Domestic think tank funding: what can foreign donors do?

[Editor’s Note: This post was first published in Aditi, a new resource on and for think tanks from CSTEP in India. The first issue of 2015 is on funding.]

On Think Tanks has given the topic of think tank funding a great deal of attention. If you are interested in learning more about it you can read its Topic Page on Funding. But most of the articles written focus on what think tanks can do to raise funds and, more recently, what think tanks can do to generate domestic funds.

This article focuses, instead, on what their current foreign funders could do.

Foreign funding for think tanks is a common occurrence in developing countries. Whereas The New York Times considered it a scandal that US think tanks were receiving funding from foreign sources to influence the American government, Aid agencies and foundations continue to funding think tanks in Latin America, Asia, and Africa without raising as much as an eyebrow.

However, foreign funding for think tanks, which has been a godsend for some, poses significant risks to think tanks.

Foreign funding is unreliable and think tanks have little control or influence over it. Funding decisions at bilateral agencies are the consequence of political processes that take part well beyond the sphere of influence of the funds’ recipients. Indian think tanks have no say over how much DFID allocated for them; this is decided by British politicians and the British electorate –and, often, the media.

Funds come attached to conditions; whether we like it or not. The second round of funding from DFID to the Think Tank Initiative, for instance, has come with the extra ‘demand’ that greater attention is given to climate change and the post-MDG/sustainable development goals agendas. This does not mean that all think tanks will have to re-focus their work, but some will be left wondering if, maybe, they should. In any case, everywhere in the world, think tank agendas are influenced (or at the very least informed) by their funders’ own interest and it is no different in developing countries. The trouble with foreign funders, however, is that they are foreign to the politics in which the think tanks operate and can therefore have an interference effect on it and can back-fire on think tanks’ reputations.

But most importantly, foreign funding is risky because it is likely to diminish as the countries develop. And this can leave think tanks in a more vulnerable situation than it found them in.

So what can foreign think tank funders do to help think tanks rebalance their funding sources: away from foreign and closer to home?

• Raising visibility of think tanks and their value by promoting initiatives such as national annual think tank awards -increasingly including the private sector as participants, judges and hopefully sponsors of these efforts.

• Working with future generations of philanthropists. For instance, setting up groups of young patrons to bring together people in their 30s to act as an informal group of patrons (contributing very little money -but relatively a lot more than what older patrons give) for the think tanks they support with the aim of ‘teaching’ them how to support research institutions. In the future they will be more willing to fund them. Individual think tanks could also take on this model.

• Work with future generations of think tank leaders to help them to think this through early on in their careers. This is behind the School of Thinktankers that On Think Tanks and Canning House have launched. The School aims to take a group of young future think tank leaders from Latin America (as a pilot) to London to be inspired by the think tank and policy research community there.

• Use foreign funding to leverage domestic funding. This may take more money but this is money that is already there. Initiatives like the Think Tank initiative or the Think Tank Fund could organise dinners or conferences at which (ideally) Bill Gates, George Soros, and other philanthropists meet their local counterparts and encourage them to fund their own research and research institutions. They could ask them to pledge, there and then, money for research and think tanks in their countries. This is how they mobilise and leverage funds for their own causes.

• Another way of leveraging funding is to condition funding to think tanks’ capacity to raise domestic funds. It could start with small amounts (10%) and grow, year on year, until it eventually takes over. Multi-year initiatives should follow this approach to give think tanks time to plan ahead and encourage them to develop a clear strategy to achieve this.

• Reward ‘graduation’. Foreign funders could reward think tanks that no longer need them with a ‘parting bonus’. A one-off and up-front payment to build their reserves as a way of addressing the new risks those new funding sources may bring. This bonus could be conditional of the think tanks not returning to foreign funders.

• Fund research on funding models to make it easier to donate. I was startled to find that funding mechanisms that were quite common in the UK, for instance, well not known by Peruvian ministries or philanthropists. Something as simple as setting-up a large umbrella programme that would be charged with funding smaller projects instead of trying to fund the smaller projects directly came across as a complete innovation to some government officials. The model of academic chairs was also relatively unknown. I started working on this last year with a brief on “Chairs” after friends in the private sector said there were no efficient ways for them to support research.

• One idea I have been working on is Crowdfunding. Current popular crowdfunding websites work well for most projects but are not tailored for think tanks or research projects more generally. The crowdfunding model I have developed makes it easier for researchers (anyone) and funders (anyone) to connect. But it also makes is possible to communicate findings.

Think tanks have a responsibility, too. It is all too easy to benefit from relatively easy to secure foreign funds. Foreign funders are, also, much more generous that their domestic counterparts. Rather than waiting and hoping for a second or third tranche of funds, they should be looking for domestic alternatives.

And they should certainly be encouraging their foreign funders to support them in this process.