Crosswinds for the Sustainability of Social Accountability Initiatives

Submitted on December 15, 2014 | Author: Andres Falconer

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What if a civil society organization could be paid using the savings generated by the social accountability project it conducted? New winds are blowing in the social-purpose arena, pushing civil society organizations to pursue novel funding models. From new financial mechanisms, such as social impact bonds, equity investments and crowdsourcing; to new donors, including venture philanthropists , social stock exchanges and hybrid organizations, a revolution is taking place, expanding a toolbox that once held a single tool: grants. Social Accountability organizations, however, remain impervious to most of these trends, and continue to rely predominantly on grant funding, a source that may prove unreliable for their long term sustainability, and for the growth and impact aspirations of the field of transparency and accountability.

We thought it was time for change. The GPSA was launched to support social accountability initiatives to solve governance problems. We fund civil society organizations – through grants – to implement their projects. We support the implementation of these projects, building the organization's capacities. And we monitor their effectiveness and their long term sustainability prospects. Yet we recognize that the sustainability of organizations, their projects, and the social accountability sector as a whole will be seriously constrained as long as they are reliant almost exclusively on a single and fickle type of funding.

This is why we invited Prof. Salamon, Director of the Johns Hopkins Center for Civil Society Studies, to examine the opportunities and the implications of exposing the social accountability field to this social finance sustainability revolution. Prof. Salamon is one of the world's foremost scholars in the civil society sector, who contributed decisively to the creation of this field of academic inquiry that tries to quantify the size and the role of the organizations that make up the "third sector". In recent years, he has shifted his attention to the new frontiers of social financing, exploring the emerging actors and tools that are reshaping the field. The result of our collaboration is this refreshing and insightful Working Paper: Navigating the Future: Making Headway on Sustainability for Social Accountability Organizations.

Salamon, Geller and Sokolowski's views are sobering yet encouraging. On the one hand, Social Accountability organizations face headwinds and additional difficulties to jump on the social finance ship, compared to other civil society organizations. On the other hand, they explore a number of possibilities and opportunities that merit serious attention. Salamon makes a stern warning: these opportunities rely, to a great extent, on the ability of organizations to get their act together on improving their metrics and , ultimately, their own accountability. If they do so, the reward may be there.

The paper serves as a primer and a rough guide for a number of strategies he outlines, to be trialed, refuted, validated and further developed. From "selling social accountability products and byproducts", to monetizing and retaining part of the government savings that social accountability projects may generate.

Outside the scope of the paper but equally important, from the GPSA's and the World Bank's perspective, are the wider institutional implications of these new trends. Beyond the sustainability of individual initiatives and organizations, the Bank is well positioned to play a field-building role in moving the sector: this may be through piloting the first non-grant investments in social accountability projects; expanding the role of other players (such as the private sector); engaging with, creating or supporting the establishment of new financial actors; and lending its capacity to scale up and mainstream social accountability interventions beyond the dreams of the current players. The Working Paper signals the way, and challenges us to aspire to reach higher.

On December 17, 2014, Lester presents the paper and the thinking behind it at a Brown Bag Lunch event at the World Bank. See his presentation, and share your ideas and thoughts with us. Leave your comments here or contact the GPSA Team.