Buzzword of 2011: Capacity Building
Posted: 11 May 2011 Filed under: Australia, philanthropic sector, USA | Tags: AEGN, capacity building, collaboration, EGA, PCBR 8 Comments »Ok, so it’s only May but I’m going to put my neck out early and call ‘capacity building’ the buzzword of 2011. A big call, especially with so much talk of ‘transparency’ lately. Call me cynical but I do worry that capacity building will be to 2011 what ‘collaboration’ was to 2008-2009. We in the philanthropic sector can talk the good talk but turning the rhetoric into reality is actually bloody hard work. When I talk to my colleagues about ‘collaboration’ more often than not what we end up discussing is ‘co-funding’. And while there are excellent examples of genuine collaborations between trusts and foundations over the last few years, somewhere the definition of what collaboration is has been lost in the noise.
I don’t want to see capacity building lost from the philanthropic agenda. It’s important for philanthropy in Australia to examine not just the ‘why’ of supporting non-profit capacity building but also the ‘how’.
But first the basics, what is capacity building? The Human Interaction Research Institute which operates the Philanthropic Capacity Building Resources (PCBR) Database describes capacity building as:
“the term used to describe funding, and services such as staff and board training, technology or other capital purchases, fund-raising strategy development, and other activities that help strengthen nonprofit organizations”.
In some circles you might hear ‘capacity building’ referred to as its evil alter-ego, ‘core-funding’. In philanthropy speak, when someone says core-funding the response you’ll get from a foundation is likely to be ‘you should be funding this yourself’. So for some in philanthropy capacity building is simply a no go area and that’s ok. For those that are interested in the value of funding in the capacity space there are a number of challenges, the biggest of which is the question of how.
Building the capacity of grassroots environmental organisations was the focus of a number of sessions at the 2010 Environmental Grantmakers Association (EGA) Fall Retreat in the US last October. At the retreat Amanda Martin, Executive Officer of the Australian Environmental Grantmakers Network, brought together a group of Australian funders to hear from Paul Beaudet of the Seattle based Wilburforce Foundation. Paul explained that at the Wilburforce Foundation they recognised that in order to build the strength of the communities they were working in, they needed to build the strength of the orgnisations they were working with. Rather than develop a grants program to allow organisations to access capacity funds, the Wilburforce Foundation developed a network of service providers that their programmatic grantees could access for support in their own areas of identified need. The Foundation’s grantees did not need to tell Wilburforce what providers they were accessing for support. In fact, the Foundation created an entire new entity to ensure they were completely removed from the process. This allowed their grantees the freedom to genuinely address their areas of capacity need without fearing what their grantmaking partner might think.
What I like about the Wilburforce Foundation approach is that they recognise the imbalance in the power dynamic between grantmaker and grantseeker. As a grantseeker would you feel confident in telling a funder that your organisation’s capacity needs were in financial management? What about seeking support for conflict mediation? Or support to develop your governance structure? As a grantseeker, these might be genuine capacity needs but it’s understandable that many might find it difficult to share these needs with a funding partner. So with this in mind, can philanthropy ever be directly involved with capacity funding? The answer of course is yes, but the ‘how’ of funding capacity needs to be carefully considered before a foundation dives in.
Ultimately, investing in capacity building is investing in the strength of the non-profit sector and that benefits everyone. If the philanthropic sector in Australia wants to ensure that recent conversations around ‘capacity building’ don’t become empty rhetoric then we need to invest some time and thought (and maybe even some capacity funds of our own) into the ‘how’s’ and ‘why’s’ of funding in this space.
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Debra Morgan
Caitriona Fay
Claire Rimmer
guestegg
Great post Caitriona. The power imbalance is such an interesting dynamic which is often not given much attention for a whole variety of reasons.
I would love to hear of any examples from yourself (or others) on Australian granting processes that have really taken this into account like Wilburforce have.
And yes – I agree that ‘capacity building’ may be the new black!
Thanks for the comment Stacey. I agree, the issue of power imbalance doesn’t get much thought or play. I think we’d all to think it doesn’t exist.
On capacity building and the issue of accounting for this power imbalance, there are a few examples in the US foundation space. Another good group is the French American Charitable Trust http://www.factservices.org/strengthening_organizations.html they also provide their grantees with a list of service providers that they can access and some funding to do it.
I know Deb Morgan has some insights on Arts Funders in the US working in this space too.
You raise some really meaty points Caitriona. I question a lot of philanthropic practice in relation to the power imbalance. I wonder if we can ever expect a truly honest view of the orgs we support. Not to say they’re dishonest, but they would want us, as funders, to view them with a particular lens. And fair enough. A small example is the feedback forms we attach to grant applications – do we really expect that organisations are going to tell us our application process is rubbish and then ask for funding on the same piece of paper..? I think not.
Anyway, I too hope the capacity building conversation continues with the robustness with which it started. For a view from the Arts, check out the Capitalization Project undertaken by Grantmakers in the Arts in the US – http://www.giarts.org/article/national-capitalization-project. An interesting read, and provides some insight into the vastly different approach to arts funding in the US.
Any examples within an Australian context? I know Myer provided one off ‘capacity building’ grants as part of their Sid celebrations a couple of years ago. Were they non-binding?
The Myer Foundation and Sidney Myer Fund provided grants for capacity development and organisational strengthening through the 2009 Commemorative Grants Program.
At the outset we invited participating organisations to tell us what they would use the funds for, and suggested a range of activities that we would consider however we tried to keep the program as loose as possible. An important point was that the funds were not for the delivery of programs or services.
Organisations have been able to use the funds over two, and in some cases three years for things such as strategic planning, succession planning, development of marketing and fundraising plans, staff and board development and so on. All the things for which community and NFP organisations find it difficult to find money, time and headspace.
Some organisations have changed their organisational development programs along the way, and we have been supportive of this. As part of the program we engaged QUT’s centre for Philanthropy and Nonprofit Studies to undertake some research on the grants. The interim report is available at http://www.myerfoundation.org.au/programs/project.cfm?loadref=90 and QUT’s final report is to be released soon.
It’s not a grants program, but it’s certainly a resource which aims to help organsations grow and build skills and capacity….it’s AbaF’s suite of volunteering programs. These link business volunteers with the Arts and Cultural sector, so orgs in the sector can access expert advice from business – gratis!
There’s an “advice bank”, where Business brains give advice to orgs on specific business challenges within the org, and a “board bank” which helps Boards with governance skills development.
To date, AbaF has connected over 1,000 business professionals with the arts, resulting in an impressive in-kind contribution of just under $8m to skills and capacity building in the arts and culture sector in Australia.
At the moment, it’s delivered in partnership with Woodside.
[...] hinted in a recent blog that there was growing talk in the philanthropic sector about the need for increased transparency. [...]
[...] of the primary activities undertaken by grantmakers beyond their financial contributions. I’ve previously posted about the challenge funders face when trying to support capacity building in a way that respects [...]