Breaking the Starvation Cycle: report findings

Humentum, a global organization focused improving how non-profits operate, in partnership with Funders for Real Cost, Real Change, a collaborative of private foundations, released a research report revealing inadequate coverage of administrative costs by funders. The data demonstrates how international funders are trapping their grantees in a “starvation cycle” by not sufficiently funding their administrative or overhead costs.

To achieve equitable & accountable partnerships - in the spirit of the Grand Bargain - funders should:

• commit to consistently covering a full & fair share of administration costs
• directly fund grantees & provide unrestricted funding

Humentum’s research team worked with 81 national NGOs in ten countries in Africa, Asia, Latin America, and Europe. During the research period, NGOs completed extensive surveys on financial health and cost coverage, and 38 of these NGOs went on to provide three years of financial data including details of their largest restricted funding agreements.