Philanthropic funders today have more opportunities than ever for collaboration with others. But which others? The choices are many: other funders, other community partners, others in business or others in government. The reasons for collaboration are not hard to point to: more resources, more impact, more leverage and bigger change possibly. Collaborative funding can also offer the possibility of more innovation, more perspectives on a problem and more possibilities for intervention. But as I described in a recent blog, typically funders don’t engage in structured collaborative funding. Most funders choose rather to focus on funding individual organizations delivering specific services usually in a shorter timeframe. This is unquestionably needed and important. But could some part of a funder’s portfolio also be allocated to funding collaboratively, not only with other funders but with other sectors? Are multi-sectoral partnerships now more of a possibility, particularly as we consider the opportunities for investing in a stronger Canada?
It's important to distinguish multi-sectoral funding from collaborative funding although both involve collaboration. I cited some examples of collaborative funding in Canada in my blog. In these cases, funders align their funding or directly pool their funds, usually as a group of charitable funders making grants. Even this sort of funding isn’t easy. Active collaboration requires compromise, communication and usually a long-term vision. But there have been growing instances of collaborative funding over the last decade, particularly in the environmental, community development and poverty reduction fields.
Multi-sectoral funding partnerships go beyond collaborative funding. In many cases they involve some mix of nonprofit, corporate and government funders. The partnerships may also involve a mix of capital, data, expertise and policy development. There are many examples of these types of funding partnerships across the Global South as described in a recent newsletter from WINGS, the international network for grantmakers. For example, the Mesoamerican Reef Fund (MARFund), a regional environmental fund that focuses on preserving the Mesoamerican Reef, which spans Mexico, Belize, Guatemala, and Honduras involves international donors, environmental organisations, philanthropy like the Oak Foundation and Paul M. Angell Family Foundation, and regional governments. Another example is the Just Energy Transition Partnership (JETP) in Senegal, involving international partners, philanthropy like the Rockefeller Foundation and Bloomberg Philanthropies, and communities in Africa. Launched in 2023, it aims to boost renewable energy in Senegal’s electricity mix to 40% by 2030. These partnerships are what is envisaged in the UN’s Sustainable Development Goal 17, which emphasizes multi-stakeholder collaborations among governments, businesses, civil society, and individuals to share resources, knowledge, and technology.
WINGS cites the benefits of multi-sectoral partnerships (MSPs) when they are properly managed:
At the local level in Canada, one of the most influential models of MSP has been the collective impact work fostered by the Tamarack Institute and its Vibrant Communities Initiative. Another example in Canada is the collaboration scaffolded by Shorefast to develop local communities and economies. Shorefast describes its work as “forging a new path at the intersection of business, philanthropy and community development”.
The most interesting opportunities for multi-sectoral partnerships in Canada today will involve a combination of innovative financing, expertise and advisory capabilities, supported by a backbone organization or purpose-built platform. Philanthropic funders have many opportunities as providers of risk capital and impact investors to engage in these partnerships.
Here are some examples:
Food and Agriculture: MaRS Discovery District is collaborating with the Farm Credit Corporation to launch a Food and AgTech Mission which “aims to mobilize capital, coordinate adopters and accelerate ventures that will strengthen Canada’s food system” through a venture accelerator and a corporate adopter cohort. These will be guided by a advisory body of experts and stakeholders from industry, finance and the innovation community, who will identify market barriers and enable large-scale adoption of agri-food innovation. The founding coalition members include representatives from Wittington Ventures, S2G Investments, TELUS Agriculture & Consumer Goods, The Arrell Family Foundation and NYA Ventures.
Affordable Housing: The new federal agency Build Canada Homes offers an opportunity for the application of innovative financing partnerships to support the building of more affordable housing options, as described in a recent article in The Philanthropist Journal on how philanthropy can help Canada build its way out of a housing shortage. Nonprofit organizations such as New Commons Development already demonstrate the impact of a nonprofit real estate developer partnering with community organizations and attracting philanthropic investors to develop affordable and sustainable housing.
As WINGS points out, philanthropy can play a unique catalyzing role in MSPs. It can provide risk capital. It can also provide networks, expertise and convening power. Philanthropy can concretely engage in MSPs by acting as a convenor, providing patient, risk-tolerant capital, supporting experimentation and early-stage innovation and ensuring that marginalised groups and Indigenous communities have a voice in decision-making and access to resources. Local philanthropy can help to boost and empower local or grassroots organizations closest to the problems and able to work on solutions. Communities need to develop partnering bodies such as community trusts and co-operatives. Public sector bodies such as regional development agencies and autonomous public corporations need to acquire new risk assessment frameworks that permit more flexibility. There is much to do for all partners to pull off these MSPs. But their impact on the complex problems we face locally, regionally or globally, can be enormous. Certainly, worth allocating some part of a philanthropy’s portfolio for the long term.