Decentralized Fundraising, Centralized Distribution
The Wikimedia Deutschland Movement Strategy & Global Relations Team has published Paper #2 in the WMDE-authored series on Movement Strategy topics.
Titled Decentralized Fundraising, Centralized Distribution, this research report describes the fundraising and distribution practices of eight large international NGO confederations and networks, and puts them in the context of the changing Wikimedia Movement.
2030 Movement Strategy calls on us to change many things - among them how we generate and share funds among regions, affiliates and communities. Subsidiarity, equity, and participation are just some of the key values and principles to be incorporated.
The paper deliberately refrains from recommendations. In addition to the research, it does provide an overview of the history of Wikimedia resource development, discusses the elements of movement strategy related to funding, and finally poses a series of questions helpful to frame the further conversation.
Executive Summary
This paper, published in the context of the Wikimedia Movement’s deliberations around its Movement Charter and the implementation of 2030 Movement Strategy, provides an overview of financial practices of comparable large international nonprofit/nongovernmental organizations (INGOs) which are organized as confederations or networks.
Based on interviews and information sharing with staff of eight organizations, including Amnesty International, Oxfam International, CARE International, World YWCA, Greenpeace and the International Cooperative Alliance, the research asks about key practices in the areas of fundraising, decision-making about fund allocation, and in particular, about redistribution policies and mechanisms. This latter topic was given particular focus, because Movement Strategy emphasizes equity in funds distribution across an economically unequal international movement. Yet it leaves open how this should be structured.
The main findings of the research show that the Wikimedia Movement differs significantly in its practices from the screened organizations: All of the organizations are based on their affiliates fundraising independently, online and offline. In several cases the INGO specifically invests in the fundraising capacity of affiliates. Yet fundraising is highly strategic rather than diversified, in terms of markets, fundraising affiliates, and revenue sources.
With one exception, the international entity collects membership dues and is in part funded by them. The international entities have a diversity of roles, with acting as a secretariat and coordination being the most common ones. Only a minority of international entities engage in their own fundraising or fundraise for the movement. Notably, grantmaking from international entities to the affiliates is not a practice, and occurs only in few exceptions when there is third party program funding. Participation in funding decisions, which has been previously researched in a report commissioned by the MS 2030 Resource Allocation Working group, is practiced mostly through democratic and equitable governance and committee structures. While these structures vary greatly, both reports conclude that governance and funding systems are inseparably linked.
Finally, three of the organizations have distinct, policy-based, central funds redistribution mechanisms. These are discussed in some detail, in terms of their principles, formulas and review periods.
The results of this research can be summarized as follows: International NGO confederations practice decentralized fundraising, and those that redistribute funds for equity do so in a centralized manner, based on policies agreed upon by the democratic governance bodies of the confederation. The affiliates that fundraise in strong markets thus support the affiliates in smaller markets.
The research part concludes with a list of insights for the upcoming deliberations of the Wikimedia Movement. In the second part of the paper, readers can find a short history of Wikimedia revenues and resources, and an overview of the elements of 2030 Movement Strategy relevant to revenue generation and distribution. The appendices provide a list of guiding questions for the Movement deliberations to follow, and an overview of the structures of the INGOs in the sample.
Discuss this story
The Wikimedia Movement operates under a system of mostly centralised fundraising, combined with central grantmaking. Over the years, the Wikimedia Foundation has added participatory features to the grantmaking processes. Still, there are large inequities in terms of how and where funds are spent. The Movement Strategy states:
What do the Movement Strategy recommendations say?
The following principles should guide the work along the way and have strong implications in how resources—not only financial—are obtained and allocated.
Nikki mentioned some pathways explored by other Movements are doing that can offer guidance in implementing the recommendations in the Movement Strategy:
Learnings from a Wikimedia Deutschland research of how other similar global movements deal with revenues and resources indicate: