Summary of the lecture by Mathew Cherian
Is financial viability of the Voluntary Sector a mirage? The way forward
PART-II
The common thread is LOCAL vs INTERNATIONAL FUNDING. Out of the 3.1 million organisations, merely 50,000 organisations are the struggling ones (just UNDER 2 percent). The common thread among them is that they are all based on EXTERNAL grants. In my opinion it is local volunteers, local products, local markets or local fundraising, is the Key to the Viability of the sector. They have proved that they can grow to scale. They also prove that solutions need not be small. It is not just the corporate sector which can create jobs and when it does so it wrests major concessions from the Govt unlike non profits.
Yet, can smaller organisations working on critical issues for disability, the destitute, rehabilitation of beggars, homeless, manual scavengers, children exist, scale up and survive? Or is there a time when they too must call it a day? The dilemma for many organisations is whether to scale up or stay small & beautiful. It is between the devil, in this case the regulating authorities, and the deep blue sea, which is freedom to work according to your passion “azadi”. We need to assess our true strengths and weakness, that is each one of us who run organisations in the sector on how we can become viable. The idea of freedom and “azadi” is very attractive but to make the organisation viable is hard work and a clear strategy is needed. There are no short cuts!
Assessment of real strengths and weaknesses of NGOs in financial viability
Financial viability is perhaps the aspirational need of many organisations but it is also a strategic thinking for the future. One has to be first viable and focussed in the work, COMMITMENT TO A VISION AND A FOCUS THEN programmes and strategies WILL FOLLOW to solve a developmental problem , There may be a need to reinvent , Take the case of HelpAge , which has just turned 41, It runs India’s largest mobile medical service and serves 2 million elderly in rural areas in a country, carries out 35000 cataract operations. About 15 years ago we started elderly self help groups as the country offers very little pensions in old age. These groups have now started Elders for Elders which is a viable organisation. To fight for pensions we have joined forces with pension Parishad with Aruna Roy, Baba Adhav to advocate for an universal pension for all the elders of this country and a minimum pension of 3000 Rs per month . Further acting as amicus to the Supreme court in a PIL for the elderly rights , we cannot work any more in silos and need to network, join associations push for change. There is strength in greater numbers than fighting it alone. All of our advocacy work is done through Indian funds.
The choice is in raising small amounts of resources both from local sources and the internet. Today we raise funds from 250,000 individual donors small to big. From children like my daughter who contributes 100 rs to a stockbroker who gives a crore for the homeless programme or the quiet Dr.Chottani who will quietly walk into my office and write out a cheque for 55 lacs. Crowdfunding like the Obama campaign is the way forward. Individuals contribute 60 percent of our 100 crore income in HelpAge India and foreign funds is under 1 % of the income. Local funding is the way forward as it connects us to local stakeholders and keeps us grounded.
Individual philanthropy in the country is more than 500 million USD and apart from it there are the big philanthropists like Azim Premji who have contributed into their foundations 400 million USD and companies such as HCL as well that gives large grants in a transparent manner. There is a potential of 1000 million USD ( 7000 crores) available.
Corporate funding is about 10000 crores through the CSR route per annum. I have some concerns on this form of funding though the 2 % CSR is an opportunity and also a threat to the viability of the sector, apart from the fact that it tends to co-opt the sector so that we are not a threat to destructive policies on environment, displacement and on energy and extraction/mining , land grab etc. Gandhiji famously said “Co-operate when you can, resist when you must”
However while looking for local funds, integrity and transparency are paramount. While raising funds on the internet either through crowdfunding sites your kite mark on credibility has to be recognisable. In the last 15 years I have spent time with others in founding Credibility Alliance, the first accreditation organisation and Guidestar the first transparent database of NGOS on the net with a set of minimum standards for the sector which can restore its credibility, Without transparency there can be no local funding.
It also takes a track record of the NGO for people to donate and you need to establish this on your website with a five year record of balance sheets and accounts on the public domain, the credibility or the impact you are making in your area of work.