UK parliamentary inquiry examines the role of private foundations in international development

26 October 2011

In her evidence to the international development select committee inquiry into private foundations, IDS Research Fellow and Bellagio Initiative project manager, Dr Noshua Watson told parliamentarians that philanthropy could provide a real source of innovation in delivering development outcomes.

Photograph of the Houses of Parliament and Big Ben on the River Thames. Image credit: Fred Hoogervorst / Panos

Without the political accountability and economic spending constraints that most donors face, foundations are better placed to take on more risk and foster new approaches and partnerships. Dr Watson cited several examples of where foundations had achieved particular success such as the Green Revolution or the Medicines for Malaria Venture.

However Dr Watson also highlighted that this lack of accountability and transparency does present a number of significant challenges. There is a lack of publicly available information on the aims and objectives and decision making processes of private foundations. There is also very little data available on philanthropic giving and the impact of private foundations investments on development outcomes.

This has very definite implications for development cooperation and Dr Watson argued that more needs to be done to ensure that there is greater synergy between the priorities of donors and foundations and that these priorities are better aligned with national strategies for poverty reduction in developing countries.

She highlighted that the forthcoming 4th High Level Aid Effectiveness Forum taking place in Busan at the end of November could provide a forum for discussions around coordination between new and traditional donors to take place. However, Dr Watson acknowledged that that by including emerging donors such as private foundations in these discussions focus could be detracted from the original ambitions of the Paris Declaration and Accra Agenda for Action. Dr Watson did agree with the committee that there could be a role for the OECD-DAC in terms of data collection on philanthropic giving and the role of private foundations which could prove extremely valuable in terms of strengthening coordination and cooperation.

The committee also focused on the governance of private foundations and how decisions about priorities were made. Dr Watson argued that more could be done to build the capacity of trustees within foundations, particularly some of the smaller ones which may not benefit from the specialist expertise Programme Officers bring to the largest foundations.

The committee raised concerns that many foundations were still investing in countries such as India which had graduated to middle income status and questioned whether these investments would be better targeted at the least developed countries. In response, Dr Watson cited the work of IDS Research Fellow Andy Sumner on the Bottom Billion which highlighted that three quarters of the world’s poorest people live in middle income countries like India. She went on to say that private foundations can have an important role to play in tackling long term structural problems such as inequality. Dr Watson also suggested that foundations are well placed to demonstrate the value and positive impacts of aid, which is particularly important at a time when surveys such as IDS’ UK Public Opinion Monitor show that public support for overseas aid is dwindling.

Watch the full evidence session.

For further details about the Bellagio Initiative please contact Naomi Marks on +44 (0)1273 915606.