A new kind of aid donor: Four things they do differently

[Jennifer Lentfer]

We all know there are aid donors and international funding partners out there that want to change “business as usual” in development (or at least people inside those institutions that do). We also all know that for various reasons, they’re not moving quick enough for those working on the ground.

New donors could come in and fill the gaps. But more importantly, we need a new kind of donor, whether they are recent to the scene or not.

The organizations that I see doing the most important and exciting work out there these days most often do not fit into current donors’ way of doing business. Donors who rely on lengthy proposals, onerous reporting, and heavy-handed funding mechanisms frankly cannot offer useful capital to organizations that don’t fit the mold.

To change this, this new kind of donors will do four things better than donors still stuck in the old ways of moving money around:

1) They are patient. They invest not just today’s services or activities delivered, but allow for uncertainty and potentially lower short-term results in favor of long-term outcomes.

2) Their money follows ideas and people, rather than activities. Project may be the modus operandi, but they do not allow them define or confine relationships.

3) They demonstrate a tolerance for risk, rather than failure. They help keep a focus on results, yet offer flexibility and responsiveness to changing conditions.

4) They are able and willing to look within and examine how their own policies and practices exclude and/or inhibit some of the most innovative and effective organizations.

Aid financing can no longer be disconnected from people and place, flowing into a community based on a donor’s imperatives. A new kind of aid donor is courageous enough to put their partners’ needs first and is adaptive to arising needs, inherent complexities, and local realities.

A new kind of aid donor knows that serving their partners’ interests first is what will ultimately fulfill their own.

This post originally appeared at: http://www.how-matters.org/2012/06/17/a-new-kind-of-aid-donor/

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[LCD]

@Rowan, see you in the new thread :)

[Rowan Emslie]

@LCD - that was sort of my point. Big donors don't want certain types of agencies to apply because they know it will come back to bite them in the ass. They want to fund middle-men who have small, local partners so they can take responsibility for problems. How often do you see the 'local network' mentioned in funder outlines these days?

[J.]

@ Rowan and LCD: I'm actually quite interested in the discussion you seem to be starting, here. I've added it as a new discussion (http://aidsource.ning.com/group/humanitarian-practice/forum/topics/...) inside the "Humanitarian Practice" working group. 

Hope to see additional debate there!

[LCD]

@Rowan, bilateral donors require onerous proposal and reporting paperwork for many reasons, but in my experience accountability to parliament/congress (and ultimately the taxpayer) for the money spent is the biggest one. This is not to say that their policies and procedures don't make it difficult for smaller NGOs to receive funding, or that we shouldn't be agitating for better bureaucratic practices. The lack of donors of the type described above is down to a whole lot of complex factors. I don't think a calculated attempt to squeeze out the little guy is the aim of many big donors -- it just happens because their interests lead them to put in place structures that happen to exclude them.

[Rowan Emslie]

Aren't the donors who require lots of paperwork, time, money, effort doing so because they want to weed out smaller orgs? What I mean is: is the lack of donors of the kind you describe an oversight or a calculated move?

[Jennifer Lentfer]

@M Couldn't agree more with regards to whose evaluation counts. (Our proclivity for pain in the ass-ness must be shared.) For this particular donor I am describing in the piece, keep in mind that program staff do not function as assessors of a particular project, or even grant, but rather of partnerships. The only question in their mind is...shall another grant be given? Therefore, in terms of our "outcomes", we were looking for the extent to which grantees utilized the very approach you describe, namely who's driving and how are "beneficiaries" shaping the organization's activities? http://www.how-matters.org/2011/09/05/already-of-the-community/

You're absolutely that funding sustainability continues to be an issue, large or small scale. You might also be interested in reading, "The Poor Philanthropist: How and why the poor help each other." http://www.impactalliance.org/ev_en.php?ID=14913_201&ID2=DO_TOPIC It describes how as outsiders we need to re-orient ourselves around this issue...

[M.]

Interesting approach, the micro, surely full of hope I think. It is not my intention to be negative but Im trained to be a pain in the ass, sorry. So even though I see hope for evelopment to happen in this way, it occurs to me that the issue of sustainability and continuation after project/grant/intervention is finished ( pera subject that personally obsesses me) seems not to be addressed either.

Correct me if I'm wrong, I read through it really quickly. And the issue of evaluation of performance is addressed in a way ("we dont evaluate becasue it's expensive") that for me lacks something while perpetuating the classic power approach (us-them, donor/receiver): they say "foundation staff analyzed grantee reports (..) and conducted site visits in order to determine the extent of responsible use of the funds (...) empowerment of communities and families, holistic programming, and demonstrated outcomes". And reading this comes to my mind, that maybe the ones who should evaluate the intervention are the people who benefited from it, actually, as simple as that. I would perhaps ask the community (after finding out who exactly is the commnity) if she fees empowered, if she feels she has benefited form some outcome, if she feels the outcome is long lasting and has produced sustainable change.

just my humble thoughts. I still find the micro approach as being able to respond to challenges that some big ngo's and their dinosaur approach can't. thanks,

M

[Jennifer Lentfer]

This post discusses some organizations that are making small, responsive grants internationally directly to local groups (mostly with private money): http://www.how-matters.org/2011/01/13/small-grants-part-2/ Many of them emphasize funding "core operating costs" in addition to activities in order to make sure that the people that make up the organizations have what they need.

[LCD]

Yes, please name them :)

[M.]

hello,

have you found this kind of donor? if so, could you inform us on who they are? thanks,

M