Systemic racism can be hard to figure out.
It is usually deeply embedded in systems and processes and shrouded in institutional history. It lurks in hidden and unexpected corners and can be difficult to spot if we don’t have a focused and deliberate point of view to eradicate it.
Removing implanted inequalities is neither a flashy job nor an award – it consists of pinpointing data gaps, system inefficiencies, and the absence or abundance of behaviors that indicate worrying patterns. Some of these weeds, similar to dandelions, are obvious and can be eradicated.
It may surprise Canadians, however, that these yellow weeds are easily found in the application of the Income Tax Act (ITA) provisions on charities. The ITA, which was enacted in the 1950s, requires charities to use their resources only for nonprofit activities that are “carried out by the organization itself.”
Because of this wording, the Canada Revenue Agency requires that charities that work with nonprofit organizations such as nonprofit organizations, cooperatives, social enterprises, civil society groups, or citizens’ movements to serve their charitable purpose, “direct and control” any collaborative work derived from donations is financed.
This has implications for both Canadian charities operating internationally and those operating domestically.
How does that go? Take the case of indigenous organizations.
In some cases, indigenous organizations (if not band councils or forms of government) are not registered charities. The only way to get charity dollars is to agree to a very complicated and expensive agency agreement between a registered charity (funded charity) and the indigenous organization under which the funding charity will have operational control over the activities of their non-profit organization must finance.
All intellectual property under this agreement must belong solely to the charity and not to the indigenous organization.
All public statements, including press releases, would have to be approved by the funding organization.
Canadian charities that are forced to comply with the law and rules will join in to do good community service.
At first glance this may seem sensible – ensuring operational control and management of narratives, ownership of intellectual property -. However, for indigenous organizations, many of which work with non-indigenous charitable hosts, they are surrounded by established accountability mechanisms and continued systemic discrimination behaviors that require them to give up intellectual property and direction about their operations.
It’s also no surprise that many donors are shy path from funding indigenous causes due to actual and perceived complexity, administrative burden and, in some cases, the need to find a registered nonprofit host to manage the funds and maintain direction and control. More and more donors and fellows are recognizing the implicit statement these requirements make: indigenous organizations cannot manage their own affairs, they need to give money to other people and have someone look over their shoulders to advance their innovative and necessary work.
If the systemic and intergenerational harm of racist politics continues, we will see the health, social and economic inequalities of indigenous peoples take hold. For those organizations and communities developing innovative solutions for child welfare, education, and health, the added burden of scrutiny, tutelage, and improper instruction does not help make good use of community dollars.
Systemic racism anchored in our public systems can be difficult to reconcile, but in this case the solution is simple.
The ITA has to be changed. We can follow the example of other countries, Turning away from the language in the act of “own activities” and replacing it with “responsibility for resources”.
This approach would require the charity to take reasonable steps to ensure that the project achieves its goals without the need for onerous and unnecessary monitoring or control, as is the case in the US. Resource stewardship can empower charities and non-charities alike, here in Canada and overseas, without compromising accountability and transparency.
We hope MPs and Canadians will support this change. It will remove old laws that perpetuate systemic racism and create more effective partnerships, freeing up resources for important purposes and justice-seeking communities. After all, it is innovations, solutions and the work of communities striving for justice that are where much of our freedoms, human rights and our sense of connectedness have arisen.
It is time to eradicate the dandelion and turn it into medicine that serves us all – a more diverse, fairer and more efficient nonprofit sector.
Senator Ratna Omidvar is an independent Senator from Ontario. She filed Bill S-222, the Act on Effective and Accountable Charities. Kris Archie is Tsq’escen ‘te Secwepemc and CEO of The Circle on Philanthropy and Aboriginal Peoples in Canada.
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