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Community Philanthropy: it’s a thing, and you need to know about it

June 2, 2016
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Guest post from Jenny Hodgson of the Global Fund for Community FoundationsJHodgson

It’s almost always the same argument. Or excuse. Governments joining the accelerating global trend of restricting civil society at home like to claim that they are protecting their country against meddling “foreign powers”.

No one has to like, or agree, with that point of view in order to take it seriously, and perhaps even to see the onslaught as an opportunity. As the saying goes, a crisis is a terrible thing to waste.

The assaults on civil society globally—as outrageous as they are—could help to provoke a hard look at the prevalent model of external funding, particularly of human rights and social justice issues. Why, when we all agree that developing country governments weaning themselves off aid and raising more domestic resources is a good thing, do aid donors and activists not apply the same logic to Civil Society Organizations (CSOs)?

KCDF logoLuckily, the world isn’t waiting for the aid business to wake up. For some years now, aid from international donors has no longer been the only “show in town”. Development funding is already starting to diminish or to become more directly associated with countries’ commercial interests. And, at the same time, local philanthropic sectors are emerging in many parts of the world that were traditionally considered purely “aid

KCDF grants map

KCDF grants map

recipient” countries. The super-wealthy are establishing their own foundations (although relatively few are yet interested in achieving their mission through grants to civil society) and many of these already overtake their European and North American peers in asset size (such as in China). And in many countries, a growing middle class has its own disposable income, and an increasing appetite for giving to social causes.

Raising money locally can be hard work. It’s far easier, of course, to submit a proposal to an eager external donor who shares your goals, and, let’s not deny it, your jargon.

But local funding is not just about the money. It is a crucial—and sadly overlooked—part of a larger political strategy for constituency building, for getting people to learn and care about your cause, so that when your organization is threatened with closure, there are people in the community that may actually speak up.  Just as taxation strengthens the social contract citizens and states, local fundraising can improve the accountability of CSOs to the people they serve.

Shifting the balance of funding power (because yes, it is power, even if we consider it to be “good” power) from international to local is going to be a long, and inevitably slow process. But there is already a growing set of institutions to learn from in the global South—including community foundations, community philanthropy organizations, women’s funds and other types of local grassroots grantmakers. These include the Kenya Community Development Foundation, Instituto Rio in Brazil, India’s Foundation for Social Transformation and the Waqfeyat al MCF panner_rightMaadi Community Foundation in Egypt.

This new generation of organizations constitutes an essential, but often missing piece, not just of civil society architecture but also of healthy, inclusive communities. They put together local and external cash under a single institutional roof, in order to give small grants to local groups through open calls for submissions, acting as a counter (or complement) to local level government institutions.

The way such organizations are governed is crucial to their wider impact. They seek to be reflective of their communities in the composition of their boards, pitching their institutional tent as broadly as possible to maximize both ownership and potential for resource mobilization. In this way, they can bring the diversity of communities’ interests together “in-house” and draw in and on different perspectives. Participatory grant-making, where communities themselves are involved in decisions around resource allocation, is another important feature of this field. It’s hard and labour-intensive work, particularly when communities have never been asked to make such choices before, but essential if power is really going to be shifted.

Over the past ten years, my organization, the Global Fund for Community Foundations has sought to increase recognition and mutual support for this fledgling movement, building up a network of over 160 community philanthropy organizations in more than 60 countries: while each organization looks different, what unites them as a group is a core belief that development will be stronger and more lasting when local people see themselves as co-investors and participants. And yes, it turns out that when a funding base is made up of lots of different contributions from local sources, it is often able to address sensitive issues that might get organizations that are entirely dependent on external funding into serious hot water.

Insitituo Rio logo-siteCommunity foundations in Central and Eastern Europe, for example, have started to engage around issues affecting the Roma and, even more recently, around refugees from Syria. That wouldn’t be possible without the trust and reputation they had accumulated by working across a range of other local issues for many years. In other parts of the world, our partners are tackling other hot potatoes such as migrant labour, the environment and peace-building.

For donors, this is not about a call to back off, but rather to think and fund differently, to realize both the power and the limitations of their support and to engage in some serious reflection as to the kind of long-term footprint that they want to leave behind them. In short:

  • Local, people-centred institutions matter. International development needs local NGOs but when they are shaped too much by external funding they might not be the kinds of organizations that local people actually want. Local civil society organisations can play an important role in negotiating with other institutional players (state, corporate etc.) but their ability to do so also depends on some degree of legitimacy and local buy-in – and perhaps not looking just like mirror images of their funders.
  • Communities have assets but too often they are overlooked in the development equation. And local giving equates to social capital and trust, something that is almost impossible to build from the outside.
  • Finally, building local philanthropy is a slow, painstaking process: external donors can play a critical role in FST logoproviding matching and core funding. And they also have much to gain by working with local partners who can target grants and other supports deep into communities that are normally beyond the reach of external donors.

This is a difficult, soul-searching time for civil society and donors alike. Community philanthropy cannot provide all the answers. But the field offers some important insights into how to build a more democratic, respectful and resilient (both politically and financially) foundation for the exercise of active citizenship.

 

2 comments

  1. Great article, Jenny, and I´ll definitely begin to keep my eye out for this new type of community foundations. Most of the foundations I´ve come across in emerging economies tend to be those of the super wealthy and have little interest in supporting social movements, advocacy/campaigning, let alone challenging the elites (ie. themselves). The closest I´ve seen in Mexico are small community-led credit unions, but it´s quite a different model by the sound of it. On the issue of developing country governments weaning themselves off aid, I´ve been looking at some of the figures of aid over time, and many Latin American countries, and no doubt other MICs as well, have never been aid dependent (ie. aid has never reached more than 1% of GDP, and State resources for social development and public services far outweigh aid). As such, even if levels of aid to many of these countries are still declining, the role aid has played has in a sense always been a catalytical role rather than a shaping/controlling role. It has funded advocacy and campaigning work, often holding the State and private sector to account, precisely the type of work that most domestic funders are unlikely to support, and this role (and funding) is just as important now as it ever was. How it continues to be supported is a fundamental question CSOs in MICs are grappling with, with very few clear answers. The challenge of how we engage emerging middle classes is really important, and I think this relates to your point about building constituency, trust and reputation over many years. Without an established tradition of charitable giving, a very strong aspirational consumer culture, coupled to a complete mistrust of politics or organisations seen to be too “political”, creating a long-term plan to build a supporter base must be key. I think you are right that lessons from community philanthropy might point us in the right direction.

  2. Interesting article which neglects some important points of history. The aid industry only came into being after the former colonies of Asia and Africa became independent. No way the Brits etc. would have allowed it. In India there were many people (including my great-grandfather and grandmother) who were inspired by Gandhi’s message of self-rule and started organisations to sell locally made textiles (I can remember the stories told by my father about how Brits cut off the thumbs of Indian weavers in the area he came from and forced Indians to sell and buy stuff made in their own mills?) and help people from low socio-economic backgrounds to help themselves. In the post-Independence era there are many industrialists like the Tatas and Sarabhais who have funded philanthropic institution, Ela Bhatt who founded the Self-Employed Women’s Association and a host of others. You may wish to visit the website of the Voluntary Heath Association of India who does a lot of work on health. Of course India has a very long way to go, but it would be nice if OXFAM etc. started acknowledging the work of Indigenous leaders. Mark Tully of the BBC in ‘No Full Stops in India’ wrote about his unease about the way OXFAM, Christian Aid etc. in their quest to raise funds always ignored the work done by Indians themselves. My friends and colleagues from African countries feel this is true of how Western aid agencies portray Africa as well. And despite all the rhetoric about poverty and gender inequities we have found that most people employed by the aid agencies do not feel comfortable when meeting those of us who do not need to be saved. Our impression was that many of them needed to be saved themselves!

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