African NGOs are being underfunded by African and non-African philanthropists alike in comparison to organizations headquartered outside the continent, according to a recent report from the African Philanthropy Forum and The Bridgespan Group.
The research, which delves into the driving factors behind funding disparities for African NGOs, found that African funders directed just 9% of large gifts to NGOs based on the continent between 2010 and 2019, lower than 14% funds provided by non-African funders to these NGOs. Those numbers remained virtually unchanged despite a “massive” response from African funders to the COVID-19 pandemic in 2020, according to the report.
The report notes that African philanthropists are directing more money toward their own private operating foundations instead of local NGOs. These funders gave 33% of large gifts to operating foundations, examples of which include the Africa-based Mo Ibrahim Foundation and The Tony Elumelu Foundation.
Operating foundations mostly oversee their own philanthropic activities instead of directing grants to other organizations. This structure allows philanthropists to keep a close eye on how their money is being spent, and their use often reflects “a belief in the abilities and business backgrounds of the wealthy funders behind the operating foundation” rather than a lack of faith in African NGOs, the report says.
Lack of trust in African NGOs
It adds that some people who were interviewed for the report said there is a “pervasive lack of trust in African NGOs” among African funders.
Mosun Layode, Executive Director at the African Philanthropy Forum, which represents African philanthropists and social investors, stated that one of the goals of the report is to show African philanthropists that local NGOs have more knowledge about and credibility with the communities they want to reach and may therefore be better situated to help those populations.
“I would say that the operating foundations may not make as much impact. They won’t have as much leverage in those communities. It’s going to take them time to build the credibility and access and connections that the NGOs already have” .
Layode
The research shows that without much funding flowing from African philanthropies, NGOs on the continent have been forced to look elsewhere. But non-African funders have similarly shown a reluctance to give to these groups. Instead, the majority of their large gifts have gone to international organizations headquartered outside of the continent, according to the report.
The data shows that when African NGOs do receive grants, they often are small, short-term, and restricted. Very few funders provide African NGOs with multiyear grants that allow for more stability, Layode said.
Other barriers to funding of African NGOs
Other barriers preventing African nonprofits from receiving philanthropic funding include a lack of targeted strategies within philanthropies to identify such groups, as well as the use of exclusionary “Western-centric” grant-making criteria that favor larger organizations over community-based ones, according to the report.
The findings come amid increased wealth accumulation and private philanthropic giving in Africa, the authors said. The authors explained that this creates more opportunities for regional philanthropists to fund nonprofit organizations, and a greater need for a strong ecosystem to make it easier for nonprofits to tap into regional funding flows.
Furthermore, the authors highlighted that the prominence of the Black Lives Matter movement and increased focus on racial justice globally have created a “reckoning in the international philanthropy space” that has highlighted the need for more locally led solutions.
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