October 13, 2023
Bold and ambitious efforts that can lead to climate breakthroughs require a lot. Not only do they demand sustained investment, but they also require the grant recipients working on the ground to possess strong capacity. However, the common “scarcity mindset” often leads many grantees to refrain from spending their grants—often already small and short-term—on capacity-building resources because they may be considered ‘luxuries.’
These resources include organizational development, measurement evaluation and learning, ongoing fundraising, strategic advising, and strengthening leadership capacities such as personal coaching, professional recruiting and headhunting, or sophisticated research. To counter this tendency, at Climate Breakthrough, we complement our large, flexible grants with additional funding for these resources that help our grantees (we call them awardees) secure top advisors, expert consultants, specialized vendors, and more.
As part of their Climate Breakthrough Award, awardees utilize capacity-building (or wraparound) funding in various ways to meet their specific needs. Each awardee works closely with a Climate Breakthrough Portfolio Manager to address the biggest obstacles to scaling that could be alleviated with outside support. In addition, there is another pool of wraparound support funds that are available specifically for Impact and Learning activities, including case studies, measurement, evaluation and learning (MEL) systems design, and rigorous third-party evaluations.
Our hope is that awardees who utilize capacity-building services will be able to improve their work. To assess this, we ask awardees to consider how much more quickly their work has progressed as a result of capacity-building services. We also compare the work of awardees who utilize particular kinds of support to those who do not. This has generated valuable insights.
LESSONS WE HAVE LEARNED
Since our first grants in 2016, we have seen a few fundamental practices stand out in helping bolster the capacity of our awardees.
- Allocate funds strategically: We separate funding for capacity-building services from the original grant. This helps grantees in startup ecosystems tap into services and expertise typically reserved for larger, more established organizations. This also allows awardees to freely consider services that can accelerate their success without having to take money out of their initial grant.
- Encourage, don’t impose: We provide recommendations for consultants and vendors but also let awardees choose their own service providers. This adds value for people who do not have strong networks in a certain field without limiting support options.
- Simplify consultant sourcing: We offer to do the groundwork in sourcing top-notch consultants for awardees. This saves them time.
According to the Center for Effective Philanthropy, only 14 percent of foundations offer general operating support in addition to capacity building, and only 25 percent of NGO leaders report having ever received capacity-building support to complement a multiyear general operating support grant.
Funders need to help grantees get out of the scarcity mindset and provide comprehensive, flexible support to invest in staff, make targeted improvements, and plan for the future. After all, the longer we wait for breakthroughs in climate action, the less certain the future becomes.
This article was originally published in Active Philanthropy.