Giving Compass’ Take:
• The authors explore how five key elements can help nonprofit organizations with capacity building, and identify the barriers to funding these efforts.
• How can donors help nonprofits work through the challenges of capacity building?
• Read about capacity building for social change.
Ask any nonprofit leader and you’re likely to hear that investments in capacity make a meaningful difference to organizations. Research backs this up. A study of Meyer Foundation grants found that investments in capacity produced positive, long-term financial results for grantees, regardless of the type of capacity-building grants provided.
Recent research from Candid and the Council on Foundations shows that from 2011 to 2015, U.S. foundation funding for capacity building and technical assistance targeting beneficiaries outside the U.S. jumped from $555.4 million to $900.1 million — a sizable increase but still less than ten percent of total international giving.
There are certain barriers that may help explain why foundations aren’t devoting more funding to capacity building.
Nonprofits may be reluctant to share information about their capacity-building needs with funders because they’re not sure whether such sharing will have repercussions on future funding decisions. We’re also learning that because organizations have unique needs, tailored approaches to capacity building tend to be the most effective, but they also make supporting capacity building more resource-intensive for foundations.
Looking across our work over the years, we have identified five elements we think should be part of any capacity-building effort. We share these recommendations with the hope that foundations factor them into their capacity-building plans and that nonprofits seek out and request this type of partnership from their funders.
Since you are interested in Impact Philanthropy, have you read these selections from Giving Compass related to impact giving and Impact Philanthropy?
- Commit for the long term. The ability to be successful over the long haul requires ongoing attention to organizational capacity — think of it as a sort of personal healthcare plan for nonprofits.
- Co-create solutions with stakeholders. A common criticism of capacity building is that it can feel paternalistic. And this is more likely to happen when foundations make assumptions about what grantees need and design services without their input.
- Strengthen the ecosystem. Ask any nonprofit or foundation leader about the challenges they encounter in efforts to strengthen capacity, and chances they’ll tell you how difficult it can be to find the right service provider.
- Support both technical and adaptive capacities. When nonprofits are working to address a complex problem, some of the capacities they need are adaptive.
- Ground capacity building in equity. The Kresge Foundation delivers capacity-building programs focusing specifically on leadership development through a racial-equity lens.
Read the full article about capacity building by Carla Taylor and Lori Bartczak at Philanthropy News Digest
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