The institutional funding landscape continues to evolve, presenting new challenges and opportunities for fundraisers. With that in mind, Imagine Canada is revisiting its “8 Shifts in the Grants Landscape” series for 2026 (check out the 2023 and 2024 editions).

The CanadaHelps 2025 giving report, which looks at trends from 2018 to 2024, identifies an increasingly palpable “crisis of community” as one possible inspiration for people to support charities and nonprofits in ways that “restore connection, strengthen neighbourhoods, and rebuild the social ties that hold us together.” In exploring the shifts below, we want to centre that hope as we look for ways that challenging circumstances can yield innovation, connection, and progress in the nonprofit sector.

1. AI is everywhere and developing exponentially

The rate of innovation and widespread adoption of AI – particularly generative AI tools like ChatGPT and Gemini – over the last two years has been astonishing. A KPMG survey published in November 2025 reported that 51% of Canadian employees use generative AI tools at work. Meanwhile, adoption in the charitable and nonprofit sector is dramatically higher than that: this year, the Ontario Nonprofit Network reported 83% of respondents using AI tools at work, up from 67% the previous year. Grant Connect’s recent subscriber survey revealed that on average 62% of subscribers use generative AI tools as part of their fundraising strategy. 

In a sector where staff capacity is stretched and 75% of charities in 2025 reported higher demand for their services compared to the previous fiscal year, it makes sense that AI tools are becoming central to operations. Charities and nonprofits are using them to help write grants, enhance communication and marketing efforts, and even evaluate data (TechSoup). New data from Imagine Canada’s report on the Use of AI by Canadian Nonprofits reinforces this period of transition. While 80% of nonprofits report using AI in some form, the report highlights that confidence, skills, and shared understanding — not funding — are the biggest drivers of deeper, more responsible adoption. But, we’re also known as the “social purpose sector” for a reason, and charities and nonprofits are aware of the potential harms of AI use, such as the environmental impacts, data training bias, and overreliance to the point of losing the “human touch.” 

As with any tool, building organizational knowledge, strategy, and usage policies in line with your organization’s values and goals is the best way to set your nonprofit or charity up for success in the age of AI. To this end, we recommend checking out both the Canadian Centre for Nonprofit Digital Resilience’s Nonprofit AI Impact Hub, a learning and discovery platform to help nonprofit professionals understand and use AI, with curated resources for the sector, and HR Intervals’ Digital Adoption for Nonprofits section, which highlights key considerations for integrating generative AI at your organization, and offers policy outline and checklist for acceptable AI use. 

2. Cross-border volatility has ripple effects on Canadian grantseekers

The interconnectedness of philanthropy and global economics across borders means that turbulence in the U.S. increasingly reverberates across Canada, with ripples throughout the fundraising landscape. 

Examples of this include: 

• A volatile U.S. dollar’s impact on Canadian institutional investors with assets in the U.S., which could affect foundation endowment levels.
• The effect of increased tariffs on Canadians exacerbating a decline in individual giving, creating revenue gaps for institutional fundraising to fill.
• U.S.-based foundations that support international work – including Canadian nonprofits – redirecting their funding to respond to the increased need resulting from U.S. government program cuts, like the dissolution of USAID and cuts to higher education and research. 

A particularly concerning possibility is a chilling effect on funding related to DEI and ARAO, as the Trump administration has been vocal about defunding what they call “woke programs.” While some businesses like Costco remain committed to their stated values around DEI, many other multinational companies like Meta, Amazon, McDonalds, and Walmart removed DEI-specific language from websites and curtailed hiring programs aimed at supporting equity-deserving employees. Corporate funding programs no longer aligned with the White House’s views are at risk, and less diversity among key decision-makers at these corporations could shape conditions for less and less future investment in equity-deserving communities. 

Some philanthropists, though, are doubling down on both their values and commitment to Canadian initiatives. Mackenzie Scott, for example, donated $86 million CAD to the Makeway Foundation via her initiative Yield Giving in late 2025, signalling continued interest in grassroots community support, social and environmental change, and wealth redistribution (she’s a signatory of The Giving Pledge). We’ll be paying attention – via tools such as Grant Connect’s Gift Explorer – to see which other philanthropists, foundations, and/or donor-advised funds lean further into funding social wellbeing at a time when doing so feels increasingly politicized.

3. Spotlight on community-centric and community-specific funding relationships

Across the nonprofit and charitable sector, the economy remains a top concern heading into 2026, with several major banks warning of an elevated risk of recession in Canada and charities naming the economic situation and subsequent decline in donations as the biggest challenge facing the sector. Simultaneously, over the last few years more and more sector leaders, such as the Tamarack Institute, have called for philanthropy to move away from transactional grantmaking and towards collaborative, trust-based funding relationships centered on communities.

Community foundations seem to be both at the fore of this movement and taking on additional significance in the funding landscape at large. According to CanadaHelps, local and regional charities have overtaken health as the top cause area by dollar value, reflecting a major shift toward community-rooted giving. The Vancouver Foundation continues to champion trust-based philanthropy with a stated commitment to grantseekers, transparency around discretionary grant processes, and an active Participatory Action Research funding program. The Winnipeg Foundation relaunched its multi-year flexible funding program after a five-year hiatus. Other foundations, like the Silver Gummy Foundation, advocate for the co-existence of trust-based philanthropy with process and outcome monitoring, framing accountability and impact measurement as part of the community-centric funding movement. 

Funders like these are looking for true partners who are embedded in their communities, aware and equipped to respond to community needs, and willing to collaborate in service of the greatest possible impact.

4. Funding for equity-deserving and Indigenous organizations is keeping momentum, but still lagging behind

In 2025, we’ve seen some meaningful wealth redistribution towards Black-led and Indigenous-led organizations in Canada. The Foundation for Black Communities, for example, deployed $9.5 million to 161 Black-led or Black-serving groups nationwide under its Black Ideas Grant, which opened and closed for the third time in Fall 2025. This past November, the McConnell Foundation shared an update on its 2023 commitment to transferring $30 million from their endowment to Indigenous-led philanthropic organizations, reporting having committed more than $16 million to four different organizations including the Indigenous Peoples Resilience Fund. 

As promising as it is to see these initiatives progress, Black- and Indigenous-led and -serving organizations are still disproportionately underfunded compared to other areas of the sector.

5. Orgs have more data than ever to inform their grantseeking strategy

Between national reports from CanadaHelps, regional data from organizations like the Ontario Nonprofit Network, bespoke research from Imagine Canada, surveys from the Charity Canada Insights Project, and reports from private companies like Blackbaud, there are a lot of eyes on Canada’s charitable and nonprofit sector. And there’s even more data coming: starting in 2026, nonprofit organizations earning more than $50,000 annually will be required to file a tax return with the Canada Revenue Agency, which will contribute to painting a more detailed picture of the entire social purpose sector. 

Much of this public and not-so-public data will be included in Grant Connect, as well as the forthcoming Nonprofit Funding Intelligence Ecosystem (for more on that, reach out to us at data@imaginecanada.ca).

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All research and preparation aside, we’re entering a new year that’s bound to contain both unexpected challenges and unexpected wins. From one frontline grantseeker to another, please know this: your resource-finding efforts are impactful, valuable, and worth celebrating no matter what they yield. Your job is a heavy lift in 2026, and we’re here to help lighten the load.

About the Author

Malia Rogers (she/her) is a Nova Scotian folk singer-songwriter, actor-musician and arts administrator who splits her time between Ottawa, Halifax, and Toronto. In her past role on Imagine Canada’s Grant Connect team and her current role as Theatre of the Beat’s development manager, Malia remains deeply committed to resourcing programs that strengthen communities and art that inspires empathy and positive change.