How funders can invest to bridge the leadership development gap

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Fewer than half of non-governmental organisations (NGOs) feel confident that anyone internally can effectively lead their organisations in the absence of their senior-most leaders, according to a data-driven study of Indian NGO leadership development by The Bridgespan Group, supported by the Omidyar Network. Believed to be the first of its kind, the report paints a picture of leadership development practice in the sector. The study findings and conclusions should spur donors and NGO CEOs alike to action.

The study, 'Building the Bench at Indian NGOs', is based on a survey of leaders of 203 Indian NGOs, 41 International NGOs working in India, interviews with 53 funders and intermediaries serving the NGO community, and secondary research. It found that while 97 percent of NGO leaders said that leadership development is vital to their organisation’s success, 53 percent do not feel confident that anyone internally can effectively lead their organisations in the absence of their senior-most leaders.

Moreover, it found that fewer than half of the organisations have received funding for such activities in the past two years. Indian NGOs tend to be overly dependent on individual leaders (often their founders); frequently lack a second layer of leadership; and have limited organisational capacity for management change and strategic thinking.

While some funders are doing exemplary work in building the long-term capacity of social sector organisations, many more narrowly provide NGOs with program support, without investing in the leadership required to make these programs succeed and scale.

Funders that aim to support the full cost of achieving results can step in to help their grantees across two broad areas of leadership development. First, they can invest in and actively support leadership development across grantees. Second, they can invest time and resources to build an ecosystem of leadership supports and move the sector to prioritising leadership development as mission critical.

Supporting Grantees Funders are uniquely positioned to provide both financial resources and management expertise to steer NGOs towards developing leaders from within the organisation. Alternatively, funders can help NGOs identify the right external candidates.

Funders can use different approaches to invest in building NGOs’ capacity to develop leaders:

•    Refrain from capping overhead costs at impossibly low thresholds, “as it limits the NGO’s ability to build its leadership capabilities;”
•    Increase unrestricted funding that can be used for leadership development;
•    Focus on capacity-building grants;
•    Earmark leadership development allocations within program grants; or,
•    Incentivise grantee NGOs with a strong track-record in leadership development.

Philanthropy can also bolster leadership development through in-kind support of grantees. The Omidyar Network in India, for example, has a team of professionals that provides services like executive coaching and talent recruitment to investees. Social Venture Partners, a network of professionals across India that funds NGOs, also provides executive time and talent to mentoring NGO leaders. Azim Premji Philanthropic Initiatives introduces its grantees to external experts in areas of leadership or fundraising, on an “as needed” basis, and at times finances such services.

Investing in the ecosystem
Meeting leadership development needs within NGOs is one important part of the answer for building the bench of Indian NGO leaders. The other part requires investing in the landscape of supports for leadership development, upgrading or creating practical programs and learning modules that can build the managerial expertise of leaders in specific areas such as strategic planning, managing change and developing others.

Funders can fill existing white space in the landscape of supports with tailored resources like toolkits, guides, and online leadership development courses, like +Acumen, which are customised to the needs of Indian NGO leaders.

Addressing today’s leadership development gaps across Indian NGOs requires a mental shift for both NGO leaders and their funders, from focusing on the charismatic leader to building strong second lines. We will share ideas on how to accomplish this in a subsequent series of short articles in this publication.

As the trailblazers that built Indian’s social sector are poised to retire, investing in building the next generation of leaders is key to sustaining and growing social impact.

Pritha Venkatachalam is a partner with The Bridgespan Group in Mumbai and co-author of the report, 'Building the Bench at Indian NGOs'. Danielle Berfond is a Bridgespan Group manager and co-author of the same report.

The thoughts and opinions shared here are of the author.