Foundations in Global Crises: How to go from ‘Constructive’ to ‘Consequential’

Following is a guest blog post by Neal Keny-Guyer, CEO of Mercy Corps. The views expressed are those of the author and are not intended to represent those of the Global Philanthropy Forum.

As the leader of a global humanitarian NGO, I think the Global Philanthropy Forum’s theme “Disruptors and Decision Makers” is exactly the right focus for philanthropic leaders at this moment in time. Life is improving for the vast majority of people – in part because of the great work of philanthropy and foundations all over the world. But the last billion will remain stuck in poverty, conflict, and despair if we don’t start disrupting systems and better engaging decision makers.

One place to start is to re-think the way foundations help address crises, whether rapid-onset natural disasters or chronic and cruel man-made emergencies.

Right now, foundation funding for global crises can be constructive, but let’s be clear: it is rarely consequential. Foundations have a massive opportunity for increased impact in the world’s toughest places. Today’s complex crises – whether fueled by conflict, contagion or climate – require that governments, business, civil society, and the charitable sector all up our games. Here are some ideas on how to do this:

Focus on fragile places

Half the world’s extreme poor live in fragile and failed countries, in a state of perpetual crisis. If we are going to eliminate extreme poverty by 2030, as World Bank President Jim Yong Kim reminded us during the conference, we need to focus on the places where that extreme poverty is most persistent, where conflict and weak governance conspire to hold people back. The philanthropic community has been virtually absent from places like Syria, where we really need their participation, not just to meet immediate humanitarian needs, but to help ensure that the conflict does not deprive an entire generation of a promising future. Indeed, it was a small foundation grant that leveraged Mercy Corps’ presence in Northern Syria more than 4 years ago.

Invest in prevention, risk reduction and resilience, not relief services

A report by The Center for Disaster Philanthropy and the Foundation Center identified $111 million in disaster giving by 234 U.S. foundations through 884 grants in 2012. This represents a tiny fraction of all U.S. philanthropic giving to natural disasters. The rest of the charitable market is providing the resources to respond to disasters, triggered mostly by emotional responses to media coverage of people in need.

While disaster relief is important, it doesn’t solve problems or address root causes. Every dollar invested in disaster preparedness saves seven dollars in disaster aftermath, yet only 1% of all international aid is spent to minimize disaster impacts. Foundations can and should be more strategic and look at proactively reducing the impact of inevitable natural crises: less than 10 percent of that $111 million was invested in resilience, disaster risk reduction and mitigation efforts; and less than 5 percent funded disaster preparedness.

The Rockefeller Foundation has been a strong leader on this front – with a major institutional focus on building resilience. The Margaret A. Cargill Foundation, another great example, is funding a three-year program to develop a more sustainable disaster risk reduction approach in Nepal’s Far West Region and Timor-Leste. In the wake of Nepal’s devastating earthquakes, the program’s goals to build resilience to natural disasters while reducing poverty are more important than ever. I would love to see more foundations join Rockefeller and Cargill in these efforts.

Lean in to learning and research

Government and broader charitable giving will often dwarf the amount of direct-service dollars foundations can make available for a crisis response. Where foundations can be indispensable is by supporting critical research that uncovers new insights, makes best practices better, and ultimately enables the bigger money from governments to have more impact. In 2012, less than 1 percent of foundation dollars funded research, and I believe that this research is critical to disrupting the standard approaches.

For example, fighting the root causes of youth participation in violent extremism – which makes progress so hard in fragile areas – is an urgent priority. Conventional wisdom has been that getting young people jobs is the critical factor in keeping them from that violent path. However, a recent report by Mercy Corps found that having a job has little or no impact on whether a young person will engage in violence. As one young man in Afghanistan told us, “I didn’t join the Taliban because I was poor. I joined because I was angry.” We found that young people are driven to take up arms by legitimate frustrations over experiences of injustice: discrimination, disenfranchisement, corruption and abuse by government security forces. They are looking to overcome these grievances and find some sense of dignity. We have shared these findings with donor governments and they’re already telling us it is affecting their go-forward strategies in tough places. That kind of research is only possible with the flexible funding foundations can provide.

Take risks to save and improve lives through technology and innovation

In crisis areas – again, both natural and man-made disasters – new technology can be transformative. Mobile phones are enabling information sharing and financial services to people in distress in a way, say, victims of the Indian Ocean tsunami never would have dreamed.

But deploying new technology to mitigate suffering in crisis usually involves a degree of risk that government donors may not want to take, especially in a humanitarian response with high media visibility. The specter of “aid dollars wasted” is just too scary for governments, and that means we don’t always push ourselves to improve.

Foundations can provide the latitude to design and implement new innovations in the wake of an emergency or in fragile places. These innovations range from better analytical tools that track the location and scale of a disaster, to mobile health and financial services platforms, to systems for improved accountability and governance. It is through the flexibility of philanthropic funds that Mercy Corps and other INGOs have been able to move forward the use of electronic cash transfers – faster, safer, easier – in emergency situations.

There are no fast fixes or “shiny” solutions to the world’s greatest challenges, and there are few challenges today greater than the confluence of complex crises the world is facing. Our ability to mitigate the impact of these crises – by focusing on fragile places, preparing communities to withstand inevitable shocks, taking risks on breakthrough uses of technology, understanding and addressing root causes – depends in part on the partnership of foundations who wish to go from “constructive” to truly “consequential.”

Hear from Neal Keny-Guyer at the 2015 GPF Conference: Coming Together to Support Communities in Times of Crisis