More than money: Optimising philanthropy’s potential to fast-track development

By Bathylle Missika (Acting) Head of Policy Dialogue Division, OECD Development Centre

The Sustainable Development Goals (SDGs) have such scale and complexity that they require governments to strengthen co-operation with a broad range of development actors. Foundations, among others, may play a role both in financing development as well as in designing and implementing innovative projects. On the one hand, North-South flows from foundations based in OECD countries alone have grown almost tenfold in less than a decade, from USD 3 billion in 2003 to USD 29.7 billion in 2013.[i]  The 2012 assets of the Bill and Melinda Gates Foundation, The J. Paul Getty Trust and the Ford Foundation equal the GDPs of Panama, Mongolia and Mauritius, respectively. On the other hand, foundations also have a non-financial value as last July’s Financing for Development Conference in Addis Ababa recognised. That conference was a turning point in thinking about foundations as more than mere ATMs for development.

Foundations have the potential to fast-track development; the momentum now is on how and with whom to do so. Realising such potential is neither a given nor a clearly defined pathway. Are foundations stepping up to the challenge? Are they applying their capacity to innovate further? Are they moving at the same pace? If and when they do act, how can foundations significantly make a difference in the post-2015 agenda?

To start, a growing number of catalytic, venture or enterprise-based foundations are focusing on achieving impact and broad scale that far outlive the benefits of short-term, ad hoc grant-making. The Shell Foundation, for example, transformed its model to focus on cost-effective approaches to deliver sustainable impact at scale and measure such impact on the ground. Among its many projects, the foundation is helping create a market for clean cook stoves in India by working across the supply chain and exploring new distribution models. Other innovative approaches are starting to flourish. Randomised controlled trials are increasingly being discussed in the philanthropic sector as an alternative way to assess impact.[ii] The UBS Optimus Foundation used them to explore how causal relationships inform development outcomes in the context of the Children and Violence Evaluation Challenge Fund in Uganda.[iii] 

However, despite recent efforts towards more accountability and monitoring, evaluating philanthropic impact remains a tall order for the whole sector. While foundations have the resources and ambition to design innovative programmes to achieve social change across a range of development issues, doing so often requires replacing their cherished autonomy with solid partnerships across sectors. No organisation, no matter how powerful, can single-handedly bring about true social impact, argues Larry McGill of the Foundation Center. Thus, as McGill points out, unless foundations are only interested in local, short-term change, they need a collective, macro perspective that looks at changing entire systems. Some encouraging efforts are already visible. For example, Novartis Foundation joined forces in a multi-stakeholder coalition with Columbia University’s Earth Institute, the Millennium Promise, the Ghana Ministry of Health and Communications, Airtel and Ericsson to transform health services for Ghana’s poorest. Mobile technology will allow doctors and nurses to see more patients, while reducing transport times and costs.

Unfortunately, only a handful of such initiatives exist so far. How can they be replicated more broadly across the development galaxy? The OECD Development Centre’s Global Network of Foundations Working for Development (netFWD) is working with foundations to answer this question. netFWD is taking the lead in the Accelerating Impact 2030 initiative, which will be launched at the Ford Foundation later this week on the margins of the United Nations General Assembly. This initiative provides foundations with tools, data and a space to share lessons on how to sustain impact at scale and play their part in achieving the SDGs at the local level.

Only then will the true potential of foundations fully blossom, well beyond the money.


[i] OECD DAC statistics. Figures are in real terms.

 [ii] Originating in the medical sector, randomised controlled trials in their most basic form are experiments in which people are allocated randomly into an experiment or control group, with the only expected difference between the groups being the intervention they receive or do not receive.

[iii] Bandiera et al. (2012), Empowering Adolescent Girls: Evidence from a Randomized Control Trial in Uganda, World Bank, Washington DC,http://econ.lse.ac.uk/staff/rburgess/wp/ELA.pdf

 


This article should not be reported as representing the official views of the OECD, the OECD Development Centre or of their member countries. The opinions expressed and arguments employed are those of the author.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s