Unleashing the True Potential of Philanthropy to Transform Lives and Communities
Over the past couple of years, I have spent an inordinate amount of time in meetings and conferences about the role of philanthropy in _______ (fill the blank with ‘global development’, ‘SDGs’, ‘closing space’, ‘climate solutions’ etc.). Usually, the conversation focuses on big foundations, family offices, high-net-worth-individuals…big philanthropy.
So, reading this new GrantCraft paper, How Community Philanthropy Shifts Power: What Donors Can Do to Help Make That Happen, produced in partnership with the Global Alliance of Community Philanthropy and the Global Fund for Community Foundations was certainly refreshing and much aligned with what we do at Charities Aid Foundation (CAF).
For many years, CAF has worked internationally to grow effective giving, working with donors and civil society organizations to build the practices that underpin philanthropy and cement giving and civil society engagement both as part of the national culture, and as the foundation for social cohesion and stable democracies. For CAF, philanthropy is not just an input of resources into society, it is also an output and an outcome.
It goes without saying that this paper is very much needed. It not only adds to the need for us to redefine what philanthropy is, but also provides good examples and case studies of how donors can support the growth of domestic giving and community philanthropy. However, we need to do more to highlight the context we are working in to truly appreciate the significance and impact philanthropy (community or otherwise) can have as part of a broader strategy to counter some of the greatest challenges facing civil society today. There are four key aspects here:
- The phenomenon of shrinking civic space is getting worse and the global clampdown on civil society has deepened and accelerated in recent years
- The global distribution of funds presents a real problem for global southern-based CSOs. According to CIVICUS, out of the $166 billion spent on Overseas Development Assistance (ODA) by OECD-DAC countries in 2013, only 13%, or $21 billion, went to civil society, with Southern CSOs receiving only 1% of this directly.
- The global decline in institutional trust which, combined with a growing perception that civil society is ineffective, poorly governed and not reflective of local values, is undermining the credibility of CSOs
- Increasing legislation and regulation of financial transactions to counter anti-money laundering and terrorist financing are placing enormous burdens on civil society, contributing to the lack of funds being directly sent to or accessed by Southern CSOs.
Often, we look at these things in isolation which, given how complex they are, is understandable! However, taken collectively, we can better understand the role and impact domestic philanthropy can have not only in the context of global development and the SDGs, but as part of the sustainability of civil society as a whole and the preservation of civic space.
The idea that community philanthropy is an important part of the development architecture is beginning to catch on within the donor community. However, if donors take their usual course, this idea risks not taking hold in the mainstream. There are some great case studies of initiatives in this paper but for now, that is what they are – short-term initiatives that show great potential. We need them to become long lasting and systemic.
This is a nuance we need to be cognizant of. Much of this paper focuses on, rightly, how external funding can be better deployed to support locally driven development, recognizing that #ShiftThePower is not just about funding flows. Bringing local voice into project design and then resourcing local organizations and the community itself to lead and implement projects that are embedded in and representative of the local community is crucial to sustainable development. This is about donors being more alert to community needs and progressive thinking in terms of understanding that working as close to the issues as possible with and through networked, capable, and trusted local organizations will lead to better development outcomes. But it doesn’t address the structural issues facing local civil society resilience and sustainability.
To achieve this, several things need to happen. First, donors need to move away from ‘projects’ and recognize that strengthening the long-term resilience and sustainability of civil society as a whole is a positive and impactful development outcome in its own right. Second, we need to look at the long-term resourcing models for local CSOs outside of narrow thematic areas. Third, to truly #ShiftThePower, we should look at how external funding can be utilized to invest in the ‘stuff’ that sits behind a diverse and vibrant civil society. And, fourth, funders should find a deeper understanding of how powerful it is when individuals engage in society by giving time, money, and other forms of support.
What is really exciting in this paper is the simple hypothesis of what community philanthropy is – all communities have a range of valuable, tangible, and intangible assets that are currently under-utilized or under-estimated in global development but are powerful when harnessed. However, we must go further to ensure these initiatives do not remain dependent on external funding sources and interests. We must look at how we release domestic civil society from external constraints.
For more than 25 years CAF has worked to build the essential infrastructure for domestic philanthropy and civil society in emerging markets such as Russia, Brazil, India, and South Africa. The CAF Global Alliance, an international network of locally led, independent organizations, works to catalyze philanthropy and strengthen civil society. In recent years our focus has turned to the powerful potential of a growing middle class in emerging markets.
Projections from the Brookings Institute suggest that up to 2.4 billion people could enter the middle classes globally by 2030. CAF’s Groundwork for Growing Giving Campaign highlights the potential impact that mass giving amongst emerging middle classes could have on civil society. Our research has shown that a potential $350 billion a year could be going to civil society by 2030 if giving is promoted amongst the new wealthy demographic in the middle classes.
This is a huge amount of financial resource that is greatly needed and is available where they are most needed – at the national level. While focusing in on the big numbers here is important, there are added benefits these resources bring. On the whole, community philanthropy (or mass public giving) is given freely to organizations, providing vital unrestricted income, allowing CSOs to take control of their decisions, being able to focus on and fund work that is important to them and their constituents, and a great enabler of innovation.
Beyond the finances, people giving connects them to the organizations and issues that matter to them and this connection leads to shared accountability, ownership, and trust.
So, yes, supporting the growth of community philanthropy is crucial to #ShiftThePower, but to ensure this shift is permanent and that the latent resources that exist in our communities all around us are truly harnessed, we need to invest in the support structures that allow philanthropy to thrive and civil society to flourish.