jc579-strategies_ngo_en_2.pdf - PDA STRATEGIES TO STRENGTHEN NGO CAPACITY IN RESOURCE MOBILIZATION THROUGH BUSINESS ACTIVITIES This document was

jc579-strategies_ngo_en_2.pdf - PDA STRATEGIES TO...

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STRATEGIES TO STRENGTHEN NGO CAPACITY IN RESOURCE MOBILIZATION THROUGH BUSINESS ACTIVITIES This document was co-authored by Mechai Viravaidya and Jonathan Hayssen PDA and UNAIDS Joint Publication UNAIDS Best Practice Collection 2001 PDA
The work of non-governmental organizations (NGOs) protecting the environment, helping the sick and needy, preserving arts and culture is by nature unprofitable. Traditionally, NGOs rely on the goodwill and generosity of others to cover the costs of their activities through grants and donations. Today, unfortunately, NGOs find that such traditional funding sources are often insufficient to meet growing needs and rising costs. In addition, restrictions imposed on many grants and donations, along with the uncertainty of these funds over time, make it difficult for NGOs to do long-term planning, improve their services or reach their full potential. When the costs of an NGO s core activities exceed the inflow of grants and donations, it is forced to either reduce the quantity and/or quality of its work, or to find new sources of funds to cover the difference. Reaching out to new donors with innovative fund-raising approaches is usually the first step. Redesigning program activities to include cost- recovery components, whereby the beneficiaries or clients of the NGO pay part of program costs, is a second approach. A third alternative is for the NGO to make money through commercial ventures. This UNAIDS Best Practice key material is directed at managers of national and international NGOs working on HIV/AIDS and other health and development issues. It is intended to increase their awareness of the opportunities, and possible problems, associated with alternative resource mobilization strategies, with a special focus on commercial activities. It is hoped that this will motivate NGO managers to determine and begin implementing the most appropriate resource-generating strategies to enable their organizations to continue and expand their important work. Policy makers, donor agencies and other supporters of NGOs also have a vested interest in seeing NGOs achieve financial sustainability. It is therefore hoped that this paper will encourage such readers to increase their efforts to promote such institutional development for NGOs. Non-government organizations make our world a better place. Together we can ensure that they continue to grow and prosper. F o r e w o r d
T a b l e o f C o n t e n t s Chapter I. The Funding Challenge Facing NGO Managers ............................... 1 Chapter II. The Response to Date ........................................................................ 3 Chapter III. Achieving Financial Security through Diversification ...................... 5 Chapter IV. Strategies for NGO Commercial Ventures: An Overview ............... 12 Chapter V. The NGO as Business Owner: Special Considerations .............. 14 Chapter VI.

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