Devolving power in grantmaking

Participatory grantmaking has the ability to level the playing field between funders and recipients. But is it all it’s cracked up to be?

As philanthropy takes steps towards being more inclusive, innovative forms of grantmaking are also coming to the fore.

Participatory grantmaking, or PGM for short, is a form of grantmaking in which users have more power over the grant’s disbursement. The main premise is that those who are participating in the grant’s use or receiving it are part of the funding decision-making process.

If this sounds familiar, it’s entirely possible you’re already employing PGM, according to Dr Renee Lim of the University of Sydney.

“Participatory grantmaking until now has very much been a label that certain people put on a particular sort of project. And it’s usually a very proactive thing that people decide to do. But the reality, I suppose… is participatory processes are a more ingrained way of approaching things well, and I think the social change sector aims to do things well,” she said.

This may stem from a desire to be more inclusive and involve more diversity in programs, Lim added, as not for profits strive to be better and make better use of the experiences of different populations.

Co-design sits on the same spectrum, Lim explained. In co-design, diverse voices are brought in to help organisations think of solutions and different factors that might impact a project.

But in PGM, crucially, final power over the grants is handed over to those who will participate in the grant’s use.

“It’s a different frame, because [co-design] is more about the design with which you interact rather than the way that the grant money is spent. But I think the outcome is often very, very similar,” she said.

“The grantmaking element is kind of the outcome of the co-design participatory process of thinking about the problem and the solution.”

What does PGM offer?

PGM is still an evolving space, according to Lim, with research into its uses and outcomes ongoing. The current focus is on the relational elements that it impacts — things like trust, power, collaboration and transparency.

But PGM ties in with the current movement in philanthropy, looking for better outcomes for all those involved: project outcomes, capacity-building in the sector, and collaborative, long-term relationship outcomes.

“With those three [outcomes] in mind then philanthropists and funders are much more likely to see the value in participatory grantmaking,” Lim mused.

From an participants’ perspective, Lim said people who take part in PGM processes may feel as though they’ve finally been given a voice, visibility and empowerment.

The process of PGM should help both sides — funders and recipients — develop a more respectful relationship as they receive insights into the funding process.

It’s all part of a “knowledge shift” in the grant process, Lim explained.

For Lim, who has researched PGM processes, the collaboration and participation that the process fosters is the most exciting part.

“Participatory processes inevitably lead to some level of collaborative growth. It’s not like everyone works together and then they keep catching up every two weeks after they finish. But the relationships that form are usually deeper and with more understanding.”

Too good to be true?

That’s not to say PGM is perfect; Lim said it does have some downsides.

PGM can be resource-consuming “across the board”, she said — in money, emotions, time and the skills of your staff in being able to bridge division and build consensus among different groups of opinions.

But if you’re looking for a way to build relationships and distribute power, PGM can be a powerful method to employ.

“I think [by] knowing what you’re trying to achieve, [designing] it with the right motivation in mind… it’s worth it.”

“Depending on the system, depending on the organisation and its priorities, PGM may not be the best way. I think until we can prove 100 per cent that projects always end up better in terms of their outcomes… if that can ever be proved, then I don’t think that some programs and some organisations should use PGM.”

For organisations looking to get started in PGM, Lim said there is some literature available online to help guide those getting started, particularly from international organisations.

She recommends reading some of the literature and using the language in it to guide what you’re trying to do, to mould the PGM framework to your needs.

Organisations should then consider how to get grant recipients involved and how to create a safe space for them to give their opinions.

Finally, they should measure whether PGM has been useful to their organisation and successful in achieving desired outcomes.

Is PGM the future?

According to Lim, “PGM is happening and will happen anyway”.

“Whether or not it becomes a foundational part of philanthropy and for purpose organisations… I think will come down to whether people embrace it.”

She considers PGM to currently be in its “piloting phase” as organisations test the PGM waters.

“Participatory grantmaking is not about removing power and bias. It’s about distributing power and creating diverse biases,” she explained.

“Power still exists, it always will exist. When it comes to the money, one side always has the money [and] one side is receiving the money. You can’t change that.

“On the flip side… the power does go to the participants because they can give whatever feedback they like. But again, that’s limited by the fact that you’re the person with the money.

“I think this is an interesting power thing, where people like to think [PGM] devolves power and suddenly the power is no longer within the funder’s hands. And I don’t think that’s true, but I think it can be a much more respectful way to disseminate the power within a group and to see the power move more often, which I think is important,” she said.