A SECOND LOOK
Colleen du Toit
The Southern African Grantmakers’ Association (Saga) is a membership association of institutions committed to developmental and effective grantmaking.
Most of Saga’s members are South African corporations having social investment programmes. During the past four months, Saga has begun to reinvent itself in light of a comprehensive stakeholder consultation, and new research into local and international trends in donor-funded development. This process culminated at Saga’s annual conference on September 21, where several key policy issues emerging from the consultations were debated.
Saga’s role is as an independent agency motivated by values of ethical development practice to take forward the ideas and aspirations of its stakeholders. This article is part of our campaign to stimulate wider debate and advance understanding and best practice on donor-funded development.
It should be emphasised at the outset that the issues raised are sensitive, important and as yet imperfectly understood. Firstly, we are hampered in these discussions by the lack of accurate empirical data and comparative research on South African development programmes especially those funded by the private sector.
However, conversations such as those taking place within Saga, while both embryonic and cautious, are important means of advancing knowledge on what we believe to be a significant area of development activity.
Providing a new and challenging backdrop to these debates, the recent Saga conference was the forum for release of an important study into the South African non-profit sector. For instance, the study shows that, at about 99000 organisations, the sector is much larger than previously thought, employing more than 645300 full-time staff. The scale of these new statistics indicates that the non-profit sector should be counted a substantial contributor to South Africa’s economic growth potential. It raises about R14-billion a year.
While government grants are the major source of income (42%), a substantial contribution (25%), is from private philanthropy. Of significance for business sector philanthropists is that South African corporates contribute R4-billion to R5-billion a year to the non-profit sector through corporate social- investment activities. This figure echoes that reflected in a corporate social-investment study by the Centre for Development Enterprise, released about two years ago.
It is clear that financial resources available to the development sector are not nearly as scarce as received wisdom would have had us believe.
Although the study also shows that there is a mythology that lack of funding is a critical problem emanating from within the non-profit sector itself, the figures themselves belie this, showing that some of the answers for the sometimes halting progress of civil society development programmes must be sought in other quarters.
While the proud history and ongoing innovation and achievement of the non-profit sector in South African transformation are undeniable, a set of negative trends characterised by poor delivery are also visible. In light of this authoritative new research on a sector where conjecture and anecdotal evidence have often been the main sources of information, there are clear challenges emerging for both the development sector and its various donors.
These challenges are to improve and make visible the results of the substantial social funding invested annually in this sector. It is long overdue that the real extent and impact of donor-funded development programmes is comprehensively monitored, measured and documented. This more rigorous approach is necessary if the actual effects and long-term impact of social investment programmes are to be incorporated into our overall understanding of transformation.
Specifically in the case of corporate social investment programmes, the most effective means to address these challenges will be better strategies, driven by engaged leadership within the business sector; effective implementation through professional management in the non-profit sector; and, at the level of implementation, well-planned and monitored programmes, structured through cross-societal cooperation and partnerships.
These directions were debated at Saga’s September conference. In the area of business leadership there was agreement on the need in both the business and the development cases to integrate corporate social-involvement activities into mainstream business strategy. Here enlightened leadership is the key factor. Internationally there is an increasing trend for CEOs to champion and lead their corporations’ social responsibility initiatives. In South Africa, while there certainly are some corporations where social investment is acknowledged as an important strategy, most social investment departments are still cut off from the locus of power.
Leaving aside value-based arguments, and given the very scale of funding revealed by the study, it is clear that it is in the interests of both business and the development sector to ensure that this investment becomes both more strategic and more effective and that the impact of these programmes is measured and made visible.
These requirements imply that programmes will need to adopt a considerably more professional and results-oriented approach. This is especially necessary given the need for more professional project- management training expressed by many of Saga’s corporate members, and an acknowledged weak organisational capacity within many non-profit organisations. Recent international best practices marry the strategies and performance-based techniques of business with a developmental value base. Making a similar paradigm shift will require that South African corporate donors prepare themselves to fund not only the programmes but also the development of the implementers.
As new research shows the extent and societal cost of these organisations, it becomes even more critical to ensure that they perform effectively. Both donors and implementing agencies will need to work together to adopt management principles and practices that will help build high-performing organisations as well as strong programmes.
This raises the issue of cooperation. At Saga’s conference, a group of delegates met to discuss the formation, composition and impact of development partnerships. These are simultaneously the most promising and the most difficult management structures for donor-funded programmes. Leveraging of both material and intellectual resources is the important intention of partnerships.
In addition it is inevitable that where diverse interests are involved, there will be better planning and monitoring, and hence increased effectiveness. The downside of partnerships is that, paradoxically, their very impetus towards greater effectiveness often marginalises the most disadvantaged, who do not have the proven track record needed to satisfy donors.
All of the points raised above are tentative at this stage. During the forthcoming year, Saga will be facilitating multilayered conversations across the country in order to develop and refine these ideas. We would welcome participation in these discussions by Mail & Guardian readers.
Colleen du Toit is executive director of Saga. The South African Non-Profit Sector study quoted in this article is the result of cooperation between the Johns Hopkins University, the Graduate School of Public and Development Management at the University of the Witwatersrand, and Social Surveys