Putting trust and resources to work for healthier grantee organizations

Open Society Foundations’ Economic Justice Program (EJP) ran for three years, prior to the Foundations’ decision to fold all its global programs into a single new team. During its tenure, the program deployed $35-45 million in grants and $50-85 million in investments annually.  It pioneered many first-ever practices for the Foundation including a three-year pilot of an Organizational Health Fund (OHF)—a pool of additional resources set aside to support existing grantee organizations’ internal needs or challenges. After an independent learning review, two external evaluations, and many conversations with the funds’ recipients, we can safely say that the pilot was successful. Given the positive impact grantees reported that our practices made, I wanted to take the opportunity to share our lessons learned with other funders who seek ways in which to adopt meaningful, trust-based support to their grantees. For a more thorough account of our lessons from the OHF, please read the recently released Learning Brief Funding for a healthier civil society here.

When we started the OHF we figured—and certainly hoped—that it would contribute to our partners’ independence and sustainability. What I never anticipated was how much we’d learn about building equitable, trusting, and even anticolonial relationships. In fact, since the premise of the fund was largely based on the gaps left behind by flexible core funding, we were concerned that a fund that offered earmarked project grants could have the opposite effect. 

“What I never anticipated was how much we’d learn about building equitable, trusting, and even anticolonial relationships.”

We could see that longer-term, structural investments were important for civil society—if not increasingly urgent, and existing funding wasn’t cutting it. The OHF also took shape at Open Society Foundation (OSF) during a time of massive upheaval, unrest, and unforeseen change in the world (2019-2021). With a backdrop of these “unprecedented” times, we felt it was more important than ever that our work to support healthier, stronger partner organizations focus on limiting funder intrusion into organizational dynamics and priorities, as well as, proactively applying a strong equity focus. 

With all of this in mind, we made deliberate choices that aimed to keep power in the hands of our partners. Critically, we decided that the organizational health priorities supported by the new fund and the work to advance them, would be left to the discretion of our partners; that is, we would provide partnership rather than direction. 

At the same time, we did not intend to be passive partners. Accountability is a key ingredient in partnership: good partners help each other to pursue their own ambitions and stay on track. The very starting point for the fund was that wholly flexible core funding wasn’t cutting it: rather than applying  towards organizational needs and opportunities, flexible support was more often being used to plug the gaps left behind by project funding. Moreover, the culture of the sector—one that has for decades prioritized gutting nonprofit overheads to the minimum viable amount—means many nonprofit boards and leaders view investments in organizational capacity, infrastructure, and their people as “extra” or “unessential.” A discrete set of funds whose sole purpose is to make exactly these investments is one of the surest ways to provide nonprofits the cover and permission needed to invest back in themselves, their ability to work, and their people.  

Based on our experience, here are three ways in which funders can deliver effective and equitable, standalone, healthier organizational funding: 

1. Say less, listen more

“My feeling is that they were really listening to the needs and weren’t really trying to persuade; they understand the importance of context, of being rooted in culture”.- OHF Grantee Recipient

During the grant design stage, we set limits on the level of advice and direction we would provide—and made this clear to partners and staff internally from the start to set expectations. In practice, this meant: 

• Listening to our partners and understanding their vision, instead of talking about our own. 
• Asking open questions about the relationship between this vision and the activities being proposed to sense-check together the feasibility, logic, and level of ownership; 
• Avoiding expressing preference for ways of working or end results. 

Often, we did challenge partners to narrow their proposed focus areas (say, from six health priorities to three) but left it to them to decide whether they would, where, and why. And to further limit the “space” we took up in discussions and to help shift the balance of knowledge, we gave partners a set of FAQs along with the guidance so that they could answer their own questions, as and when they arose, without needing to come to us. 

2. Be values-led

“In my view [the OHF] had a truly genuine goal of strengthening the organization, regardless of what they do. You need to have healthier civil society organization capable of holding actors to account. I saw that spirit, and those principles reflected in [the OHF] process.”-OHF Grantee Recipient

Language and values matter—not only in helping funders to appear credible but also in how well they are able to support the impact and resilience of their partners. To make sure that grantee ownership and autonomy were at the core of our healthier organizational fund approach, we prioritized: 

• Developing a set of values that could serve a dual purpose of guiding us, and also be used as measuring sticks for assessing the fund’s work. 
• Sharing these values with all of our partners so they could hold us accountable.
• Adjusting our language to align with our values.

Importantly, we chose to talk about organizational “health” specifically. Other, more popular terms like effectiveness and resilience are overused by funders and have been known to perpetuate white supremacy and inequity. Health, on the other hand, implies a longer-term, more holistic view and translates easily across contexts; everyone has “health.” Whatever your values, explicitly naming, sharing, and using them in designing and assessing your efforts can help to rebalance power. 

“Accountability is a key ingredient in partnership…”

3. Practice trust and transparency

“OSF seems to believe in the changemakers, I felt like they saw the vision, they didn’t expect me to be perfect, or expect the organization to be perfect.”- OHF Grantee Recipient

Organizations are and will always be imperfect, but “performing perfection” is a common trope in the funder-grantee dynamic. In our experience, grantees less familiar with us were not only more likely to paint a rosier picture, but they knew less about our funding rules and practices, and were less able to pivot within them to serve their needs. In order to invest in organizational health that was managed and led by organizations themselves, we needed to convince those same organizations that we trusted them and did not expect perfection. We also knew that to feel trusted organizations needed us to:

• Offer explicit (i.e. written) permission and encouragement to flexibly use resources and adapt their plans. 
• Provide flexibility, even in the context of a project grant, by working with organizations to reduce line items in budgets and aggregate more costs, so they would be less likely to need to come back to us to request budget modifications between line items. 
• Provide blanket approval for certain types of budget modifications and for no-cost extensions upfront.
• Require only simple, learning-focused, light-touch reporting. 

Whatever your expectations and practices, healthier grantees who are clearer about them, and know that they have your permission to fail, and understand the difference between funder rules and hopes, will be much more likely to maximize organizational support.