Systems change philanthropy operates at a different level from service delivery funding. Rather than helping more individuals navigate a broken system, systems change grantmaking targets the system itself — the policies, norms, power structures, and institutions that create and sustain social problems. This is more complex, more political, and harder to evaluate than programme funding — but potentially far higher impact.
Systems change is transformation in the conditions that hold a problem in place — not just addressing symptoms, but changing the underlying drivers.
For any social problem, there are:
- Symptoms: the immediate manifestations (hungry children, homeless people, sick communities)
- Drivers: the conditions that produce the symptoms (poverty, housing policy, social determinants)
- Root causes: the deeper structural factors that produce the drivers (power imbalance, discriminatory policy, economic structure)
Systems change philanthropy targets drivers and root causes — while recognising that direct service (addressing symptoms) remains necessary while systems change is pursued.
Examples of systems change
The case for systems change
Why funders avoid systems change
Long time horizons
Systems change requires patience — 10-20 year commitments to issues, not 3-year project funding cycles. Funders committed to systems change make long-term bets and stick with them through cycles of progress and setback.
Network funding
Systems change doesn't happen through single organisations — it requires networks of advocates, researchers, practitioners, and community organizers working toward shared goals. Funding the ecosystem (multiple organisations, conferences, research, communications) rather than single organisations.
Power analysis
Who benefits from the current system? Who loses? Effective systems change philanthropy starts with power analysis — understanding who has interest in maintaining the status quo and who has interest in changing it.
Policy and advocacy funding
Policy change requires advocacy — lobbying, campaigning, coalition building, and sustained pressure on decision-makers. This is often the most direct lever for systems change, but also the most politically sensitive for funders.
Narrative and communications
Systems change requires changing how problems are understood and discussed — from individual failure to systemic cause. Funding narrative change (journalism, research, public communications) builds the public understanding that enables policy change.
Research and evidence
Policy change is more sustainable when grounded in evidence. Funding research that documents the problem and evaluates potential solutions contributes to the evidence base for systems change.
Community organizing
The most durable systems change is driven by the people most affected — community organizing builds power among affected communities to advocate for change themselves. Funding community organizing is one of the highest-leverage systems change investments.
A theory of change for systems change philanthropy articulates:
- What change do we want? (the vision)
- What needs to change to get there? (drivers and root causes to address)
- What interventions will produce that change? (advocacy, research, narrative, organizing)
- What assumptions are we making? (what needs to be true for this to work?)
- How will we know if it's working? (indicators and learning)
Systems change theories of change are necessarily more complex and contested than programme-level theories of change — acknowledging uncertainty and non-linearity.
Evaluation is the hardest part of systems change philanthropy:
Attribution
When a law changes or a policy shifts, who gets credit? Typically many organisations, movements, and decades of work contributed — a single grant cannot be attributed as the cause.
Counter-factual
Would the systems change have happened without the grant? It's genuinely impossible to know.
Long time horizons
Evaluation at the scale of systems change requires decades of data — far beyond typical grant reporting cycles.
Emerging strategies
Developmental evaluation — adjusting strategy based on what is being learned in real time — is more useful for systems change than summative evaluation after the fact.
What to measure
Contribution, not attribution:
- Did the organisations funded build the capacity and relationships needed for systems change?
- Is the policy landscape shifting in the desired direction?
- Are the right coalitions forming?
- Is public discourse changing?
Policy advocacy restrictions
Public benevolent institutions (PBIs) and other DGR-endorsed organisations face restrictions on political activities. Funders considering systems change need to understand the legal framework for advocacy funding in Australia and New Zealand.
In New Zealand: charities may advocate on political issues provided it is incidental to charitable purposes.
In Australia: advocacy for charitable purposes is permitted, but partisan political activity is not. The boundary can be unclear.
Examples in the region
Globally
MacArthur Foundation, Ford Foundation, Open Society Foundations — have made systems change central to their approach.
Australia and New Zealand
Some Australian and New Zealand foundations are increasing systems change investment — though it remains a smaller proportion of the philanthropic sector than service delivery funding.
Tahua's grants management platform supports funders investing in systems change — with long-term grant portfolio management, advocacy milestone tracking, narrative change monitoring, coalition mapping, and the evaluation tools that help systems change funders navigate the complexity of measuring their contribution to structural transformation.