The Open Society Foundations is in the early stages of a "transformation" that has seen a freeze on new initiatives and hiring and grantmaking budgets temporarily limited to a quarter of pre-pandemic levels, Inside Philanthropy reports.
According to an internal memo obtained by IP, the New York City-based foundation has suspended new initiatives in its thematic, advocacy, and geographic program areas and has allocated 25 percent of each program's pre-COVID budget for wrapping up work already scheduled to end this year or supporting work already under way. The changes had been under discussion for over a year but were put in motion over the last six months. The memo also states that a hiring freeze at the foundation would be in effect as of January 1, and that while current staff levels and related overhead are fully funded for 2021, travel budgets — already limited by the pandemic — would be cut to a quarter of last year's levels.
"There is no doubt that this process will be painful in the short term," wrote former OSF president Patrick Gaspard in the December 9 memo shortly after he announced he would be stepping down as president. "We will have to make difficult choices, but that is the only way forward." It is unclear whether the latest developments are connected to Gaspard's departure, IP reports, while his successor as president, former UN deputy secretary‐general Mark Malloch-Brown, is withholding comment on the changes until a later date.
OSF chief communications officer Laura Silber told IP that while the program structure at the foundation is likely to change, any cuts to programs are temporary, there are no long-term plans to reduce overall spending, and the 25 percent allocation for wrapping up work is for the first quarter only — a point of confusion among staff, according to IP — with further budget decisions to be determined in the months ahead. In the meantime, the foundation will honor all existing grant commitments as it goes through the change process, which is expected to last about eighteen months. National and regional foundations OSF maintains abroad also will continue to be funded at 2020 levels, and the operations department will be funded at requested 2021 levels.
While Silber did not comment on the possibility that some programs will be downsized, she noted that a number of programmatic mergers have been completed or are in the works, including a merger of the information and digital rights program with the project on journalism, and that others are under consideration. According to a staff member who spoke with IP on the condition of anonymity, senior leaders have made no final decisions on program downsizing or consolidation, which has made it difficult for staff to take next steps, and the organization, which has been in strategy development mode since late 2019, appears to be restarting the process.
"The process is still under way and the contours of the change are being worked out. The transformation is not about cost-cutting — the foundations' overall funding level is not expected to change significantly — but rather how we use that funding more effectively to maximize impact," Silber said in a statement. "We are taking great care to ensure that the decisions we make in the coming months are judicious, fair, and sensitive to the needs of our staff and grantees. We are confident that we will emerge from our transformation better equipped to protect, defend, and advance open society."