The Donor-Driven Model and Financial Sustainability: A Case Study from Palestinian Non-Government Organizations

Abstract

This study presents factors that encourage Palestinian NGOs to embrace financial sustainability employing modern ideologies that encompass community engagement, voluntarism, collaboration, and business-like practices in order to meet societal challenges. The study explores the reliance of Palestinian NGOs on external funds (donor-driven funds) and the environment impact of their attempts at financial sustainability. Data were gathered using semi-structured interviews with 22 NGOs in the West Bank and Gaza in 2019. The data were analyzed through thematic analysis using the computer software MAXQDA. Key findings were that Palestinian NGOs need to alleviate the dependency on a donor-driven model by functioning independently from donors’ agendas; and that Palestinian NGOs need to collaborate with each other to centralize their efforts and avoid fragmentation. Further, the Palestinian government needs to revisit the relevant laws to regulate the civil society sector and avoid competition between NGOs and private sector on the one hand, and NGOs and governmental institutions on the other hand.

Social innovation in extreme institutional contexts: the case of Palestine

“…On the one hand, the PNGO sector's challenges and internal constraints (internal sustainability issues) make it ultimately dependent on international funding. Because PNGOs failed to create a financially sustainable model for themselves (Morrar and Sultan, 2020), this situation leaves them vulnerable to the agenda of donors and funders (conditional and political funding). We label this as the "reinforcing" mechanism in our figure.…”

“…Unfortunately, how these contexts influence SI when institutions are volatile and failing is less explored in the literature. In countries with a politically complex and rapidly changing environment, social innovators—just like PNGOs—failed to create a financially sustainable model (Morrar and Sultan, 2020), which leaves them vulnerable to the agenda of donors and funders (conditional and political funds) that tend to neglect the societal needs of their beneficiaries (Morrar and Sultan, 2020). Further, political instability damages the institutional environment and leads to the fragmentation of the innovation ecosystem (Morrar and Arman, 2020; Gayle et al , 2012; Leydesdorff and Meyer, 2006).…”

Beyond the “NGOization” of Civil Society: A Framework for Sustainable Community Led Development in Conflict Settings

“…While PCSOs play a vital role in providing services to marginalized populations, the sole focus on service delivery leads to a mission drift insight of dependence on aid (Atia & Herrold, 2018). Donor-driven PCSOs have led to duplication of projects, loss of public trust, and a shift in service provision from public needs to donor agendas (Morrar & Sultan, 2020).…”

“…Fortunately, this attempt to exert power over CSOs failed after pressure from NGO networks prevented the legislation from passing. However, the competition for power and resources is not limited to CSOs, as the PA also relies on donor aid to fund its activities, which creates hostility between CSOs and the government that is acting like an aid-driven CSO (Morrar & Sultan, 2020).…”