Proactive vs responsive philanthropy

Peter Laugharn

Peter LaugharnEach foundation is faced with the question of how its agenda will be set – and reset. This article looks at both responsive and proactive styles, and their extreme versions of ‘reactive’ and ‘directive’ grantmaking. The article also argues that in the end the relevant question is not so much whether funder or funded partner is setting the agenda but rather whether they can set up a strong, generative partnership in the context of agendas that are much larger than either funder or partner.

Responsive grantmaking

A responsive grantmaker is one whose leaning is to have grantees largely driving agendas. This includes accepting unsolicited proposals as well as having flexible project designs, proposal formats, and reporting. Typically the foundation will define to some extent what is to be addressed but allow significant latitude for how that issue will be tackled.

The typical drivers of responsive grantmaking include a stance of modesty or prudence – the robust assumption that others closer to an issue know more about it than a funder does. Funders wanting to work outside their own geographical area or zone of experience will often tend towards responsive grantmaking. Responsive grantmakers may also work from a philosophy of solidarity that goes beyond pragmatism about who knows what, taking the view that a funder’s role is to support action in a particular area, or at the grassroots, more than working towards any particular outcome. Responsive philanthropy tends to produce contextually adapted approaches, and places a significant emphasis on the relationship between funder and funded partner.

There are some downsides to responsive philanthropy, in that it can lead to a project-by-project focus that lowers coherence in the funder’s portfolio, thus limiting the funder’s ability to generalize from its experience. Since responsive funders take a less active role in specifying activities and results, they may be less able to commit to progress on outcomes, or even to discern overall outcomes from their grantmaking. Responsive grantmaking can come into tension with public or regulatory expectations about grantmakers’ ability to be accountable for results.

Proactive grantmaking

Proactive grantmakers, by contrast, seek to a greater extent to set the agenda themselves. Often this involves specifying not only the area of interest and ultimate outcome but also intermediate outcomes or methods.

Where responsive grantmakers feel accountable largely to the relationships they establish, proactive funders often see themselves as accountable for successful interventions. A proactive approach implies a focus on a particular socially valuable change. It is usually characterized by a breakthrough-seeking mentality, which in turn places emphasis on analysis and hypotheses, often leading to new knowledge. Proactive grantmaking is often accompanied by high levels of external accountability, either imposed or voluntarily accepted by the funder.

‘Philanthrocapitalism’ is usually characterized by proactive approaches. The large resources and public prominence of ‘new philanthropy’ tend to make foundations ambitious. The annual payouts required of very large foundations are difficult to achieve in a truly responsive mode without huge staffs and high transaction costs. But it should of course be pointed out that proactivity is not the unique preserve of large foundations: smaller funders may also choose a strong results orientation. Nor is it necessarily linked to a business background: focus, discipline and strategic thinking are certainly not the monopoly of business.

One obvious risk in proactive funding is that the funder may not have sufficient understanding of situations and actors to achieve its goals, or enough flexibility to adjust its approach when necessary. An overly proactive approach may also become directive, essentially turning grantees into contractors, and running the risk of ignoring the partners’ strengths and overestimating the funder’s own grasp and effectiveness.

Combining approaches

In practice, while many foundations would place themselves in one of these two camps, it is rare to find foundations working consistently at either end of the spectrum. Most foundations in fact use both approaches, deciding the ‘dosage’ in each situation. I can illustrate this by the example of my own organization, the US-based Firelight Foundation, which is focused on supporting the community response to children affected by AIDS in Africa.

More than 10 million children in Africa have lost one or both parents to AIDS. This crisis compounds already difficult circumstances of poverty and lack of access to education and health. It has significant effects both on present-day quality of life for children and on the next generation’s economic and social chances. In those countries hardest hit by HIV/AIDS, it is estimated that more than 90 per cent of the response to children affected is at extended family and community level – not from national governments nor from multilateral or bilateral assistance, despite the significant size of those efforts.

Community action is thus the current front line, and it makes sense for foundations to support it – that is, to work in responsive mode. This is where the large majority of Firelight’s grantmaking funds go, on the principle that community-based organizations will know better than Firelight which interventions are the most promising in a given situation. For this grassroots-oriented grantmaking, we have established processes to enable us to respond quickly with small grants, delivered efficiently. We have tried to keep bureaucracy to a minimum, minimize paperwork, and deal expeditiously with US regulatory requirements. We have sought to set up monitoring and evaluation systems that are intelligible and useful to those working at the grassroots while also feeding important data and insights into a wider discussion.

But while we are committed to grassroots grantmaking, we also recognize that the current division of labour and resources is unjust and unsustainable. Families and communities are bearing much more of the burden than they should. As we see it, two larger changes need to happen. First, a larger share of the significant resources mobilized to fight AIDS should be made available to community action. Second, some of the areas in which communities are now getting involved are more appropriate for the state to undertake. There should be a realigning of responses among actors.

These two macro-level issues draw Firelight into a proactive philanthropic mode. We seek to draw insights and lessons from our field experience and our networks about how more resources can be made available to grassroots action, and to increase knowledge about which combinations of community and state response are most effective. The desire to contribute to discussions about effectiveness means that part of our funding portfolio needs to be shaped not only by what field-based partners ask for but also by what the most perceptive practitioners tell us and by what decision-makers need to know. Firelight and partners will be debating working hypotheses about which interventions make the most difference for children, and examining these hypotheses through action and operations research. We will have a strong learning agenda, will at times negotiate vigorously with partners about project design, and will encourage larger evidence-oriented actors to conduct rigorous research into the question of effectiveness.

A larger ecology of international social action

But the bigger issue, after all, is not whether foundations or funded partners are the ones setting the agenda. In reality, neither one sets the agenda as they are both actors in a much larger landscape as they seek to address huge challenges like climate change, HIV/AIDS, or expanding access to education. The real issue is whether foundations and their grantees can form effective partnerships.

‘Partnerships’ should be literally that – robust collaborations involving actors with similar goals but different and complementary resources, networks, and ways of working and thinking. Foundations should welcome partners with strong convictions, and engage in lively debate on how to reach mutual goals. Responsiveness should not be just a passive philosophical stance – ‘the partner always knows best’ – but rather be characterized by dialogue, willingness to learn, and an ability to observe and to identify and correct assumptions.

Foundation agendas should thus be set in consultation with the foundations’ funded partners, who have knowledge, networks and experience, have passed the foundation’s initial assessment tests, and know the foundation well. But agenda-setting should also involve non-funded, non-dependent organizations, for greater objectivity, as well as those organizations (often larger ones) that the foundation seeks to influence. And it needs to take into consideration both local context and important global debates. Agendas should be explicit but flexible, with room for adjustment based on learning.

Foundations have a responsibility to pursue a mandate and to set goals – this is central to accountability and to measuring and improving effectiveness. The key is for a foundation to set its own agenda in ways that promote the establishment of robust and generative relationships with other organizations, which produce much better results than the foundation could achieve on its own.

Peter Laugharn is Executive Director of the Firelight Foundation. Email

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