Many of the nation’s most savvy grantmakers and donors who seek to make lasting structural change on important issues give to 501(c)4 organizations, in addition to their sizable investments in more traditional 501(c)3 nonprofits. In their own words, here’s why they do it and why it matters for the communities and causes they support.  

Editor’s note: This article was written before the murder of George Floyd by police in Minneapolis and the subsequent uprisings in more than 400 cities. Please see the dear colleague letter that accompanies this issue of Responsive Philanthropy for more context.

Open Society Foundations 

The Open Society Foundations supports advocacy organizations because good policy saves lives, advances equality and protects our democracy. When government budgets run into the billions of dollars and affect millions of people, effective and lasting change only happens when laws and policies are revised, approved or defeated.   

Through the Open Society Policy Center (OSPC), our 501(c)(4) arm, we back creative and courageous efforts to advance a more just, inclusive and democratic America. 

We are proud of our partnership with frontline organizations demanding better lives for all Americans and our neighbors around the world.  

Together, we have helped to reduce racially disparate sentencing laws, check executive war powers, humanize our immigration system, protect voting rights and anti-corruption rules, advance reforms of the pharmaceutical industry and Wall Street, and block countless efforts to enshrine hate, repression and division into federal, state and local law.  

Working to influence U.S. foreign policy, OSPC supported the expansion of bans on funding foreign military units that have engaged in extrajudicial killing and kidnappings, and supported Sen. JohnMcCain’s successful effort to end the CIA’s detention and interrogation program. 

The powerful often have enough advocacy muscle and money to choke out the voices of the people, especially the marginalized. Open Society is proud to have increased our spending in the face of recent escalations of bigoted and anti-democratic policies, and hope other philanthropic institutions will do so as well. 

Tom Perriello, Executive Director 

Open Society-U.S. 

Civic Participation Action Fund 

The Civic Participation Action Fund (CPAF) is exclusively a c(4) grantmaker. When the Atlantic Advocacy Fund (AAF) created CPAF, it did so because it recognized that changes in public policy are often necessary to create the kind of change AAF was seeking.  

Because c(4) organizations can engage in much more direct advocacy than c(3) organizations, they are key players in achieving policy change. These groups can directly lobby elected officials, and they can ask their members and communities to lobby and engage in elections. 

Early on, CPAF focused on issue-based work but soon decided to adopt a civic engagement approach to the work.   

We recognized that the people and communities whose interests we sought to promote, mostly people of color and low-income communities, often participated in civic engagement activities at rates far lower than their representation in the general population and far lower than their white counterparts.  

If their voices were to be heard by the policymakers who were making decisions about issues that directly impacted their lives, they needed to be engaged, and policymakers needed to understand they would be held accountable for their policy positions.   

Some voter engagement efforts, such as voter registration and voter education, can be done with c(3)funding.  

However, the kinds of messages that directly link candidates to their policy positions, and work on direct issue advocacy like ballot measure campaigns, require c(4) funding.  

This type of work can then by translated into political power as the organizations doing the work demonstrate their ability to win elections by mobilizing their communities.  

For example, CPAF provided early support for a minimum wage/paid sick leave ballot measure in Arizona in 2016 by giving a grant to LUCHA, an emerging Latinx-led immigrant rights group in the state.  

The ballot initiative was overwhelmingly supported by the voters that year and because of LUCHA’s leadership role, the organization has grown in stature, membership and financial viability to become one of the leading powerhouse organizations in the state.  

Stephen McConnell and Katherine Peck 

Civic Participation Action Fund 

Ms. Foundation for Women 

After 46 years, the Ms. Foundation expanded out to develop a c(4) arm, and is venturing into supporting c(4)s through our newly formed Ms. Action Fund (MAF). The strategy of the MAF was constructed around the idea of building political power for women of color.   

Political power is not just about representation, but the ability to influence outcomes, to change the landscape – the ability to move transformational change on behalf of our communities. We believe that building a more reflective democracy moves us closer to a country where communities of color — women and girls of color, in particular — have political influence. 

It has been proven that the health of any nation depends on the support and existence of strong independent women-led structures. Simply put, women of color must have increased power to influence outcomes on the policies and institutions that affect their lives. 

We believe that shifting the makeup of U.S. political institutions is tied to increased power among organizations empowered to do 3 main things: hold institutions accountable; govern in partnership with elected officials; and ultimately leverage influence for systemic transformation.  

Therefore, while our analysis takes into account electoral opportunities, power for women of color must also include strengthened capacity, infrastructure and influence across the country. 

Ms. Action Fund is coming out of the box to put more money into the people closest to the solutions. To build political power for women of color that is truly transformational we have decided to focus on tackling challenges centered around funding, aligned training and infrastructure, and building accessible and culturally competent tools. 

Teresa C. Younger, President & CEO 

Ms. Foundation for Women 

Organizers from Alliance for Youth Action affiliate MOVE Texas distributed voter guides for the 2018 Midterm Elections.

Organizers from Alliance for Youth Action affiliate MOVE Texas distributed
voter guides for the 2018 Midterm Elections.

Ian Simmons 

Our smartest opponents have utilized the c(4) playbook for decades. With c(4) resources the Kochs built Americans for Prosperity, spending about $100 million per year persuading voters, writing laws and winning elections throughout the U.S. In states like Wisconsin, their c(4) infrastructure mobilized voters key to Trump’s surprising 2016 election. 

The Kochs chose to build their strongest organization with c(4) resources because c(4) resources enable clear and persuasive conversations with voters and lawmakers. Tax-deductible c(3) resources come not only with a tax-deduction but a gag order — restrictions that neuter public conversation. 

When we combat agendas fueled by hate or corruption, we must enable organizations to talk plainly with voters, empower the best candidates and win better laws. That usually means using c(4) dollars. If we don’t fight with c(4), we fight with our stronger arm tied behind our backs. When we use c(4), we win more fights.  
  
That’s how the best progressive organizations operate. For example, The Alliance for Youth Action deploys millions of voter guides around the country with c(4) resources, enabling organizers to engage voters directly, unencumbered. They talk openly about candidates who are awful on the issues and those who are awesome; young voters, like all citizens, respond better with clarity. Research shows organizing with such tools is more effective, helping progressives win more power.  
 
Whether we seek to strengthen climate standards, defeat a corrupt president’s re-election, recruit inspiring, diverse candidates or fight for fair elections, building an inclusive America requires the proven power and precision of c(4) fuel. 

Ian Simmons, Co-Founder & Principal

Blue Haven Initiative and Democracy Alliance Partner 

A major investment of 501(c)4 resources in groups like Florida Rights Restoration Coalition enabled the Voting Rights Restoration for Felons Initiative to be passed in Florida in 2018.

A major investment of 501(c)4 resources in groups like Florida Rights Restoration Coalition enabled the Voting Rights Restoration for Felons Initiative to be passed in Florida in 2018.

Jason Franklin 

Most of my personal giving and that of the donors I advise is c(3) giving supporting community organizing and advocacy to advance racial, social, economic and environmental justice. But I have increasingly layered in c(4) (and political) giving alongside that c(3) funding to help build a more robust ecosystem of work towards social change. 
 
Tax-deductible c(3) giving remains critical for so much work as it supports community building, research, issue education, communications and more. But all of that work gets a powerful boost when we also fund movements to expand into the c(4) realm with lobbying, ballot measure campaigns and electoral work from endorsements to independent expenditures. Growing our c(4) investments into social change movements yields bigger wins and that is worth far more than the tax deduction that we lose. 
 
Take for example Amendment 4 in Florida, the Voting Rights Restoration for Felons Initiative that passed in 2018 and stands to restore the right to vote to an estimated 1.4 million people. We have funded civic engagement efforts in Florida for years (and will continue to do so!), but it took a major investment ofc(4) resources into the Florida Rights Restoration Coalition, New Florida Majority and others to pass the biggest voting rights enfranchisement campaign in a generation. And we must continue to fund their work to implement this landmark law as conservatives attempt to undermine it with illegal modern-day poll taxes and other tactics.  
 
When I review my own giving or help a client develop their philanthropic strategy, a key question I ask is whether shifting types of giving could lead to greater change. Over and over, increasing c(4) and political giving is the answer.  
 
Jason Franklin, Co-Founder & Co-Chair

Solidaire Donor Network and President, Ktisis Capital 

As progressive philanthropy responds to rising authoritarianism in the United States and around the world, we cannot afford to ignore that anti-trans attacks have become the right’s power tool of choice.

Broadly speaking, progressive funders have treated trans issues as outside of their purviews. Despite how politically relevant trans rights have become, funding for trans issues does not yet reflect its strategic significance. It is not uncommon for progressive funders to avoid trans communities by treating us as a fringe political distraction.

But if we consider why the right has centered trans communities in prime-time speeches, funding and policy campaigns reveals many hard truths that should be of great concern to progressive funders. We start to see that trans communities are ground zero for how political power wins on the right despite shrinking margins, how cracks in our solidarity are easily exploited, and how progressive funders play into a highly funded right-wing strategy.

We cannot protect civil rights if we don’t recognize where the frontline of that legal and ideological battle is being waged.

Rye Young
How Anti-Trans Attacks Threaten Democracy and Civil Rights

Barbara Geddes, an American political scientist and leading scholar of authoritarianism, found that in previous generations, dictatorships were typically established through regime change or violent overthrows. In modern times, “Democratic backsliding orchestrated by a leader who was originally elected in a fair competitive election is now the most common way of establishing dictatorship.” In the United States, authoritarian tendencies have become part of the fabric of mainstream politics at an alarming rate.

It is not a coincidence that this rise in authoritarianism coincides with an exponential increase of political attacks against LGBTQ communities, the bulk of which are targeting trans people and trans youth in particular. In 2024, a new record for anti-trans bills was set, and it is the 5th consecutive record-breaking year. At the time of writing this article in late August 2024, the Trans Legislation Tracker is actively tracking 638 anti-trans bills across the country, 45 of which have been signed into law.

These laws are facing strong legal challenges thanks to the hard work of organizations including Transgender Law Center, the ACLU, TLDEF and Lambda Legal, but the social, legal and political repercussions are massive and broad in their scope.

Prior to 2018, the bulk of anti-trans legislation was focused on so-called “bathroom bills” that sought to limit trans access to public facilities, including restrooms. After 2019 and through to today, there has been a shift toward legislation that targets health care, education and sports – in other words, legislation that tests the roll-back of civil rights in more segments of society and public life.

Recent research from the Williams Institute finds that attacks on LGBTQ rights can be a precursor to democratic backsliding in the United States and globally, and attacks on gender and sexual minorities contribute to the weakening of democratic institutions. Pamela Shifman of the Democracy Alliance agrees, writing that the rise of the anti-gender movement and its threats to bodily autonomy “are the tip of the spear in a campaign against our democracy itself.”

Anti-trans Attacks, Rhetoric and Policy Embolden Far Right Nationalists

Over this last year, I’ve interviewed key democracy funders and heard several leaders express the challenge that progressive funders tend to want to stay out of messy “culture wars” as they treat them as distractions from the “real issues.” However, these “culture wars” are actually the frontlines of social and political power building that are currently dominated by the right and increasingly a site of populist-style messaging that demonizes trans people. As we try to roll back authoritarianism, we can’t ignore the role populism plays in democratic backsliding.

Whether anti-trans policy attacks pass and get adopted into law or not, they serve a number of roles that strengthen the right. They normalize the rollback of civil rights, make inroads with voters they otherwise lack a message for, and unite distinct factions of the far right, including white nationalists and Christian nationalists.

“We have to understand that the volume of the bills actually underscores where the momentum is,” Imara Jones, journalist and trans movement strategist, said. “Usually what I have seen from my reporting on this is that you’ll have certain years where it seems that there are less bills passing, but what’s actually happening is an experimentation about the types of bills that will become the models for the surge in subsequent years.”

Anti-trans attacks build the power and momentum that the right need to enact a broader agenda. They can also stump and confound progressives, exposing weaknesses that are regularly exploited.

Before conservatives united around an anti-trans strategy at the national level, they tested and honed it in state for years, if not decades. Time after time, they learned that progressive policies, even highly popular ones, could be defeated by turning them into a debate about trans people.

Case study – The HERO Act: How Transphobia Helps the Right Leverage Power

On May 28, 2014, The Houston Equal Rights Ordinance (HERO) Act passed in Houston’s City Council with an 11-6 vote. Introduced by popular lesbian Mayor Annise Parker, the HERO Act was a run-of-the-mill equal rights ordinance. Conservatives were determined to overrule the bill, and this opposition became referendum 1, which put the future of the HERO Act in the hands of the voters.

The LGBTQ community had a period of relative political strength in 2014. The Defense of Marriage Act had just passed the year prior, and national momentum was building that would lead to national marriage equality the following year. Twelve days after HERO Act passed, Laverne Cox graced the cover of TIME Magazine and declared 2014 “the Transgender Tipping Point.”

The HERO Act was popular when it passed. It protected all citizens from discrimination on the basis of 15 characteristics that applied to the vast majority of people, including women, veterans, people with disabilities, people of color and LGBTQ people. Houston’s City Council was keen to put itself on par with all other major cities that already had equal protection laws. In this context, the HERO Act seemed bound to survive the referendum.

The opposition cast the law as a devastating threat to the safety of women and children by claiming that gender identity protections would allow predators into bathrooms. This message was so effective, and the progressive side was so woefully unprepared for this to become a referendum on trans communities, that the referendum won in a 2-to-1 margin. The HERO Act failed to win support from most voters in 10 of the city’s 11 council districts. On top of that, the conservative campaign had far less funding than the progressive side: $400,000 vs. $1.9 million.

Conservatives even learned how to get registered Democrats to turn against civil rights in large numbers. It’s no wonder that after the HERO Act was overturned, conservatives invested billions to scale up their attacks on trans people. It is essential that the progressive movement and funders figure out how to talk about and defend trans rights and authentically harness the potential power of trans justice, feminism, reproductive justice and sexual liberation. The conservative movement is not afraid of wielding that power.

First Trans Rights, Then All Rights

In order for voters to embrace authoritarianism, enough people need to be convinced to vote against their own interests. According to Tarso Ramos, Executive Director of Political Research Associates, “Misogyny is a uniting force of a right-wing alliance between conservative subgroups.”

At the same time, no party can win an election without the support of women voters. How can a far-right alliance that embraces misogyny win over women voters? Trans attacks offer a blueprint for getting women to vote against their self-interests. Despite being the same movement that effectively shut down abortion access in much of the country, the bathroom argument has been salient with women voters.

Conservatives have been extremely strategic in choosing which anti-trans messages to embrace. The bathroom bill rhetoric that evolved into what we have now was directly lifted from the transphobic faction within the second wave feminist movement, which feared that men would “pose as women” and cause harm to women and their movement. Sound familiar?

The highly effective “bathroom playbook” that casts trans people as pedophiles and rapists is meant to speak directly to women who feel anxious and vulnerable. If transphobia can build alliances between radical feminists and the proudly misogynist extreme right, it can certainly make inroads with mainstream women voters. While there are many feminist institutions and foundations that embrace trans communities to varying degrees, the nature of our electoral system allows for a small minority to make drastic policy changes.

Conservatives don’t need to convince many people to win the power they need to carry forth their ambitious policy agenda as defined most recently in the Heritage Foundation’s Project 2025.

Movement Advancement Project’s report “Freedom Under Fire: The Far Right’s Battle to Control America” shows that the current political efforts of the right seek to restrict and control all aspects of a free and democratic society including:

  • health care and the right to make decisions about one’s body
  • the freedom of ideas and the ability to get a comprehensive education
  • the freedom of travel and the ability to be in public places
  • accurate legal recognition of people’s identities
  • freedom of the press and freedom of expression
  • the right to vote and participate in free, fair elections

This conservative vision is being tested on trans communities in every corner of the country and is gaining momentum. It is part of a broader policy agenda that seeks to curb the civil liberties and rights of immigrants, women, people with disabilities and people of color – essentially all groups that have fought for their current rights. It’s no coincidence the right tests radical policies on communities that are highly marginalized and whose institutions are deeply underfunded.

Funding for Anti-Genderism Eclipses Funding for Trans Rights

The anti-gender movement has benefited from investments of political, economic, social and financial capital over a long period of time. The movement is financially backed by a highly motivated network of individuals and organizations.

While precise figures are hard to obtain, the Global Philanthropy Project found that United States–based organizations associated with the anti-gender movement earned an aggregate revenue of $6.2 billion between 2008 and 2017, and the right has invested far more heavily since then.

The movement for trans rights has made enormous strides, but as of 2021, U.S.-based foundation support for transgender and gender nonconforming youth communities totaled just over $36 million and accounted for only 4 cents of every $100 awarded by philanthropy that year.

How can philanthropy respond?

The future of democracy disproportionately depends on whether we energetically and unequivocally stand with and invest in trans communities. How can philanthropy make moves to protect democracy and stand with trans communities?

Here are some ways philanthropy can help:

  • Get involved. This summer, Funders for LGBTQ Issues launched a new initiative to fill a gap at the intersection of trans justice and democracy. Funders United for Democracy and Trans Justice (DTJ) is a working group that brings together the collective knowledge, strength, and power of both democracy and LGBTQ-focused institutions. Funders Committee for Civic Participation is the DTJ co-chair and answers the call for new partners in this fight. Learn about DTJ and fill out this interest form to participate.
  • Celebrate and invest in visionary and principled women’s funds, women’s organizations and a reproductive justice ecosystem that is deeply and meaningfully trans inclusive.
  • Encourage your institution and colleagues to learn about these issues together. Consider providing trainings through Funders for LGBTQ Issues or consultants.
  • Encourage your institution and the philanthropic networks you’re in to develop a gender justice strategy if they don’t have one.

The trans movement is small but mighty. It has fought for visibility and accomplished incredible changes in a short period of time. But the trans movement and its funders are stretched thin and struggling against an all-out attack that weaponizes that hard-won visibility.

Philanthropy can do a lot, but it must work in coordination with and on behalf of our most important source of hope: our own trans communities. Will enough funders support and invest in trans communities as fiercely and as persistently as conservatives have in their anti-gender movement?

If we do, we can pull the plug on the most effective power tool the conservative movement has.

If we don’t, the risks are well established.

Drawing on fourteen years of experience in social justice philanthropy, Rye Young is the head of Rye Young Consulting, the Director of the Sprocket Foundation, a Trustee of the Freeman Foundation and a Board member of Unite for Reproductive and Gender Equity (URGE), and co-creator and co-leader of DIGG (Donor Intro to Grounded Giving), a donor-organizing and political education program for people with wealth to find their grounding in social justice philanthropy. Rye works with individual donors and philanthropic institutions to align their values with their practices and to invest boldly and strategically in social justice movements. He got schooled in social justice philanthropy at Third Wave Fund where he began as an abortion fund intern in 2008 and eventually served as the Executive Director from 2014-2018.

More Responsive Philanthropy

Fall 2024 Issue
Democracy: Before, During and After Election Years

10 years after Ferguson: How philanthropy can bridge funding gaps for Black and brown-led organizations

Forward Through Ferguson’s Annissa McCaskill and Jia Lian Yang recount how philanthropy reacted – and continue to react – to funding disparities in Black and brown-led organizations after the murder of Michael Brown Jr.

5 lessons learned about trust-based philanthropy

In this collaborative piece People’s Action Institute Sulma Arias, Climate Justice Alliance’s KD Chavez, Fund to Build Grassroots Power’s Denise Collazo, PowerSwitch Action’s Lauren Jacobs, and WE ACT for Environmental Justice’s Peggy Shepard discuss the benefits to communities and systems change when funders center Black and brown voices and utilize the values and principles of feminist leadership to resource grassroots power.

A clarion call: How attacks on U.S. Palestinian solidarity movements undermine our democracy

Proteus Fund’s Rana Elmir draws the parallel between the inadequate funding behavior for Black, African, Arab, Middle Eastern, Muslim, and South Asian movement groups post 9/11 and the current attacks on Palestinian solidarity movements.

The philanthropic strategies and networks attacking our democracy

NCRP’s Katherine Ponce utilizes research, data points and history to showcase what progressive movements can learn from the right-wing nonprofits networks that are attacking our democracy.

First trans rights, then all rights

Funders for LGBTQ Issues’ Rye Young writes how heightened attacks on LGBTQ+ communities have impacted the very function of democracy. How complicit is philanthropy to these far-right advances?

Featured Visual Artist: Gregg Chadwick

Find out more about visual artist Gregg Chadwick, whose work is featured in the Fall 2024 issue of Responsive Philanthropy.

Fall 2024

background picture of a voting polling place on Election Day. credit: Jason Doiy from Getty Images Signature via Canvo Pro license
NCRP’s Voter Registration Brief

There’s no one better equipped for transformational investment than a community-based issues organizing group with established relationships in and knowledge of its own communities.

Groups like these are uniquely qualified to reach and mobilize voters who are underrepresented in the electorate.

They are equally – if not more – important to the civic engagement ecosystem as groups that are only focused on voter registration.

Pride is a Protest

At its core, pride is a protest against the criminalization of our identities.

It is a refusal to be confined to the shadows, to be denied our humanity, and to be stripped of our rights.

In countries where being LGBTQ+ is still illegal, pride takes on an even greater significance, serving as a beacon of hope for those living under the shadow of persecution.

Fund Organizing Like Our Democracy Depends on It…Because It Does

All elections shape the nature of the communities we live in, and there has been an immense amount of work that went into ensuring that the will of the people was heard. Yet after the votes are counted, there is still the need for organizers after every election to continue engaging their communities.

This kind of sustained effort is key – to holding elected officials accountable, passing progressive legislation, and continuing to leverage people power in the struggle for collective liberation.