What local NGOs need to do to secure climate finance

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Even donors have begun to recognize the effectiveness of grassroots organizations and are focusing on “localization” in the humanitarian sector, which could be implemented in climate action. Photo: Collected

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What local NGOs need to do to get climate finance

Even donors have begun to recognize the effectiveness of grassroots organizations and are focusing on “localization” in the humanitarian sector, which could be implemented in climate action. Photo: Collected

The Green Climate Fund (GCF), although the youngest financial mechanism of the United Nations Framework Convention on Climate Change (UNFCCC), is one of the largest multilateral climate funds. However, only 19% of direct entities receive this funding, as only accredited entities are eligible to apply due to the very high transparency and fiduciary standards set by the GCF Board. This is the case for all major climate funds. Thus begins a dilemma, as the entities best suited to acquire these funds are often not those best suited to implement project activities at the local level.

Local organizations are always the first responders in an emergency due to their proximity and understanding of the local population. Development projects are cyclical, as is the involvement of international actors, but local organizations are constantly at the service of communities. This is why they are trusted and taken seriously by people. This, combined with their localized knowledge and familiar communication methods, allows them to help people in climate-vulnerable regions in the most effective way.

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However, only a small part of the funds for climate actions reaches them, which is not enough for them to realize their potential. Funding from global sources and bilateral agencies is distributed using a trickle-down approach. After covering the overheads at various levels, a minimum amount is left to achieve the desired goals at the ground level. Due to the funding situation, these organizations also face a huge human resource recruitment and retention challenge as they cannot compete with the salaries and benefits offered by international NGOs.

Why can’t or don’t donors fund these local organizations directly? One of the main reasons cited is that local organizations often lack the capacity to comply with their demands and spend the money effectively. Multilateral and bilateral organizations also prefer to channel funds through a few trusted partners, as this method carries less risk and is more in line with their own rules. It is also difficult for these organizations to channel funds directly to local NGOs due to their strict anti-money laundering rules, and local organizations often lack the capacity to ensure the level of transparency and accountability that these donors need.

Local organizations also often lack the technical skills that can appropriately express the value for money of their work. As a result, their funding proposals often fail in tenders. However, they too can work to build their institutional capacity and compete for global funding. To stand out, these grassroots organizations need to address three aspects of institutional capacity building.

First comes profile building, for which proper documentation of all projects in which an organization is involved must be maintained. Documentation should be done from a knowledge management perspective, including internal and external evaluations to track the impact of projects. This greatly helps in tracking their progress and archiving all achievements so that they can be presented to donors at any time. Publishing good articles in newspapers and peer-reviewed journals is another great way to get noticed. Professionalism is key – following the working style of international NGOs could help build trust with donor organisations. In addition, these organizations can also come across as more professional and trustworthy when they have and adhere to appropriate environmental and social safeguards. It is therefore strongly recommended to prepare these frameworks and to respect them. The preparation of a five-year strategy and action plan could also be very useful for local organisations. In addition, concept notes can be prepared on various topics related to climate change adaptation, such as water security and sanitation, agriculture, aquaculture, nature-based solutions, migration and urban livelihoods, and skills development.

Building a global and national network is the second essential aspect of institutional capacity building. The more people know about an organization and its achievements, the more likely they will be to fund its projects. Getting to know government stakeholders and identifying champions within government is key to strengthening national presence. In addition, it is important to build a network with bilateral and multilateral agencies. Proactively engaging and offering to present projects and ideas to different stakeholders helps increase the visibility of an organization’s work. Attending relevant national and international conferences is a good starting point for building networks and increasing visibility.

Finally, when it comes to accessing funds, it is extremely important to be aware of the identity of potential donors and the funds available for Bangladesh. Maintaining lists of other relevant stakeholders is equally important. It is also mandatory to keep abreast of political changes in major donor countries. Note that funding flows to different sectors by bilateral donors often vary according to the agendas of the political parties in power. In fact, climate finance is politically sensitive. Local organizations can also increase their chances of accessing funds by being part of a consortium.

The development discourse dictates where funding is targeted; with the current global focus on climate change, funds will be available to address it over time. In recent times, even donors have begun to recognize the effectiveness of grassroots organizations and are focusing on ‘localization’ in the humanitarian sector. Major bilateral donors required international NGOs and other agencies to partner with local NGOs and provide them with 25% of project funding. In addition, international organizations are also working to build the capacities of their local partners. This concept could potentially be adopted in the fight against climate change in Bangladesh.

Therefore, these grassroots organizations must continue to work on strengthening their institutional capacity focusing on the three aspects to access climate finance.

Md Bodrud-Doza is Head of Operations and Business Development at the International Center on Climate Change and Development (ICCCAD). Email: [email protected]
Mahzabeen Mahfuz is a research fellow at ICCCAD. Email: [email protected]

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