. The fallout from the coronavirus is likely to be even worse so we must continue to collaborate and donate, even in these unprecedented times. Our Fondation Lombard Odier has also set up a COVID-19 Relief Initiative to continue to support vulnerable populations.

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This document is issued by Bank Lombard Odier & Co Ltd or an entity of the Group (hereinafter “Lombard Odier”). It is not intended for distribution, publication, or use in any jurisdiction where such distribution, publication, or use would be unlawful, nor is it aimed at any person or entity to whom it would be unlawful to address such a document. This document was not prepared by the Financial Research Department of Lombard Odier.

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