A movement sweeping through American philanthropy is making life significantly easier for the nonprofits that receive grants — and considerably harder for the people inside foundations who make them. If you give meaningfully to charity, in any form, this shift is worth understanding.
The Old Way Was Exhausting for Everyone
For decades, getting a grant from a foundation meant running a gauntlet. Nonprofit staff — often already stretched thin — spent weeks filling out detailed applications, compiling financial spreadsheets, and writing long narrative reports just to demonstrate they were trustworthy enough to receive funding. It was a system built on documentation as a proxy for trust. It worked, after a fashion, but it consumed enormous time on both sides of the table.
Trust-Based Philanthropy Changes the Rules
A growing movement called trust-based philanthropy has largely turned that model upside down. The core idea is straightforward: treat nonprofits as equal partners rather than applicants who must prove their worth. Foundations adopting this approach simplify or eliminate burdensome application requirements, offer longer-term funding commitments, and trust that community organizations know their communities better than funders do. For nonprofits, this is genuinely liberating. Less time on paperwork means more time doing the work funders are paying for. For more on trust-based philanthropy, see Doing the Homework from trustbasedphilanthropy.org
But there is a catch.
The Homework Doesn’t Disappear — It Just Moves 
Due diligence — verifying that a charitable organization is financially healthy, well-governed, and doing what it claims — doesn’t evaporate because the application process has been simplified. Foundation staff still carry a fiduciary responsibility to make sound funding decisions. What trust-based philanthropy changes is who does the research. Instead of the nonprofit submitting financial records and accountability reports, foundation staff now have to find much of that information themselves — independently pulling IRS tax filings, digging through public records, and piecing together financial histories from scratch. The underlying truth, for any donor — individual, institutional, or collective — is that charitable due diligence doesn’t go away. Someone always has to do it.
AI Looks Like the Answer — With One Significant Catch
Foundations looking for relief have naturally turned to artificial intelligence (AI). The appeal is obvious: software that can read a thousand-page IRS tax filing and surface the key numbers in seconds sounds like exactly the kind of help overwhelmed grant managers need. However, using AI in philanthropy raises real privacy concerns. Foundation leaders want the speed of AI, but they rightly fear pasting sensitive applicant information into public tools like ChatGPT – and without good answers, teams can remain stuck doing their due diligence by hand.
Small Foundation Teams Are Bearing the Brunt
This collision of increased research demands and still-developing AI tools takes a real toll, particularly at smaller foundations. At the smallest foundations, a single staff member may simultaneously serve as program director, tax compliance officer, and de facto IT department. Exponent Philanthropy reports that full-time administrators at lean foundations clock up to 75 hours a week to keep up with the workload. Every hour spent parsing financial documents is an hour not spent in the community, building relationships with the organizations they exist to support.
The Same Challenge Faces the Rest of Us
Foundation professionals aren’t the only ones navigating this. Giving circles pooling members’ donations, individuals managing donor-advised funds, and other substantial donors face the same essential problem: when you give meaningfully, you have a genuine interest in knowing whether the organization you’re supporting is financially sound, well-run, and doing what it claims. Most people in that position don’t have a research staff. They have goodwill, limited time, and an IRS database that was not designed for casual browsing.
One Approach That Works: AI on Public Data
The most direct solution to the privacy concern is also the simplest: use tools that work exclusively with public data. Hundreds of thousands of nonprofits — from major national organizations to local community groups — file Form 990 with the IRS each year. Together those filings constitute one of the most comprehensive public financial databases in the sector. Because the data is already public, there is no privacy exposure. An automated tool that reads these filings and organizes their contents gives foundation staff and individual donors much of what they need, without anyone uploading a sensitive document anywhere. AI can also search public news sources, helping donors stay current on what’s being reported about the organizations they support.
How CharityNine.org Helps
That is exactly what CharityNine.org is built to do. Enter the name or EIN of any IRS-registered nonprofit and CharityNine generates a nine-section due diligence report in under three minutes — program spending, administrative costs, executive compensation, cash reserves, and more, drawn directly from IRS filings. An AI-assisted summary of the organization’s top program and a public news check round out the picture. Everything is delivered as a private PDF link to your inbox. Because CharityNine works only from public IRS data and public news sources, there are no privacy concerns — for foundation staff or anyone else.
Built for Teams, Simple Enough for Anyone
Small foundations don’t have IT departments, and giving circles don’t have time for complicated software setup. CharityNine offers a straightforward group arrangement: one flat payment covers a shared block of 100 reports ($400 currently), the whole team uses a single private code with no individual accounts to manage, and every report goes directly to the inbox of whoever requested it. Whether you’re a program officer evaluating a new grantee, a giving circle preparing for your next funding decision, or an individual donor wanting to know more before writing a check — the information you need is available. You shouldn’t have to work 75 hours a week to find it. By the way, everyone gets 18 free reports. See free sample reports.
Learn More For a broader look at how professionals are thinking through the AI transition, see the video How Nonprofit Grantmakers Should Think About AI Use.
If you know someone who has the challenge of doing due diligence on potential donees — this post is worth passing along. You can copy the link: https://charitynine.org/pressures-on-foundation-giving/