I had the opportunity to attend the Emirates Foundation Annual Philanthropy Summit in Abu Dhabi, where panellists discussed a number of trends and challenges in the field of philanthropy and development. One issue that was not discussed, but stands out to me, is how the number of actors in the field of development is increasingly dispersed and diffused.
The proliferation of philanthropic organizations has risen and will likely increase as we see the number of new billionaires take off across the world. No longer is the philanthropic field dominated by the big names of “old money” like the Rockefeller Foundation; instead, “new money” is emerging globally, from the Tata Trust in India to the Gates Foundation in the United States. Undoubtedly, with more billionaires coming from the developing world, we are likely to see new actors in philanthropy.
In bilateral foreign aid, we are similarly seeing a global shift from DAC members of the OCED to non-DAC members in emerging market economies. The West is increasingly cash-strapped, while we see the rise of new state donors in China, Brazil, and the Arab Gulf. In tandem with this trend of emerging market economies taking on new development profiles, we see the general decline of funding in multilateral foreign aid agencies that once dominated the space of foreign aid and development. The Gates Foundation can tout that it invests more into health than the World Bank. The Chinese government is providing foreign aid to Africa at a race that outpaces World Bank development aid.
More actors and more global money for the poorest people is a good thing, right?
Well, yes and no. Indeed, I think having more globally responsible actors in the field of development is always a good thing. We need the spirit of giving to cross borders and cultures. I am afraid, however, that as we decentralize and diffuse development across a multiplicity of actors, we lose an important repository of knowledge. In plain speak, there is a risk that new actors reinvent the wheel and fail to internalize lessons learned from previous projects. It needs to be noted that part of the impulse to do it alone, as opposed to investing funds into already established networks and agencies, can be understood as a loss of faith in many of the existing global organizations.
The perceived politicization of existing multilateral agencies, like the World Bank and the OECD’s DAC program, are partly to blame for why “going it alone” is the new way to go. Undoubtedly, there will be actors who want to see their name in front of initiatives and hence explain their desires to circumvent existing organizations. Nevertheless, the failure of global governance to follow an impartial approach to development is also at fault.
Like many global governance dilemmas, the solution may lie not in creating new organizations, but in improving existing ones. Deep structural governance reforms of organizations like the World Bank and the OECD’s DAC program are necessary to make them more inclusive of rising economic powers. Both examples have a deep repository of development knowledge and need to open their doors to emerging market economies. Governments also need to recognize the power of the private sector by sharing development knowledge with philanthropic organizations. Governments need to acknowledge the shift of economic power from the public to the private sector. It’s time to for existing actors to share the space with new global players in development and aid — but let's not reinvent the wheel by losing the transfer of knowledge to these new actors.