ESG Investing

Community Foundations Take a Personal Approach to Disaster Relief

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When an area faces events such as wildfires, hurricanes, severe storms, flooding, and public health crises, news outlets often highlight the stories of national organizations and federal agencies rushing to help. These organizations provide some of the most visible support, but they do not act alone—local community foundations make a direct impact on those affected by extreme events; in fact, owing to their established relationships in the community, they can often accomplish even more.

In turn, they also offer an opportunity for ESG investors looking to increase their impact on the ground.

Championing Leaders in Disaster Relief

The human, economic, and environmental toll of recent natural disasters has been nothing short of overwhelming. As of July 2021, natural disasters had caused losses in the United States exceeding $1 billion and impacted millions of Americans. Worldwide, the economic loss due to such disasters was calculated at $190 billion in 2020, up 50% from 2019.

When disaster strikes, community foundations around the country are often among the best positioned to respond. These foundations are already part of the community, giving them the knowledge and connections to better assess the needs at hand and deploy the available assets.

Those established relationships mean that community foundations have already vetted their partners—or have the processes and procedures in place to do so—allowing them to act quickly and effectively. For example, after raising money for Hurricane Ida victims, the Greater New Orleans Foundation only issued grants after performing damage assessments and undertaking due diligence to ensure that grant recipients were actively responding to the disaster. In addition to established partners, foundations often have relief funds already in place, aiding in their ability to mobilize quickly and get funds to the people and agencies that need them.

Community foundations also typically adopt a long-term approach to disasters, meaning they will continue to work with the community to rebuild after the immediate emergency subsides. Both during and after a crisis event, these foundations are accountable to donors and partners, requiring them to have discernible approaches to making an impact.

When disaster strikes, community foundations around the country are often among the best positioned to respond.

Understanding the Role of Community Foundations

Community foundations may provide a wide range of services or specialize in a particular area of disaster relief, whether as the sole administrator and leader or as the support organization in a cooperative endeavor.

Their primary tasks generally include:

  • Providing a community platform to discuss relevant issues
  • Analyzing the causes of problems and potential solutions
  • Communicating with decision-makers
  • Galvanizing community members to implement disaster plans
  • Mobilizing resources from both within the community and outside it to identify solutions
  • Building community awareness and promoting community action on environmental and disaster issues and employment options
  • Raising community members’ capacity to prepare for disasters
  • Carrying out ongoing monitoring and evaluation

Responding to Weather Events

Community foundations have showed particular mettle amid extreme weather events:

  • California’s North Valley Community Foundation gave out $140,250 in grants for shelter and relief supplies to those impacted by the Bear/North Complex and August Complex fires;
  • In the aftermath of Hurricane Ida, the Communities Foundations of Texas established the Hurricane Ida Relief Fund to support relief and recovery efforts in affected communities.
  • Similarly, the Community Foundation of North Louisiana established its Hurricane Ida Relief Fund to help community foundations in southern Louisiana restore areas impacted by the storm.
  • California Community Foundation’s Wildfire Recovery Fund provides intermediate and long-term recovery support for major California wildfires, including preparedness efforts.

Supporting the Fight against COVID-19

Local foundations have also rallied in response to COVID-19, with more than 600 such organizations establishing relief funds to support those affected by the virus and contain its spread. The Seattle Foundation’s COVID-19 Response Fund has raised more than $28.8 million and provided more than $19.2 million in rapid-response grants to help those affected by the pandemic. Across the country, the Philadelphia Foundation and United Way of Greater Philadelphia and Southern New Jersey launched the PHL COVID-19 Fund, awarding roughly 600 grants totaling more than $18.4 million since March 2020.

Investing for the Present and the Future

As the past year or so has shown, communities can face a variety of challenges when a crisis hits. Whether related to health, the weather, acts of terror, or other concerns, these events can have devastating impacts on mental health and the economy. Responding to a disaster requires cooperation—national relief organizations have infrastructure and experience in handling large-scale disruptions, while local organizations bring an intimate knowledge of the community.

By donating to community foundations, philanthropists can support disaster relief in both the short and long term.

  • Immediate: Donations provide victims with basic necessities, such as food, water, shelter, medical care, and clothing.
  • Short-term: Donations generally peak around eight weeks after a disaster, when critical recovery work begins. Philanthropic investments at this stage help provide continued health and social services for victims.
  • Long-term: Advance preparation is crucial for minimizing the impact of a disaster. Having funds available allows relief agencies to move quickly when disaster strikes as well as to service communities for years afterward. Funds can help areas rebuild and address chronic social and environmental issues impacting the community.

Donors have a variety of options for supporting community foundations. Small and one-time gifts can go toward a specific disaster relief fund, or a donor might make a gift to a foundation’s unrestricted fund for its board to determine the best use of the funds. ESG investors might also consider a donor-advised fund, which allows the donor to direct how grants are made. Looking ahead to the next potential crisis, community foundations are perhaps best set up to deliver that impact with force.

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