Academic journal article Canadian Journal of Nonprofit and Social Economy Research

Room to Flourish: Lessons for Canadian Grantmaking Foundations from Sweden, Germany, and the Netherlands

Academic journal article Canadian Journal of Nonprofit and Social Economy Research

Room to Flourish: Lessons for Canadian Grantmaking Foundations from Sweden, Germany, and the Netherlands

Article excerpt

INTRODUCTION

Canadian grantmaking foundations have played an important part in seeding and funding new ideas, programs, and policies that enhance the well-being of communities. These foundations are mainly, and for the purposes of this analysis,1 registered charities that make grants to multiple other Canadian charities and to those organizations recognized by the federal government as "qualified donees" (Philanthropic Foundations Canada, n.d.). While relatively young, the Canadian grantmaking foundation sector has experienced extraordinary growth and made substantive impacts on society both in Canada and around the world. Unlike in the United States, however, where there is a long-standing body of knowledge about grantmaking foundations, very little is known about the Canadian grantmaking landscape, especially as it relates to other European examples. The body of international comparative research has not yet included Canada in its analyses. Canada's foundation sector has also not yet been extensively compared to the European context, where there is a substantial body of knowledge on foundations, led by scholars understanding foundations in a comparative context (see Moreno & Plewes, 2007).

This article addresses an important, yet, open question in the literature: what contexts allow for Canadian foundations- which create much of the social capital that factors into both political and economic life-to develop and thrive? While Canada has experienced a long and successful history of encouraging social participation and community activity through its grantmaking foundation sector, this article argues that Canada's historic and present-day regulatory restrictions have played a role in limiting the extent to which its foundation sector has been allowed to innovate and flourish. Anecdotal evidence reveals that many practitioners will readily admit that the more trendsetting and pioneering foundations are the ones that will run into regulatory hurdles, more so than others where the limiting factor appears to be more cultural (e.g., stemming from boards, donors, and the community context). Nevertheless, when applicable, regulatory obstacles include restrictive laws that limit foundations to giving only to other registered charities.2

The article begins by detailing the evolution of grantmaking in Canada, the state structure, the current foundation landscape, and the challenges and obstacles it faces to evaluate these comparisons. Specifically, it asks: "Do regulations in Canada actually limit the philanthropic sector?" An assessment of the constraints on the Canadian foundation sector by a stringent regulatory regime is provided. To exemplify the types of tractable regulatory schemes that have allowed grantmaking foundation sectors in comparative contexts to prosper, the evolution of the grantmaking foundation sectors in Sweden, Germany, and the Netherlands within the context of social origins theory (Salamon & Anheier, 1998) are examined. While comparing between grantmaking foundations internationally can be difficult, since foundations can take various forms around the world (Anheier, 2001), these countries have widely been characterized as European exemplars in terms of regulatory flexibility for grantmaking foundations. As a result, grantmaking sectors can vary greatly depending on the nation in question. This analysis uses Lester Salamon and Helmut Anheier's (1998) social origins theory, which proposes that this variation is the result of more than a single factor, and that varying social and historical contexts give rise to distinct nonprofit regimes, as a theoretical framework.

The countries explored for the purposes of this analysis tend to have fewer regulatory restrictions on philanthropic activity and this has allowed the size, scope, and activity of their grantmaking foundation sectors to flourish in a manner unlike Canada. One important contribution of this article is to compare their regulatory frameworks to the Canadian context. …

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