Foundations changed course, and few say it is Working.

Since January 2025, nearly every large foundation has changed how it works. Very few think the changes have been enough. That is the central finding of Evolving Foundation Responses to a Sector in Crisis, a report released September 29 by the Center for Effective Philanthropy.

The center surveyed leaders of 183 independent and community foundations that give at least $5 million a year, and 329 leaders of nonprofits that receive foundation money, in May 2026. The backdrop is the run of federal grant terminations, funding freezes, and investigations that its earlier reports documented.

Almost everyone changed something

Ninety-three percent of foundation CEOs reported at least one change in approach. The most common were these.

Takeaway: most of the change is in where money goes, not how much.

The payout barely moved

A third of independent foundations, 33 percent, said their payout this fiscal year was higher than usual, and 65 percent said it was typical. The median payout among independent foundations was 6 percent of assets, just above the 5 percent most private foundations must distribute. The report contrasts this with 2020, when foundations raised payout sharply during the pandemic.

Takeaway: the pie is being recut more than it is growing.

Few call it a success

Twelve percent of foundation CEOs rated their own response as very effective, and 8 percent said the same of foundations generally. More than half, 53 percent, named some form of risk aversion as a barrier, and more than 40 percent said board members' wish to stay neutral or limit risk had held them back.

Help that misses the need

Nine in ten foundations said they offer support beyond the grant. Nonprofit leaders describe a mismatch.

Takeaway: of nonprofits that received such help, 40 percent found it very useful, and only 1 percent said more of it was the most valuable thing funders could do.

Candor is the bottleneck

Just 41 percent of nonprofit CEOs said they can be completely honest with funders about their challenges, and 23 percent rated funders very effective at communication. Leaders who can speak openly rated their funders higher on responsiveness, risk-taking, and rapid-response support.

What to do about it

For nonprofit leaders, the data supports asking funders directly whether their payout or priorities are changing this year, and naming the specific help you need rather than accepting whatever is offered. For foundation boards, it suggests the gap is money and candor more than workshops.

Methodology and source

The Center for Effective Philanthropy surveyed foundation CEOs at independent and community foundations giving $5 million or more a year, and nonprofit CEOs in its Nonprofit Voice Project, a nationally representative panel of nonprofits that receive some foundation funding. Surveys ran in May 2026. All figures are from the report.