Philanthropic Foundations, Think Tanks, and Development: Understanding and Assessing the Think Tank Initiative
November 21, 2011
The financial crisis, amongst other things, shed some much needed light on the rising levels of inequality in the United States and the staggering amounts of wealth transferred to the top over the past three decades. Little attention, however, is being given to understanding how and where at least some of this wealth is being deployed. In fact, an enormous amount of private U.S. money is now revolutionizing the worlds of philanthropy and international development.
Given the profusion of actors and initiatives currently engaged in improving people's well-being across the world, how should we evaluate the philanthropic impulse? Are development initiatives born out of robust empirical analysis or are they largely the product of donor predilections? How transparent are their governance processes, to allow for sufficient feedback and reform? In order to better understand the rise and impact of these actors and their initiatives, it is important to subject philanthropic development ventures to such scrutiny.
This article is intended to further that cause. It does so by taking a look at the Think Tank Initiative (TTI)—a novel, multi-stakeholder development initiative that aims to enhance the lives of citizens across the developing world by bolstering the capacities of think tanks across the developing world so they can assist their respective governments in formulating policies that can advance economic development.
But can think tanks really facilitate growth? Is there adequate empirical evidence to this effect? If not, then how can think tanks merit sustained long-term investments of the kind they are receiving from TTI? How robust are the TTI's evaluative and accountability processes? Measuring how the TTI fares will not only enable us to gauge the venture's efficacy, but also help us to better understand the role that philanthropic foundations play.
Philanthropy is usually defined as the use of private funds to prevent or solve social problems. Wealthy individuals are the dominant source of philanthropic giving, often establishing eponymous foundations to execute their visions.
The philanthropic landscape is undergoing its third transformation since the
dawn of the 20th century. The first wave constituted the genesis of institutionalized
philanthropy under the stewardship of "robber baron" tycoons John
D. Rockefeller and Andrew Carnegie, who established a variety of foundations
and institutions to advance education and the discovery of scientific knowledge.
The next phase constituted the creation of the global development architecture,
with the establishment of the United Nations and the International Bank for
Reconstruction and Development. The third wave of philanthropy is now upon us.
It is characterized by a bewildering array of organizations, each working to
advance human well-being in its own way, and harnessing the technological and
organizational innovations accompanying globalization.
One can argue that this latest wave has rocked the very foundations and values that have suffused philanthropy since the early 20th century. Governments find themselves beleaguered in the wake of asphyxiating public finance deficits. The efficacy of global development agencies like the UN and World Bank are under intense scrutiny given their manifest failure to sustainably improve the livelihoods of citizens across the global south. To fill the void, non-state actors, such as, but not limited to, foundations have picked up the mantle and charged ahead.
The constellation of actors currently engaged in philanthropy is truly unprecedented. At one end of the spectrum are private foundations that deploy their largesse to improve the lives of billions. At the other end are hundreds of development networks and micro-development initiatives that rely on technological and social media tools to make a difference in people's lives. And in-between are other non-governmental organizations, private corporations, religious organizations, and international development agencies. Increasingly, these development actors, large and small, are partnering with each other and with government agencies on development initiatives intended to improve the lot of the poor in developing countries.
The Global Philanthropic Landscape—A Snapshot
Today, there are two broad philanthropic approaches to effecting change in developing countries. The first approach focuses on developing and augmenting the core capacities of citizens, empowering them to eventually function as progressive agents of change within their own societies.1 Development initiatives under this rubric emphasize local participation, ownership, partnership, collaboration, and capacity building. An example of this is the Revenue Watch Institute, collectively funded by the Open Society Institute, Hewlett Foundation, and the Norwegian Oil for Development initiative. Through a combination of technical assistance, capacity building, research, and advocacy, the RWI helps resource-rich countries and their civil society organizations improve their governance of natural resources.2
The second method endeavors to direct immediate resources to tackle and ultimately
resolve problems that languish due to pervasive deficits in governance, finance,
and capacity.3 Examples
of this approach include the plethora of recent initiatives to stem the rise
of communicable diseases such as HIV/AIDS, TB, and malaria, most notably under
the Global Fund, a partnership between governments, civil society, the private
sector, and affected communities.
Private philanthropic finances typically take three forms: direct philanthropy, remittances, and private investment. As revealed in the Index of Global Philanthropy and Remittances published by the Hudson Institute, these three forms made up roughly 83 percent of the OECD's economic engagement with the developing world in 2007, with the other 17 percent being official development aid. Private philanthropic investments from foundations, corporations, voluntary organizations, religious organizations, and academic institutions constituted $50 billion in 2007, with almost three-fourths of it ($37 billion) emanating from the United States.4
Latest estimates indicate that globally, foundations provided between $7 to 10 billion for international development initiatives in 2009, with approximately two-thirds or roughly $4 billion of that coming from the United States.5 Contributions from the Bill & Melinda Gates Foundation (BMGF) ranked at the top in 2009, with nearly $3 billion for global development purposes.6 Although possessing far less funding than BMGF, other foundations such as Rockefeller, MacArthur, Skoll, and Open Society disperse hundreds of millions of dollars to a diverse set of initiatives.
The Clinton Global Initiative has emerged as a key philanthropic convener, acting as a hub connecting those endowed with ideas and those with funds. Entities such as the Unreasonable Institute and Acumen Fund match budding social entrepreneurs with investors seeking returns by funding social causes. In addition, Gates, in alliance with fellow tycoon Warren Buffett, has lobbied other members of the billionaire club to give half of their net worth to philanthropic endeavors. Under the "giving pledge," the funds that stand to be raised provided all members live up to their pledge amount to a staggering $600 billion.7
The Think Tank Initiative
The Think Tank Initiative8 (TTI) is a multi-million dollar, transnational development venture jointly funded by the Hewlett Foundation, BMGF, UK's Department of International Development (DFID), the Netherlands's Directorate-General for Development Cooperation (DGIS), and Canada's International Development Research Centre (IDRC). The coordinating unit is the IDRC's head office in Ottawa, Canada.
TTI seeks to augment the capacity of think tanks in developing countries to inform public policy and foster development. The initiative posits that if governments are armed with wisdom that is locally collected, synthesized, and analyzed by domestic think tanks, they will be in a better position to formulate effective policies that reflect and advance the interests of the most disadvantaged.
It strives to achieve this objective in two ways: First, the initiative provides long-term, flexible, and non-earmarked grants to designated think tanks to enable them to develop and execute their research vision and objectives. As a result, the assistance is demand-driven, where think tanks are not impelled to investigate issues that are predetermined by donor predilections but instead by a judicious appraisal of domestic policy issues. And second, the program places a premium on organizational development by investing in the research infrastructure, augmenting research and communicative capacities to enable think tanks to develop and sustain their intellectual contributions.
Following a rigorous selection process, the TTI chose 52 think tanks from 23 different countries from three different continents—Africa, Latin America, and South Asia. Think tank grantees vary in size, capacity, scope, and tenure. One aspect that unites them all is a common desire to function as knowledge actors—seeking to raise awareness on national economic and social issues related to growth and poverty reduction, conducting research and analysis on these issues, and possessing a keen desire to effect change in those policy areas.
Measuring the TTI
The Nature of Think Tanks in Many Developing Countries
History indicates think tanks can discharge developmental roles; but there is a caveat. As several East Asian countries targeted rapid economic growth and development, think tanks emerged within governmental ministries or closely affiliated with bureaucracies that governed the economic planning process. Research and analysis were urgently required to enable bureaucracies to make sound decisions, and think-tank-type centers filled that void.
In China, these included four national level research centres: Economic Research Centre (ERC), Technical Economic Research Centre (TERC), Price Research Centre (PRC), and the Rural Development Research Centre (RDRC). All these institutes, including the Chinese Academy of Social Sciences, derived their operational and financial mandate from various ministries and in return furnished their patrons with policy inputs to address domestic problems.9 Indeed, as Cheng Li points out, the top ten think tanks in China even today are all largely state-sponsored think tanks.10 Several other countries within the region also followed this practice; ministries in Vietnam, Indonesia, South Korea, and Taiwan all designated think tanks to perform "developmental" functions.
The critical point here is that none of these think tanks were entirely independent. In most cases, think tanks drew direct support from governmental patrons and adhered to the mandate given to them. This increased their access and influence, without which all their work would be for nothing. In the developing world, independence can be a veritable disadvantage for think tanks, and since independence was one of the determining factors leading to their selection, this could weaken the policy potential of the think tanks chosen by the TTI. As much as independence is a virtue, we need to recognize that independence is often inversely proportional to direct policy influence in developing countries. Therefore funding think tanks to be both independent and influential could be problematic.
This fundamental flaw can be traced to some of the assumptions that underpin the TTI's core. The initiative defines and expects think tanks to function as independent policy research organizations in the developing world that play a vital role in building cultures of democracy and contributing to human and economic development. But are they? Going by this definition, one will be hard pressed to find many think tanks in the developing world. In general, the term "think tank" has caused much consternation among political scientists and international relations specialists, as it defies definitional or analytic precision. Definitions abound. Reigning characterizations draw heavily from think tank models in the Anglo-American world where independence, impartiality, and a policy research focus are venerated (Stone 1996; McGann and Weaver 2002; Rich 2004).
This scenario, unfortunately, is not reflective of a majority of think tanks
in the developing world. Several recent studies have indicated that think tanks
in other regions perform a diverse set of functions that run counter to the
prevailing Western orthodoxy. And these functions are often intricately tied
to the politics of their contexts. As previously mentioned, most Chinese think
tanks are wedded to the state apparatus and derive their operational and financial
mandates from the ministries to which they are formally linked. Elsewhere, think
tanks are linked to political movements, and eventually, governments. Bolivian
think tanks such as CEJIS and CEDLA generated and conveyed evidence to several
indigenous social movements that enabled them to shore up their demands and
grievances before communicating them to the Bolivian government. As Rafael Bueno
states, the unity of these disparate social movements, abetted by think tanks,
proved critical to the eventual rise of Evo Morales in Bolivia.11
To take another example, former Malaysian premier Anwar Ibrahim established
the Institute of Policy Studies (IKD) think tank, which then propelled Anwar's
political rise through the assistance of youth networks. Following Anwar's ascent,
the IKD grew in stature and influence by contributing to Malaysia's youth and
cultural policy, areas that were politically sensitive to Anwar's standing.12
This list could go on. The point is that think tank type entities differ greatly from their Western counterparts and viewing them through Western lenses detracts from considering their role and subsequent influence within their own political environments. And this becomes more problematic when you fund think tanks through a largely Western conception of who they are and how they operate that does not translate well across different contexts. Domestic political considerations are critical and omitting them from the picture undercuts our capacity to understand how domestic think tanks can play an influential role in their policy environments.
Advancing Structural Change
Despite some of the questionable assumptions that underpin the initiative's governing mandate, the venture can have a broader impact on the political contexts of countries where think tanks are based by opening up the policy environment to more voices, ideas, and opinions. By strengthening the capacities of think tanks, TTI is facilitating the relationship-building process between institutions of government, civil society, and those that operate in between.
Such an approach allows for domestic political actors, like think tanks, to engage in public policy by negotiating and building coalitions to have an eventual imprint on policy, whether tangible or indirect. Indeed, one can perhaps surmise that such investments advance the deepening of a democratic fabric, where different actors are vigorously debating the merits of different policy options and how to best structure public policy to achieve requisite objectives. And this can be attributed to one of the direct advantages of having philanthropic foundations take the lead by investing in building the socio-political infrastructures that can contribute to social transformations over the long-term.
In the near-term, however, the efficacy of most developing country think tanks rests on nesting themselves within the power structures of their political environments. Shifting gears on this front hinges on the governance processes of the TTI and how amenable they are to reform and change. Foundations should be expected to justify their investments, not solely to demonstrate that they are open to criticism and reflection, but most importantly, to show that they are taking to heart the interests of those who are directly affected by their programs.
How robust is the governance of the Think Tank Initiative? Unlike other initiatives of the Gates Foundation that are governed by a board of four individuals (three members of the Gates family and Warren Buffett), the TTI's oversight is more robust. As mentioned above, the initiative is funded by five organizations—two foundations (Gates and Hewlett) and three public development agencies (DFID, DGIS and IDRC)—and administratively managed by the IDRC. Unlike the two foundations, the latter three entities are public agencies that have to formally report to their respective legislative establishments. As a result, the initiative's mandate does fall under democratic purview.
In addition, the creation of an international advisory group, comprising of an independent group of development experts, bodes well in terms of enabling sufficient space for reform should the program or its grantees fail to deliver on their mandate. The advisory group counsels the funding consortium on the overall strategic direction of the entire initiative, and reserves the right to make final recommendations to the IDRC. Such a collaborative approach to development, governed by a cross-section of stakeholders, strengthens the overall governance of the initiative.
The TTI exemplifies an emergent development paradigm—where partnership and collaboration are underscored, knowledge is recognized as a growth lever, and local agency and empowerment are deemed critical to advance and sustain growth trajectories. And philanthropy, given its penchant towards innovation and experimentation, appears poised to function as the predominant driver of this epistemic shift.
Foundations are largely exempt from rigorous public scrutiny; and although this gives them greater freedom when devising their agenda, it also creates a moral hazard where they may be prone towards taking socio-economic risks that could fail. On this count, the TTI, given that it has instituted a more horizontally aligned accountability structure, holds more space for reform and tinkering if it turns out that think tanks designated under the initiative have a limited domestic policy presence or impact.
However, it is arguable that some of the founding axioms that underpin the TTI do not meet empirical scrutiny. Investing in bolstering the capacity of independent think tanks across the global south does not commensurately increase their access to the corridors of power, which is critical if think tanks hope to translate their ideas into policy. Hitherto, think tanks that have assumed "developmental" roles have largely done so as an official or semi-official entity with intimate linkages to the government in power. Power relations are a critical factor and one that cannot be easily surmounted by financing from abroad.
"Developmental" think tanks need to focus on building and strengthening linkages with policymakers in order to gain and sustain influence before we can realistically expect them to have a tangible imprint on development policy in their countries. On the plus side, the TTI is geared to facilitate this latter objective over a longer term. Funding think tanks and building their capacities (even if they are not fully independent, perhaps) can accelerate the gradual opening up of political infrastructures in the developing world where different political actors—state and non-state—debate the merits of ideas that eventually end up determining policy.
Edwards, Michael (2011). The Role and Limitations of Philanthropy. The Bellagio
2 For more on the RWI, please visit http://www.revenuewatch.org/about.
3 Edwards, Michael (2011). The Role and Limitations of Philanthropy. The Bellagio Initiative.
4 Adelman, Carol. (2009) "Global Philanthropy and Remittances: Reinventing Foreign Aid." Brown Journal of World Affairs, Volume XV (11):23-42.
5 Adelman, Carol. (2009) "Global Philanthropy and Remittances: Reinventing Foreign Aid." Brown Journal of World Affairs, Volume XV (11):23-42.
6 Ogden, Timothy. (2011) "Living with the Gates Foundation: How much difference is it making." Alliance Magazine.
7 Rogers, Robin. (2011) "Why Philantro-policymaking matters." Society 48 (5): 376-381.
8 For more on the Think Tank Initiative, please visit http://www.idrc.ca/EN/Programs/Social_and_Economic_Policy/Think_Tank_Initiative/Pages/default.aspx.
9 Zhu, Xufeng (2009). "The influence of think tanks in the Chinese policy process: Different ways and mechanisms." Asia Survey, 49, 2: 333-357.
10 Li, Cheng (2010). "China's New Think Tanks: Where Officials, Entrepreneurs, and Scholars Interact." China Leadership Monitor, No 29: 1-21.
11 Bueno, R and Datta, A. (2010) The politics of Evo Morales' rise to power in Bolivia: The role of social movements and think tanks. RAPID Policy paper. Overseas Development Institute: London.
12 Khoo, S. (2004) "Think Tanks and Malaysian Development." in Stone, D and Denham, A. Think tank traditions: policy research and the politics of ideas, 179-197.