Catalyst 2030 organised Catalysing Change Week 2023 convening social entrepreneurs, private sector representatives, government officials, funders, and others involved in systems change. The event aimed to stimulate innovation and progress towards achieving the Sustainable Development Goals (SDGs). I was fortunate to moderate a panel discussion, ‘Locally Led Development and the Compliance Conundrum,’ which focussed on the current understanding and management of due diligence, compliance, and risk. Participants included Rachel Huguet, Officer at Conrad N. Hilton Foundation; Lynnette Micheni, Program Manager at TechSoup;  Naomi Ayot Oyaro, Executive Director at CAP AIDS-Uganda, and Charles Kojo Vandyck, Head, Capacity Development Unit at West Africa Civil Society Institute (WACSI).

Throughout our discussion, we talked about the civil society’s sector’s aim to transition from labor-intensive, donor-focused processes to a more collaborative model that supports local organisations, and aligns with funders’ dedication to locally-led development. I’d like to take a moment to share some key takeaways from the panelists’ insights. I hope to inspire further discussion around the challenges of local grassroots organisations in accessing funding and encourage conversations about and action toward funder commitments to locally led development.

The essence of localisation

Charles Kojo Vandyck  began with an exploration of what ‘local’ means and its role in the ongoing localisation debate. He defined the term “local” as the specific setting and conditions where communities live and interact with each other and national entities. This concept includes a community’s unique perspectives, native knowledge and talent, and regional expertise.  He addressed the systemic issues that perpetuate power imbalances within the aid sector and shared inspiring examples from organisations such as Pledge4Change, Peace Direct, and ActionAid International as steps towards ‘decolonising’ aid. Instead of imposing top-down solutions, these organisations work to empower local leaders, especially women and marginalizsed groups, by providing them with the necessary skills and resources to participate in decision-making processes. He added that rather than positioning themselves as the sole experts or implementers, they collaborate with local partners who are directly connected to the communities they serve.

Challenges of local actors

Naomi Ayot Oyaro spotlighted the unspoken challenges local actors face, including governance, administration, and financial management. She pointed out that without sufficient funding to address compliance and performance costs, local groups cannot invest in proper systems, which in turn escalates risk. Further complications arise from inadequate reporting and auditing. She called for investment in this kind of organisational infrastructure to be mainstreamed in order for local actors to become more than project implementers and focus on their community’s needs.

The need for local leadership

Rachel Huguet emphasised the importance of locally-led development, not as a new trend, but an essential practice. The Conrad N. Hilton Foundation was given as an example, with their approach and commitment to the Grand Bargain, directing 25 percent of funding to local actors. Rachel’s presentation also reminded the potential risks associated with neglecting local leadership, and commented that most initiatives are subject to failure and can’t extend beyond their original phase without local ownership and management.

Unlocking funding potential for CSOs with STEP

Lynnette Micheni introduced TechSoup’s Strengthening and Tiered Evaluation Process (STEP), designed to ease smaller local organisations’ access to funding. STEP offers a holistic assessment of an organisation’s governance and financial management, fostering relationships and lessening the load on Civil Society Organisations (CSOs). STEP also provides a comprehensive report and a resource portal, which serves as a self-auditing tool for CSOs.

Moving forward: shifting the due diligence paradigm

We concluded by reemphasising the challenges local grassroots organisations face due to perceptions of risk, issues of compliance, and due diligence requirements. Our discussion proposed reframing due diligence as a health assessment, which would allow for a more nuanced view of risk and due diligence. This approach could aid organisations in identifying their strengths and weaknesses, as well as areas requiring support. It could also pave the way for a more equitable partnership with funders, who would then acknowledge a broader diversity of assets and expertise.

I am grateful to have been part of this panel.  While much progress is needed in this area, this discussion represents a significant step forward. If you missed it, the recording is available on the Catalysing Change Week 2023 event page.

Caroline Burrage is the Director of Partnerships and Development at TechSoup