Funding Disruptions Are a Systemic Failure – Philanthropy Must Do What’s Right and Support Local Leadership

By Tais Siqueira
SORIA, Spain, Mar 17 2025 (IPS)

The slashing of US aid funding by Donald Trump and Elon Musk, and cuts or planned cuts in international support by several European states, threaten to cut off the oxygen supply to a civil society already in a critical condition. At CIVICUS, the global civil society alliance, activists and grassroots groups have shared with us time and again that shifting and volatile donor priorities are one of the top funding challenges they face, alongside limited resources for strategy and restricted funding.

This is a critical moment for philanthropy to step up and put locally led development principles into practice. This means channelling more resources directly to local civil society, advocating for the meaningful participation of a diverse local civil society in policy spaces at all levels, ensuring their financial, legal and security resilience, and reimagining the role of philanthropy as being not just a funder, but an investor, catalyser and collaborator. As a starting point, philanthropic funders should do the following.

1. Commit to immediate, flexible, and sustained financial support

Local civil society is on the frontlines of addressing some of the world’s most pressing issues. Yet it’s often the first to feel the impact of funding disruptions. Philanthropy must act quickly to provide immediate, flexible and emergency grants to help local organisations survive funding gaps, including by increasing flexibility in existing grants to allow for operational reallocation to cover urgent needs, such as security-related expenses, salaries and insurance.

Unrestricted funding is also critical. Local groups need autonomy to allocate resources where they’re most needed, including for financial, legal and digital protection. Philanthropic funders should prioritise high-quality support – funding that is flexible, predictable and for core work – to support local civil society’s agency and autonomy and avoid orientation around donor priorities. Philanthropy must recognise that trust in local leadership is both the right and strategic thing to do.

2. Strengthen local civil society’s governance through collaboration and promote trust and support

Local leadership isn’t just about financial support; it’s about co-creating the systems and structures that enable local groups to thrive. Philanthropy can play a pivotal role in supporting local groups to strengthen their governance, risk management and compliance systems by fostering collaboration and innovation rather than imposing external standards. Support should be tailored, context specific and co-designed.

One key step is providing direct support to local groups to develop systems that prioritise accountability while trusting them to manage resources. This requires funders to move away from overly prescriptive conditions and toward models of support that acknowledge the leadership and agency of local civil society.

Philanthropy must also recognise that compelling narratives and ambitious policies are needed to stimulate trust and support local civil society. Progressive philanthropic funders can encourage others to follow suit.

3. Invest in infrastructure enabling diverse local civil society groups to collectively organise, share resources and strengthen resilience

In an increasingly interconnected world, the ability of local civil society groups to connect, collaborate and share resources is more important than ever. Investments in infrastructure can enable civil society to bravely defend and promote civic freedoms. Investment will facilitate collective influencing and knowledge-sharing networks, ensuring organisations are better prepared for further funding instability.

Philanthropic funders can earmark funds for emergency response, including for legal defence, audits and unforeseen security threats. Security in the digital sphere is also a critical need, and support can be provided for digital communications infrastructure, encrypted platforms and security audits.

Support for protection of civic space and promotion of civil society participation in decision-making will help enable strategic resistance against rollbacks of hard-won rights and gender, racial and social justice gains.

It’s also crucial to recognise that progressive local civil society groups and leaders are key enablers of locally led development and strengthen civil society’s support infrastructure. Investments in these infrastructures ensure that local groups have the necessary space, resources, agency and autonomy to shape and implement solutions that best fit their contexts.

CIVICUS’s Local Leadership Labs initiative addresses the political, technical and behavioural barriers that hinder governments, donors and other stakeholders from fully embracing and resourcing diverse civil society groups as legitimate participants in development. These labs support radically inclusive spaces, where local civil society groups can drive the development of policies and solutions, together with decision-makers and other key players. This cultivates spaces for collaboration, allowing diverse civil society groups and multi-stakeholder initiatives to share knowledge, reflect and strategise together.

A call to reaffirm commitment to locally led development

Philanthropic funders have unique convening authority, networks and partnerships that can be leveraged to advocate for locally led development. This isn’t just about funding; it’s about using influence to shift narratives and create an enabling environment where local civil society can thrive. Philanthropist must publicly reaffirm their commitment to the Donor Statement on Supporting Locally-Led Development and take real steps to put these principles into action.

The challenges are immense, but so too are the opportunities. By fostering an environment where local civil society has the resources, autonomy and trust to lead, philanthropy can move beyond financial transactions and become a transformative partner.

Tais Siqueira is Coordinator of CIVICUS’s Local Leadership Lab