How to Measure Power

4 min read · Sept 8, 2023
New Power Labs

Tl;dr: In an earlier piece, we unpacked New Power Labs’ approach to defining and understanding power and shared a project we’ve launched to help organizations measure the diversity of their funding portfolios. Here, we continue to explore how power can impact capital flow decision-making.

An important part of New Power Labs’ research agenda focuses on how power shapes capital flow. Our earlier research shows that for some capital deployers, power is deeply concentrated, with a handful of individuals making a majority of the capital flow decisions within an organization. And we know that affinity bias can impact our decision-making. Based on this, knowing the identities of these decision-makers (across race, gender, sex, beliefs, etc.)  should be important information for organizations that take representation seriously. Equity, diversity, and inclusion goals can only be achieved when examining power through an intersectional diversity lens.

“We need tools to reveal and analyze how capital is allocated—not just where. Otherwise, power imbalances will continue to create inequitable outcomes.” — Denise Hearn & Alyssa Ely

But how to measure power?

This is a question we’ve wrestled with through our People & Capital Data Partnership — a program that provides our partners with high-quality, disaggregated diversity data to help understand the representation of their portfolio of grantees and investees across 10 diversity lenses, as well as that of their teams. 

One straightforward way to measure power captures formal authority, by looking at different job types across an organization. Logically, a General Partner at an investment fund has more control over where money is going than an associate. But formal authority isn’t everything. 

Depending on an organization’s structure and norms, different types of people might exert substantial influence over capital deployment that wouldn’t be apparent from job type alone. Informal power may rely on attributes like expertise, credentials, and networks, and can be as important as formal authority in decision-making across organizations. 

For these reasons, our People & Capital Data Partnership goes beyond individual job titles to capture the role decision-makers play in the process of allocating capital (e.g., from setting an overall investment or philanthropic strategy to making a final investment or granting decision) and their perception of the control they exert over capital deployment. 

This approach to measuring power doesn't capture every aspect of power that might be at play across a diverse group of capital deployers. What it starts to provide — and what's missing in Canada today — is a step towards building an intuitive, simple framework to capture complex power dynamics, helping us navigate beyond flat assumptions about where power resides and how shifting power can help to flow more capital to underfunded and overlooked leaders.

Interested in being part of this movement? Work with us to collect data from your organization, to help you understand power through a diversity lens, highlighting opportunities in your organization and across your portfolios.

Contributed by: Kasha Huk

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