Fearless Fund: Planting Seeds in Rocky Soil

2 min read · July 26, 2024
New Power Labs

Last year, we shared about the Fearless Fund, a US-based initiative designed to support businesses run by Black women, facing legal challenges. Early June this year, the US federal appeals court upheld its decision to block the Fearless Fund's grant program, which awards $20,000 to Black women-owned businesses, citing concerns about race-based discrimination. This legal action is led by Edward Blum's American Alliance for Equal Rights, the same group behind the successful Supreme Court case that ended affirmative action in college admissions policies.

This case is not isolated. Similar lawsuits are affecting community lenders and other initiatives aimed at supporting historically underfunded and overlooked leaders — including in Canada. The Philanthropic Initiative for Racial Equity discovered that grantmakers are growing more concerned about the legal risks associated with funding racial equity initiatives. Consequently, they have started imposing additional requirements on the grantees they continue to support.

Race-based lawsuits are creating a chilling effect on capital deployers’ efforts to address disparities in funding. 

Fearless Fund and similar initiatives are working to level the playing field by focusing on equity, not just equality. By supporting historically underfunded groups, these efforts address systemic disparities that limit access to resources. 

The push by some to attempt (sometimes successfully) to stop programs that support historically underfunded leaders & communities represents an underlying idea that equality is a zero-sum game. This perspective erroneously assumes that if one group gains something, it must come at the expense of another group. I was recently in a meeting where a CEO of a large philanthropic foundation noted that at this rate of diversity growth and focus, white men will soon be the diversity on boards. While we do not have data on nonprofit board diversity in Canada, white men comprise 87.3% of the 2,200 board positions within Canadian S&P/TSX companies.

Moving forward, we can take two important steps. First, funders can strengthen the legal resources and infrastructure required to fight this pushback against progress. In parallel, we have the opportunity to shift from a scarcity mindset to one that recognizes that expanded access to resources benefits everyone and broader economic prosperity.  

Narinder
New Power Labs

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