What have we learned?

The moon has a shadow side but since we always see only the bright side we could only guess what the other side was like and we had to go on a journey to outer space to really see it. As for philanthropy, we do see its shadow side almost as often as the bright one, but we don’t often talk about it. Alliance has been brave enough to explore and invite us on a journey around the shadow side of philanthropy. I had the privilege to be among the first to go on this journey, and I must say I enjoyed it very much. Here is what I came back with.

A typology of murky figures

Michael Lerner looks at a range of different players in the ‘foundation food chain’. I particularly liked his expression ‘the self-appointed foundation strategist’. This is the one who lays out the war plan for NGOs to resolve the great social problems of our time. This led me to think of further typical figures I have encountered in the foundation world. While well-meaning, these types can do much harm, so beware.

The activist programme officer – who micromanages the grant, follows every step of the way and intervenes in every decision (eg what should be on the agenda for an event and who should be on the list of invitees or what should be included in the data collected from beneficiaries). This could be because, as often happens with intermediary grantmakers, they need to report to their own donors and are constantly concerned about something going wrong; or because the person would in fact like to do the job him- or herself – their main reason for not being in the NGO world being pay levels and job security.

What about the laissez-faire programme officer? NGOs of course do not mind this type at all. However, leaving the organization alone and blindly approving of every change they may propose can lead to a lack of accountability (or, in the worse case, abuse) on the side of the NGO. It also demonstrates a lack of interest on the part of the donor and leaves a feeling that ‘what we do does not really matter to them after all’.

And the ‘local expert’? There is an ongoing debate in foundations working internationally as to whether the staff responsible for a certain country should be the nationals of that country or not. I have seen several examples where people being responsible for giving grants in their own country has led to controversial situations. When the person who was until now ‘one of us’ becomes the representative of money and power, that can be hard for some NGOs to swallow. More importantly, the person in that position now feels that he or she does indeed have greater power to influence things and tends to favour certain organizations, cherry-pick projects and even impose strategies or projects on NGOs, sometimes in a tacit but sometimes in a more explicit way. The HQ does not necessarily see any of this as they trust the ‘local expert’.

Gender and ‘political correctness’

The short piece on foundations and gender points to the striking difference between the US and Europe as regards the extent to which women are represented in decision-making in the foundation world. But I also want to reflect on the importance for both US and European foundations of not imposing their own need for improvement on their grantees. I have come across several (especially UK) donors who expect their grantees to engage in a gender mainstreaming policy and who ask questions in their application forms such as how many women are on the staff, on the board, or among the managers, and how they plan to ensure gender balance in the project. Based on the Central and Eastern European experience at least, this is not very helpful as NGOs will always find a way to give the proper answers without reconsidering their actual gender balance.

Moreover, this gender balance can actually go both ways. It is common to have patriarchal NGOs with a male chairman and women carrying out the nitty-gritty work. But in Central and Eastern Europe it is equally if not more common to have all-women NGOs. So the problem for many NGOs is that they do not have any men on the staff or the board; these NGOs may fit funder requirements but can have a rather unhealthy organizational culture that stifles effectiveness. (I do not refer here to NGOs where it is a conscious choice to have only women, like women’s self-help groups.)

The imposition of politically correct agendas by Western feminist thinking can go beyond the formal requirements. A recent article in IJNL[1] describes how Bulgarian women’s NGOs have had their projects determined by the ‘politically correct’ agendas of Western donors, which do not correspond to the real concerns of Bulgarian women such as unemployment, crime and increasing income inequality. There has certainly been a tension in the past 15 years between the mainstream Western feminist agenda and the vast majority of East European women who do not believe in ‘sisterhood’, do not feel ‘oppressed’ or ‘victimized’, and do not think that sexist advertisements have to be a top priority for women’s NGOs. Women’s NGOs in Central and Eastern Europe have not really been able to mobilize social support, and this is partly due to this disconnect between what really concerns women and what Western-funded women’s NGOs advocate for.

Agenda-setting

In terms of philanthropy, the gender issue reinforces the importance of proper agenda-setting, which is pointed out in several of the articles in this issue. The interview with Ingrid Srinath from CRY centers on problems of how to deal with gender discrimination in a caste society. Rebecca Adamson defines problems with compartmentalizing funding and the phenomenon of ‘philanthropology’, which prevent donors from effective grantmaking to indigenous peoples. Whether donors are dealing with post-communist ‘transition’ society, caste divisions, a religious Islamic culture, or a holistic indigenous worldview, it should be the rule of thumb to start from the local circumstances in setting the philanthropic agenda.

But let me pause here for a moment. While we absolutely should consider the local culture and needs when determining the need for social change and the best means to achieve it, this should not mean that social change will be subordinated to the local environment. The fact that the biggest problem for Bulgarian women is unemployment does not mean that there is no need to address domestic violence in Bulgaria. The fact that gender is not the biggest issue within the Dalit community in India does not mean that there is no discrimination to be dealt with. The fact that there is no local demand for transparency of government does not mean there is no need for it.

This puts donors in a difficult situation internally and externally. Internally, because they may have to reconsider their own funding guidelines and adapt them for every country or even every community; externally, because they will have to find NGOs who are able to achieve the ultimate social change objectives in an effective – non-intrusive, non-imposed, learning-led – way. The truth is, there are not too many such NGOs to choose from.

Power and money

It is often the NGOs themselves who rush to accept the donor’s agenda even if they see that it may not effectively address the local issues. Not being a donor, I feel it is my obligation to say what donors may feel shy about saying: it is not (just) the donors’ fault that NGOs behave like this.

I very much agree with David Gold (‘The power of the chequebook’) that the power of money in and of itself often distorts the relationship between the parties. He describes a scenario where a mere remark of a donor prompted an NGO to revise the whole application and concludes that it is important for donors to watch what they say. This is true, as is all the good advice from David on meeting the grantees on their own ground, asking questions about themselves rather than about the project, talking openly, etc.

I would, however, propose that NGOs who know what they are worth, what they aim to achieve and how you can help them will not submit to the power of the chequebook. They see you, the donor, as an important means to achieve their goals just as much as you, the donor, see them as a means to achieve yours. In a quid pro quo situation partnership should be evident, as in any win-win business deal.

In other words, there is only so far the donor can go in being cautious, nice and empowering with the grantee. At some point, grantees have to become aware of their own power and regard the donor as an equal, otherwise it is easy to slip from empowerment mode to paternalism.

Donor transparency

One way to overcome the power barrier and ensure that grantees can regard donors as equals is to increase the transparency of the donor. Interestingly, this was not addressed in the wide array of topics on the shadow side of philanthropy. Think about it: as a grantee, you submit every aspect of your precious organizational life to the donor, including salary levels, how you allocate costs within the NGO, your visions and dreams, the ‘learning points’ from failures in your programmes. Doesn’t that make you exposed – especially knowing that the donor has the same amount of information on hundreds of other NGOs and can compare your salaries and outputs with those of your competitors?

The least the donor can do to mitigate the effect of this self-exposure is to return the openness – maybe not to reveal the salaries of the programme officers (what an idea!) but certainly to a greater extent than is common practice. Most NGOs see the grants list and the financial report, though they often don’t understand the latter. But do they know what these numbers mean to the donor? Do they represent a success? Or a diversion from their plans? Are we helping them achieve something or are we a liability in a programme that should be closed down?

Yet transparency means more than numbers. The most sensitive aspect of transparency relates to decision-making mechanisms – and I’m not just talking about how transparent donors are about why they support certain organizations and not others. I have not yet come across a donor, for example, who would genuinely and in a transparent way involve its grantees in its own evaluation and strategic planning process. I have answered many questionnaires and given many interviews to independent evaluators, but I’ve failed to see the link between my involvement and the result of the process. I have never, for instance, been invited to a facilitated session where the donor presents to its grantees, past, present or future: this is what we achieved in the past, this was your contribution, this is what we think we learned, this is where we plan to go – what do you think? This is more likely to come in the form of a finished strategy report that the foundation has compiled internally or with the help of an expert. Then the ‘what do you think’ part really means: will you come along or not?

Donor communication

Related to this, and also a key indicator in donor-grantee relationships, is communication on the part of the donor. In fact the style and patterns of communication by donors might be a shadow side worth a study by itself. Here I have seen good and bad examples. Some of the bad examples are the following:

• Donors requiring grantees to submit information by a certain deadline but not committing themselves to any deadline for providing information;
• expecting quick responses from grantees but making them wait weeks or months for their own responses;
• being informal during face-to-face meetings but keeping to a formal style in writing and sending out group emails;
• requiring more and more to be submitted in writing when things seem to be going wrong.

A lot of this comes down to a basic respect on both sides. Trust is mentioned in several contributions, and trust can be given only to someone we respect. When the donor thinks, ‘my, I could do better than these guys, why can they not perform the way they should’; when the grantee thinks, ‘whatever they want us to do we will find a way to do what we want’ – there is a lack of respect and hidden agendas and the relationship will reflect that.

Free-market philanthropy

Finally, some reflections on an undercurrent reflected in these contributions, which I consider part of the ‘no logframe movement’. In recent years, there has been a definite emphasis on the need to dismantle the infamous ‘logframe’ models of planning and evaluation and revert to more ‘organic’ or, as Chet Tchozewski puts it, more ‘intuitive’ ways of decision-making in the philanthropic arena. Perhaps this is best practice. Perhaps it is just a backlash against the overly bureaucratic, technocratic approach of multilateral and bilateral donors.

Governments spend taxpayers’ money and need to be accountable to them, so they come up with a vast amount of red tape to safeguard their spending. In private philanthropy, do we need to be accountable in the same way? Maybe, actually, not. Do we still want to be accountable? And what shall we do if the answer is ‘yes’?

In the business world, successful companies are intuitive learning organizations as well as producing things that can be counted through means that can be counted. In fact, only results that can be counted will show whether they are successful. Why make a dichotomy out of two reinforcing elements of success? My point is not to defend the logframe (though there could be a nice debate about it) but to avoid swinging to the other side of the pendulum: grantmaking without any measure of whether we are making a difference or not.

I do like what Chet proposes, though, because it is like the free market: there are needs emerging and funds responding and it all balances out nicely. In this ideal world, philanthropic supply meets demand. Is there a shadow side of this ideal world? Just that it seems far from reach, for the moment.

1 Kristen Ghodsee (May 2006) ‘Nongovernmental Ogres? How feminist NGOs undermine women in postsocialist Eastern Europe’, International Journal of Not-for-Profit Law, Vol 8, Issue 3. www.icnl.org/knowledge/ijnl/vol8iss3/art_2.htm#_ednref1

Nilda Bullain is Executive Director of the European Center for Not-for-Profit Law. Before that she was Executive Director and is currently a Board Member of the Civil Society Development Foundation Hungary. Email nilda@ecnl.org.hu