Soon after becoming head of the World Bank in 1996, James Wolfensohn invited a number of institutions and groups to expand their activities with the Bank, and to work in partnership with it – including foundations. Despite regular contacts between Wolfensohn and foundation CEOs, most Bank and foundation staff are uncertain about how to work together. The appointment of a Foundations Coordinator in 1999 began a process to address this.

Initial collaborations with CEOs led to a foundation/Bank solar energy investment programme and several other well-known partnership successes.[1] However, Wolfensohn’s thinking was far ahead of the Bank’s culture in 1996, and the very concept of the Bank working ‘in partnership’ was challenged by board members and senior managers.

Barriers to partnership

In spite of positive momentum at the CEO level, too many working-level Bank and foundation staff were ill prepared for this relationship. In the Bank there was considerable confusion about the arrangements needed to work with foundations, and little internal coordination among staff. A power struggle developed as to the location of and responsibilities for Bank/foundations relations. Subsequent competition among Bank staff in making overtures to foundations offended several foundations.

Bank staff had little understanding of the variety in foundation organizational arrangements – that a foundation can be dominated by its board, or by the CEO, or by programme staff, and that there are rivalries among some foundations not unlike those among governments in foreign aid work. Conversely, foundations have little knowledge about the role of governments in the governance of the Bank, or how the Bank itself is organized.

Foundations are unclear as to who they should approach when trying to access the Bank – though they were and are very clear in wanting operational and content contacts, and not a public-relations focal point at the Bank. This is of special concern to foundations whose grant recipients are active on globalization and international financing issues.

For many in the foundation community, it is difficult to comprehend why the Bank is soliciting funds from foundations. The fact is that as a Bank, and thus a lending institution, the Bank has very limited funds outside its lending resources. The amount of such programme funds is determined annually by the Bank’s board, and their use controlled through processes involving Vice Presidents and Country and Sector Directors.

Many foundation staff resist having their projects associated with the Bank and are repelled by its institutional arrogance. They also resent being contacted by Bank staff who are ignorant of the foundation’s priorities and programmes and/or seeking funds for projects at the final design stage, denying the foundation any input.

The extensive capacity and knowledge of foundations and their grant recipients in development work is essential to Bank efforts to support community-driven development. Equally, the Bank’s in-country knowledge and access, its analytical work, its ability to convene both government and private sectors, and to arrange lines of credit, provide guarantees, and other investment instruments, can serve important foundation goals.

Foundations Coordinator appointed

In 1999, a better understanding of these problems and opportunities led the Bank to appoint a Foundations Coordinator, to be located outside the Bank’s External Relations unit. A Bankwide Foundations Working Group (FWG) was soon established consisting of middle managers and foundation focal points[2] for each region and network or thematic group (eg environment, social, education, health, etc). The FWG also includes the International Finance Corporation.[3] In 1999, the group adopted a policy statement setting out its mission and guiding principles and its rationale for working with foundations. It meets quarterly and is a useful forum both for coordinating and knowledge-sharing and for foundations to present their interests, initiatives and concerns to the Bank.

Foundations website

In early 2000, the Bank launched an interactive Bank/foundations website at http://www.worldbank.org/foundations that enables staff to report on their work with foundations and thereby inform their colleagues on the status of this work. This transparency can help reduce competition and encourage cooperation among Bank staff in working with foundations. To date there is no institutional requirement to report, but slow progress is being made. The site also includes:

• a site for foundations to post information and/or provide commentary and feedback to the Bank;
• the names and coordinates of the Bank’s regional and sector foundation focal points;
• the records, minutes, and contact coordinates of all Bank/foundation meetings;
• links to all foundations with websites and to other Bank websites that include information on client country projects and Country Directors, who are increasingly located in Bank client countries.

These arrangements have positioned Bank/foundations relations in the Bank’s institutional mainstream. However, staff ‘ad hocism’ has cost this relationship much in terms of trust and accountability, and important opportunities for collaboration have been missed.

Foundation/Bank initiatives

Concurrently with establishing these organizational and technical systems, the Foundations Coordinator initiated specific foundation/Bank activities to share knowledge and to provide opportunities for cooperation. These included a multi-day workshop on ‘local-global connectivity for voices of the poor’, discussions between foundations and the Bank’s Development Grant Facility (DGF)[4] on best practice associated with grants, and a day-long review of Bank/foundation work in Africa.

A foundation/Bank group was also established to examine ways the Bank can advance knowledge about, and support for, community foundations – the missing link in community-driven development. As a result, it has been agreed that foundations will undertake a personnel search and produce a shortlist of senior-level experts from outside the Bank on the creation of community foundations. One will be selected by the Bank to work with the Bank’s community-driven development group.

Evolving relationships

What more can be done to advance foundation/Bank relationships? On the foundation side, it would be very useful for foundations to look at the information on the Bank’s websites and learn more about the Bank’s governance as well as its current organizational arrangements, which have changed dramatically in the past three years. They should also visit Bank in-country offices when travelling: there is great potential for Bank and foundation staff to work together at the country level, as has been evidenced in the past.

On the Bank side, it often brings together governments, NGOs, UN agencies and other constituents to address common concerns, and should include foundations in these meetings. More specifically, it should initiate exchanges between the Bank, donor governments and foundations. The Bank meets biennially with donor governments to discuss the policies and criteria associated with trust funds. As foundations also have trust funds in the Bank, foundations should be included in at least some of these meetings. The Bank should also consider including foundations in events held in conjunction with its annual and/or spring meetings, and/or the Development Marketplace. These provide unique opportunities for advancing the alignment of precious resources in local, regional and/or global development efforts.

A current and historic event is the global adoption by governments and international organizations of a humane agenda for development, the Millennium Development Goals (MDGs).[6] Of equal historic note, the World Bank has incorporated the MDGs into its work programmes, and foundations should be joined to this effort.

As relations between the Bank and foundations evolve, it is my hope that the Bank will play a key role in three areas:

• Promoting the establishment of community foundations in client countries. Such a community-owned mechanism is essential if countries are to have local capacity to respond to the redeployment of government funds to poverty reduction. Foundations with extensive experience of supporting community foundations can help greatly here.
• Fostering individual philanthropy and the creation of national and local foundations through promotion of favourable legal and tax regimes. A Bank/foundation working group could be created to work on this.[5]
• Hosting an annual Bank/foundation consultation on the MDGs, to include donor and client governments. The consultation would consider the strategic alignments of programmes and resources associated with the MDGs.

Each of these initiatives would serve the worlds of philanthropy and of international development. The fact that at present foundations contribute only 2 per cent to international development does not mean that the amounts cannot be increased, and many foundations are seeking ways to expand their efforts beyond their borders. This 2 per cent can also serve to catalyse more effective development work supported by other donors.

1 Two examples are the Consultative Group for International Agricultural Research (CGIAR), which engaged the Bank and several foundations, and more recently the Consultative Group to Assist the Poorest (CGAP).
2 A Bank staff member is designated as focal point for each sector, theme, region or country, or with a specific foundation (or foundations), to rationalize the Bank’s work with foundations. The focal point is a relationship manager.
3 The IFC is the part of the World Bank Group that supports private sector investment, including small and medium entrepreneurship.
4 The DGF was established in 1997 to integrate the overall strategy, allocations and management of Bank grantmaking activities funded from the Administrative Budget under a single umbrella mechanism.
5 The MDGs have fixed dates and targets for reducing extreme poverty, expanding educational opportunities, empowering women, reducing child mortality, improving maternal health, combating diseases including HIV/AIDS, and ensuring environmental sustainability.
6 The working group should be chaired by the Bank’s legal department, to include foundations with regional representation, the European Foundation Centre, the Council on Foundations, and selected parliamentarians.

Joan Martin-Brown was Foundations Coordinator at the Bank from 1999 until her retirement in March 2002.
The new Foundations Coordinator is Eleanor Fink. She can be contacted at efink@worldbank.org

See http://www.worldbank.org/foundations