Reflections on Risk

By: Jessamyn Shams-Lau

In philanthropy, we often talk about risk. How much are we willing to take? How do we strategically plan to minimise it? Can we mitigate it entirely? Are we taking enough? How do we manage it?

As funders, there is a risk to our brand if we make bad decisions about who and how to fund. Risk to our professional reputations with our boards or investors. But in grant making, for the most part, ultimately the money is gone and not coming back. And philanthropy is in many ways society's best risk capital out there.

Let's compare this to the risk of the social entrepreneurs and social sector leaders we provide those grants to. I know many social entrepreneurs who pour their (often meagre) life savings in to their ventures, after passing on potentially lucrative traditional business sector careers. I know immigrant social sector leaders whose families are depending on them for their retirement plans. I know of changemakers who risk their safety (and that of their families), to make the statements they do and advocate for change in the face of corruption or the status quo.

Finally, let's think about the risks beneficiaries or clients of the programs we fund. Perhaps it's a mother making the decision to put her premature baby in an Embrace warmer--a device she's never seen or heard of before. Or a farming family choosing to be the first in their community to lay away funds from their subsistence budget with myAgro, with the promise that these investments will lead to increased crop yields and surplus food later in the year. Or the homeless person who decides to skip panhandling for money for a meal and decides to attend a Downtown Streets Team meeting to see if the claim of a future of employment and a home is more than a scam or a dream.

All different risk. No call to action here. Just food for thought, next time you're talking about the risk tolerance or mitigation strategy of your foundation. We're not the only ones taking it. We're not the ones taking the lion's share of it.