Hlengiwe Phiri is the Product and Community Manager at Nation Builder.
Hlengiwe says the social development sector in South Africa is relied upon to reduce the number of people falling through the cracks of the social fabric. Because the needs are greater than the available support, a strategic intervention is required to guarantee the greatest long-term impact. Trialogue reported that an amount of R10.2 billion was used for social investment in South Africa in 2019. The Nedbank Private Wealth Giving Report stated that R7 billion was entrusted to them for distribution by their partners, both donors and Non-Profit Organisations (NPOs). In 2018 only 36% of these monitored the value of their impact. “Part of the regeneration of our Nation… entails having a thorough understanding of the work we are already doing as well as what constitutes doing it well,” explains Hlengiwe.
In July 2020, Nation Builder conducted a survey to assess the effects of COVID-19 on the NPO sector in South Africa. 72% of the organisations surveyed indicated decreased funding; 61% indicated an increase in project costs and 36% indicated a decrease in staff complement. This has placed extra pressure on an already strained development system. For example an organisation which applied for assistance from the GAP Fund had been feeding 76 families prior to COVID-19 but this rose to 800 families during COVID-19, showing that drastic measures were required to cope with the exacerbated need.
Impact management has become a priority for businesses and NPOs alike. International reports and guidelines are available but South Africa requires a local, relevant, contextualised framework. A large amount of money goes towards social development in this country, but at present there is no idea of the consolidated sum which goes to the social investment sector. There is also a lack of consistency in the manner of reporting social investment and many stakeholders are exploring different approaches towards understanding impact.
For this reason Nation Builder, along with 95 donors and NPO entities, embarked on an exercise to clarify and develop Best Practice Standards. They attended a variety of stakeholder interviews, committee meetings of funders and NPOs in their own sector as well as many collaborative engagements in three different provinces, looking at two specific problems. Firstly, the financial side; this involved studying the funding of overheads, organisational excellence, capacity for development and reporting on finances in a mutually acceptable way. Secondly, they investigated the reporting side; the administrative burden of having to report to a number of different funders in as many different ways. They found misconceptions and a lack of understanding existed between the donor and NPO communities.
Guidelines were required to assist participants to understand the partnership process as well as principles to underpin this process. It is hoped this will lead to standardised reporting methods, mutual financial partnerships, healthy partnerships between NFPs and funders, professionalisation of the development sector and a strengthening of the collaborative impact that is occurring.
In March 2021, we will launch both the Impact Management Reporting Guideline and a Masterclass Series, which will consist of four interactive learning sessions. If you’d like to join the Masterclasses, please add your details here.
The ultimate aim is for every business and NPO to report effectively in order to gain an accurate picture of the impact being made. No business is too small to assist in developing our nation. In the words of Anita Roddick: “If you think you’re too small to have an impact, try going to bed with a mosquito!”
This talk was delivered at Nation Builder’s 6th Annual In Good Company Conference (September 2020) which looked at “building back better.”
