The catch-22 of ‘localisation’ in humanitarian action

FACT Foundation's team of interviewers in Maiduguri, June 2023.

A guest blog from Emmanuel Atam, Executive Director at FACT Foundation

As local non-governmental organisations (let’s call us LNGOs) operating in Nigeria, we face many challenges. Often the international response paints a conflicting picture of local actors. Lauded on the one hand for our ‘localness’, we evoke concerns about risk and poor systems on the other – and this ‘risky’ hand seems to be the dominant one. This makes it hard for local organisations to do the work that they need to, to reach people in need. Even though humanitarian aid happens locally, most discussions about it happen ‘internationally’, a million miles away. And we wonder why localisation isn’t working.  

When trying to access funding for projects, the largest hurdle we face is low trust due to perceived high fiduciary risk (the risk that funds are not used for the intended purposes; do not achieve value for money; and/or are not properly accounted for).  International NGOs, UN agencies and donors tend to use financial management assessments to rank potential partners in terms of risk. NGOs with strong systems perceived to be in place are rated as low risk and can receive funds in advance. Higher-risk partners receive month-to-month disbursements with heavier monitoring. As we have come to expect, most local NGOs land in the high-risk bucket, making a top-down “implementing partnership” the most common model between LNGOs and their international counterparts. While we all agree that fiduciary controls and risk assessments are important and appropriate to address weak or fraudulent practices that exist within every sector, it is inaccurate to assume the problem stems from LNGOs alone. In fact, the nature of national-international partnerships themselves may encourage risky practices in LNGOs and make corruption more likely. We see this in the following ways: 

1) More often than not, LNGOs are only valued for their access, especially in security-challenged contexts.  This means LNGOs that can demonstrate the best access have the most to gain, regardless of whether they have the capacity to deliver, manage risk, and be sensitive to the conflict dynamics.  This encourages LNGOs to engage in risky practices and to be less attentive to their duty of care for both their staff and the people they serve. 

2) LNGOs are expected to deliver high-quality output for a small fraction of what would have been given to an INGO because “localisation” should magically deliver projects more cheaply. This leaves very little non-programme associated funds for LNGOs to build proper supporting systems that would mitigate the fiduciary risk that the international partners are so worried about. As a result, LNGOs struggle to hire and maintain competent support staff and are unable to support proper capacity building of staff. 

3) As a result of a “high risk” rating, local actors almost always end up paying out of pocket for costs incurred that international actors would have been paid for in advance. While this is not unique to LNGOs, local actors are rarely able to build up enough liquidity to cover overheads in the short term due to the inflexible nature of funding and the relatively small size of our budgets. This inadvertently leads LNGOs to adopt risky practices, such as taking high-interest loans to cover short-term needs, shortcuts in procurement processes, and delaying staff salaries for months, all resulting in the very reputational damage international partners and donors sought to prevent.  

4) LNGOs are put in the ‘too hard’ basket. A good anecdote was when Ground Truth Solutions tried to design projects with us as equal partners for global grants, but donors have said that is administratively impossible, and they should continue contracting us for ‘services’. The gap between localisation rhetoric and donors supporting local actors is one of the main obstacles to making localisation work. 

LNGOs are stuck in a catch-22. They can't improve their systems without funding, and they can't get funding without improved systems. The international community must start promoting supportive international-local partnership models that promote local ideas and take capacity-building (by way of systems) of the local partner as objectives. This should be done in a non-hierarchal way and give the local partner a significant level of financial autonomy. The onus here is on intermediary organisations, but donors must also look at local organisations in the same way they do international organisations, recognising the need for both to be supported with overheads for administrative costs and systems building. Only with this investment can we level the playing field.  

From our side as LNGOs, it is important to be transparent and committed to improving risk mitigation. We can best do this with an appropriate level of institutional support from international partners.