‘Era of Uncertainty’: How Leaders in Canada’s Non-Profit Sector are Preparing for 2023

In these excerpts from The Philanthropist Journal, Senator Omidvar discusses the new rules on non-qualified donees and the need for data collection on diversity in the charitable sector:

Implementing new rules on non-qualified donees

The CRA released its draft guidance for registered charities making grants to non-qualified donees in late November and will accept public feedback until January 31.

“We now have a new legal pathway to broaden partnerships,” says Jean-Marc Mangin, president and CEO of Philanthropic Foundations Canada. “This could become the most significant change to the regulatory framework of the last 25 years.”

Senator Ratna Omidvar, who has long championed the changes, is cautiously optimistic that the changes will “expand the flow of money from charities and philanthropy to non-qualified donees that are serving the most disadvantaged people.”

“The proof will be in the pudding,” she says, of how the new rules impact funding of on-the-ground work. She’s hopeful the sector will undertake an effort to advance education on the matter. “The door has been opened. The question is whether the charitable dollars will flow through that door.”

Others are concerned the new rules don’t allow for communities or organizations to receive funding as had been hoped. “So far it looks like there will still be challenges to fund non-qualified donees,” Ahovi says. “There’s some flexibility but not as much as we had hoped to see.”

As Andrew Chunilall, CEO of Community Foundations of Canada, points out, there are challenges and learning curves for funders looking to establish relationships with non-qualified donees. “Oftentimes we say the barriers are regulatory, but the real barriers are relational,” he says. “You can change all the rules … but that also requires the funder to build a relationship with non-qualified donees.”

Nazareth is concerned that changing the rules around non-qualified donees is not enough to ensure that more funds flow to new groups, highlighting that the challenges are more around equity than tax rules. “If we don’t solve the underlying issues, no amount of math is going to solve this,” he says. “Is this really going to change the way things are, just because it’s allowed?”

***

Making progress on the data analysis gap

“On the data side, there’s some really good news,” Taylor says, noting that ONN plans to launch its data strategy framework in March. There are, she says, “three buckets” of data to look at: collecting new data, re-examining data the sector already holds, and utilizing data the government has to its full potential.

“In the sector as a whole, there’s a real appetite to change our data practices,” says Charity Insights’ Raggo, who says that people want meaningful engagement with data rather than a more extractive approach. Data sovereignty is also front of mind: “We need to decolonize the data,” she says. “We get answers to the questions we ask, we find the things we look for. What if what we are looking for is a product of the biases we bring in?”

Omidvar also hopes to make progress on data in 2023, saying she plans to table legislation that would result in more data being collected on governance and diversity within charities, similar to legislation that already exists for Canada’s federally regulated businesses.

Read the full article in The Philanthropist Journal