What Is Capacity Building and Why Is It Important?

Capacity building is fundamentally about improving effectiveness, often at the organizational level. The term is sometimes used interchangeably with other terms like organizational development, institution building, and funding plus. It is both a verb (the action of building effectiveness, often by improving specific organizational capacities such as infrastructure, operations, financial health, and programs) and a noun (the results of increased attention to effectiveness).

Here we focus on both the action and what results when funders and grantees work together to build the capacity of grantee organizations

Takeaways are critical, bite-sized resources either excerpted from our guides or written by Candid Learning for Funders using the guide's research data or themes post-publication. Attribution is given if the takeaway is a quotation.

This takeaway was derived from Supporting Grantee Capacity.