Trust-based philanthropy isn't new. Foundations have talked about trust, equity, and power-sharing for years. What is new is that the evidence base has grown strong enough, and the sector pressure has become intense enough, that implementation is no longer optional for foundations that want to remain relevant. The organizations closest to the communities you fund are telling you — loudly and consistently — that traditional grantmaking practices don't work. It's time to listen.
This guide isn't about whether trust-based philanthropy is the right approach. The evidence has settled that question. This is about how to do it — practically, responsibly, and in a way your board, staff, and grantees can navigate together.
distributed by MacKenzie Scott's Yield Giving since 2019 as unrestricted gifts — the largest demonstration that trust-based giving works at scale without the catastrophic misuse that traditional philanthropy fears.
Trust-Based Philanthropy: Core Principles
The Trust-Based Philanthropy Project articulates six interconnected practices that form the foundation of the approach. Understanding them as a system — not a menu of options — is essential for effective implementation.
Give Multi-Year Unrestricted Funding
Unrestricted grants allow organizations to deploy resources where they're most needed rather than where a funder's theory of change dictates. Multi-year commitments provide the stability organizations need to plan, invest in staff, and build sustainable programs rather than lurching from grant cycle to grant cycle.
Do the Homework
Foundations should invest in understanding the communities they fund rather than requiring grantees to repeatedly educate them. This means proactive landscape research, community listening, and relationship-building before soliciting applications — not after.
Simplify and Streamline Paperwork
Every hour a grantee spends on application and reporting paperwork is an hour not spent on the mission work you're funding. Simplified applications, reduced reporting, and acceptance of common formats respect grantee time and reduce barriers for smaller organizations.
Be Transparent and Responsive
Share your decision-making criteria, strategy shifts, and funding timelines openly. Respond to questions promptly. The information asymmetry between funders and grantees creates a power dynamic that transparency helps equalize.
Solicit and Act on Feedback
Create safe channels for grantees to provide honest feedback about your practices — and demonstrate that the feedback leads to change. Anonymous surveys, third-party listening sessions, and grantee advisory committees all serve this purpose.
Offer Support Beyond the Check
Technical assistance, peer learning networks, capacity building, and strategic coaching can be as valuable as the grant itself — but only when driven by what grantees actually need, not what the foundation thinks they need.
The Landscape: What Foundations Are Actually Doing
The rhetoric around trust-based philanthropy has moved faster than the practice. Surveys from 2024-2025 reveal a sector in transition — with significant gaps between aspiration and implementation.
On the positive side, the percentage of foundation grants offered as general operating support has increased meaningfully over the past five years, driven in part by the COVID-19 pandemic response and the subsequent reckoning around racial equity. More foundations are offering multi-year grants, and many have simplified their application processes. The Trust-Based Philanthropy Project reports growing membership and engagement among foundation leaders.
On the slower side, most foundations still require detailed project budgets, specific outcome metrics, and formal narrative reports. Many foundations that describe themselves as "trust-based" still cap indirect costs, restrict fund use, and require quarterly reporting. The gap between marketing language and operational reality remains wide.
Traditional Approach
- Project-specific restricted grants
- Detailed applications (15-30 pages)
- Quarterly written reports
- Funder-defined outcome metrics
- 10-15% indirect cost cap
- Annual funding cycles
- Compliance-focused site visits
Trust-Based Approach
- General operating / unrestricted grants
- Simplified applications (2-5 pages)
- Annual conversations or brief updates
- Grantee-defined success measures
- Full cost or actual indirect rate
- Multi-year commitments (3-5 years)
- Learning-focused peer convenings
Moving to Flexible and Unrestricted Funding
The shift from project-specific to unrestricted funding is the most significant operational change in trust-based philanthropy — and the one that triggers the most board anxiety. The concern is reasonable: if we don't restrict how funds are used, how do we know they'll be used well?
The answer, supported by extensive research, is that organizations closest to their communities know better than distant funders how to deploy resources effectively. Unrestricted funding doesn't mean unaccountable funding. It means the accountability shifts from "did you spend line items as approved?" to "did your organization advance its mission?"
Implementation Path: From Restricted to Flexible
Start with a pilot portfolio
Select 10-15 grantees from your existing portfolio — organizations with strong track records and established relationships. Convert their next grant cycle to unrestricted, multi-year funding. This limits risk while generating evidence for broader adoption.
Redesign the application process
Replace the 20-page project proposal with a 2-3 page organizational overview: mission, key activities, current challenges, how unrestricted funding would be used, and a brief financial summary. This reduces applicant burden by 70-80% and shifts the conversation from project logistics to organizational health.
Establish relationship-based accountability
Replace formal reporting with annual check-in conversations — either by phone or in person. Use a simple framework: What's going well? What challenges are you facing? How did you use the funding? What would help you most going forward? Document these conversations internally but don't require written reports from grantees.
Track and share pilot results
After 12-18 months, assess the pilot: How do grantee outcomes compare to historically restricted grants? What did grantees do with the flexibility? How has the program officer's role changed? Present findings to the board alongside grantee testimonials to build the case for expansion.
Expand systematically
Based on pilot results, extend trust-based practices to additional portfolio areas. Each expansion cycle should incorporate lessons from the previous one. Full conversion typically takes 3-5 years for a mid-sized foundation.
Reducing Reporting Without Losing Accountability
The reporting question is where trust-based philanthropy meets fiduciary reality. Foundation boards have legal obligations to ensure charitable assets are used for their intended purposes. The question isn't whether to maintain accountability — it's how to achieve it without creating a bureaucratic burden that undermines the very programs you're funding.
The evidence strongly suggests that traditional reporting is a poor accountability mechanism. Program officers privately acknowledge that they can't deeply read all the reports they receive. Grantees craft reports to highlight successes and minimize challenges — the exact opposite of what honest accountability requires. The result is a system where enormous effort produces information of limited value.
Alternatives That Work Better
Learning conversations. A structured but informal annual conversation between the program officer and grantee leadership reveals more honest information than any written report. When the relationship is trust-based, grantees share challenges they'd never put in writing — and those challenges are exactly where foundation support can be most valuable.
Peer learning cohorts. Bring grantees together to share insights and challenges with each other. The foundation learns from the room without extracting formal reports. Grantees benefit from peer connections, and the conversation is oriented toward learning rather than performance justification.
Grantee-defined metrics. Instead of imposing a uniform reporting framework, ask grantees what they're already tracking and what matters most for their work. Then ask them to share those metrics annually. This produces more authentic and useful data because organizations are reporting on what they genuinely measure rather than retrofitting their work into funder categories.
Accept existing reports. If a grantee already produces an annual report for other funders or their own board, accept that instead of requiring a custom format. This single change can reduce reporting burden by 50% for organizations with multiple funders.
Non-Financial Support That Actually Helps
Many foundations offer capacity building and technical assistance alongside grants. The intention is good. The execution is often terrible — because the support reflects what the foundation thinks grantees need rather than what grantees actually want.
The most common complaints from grantees about funder-provided support: mandatory trainings on topics they've already mastered, consultant-led assessments that produce reports nobody reads, convenings that consume two days of leadership time for four hours of useful content, and strategic planning support that doesn't account for the organization's real constraints.
Trust-based non-financial support looks different. It starts with asking grantees what would be most helpful and then delivering exactly that. Common high-value supports include connections to other funders and partners, access to professional development opportunities the organization can't afford, technology tools or subscriptions the organization needs, and coaching or mentoring from experienced sector leaders — chosen by the grantee, not assigned by the funder.
Internal Change Management for Foundations
The hardest part of implementing trust-based philanthropy isn't changing your grant agreements. It's changing your organizational culture. Resistance comes from predictable sources — and addressing each one requires a different strategy.
MacKenzie Scott's Yield Giving: Lessons for Foundations
MacKenzie Scott's giving approach has become the most visible large-scale test of trust-based philanthropy's core premise: that organizations closest to communities can be trusted with unrestricted, no-strings funding at significant scale.
Yield Giving by the Numbers
The early research on Scott's giving reveals several findings that challenge traditional philanthropic assumptions. Organizations used the funds responsibly — investing in staff retention, building financial reserves, strengthening infrastructure, and expanding programs. The absence of restrictions did not lead to frivolous spending. Organizations of all sizes, including small grassroots groups, stewarded large unrestricted gifts effectively.
The most provocative lesson is about due diligence. Scott's team conducted research on potential grantees but didn't require lengthy applications. They gathered information from public sources, peer recommendations, and existing evaluations rather than demanding that organizations produce custom documents. This approach — which resembles how venture capitalists evaluate investments more than how foundations evaluate grantees — produced outcomes comparable to traditional grantmaking with dramatically less burden on recipients.
For foundations, the implications are clear: the due diligence that matters most isn't in the application paperwork — it's in the research you do, the relationships you build, and the signals you read from an organization's track record, leadership, and community reputation.
Measuring Success in a Trust-Based Framework
Trust-based philanthropy doesn't mean abandoning measurement. It means measuring what matters — which is often different from what traditional grantmaking measures.
Traditional grantmaking tracks outputs and compliance: Did the grantee spend the money as budgeted? Did they serve the promised number of participants? Did they submit reports on time? These metrics measure process fidelity, not impact.
Trust-based measurement focuses on three dimensions. First, organizational health: Are your grantees building stronger, more sustainable organizations? Track indicators like staff retention, financial reserves, leadership development, and organizational infrastructure over time. Second, mission advancement: Are the communities your grantees serve experiencing positive change? Let grantees define the metrics that matter most in their context rather than imposing a uniform outcomes framework. Third, relationship quality: Do your grantees trust you enough to share challenges, ask for help, and provide honest feedback? This is measurable through anonymous surveys, third-party interviews, and the quality of your check-in conversations.
The transition to trust-based philanthropy isn't about lowering standards. It's about raising them — holding yourself to a higher standard as a funder while extending to your grantees the trust they've earned through their daily proximity to the work that matters.