While there is general agreement on the importance of civil society in development, there is now a healthy debate about how to create self-sustaining civil society organizations (CSOs). Can external models take root in foreign soil? Or is the best chance for success dependent on building on indigenous structures?

Within the context of this debate, the Aga Khan Foundation USA (AKF USA) is reviewing the way it supports its civil society programme. AKF USA continues to believe that CSOs are essential for a better society, but is looking to identify local ways of funding them to ensure long-term sustainability and enduring support from local people.

A revised strategy would build on AKF USA work in establishing local organizations like the Pakistan Center for Philanthropy and the Kenya Community Development Foundation to focus more on community philanthropy.

To explore this idea, AKF USA called together a group of 18 practitioners from different parts of the world to a meeting in Washington DC in September 2010.  One outcome of the meeting was strong support for a strategy to develop community philanthropy. Indeed, some people felt that without local people contributing their own money to solve their problems, external aid agencies are wasting their time.

People noted that community philanthropy is a naturally occurring phenomenon, found in all parts of the world, and embedded in different cultures in different ways. For the most part, however, the power of giving lies latent and unrecognized. But it could be a much more potent force in development if it expands from giving to local community members to giving to local CSOs.

When the power of local giving is harnessed, results can be impressive. To take two examples, the Phuket Disaster Fund in Thailand arose following the 2004 tsunami because local people disliked depending on external aid and wanted to be in charge of renewal. In Selma, Alabama, the Black Belt Community Foundation has 100 community ambassadors who give their time to ensure that the foundation is connected to the needs of local people. The ambassadors have raised $100,000 for the benefit of the 12 counties they work in under the motto ‘taking what we have to make what we need’.

According to the 2010 Global Status Report on Community Foundations, published in November, there are signs that, despite the worldwide recession, people are stepping forward to take responsibility for their communities and are increasingly willing to commit their personal resources for public benefit. They want to see their money used competently and professionally but in transparent, democratic and culturally appropriate ways that avoid the capture of resources by local elites, which happens all too frequently when money comes from external agencies.

But what is the appropriate role for an outside funder who wishes to foster positive developments without displacing or harming local efforts?

In approaching this question, meeting participants agreed that outside funders should be ‘gardeners’ rather than ‘manufacturers’. They need to test and till the soil, water – but not over-water – the plants, be careful not to block out the sun, and change the approach according to the season.

The group identified a large number of principles implied by this approach. Of these, one particularly important one was that local people should contribute their own money from the start. Unless this money is on the table, there should be no external funding.

Other key principles are:

Context matters There is no ‘right way’ for external funders to do things. The approach adopted should match what local people want.

Time is needed As good, organic processes take time, patience is necessary. Funders should be there for the long haul, but not forever, and should develop an exit strategy.

Money, and  more than money, needed Grant size should vary according to capacity to absorb the money. Funders should use their power to provide technical assistance and contacts, and to convene local partners as appropriate.

Measure what matters Measuring results is essential, but indicators of success should reflect what matters to local people.

Use technology Funders should encourage local groups to harness the transformative power of technology.

AKF USA wants to know your views. Is community philanthropy, as explained here, a useful strategy for further development? Would you be interested in taking part in the next stages of developing this concept? If so, please write to Joanne Trotter at jtrotter@akfusa.org.

Richard Holloway is Director of Civil Society Programs at AKF. Email richard.holloway@akdn.org

Barry Knight is secretary of CENTRIS. Email barryknight@cranehouse.eu