(Abstract title was: Conservation NGOs: who's doing what and how well?.)
Potential for greater private spending on conservation
Anne B. Lambert, Editor, Greendonor.orgIntroduction
Funding needs for conservation
Public sector spending
Context: U.S. government spending
Private sector funding
Private wealthPhilanthropy
NGO accountability
Greendonor
Summary
References
Introduction
Today I'd like to tell you about a new website called Greendonor.org that collects and presents information on who's doing what and how well in the conservation nonprofit sector. But first, I'd like to talk about the funding shortfall for conservation, the upward trend in private philanthropy and the potential for an increased role for NGOs (non-governmental organizations) in conservation.
We know a lot about what needs doing in conservation and we have a lot of existing capacity to undertake it. But although the funding needs of conservation are very reasonable and affordable, we are not close to funding conservation adequately.
So, first, what are the funding needs?
Funding needs for conservation
An estimate of the costs of safeguarding the world's biodiversity was published in a paper in Nature in 1999 by James, Gaston and Balmford1. They estimated that an annual expenditure of $300-billion would be needed for a comprehensive global conservation program that included biodiversity protection as well as remediation beyond reserves in agricultural and forested lands and freshwater and marine systems. They point out that this is a modest amount compared with government expenditures on activities that harm the environment, the so-called "perverse" subsidies for agriculture, energy, road transportation, water consumption and commercial fishing, which have been estimated at $950-billion and $1.45-trillion a year2,3. And the cost is a bargain when set against the estimated value of ecological services of about $33-trillion annually4.They also examine what much smaller amounts of additional funding could do. An additional $2.3-billion per year should be spent on managing existing nature reserves, which were then receiving about $6-billion per year. They estimated that expanding the protected areas system to include 10% of the Earth's land area would cost an extra $16.6 billion per year. Since then, the reserve system has increased to about 12% of the Earth's land area5, but it is still badly underfunded.
Note that of the estimated $6.2-billion spent on protected areas in 1996, less developed countries, which house a majority of the Earth's biological diversity, account for just 12% of expenditure and 60% of protected areas6.
A mid-1990s study by Birdlife International estimated that the financial need for biodiversity conservation in developing countries amounts to about $20-billion per year, compared to actual spending of about $4.14 billion7.
Given that funding has fallen far short of what is needed, there have been various attempts to identify the highest priorities for conservation. Conservation International has identified initially 258, and now 349, global conservation "hotspots" based on the amount of endemism and the degree of threa t. They estimated the annual cost for safeguarding these hotspots at $20-million each, which applied to the current figure gives a total of $680-million. Combined, the 34 hotspots are estimated to contain 50% of all vascular plant species and 42 percent of terrestrial vertebrate species, while comprising just 2.3% of the Earth's surface9 (or 7.9% of the land area).
Other NGOs have done separate analyses of conservation priorities and these varying lists can be debated, but the point is that the lack of progress in biodiversity conservation is not due to a lack of information on what needs to be done. It comes from a lack of funding.
TOPPublic sector spending
So, what has been happening with government funding for conservation?With the 1992 Convention on Biological Diversity (CBD), signatory countries pledged to provide substantial "new and additional" funding for biodiversity conservation.
The Global Environment Facility administers financing for the CBD and other international agreements and receives money from a subset of its 178 member nations. From 1991 to 2004 it has allocated $1.8 billion for biodiversity conservation, for an annual average of $129m10. Hardly a substantial amount.
Bilateral spending on biodiversity has been on the order of $1-billion in recent years (for 1998-2000, $1.09, 1.03 and 0.87 billion respectively) 11. The largest bilateral donor is the United States, and USAID spending on biodiversity conservation grew from $5-million in 1987 to amounts ranging from $61m to $106m for 1991-2002.
Among multilaterals, the World Bank is the biggest spender on biodiversity, with average annual speding of $168 million ($340 million with co-financing) for 2002-2004.12
What this adds up to is government spending for conservation of a few billion annually, far short of what is needed.
In recent years, there has been a marked shifting of priorities from conservation and environmental issues to the issues of human poverty and its attendant problems. These issues, along with third world health scourges of HIV, malaria, and so on, have been receiving much overdue attention. None of the eight United Nations Millenium Development Goals deals directly with biodiversity conservation, although one goal is to "ensure environmental sustainability".
Bilateral and multilateral agencies have shifted away from funding conservation directly to trying to include conservation or sustainable resource management in human development programs13. "Mainstreaming" conservation into aid programs is now the dominant approach even though many difficulties have been documented with so-called ICDPs, integrated conservation and development projects, since they came to the fore in the 1990s14.
Context: U.S. government spending
It's useful to compare public funding for conservation with other government expenditures. Remember that less than $1-billion annually would conserve CI's hotspots; about $23-billion would finance an expanded global reserve system; and about $300-billion would provide a comprehensive conservation program.Looking at the United States federal budget, estimated spending for 2005 totals $2.4-trillion and includes $402-billion for defense, up from $302-billion in 2001, plus another $28-billion for "homeland security".15 International assistance is to get $19-billion this year and the same for agriculture; NASA gets $16-billion, the Department of the Interior gets $12-billion and the EPA gets $7.8-billion.
The energy bill that just passed through the U.S. Congress has $14 billion in incentives, mostly to the oil and gas industry. The European Union Common Agricultural Policy provides subsidies of around $45 billion annually to EU farmers, and in fact OECD countries' total agricultural subsidies amount to more than the GDP of the whole of Africa.15
Private sector funding
While public funding for biodiversity has stagnated, funding for NGOs and private foundations in general is on the rise.Total charitable giving in the USA grew eight-fold between 1975 and 2004, from about $30-billion to $249-billion.17 By 2015, it is estimated that there will be a further increase of 50-75 percent. About three-quarters of donations last year were by living individuals, 8% was in bequests, 12% was by foundations, and 5% by corporations. The number of foundations has doubled in the last decade to 70,000 and their contributions have tripled.
The source for this information is the Giving USA Foundation. One of their seven categories of recipients is environment and animal welfare, which received about 4% of total allocated donations last year, or $7.6-billion. It was the fastest growing category, having increased by 7% from the year before.
The non-profit sector is also increasing internationally. There were 13,000 international NGOs in the year 2000, of which one-quarter were created in the 1990s, when membership in INGOs nearly doubled. And there have been significant increases in funding to INGOs from the World Bank, the European Union and from U.S. foundations.
Recent annual spending (FY 2003) by five big North American NGOs was as
follows18:
- The Nature Conservancy $570m
- Wildlife Conservation Society $140m
- Conservation International $84m
- The Conservation Fund $46m
and
- the Nature Conservancy of Canada $51m in Canadian dollars or US $44m
Private wealth
Why is private charitable giving increasing so much and how much further potential does it have?One factor is surely that private wealth has increased greatly in recent decades, especially during the 1990s.
Each year, Forbes magazine collects data on the world's richest people. In the most recent report, in March [2005], they tallied 691 billionaires from 47 countries who were collectively worth $2.2-trillion. Interestingly, Forbes says that more than half of them are entirely self-made.
Forbes' most recent report on the 400 richest Americans had a cut-off point of $750-million in net wealth and the 400 had a combined wealth of $1-trillion.
A third of a million US households have net assets of $10-million or more. That number has more than quadrupled since 1980, after adjusting for inflation , while the total number of households has grown by just 27%.
That last information is from an article in the Seattle Times in June, which described the widening lead of America's super-rich over the rest of Americans19. The top one-thousandth of income earners had an average income of $3 million in 2002. That is 2« times what the group made in 1980, after adjusting for inflation. No other income group rose nearly as fast.
So we have a new aristocracy of the wealthy, with a disproportionate number in the United States, which has no death or estate tax to reduce the wealth passed on to the next generation. Some have called this the "Second Gilded Age".
Philanthropy
But, as noted, there's another trend happening. Philanthropy is trending sharply higher and seems to be in vogue, with high-profile examples like Bill Gates and Ted Turner. And more people with substantial wealth are choosing to allocate it for charitable purposes during their lifetimes rather than through bequests or foundations established at their death. Many are not interested in leaving large fortunes to their children and grandchildren.Business Week magazine compiled a list of the 50 most generous American philanthropists based on their donations from 2000-200420. The list included an estimate of their lifetime giving, which for the 50 combined totalled $65-billion. Only five of the 50 donated significant money to environmental causes, with the most notable being Gordon and Betty Moore, who donated $7-billion in that five-year period, with much of it going to nature conservation and science.
People who have made a fortune in business tend to spend money carefully. In business your success is due in part to controlling costs and maximizing output and to analyzing markets and opportunities. They're good at that. And when they make charitable donations they want assurance that the money will be well spent.
Some, like Bill Gates and eBay founder Pierre Omidyar, accomplish that by starting foundations that they take an active role in.
Others, like Intel co-founder Gordon Moore, provide substantial support to existing non-profit organizations, in which case you can be sure that their donations are well researched.
George Soros said, and Bill Gates has agreed, that giving money away is harder than it is to make it.
NGO accountability
The conservation NGO sector has recognized the importance of accountability and there have been several cooperative efforts involving multiple NGOs and others aimed at developing tools for monitoring and evaluating projects. Three such efforts are the Biodiversity Support Program, the Foundations for Success, and the Conservation Measures Partnership.The big conservation NGOs all now say they monitor outcomes of their projects. But it's an internal process whose findings are not generally shared outside the organization.
So who knows how successful various conservation programs are and whether NGOs are really learning from their experiences and those of others?
The answer is that many people work at green NGOs and many more deal with them directly and indirectly. These people have first-hand knowledge of conservation programs and their successes and failures, as well as the relative merits of various NGOs.
Greendonor
This is the kind of information that Greendonor seeks to collect and share.The Greendonor website examines a selection of national and international NGOs working in conservation or environment. It gives a synopsis for each, with five questions:
1. where do they work?
2. who works there?
3. what do they do?
4. what have they accomplished?
and
5. how do they raise money?
as well as standardized financial analysis. It will also summarize the input of greendonor contributors, as well as media and public discussion of the organization.
A lot of this information is publicly available, but we're trying to put it in a succinct, readable form. Websites of NGOs are giant infomercials. They have mission statements and lots of glowing rhetoric about their work, frequent references to their conservation "partners" and how they are building capacities, fostering relationships with "stakeholders" and "decision makers" and so on. There is also information on what they're doing, but never any reference to problems and difficulties with past or current projects.
Most of the work on the NGO synopses still needs to be done. But what is ready now is a database to collect input from visitors to the website.
You can make a comment on a topic of your choosing or use our evaluation form to rate NGOs that you're familiar with.
To rate NGOs, we must know your identity and you need to fill out a brief form telling us who you are, including any affiliation with green NGOs. Your evaluation will be anonymous with respect to the public presentation of the data.
With comments, you have three options. (1) Your comments can used on the Greendonor website and attributed to you, or (2) used but not attributed, or (3) completely confidential.
Comments will be reviewed by Greendonor staff and portions of them will be made viewable by visitors to the website, who will be able to selectively view comments on specific NGOs or on range of topics.
Contributors can log in and revise their NGO evaluations or their comments any time.
Now, the opinion data we collect this way is of course not necessarily a representative sample. But I would compare it to the following scenario. Let's say we have a meeting of conservation biologists and the question is asked, what are the opinions of the attendees on various NGOs. Let's say we have a chatty group. The early responses would likely be polarized with people praising or panning certain organizations. People are unlikely to stand up to announce that such-and-such an organization is pretty average. But after a while, in response to strongly positive or negative comments, you would start to get comments more from the middle. Someone might say, well, yes, Organization A is very good, but they're not perfect and they need to pay more attention to this and that. Someone else would say, well Organization B is not so bad as people are making out. They have accomplished much in the area of such-and-such.
Eventually, someone sitting in the audience with no knowledge of these NGOs would start to get a pretty fair impression of them, along with some idea of who's doing what.
This is what we hope will happen with Greendonor, given enough contributor input. We would like input from NGO staff, conservation biologists and other scientists, people working for charitable foundations, people working in government agencies and multilaterals, and donors.
When enough data has accumulated, visitors to the site will be able to view public evaluations of various NGOs, and to separately view evaluations by insiders at an NGO and non-insiders.
I think that this kind of information has the potential to be as useful as information that could be obtained through the very costly process of external audits of conservation programs and organizations.
[Show pdf "slides" of greendonor NGO rating page. Can skip if time short.]
Here is our evaluation form for NGOs. View form
The first two questions ask you to rate the organization's effectiveness.
Then it asks you to rate it on various aspects: scientific, program design and implementation, etc.
We then ask how well the organization's programs contribute to various outcomes.
Then, three questions: - What are the organization's strengths? - What are its weaknesses? and - How might it improve its effectiveness?
We ask what your opinion of the organization is based on and whether your knowledge of it is limited, considerable, or extensive.
Finally, we have a provision for your rating to be on or off the record in the following sense. People using Greendonor's website may well wonder just who it is that is making these evaluations, beyond simply whether they work for the organization. We may offer a more transparent version of survey results, in which the pool of "on-the-record" contributors for each NGO can be viewed as a list of each respondent's name, occupation and location. Only pooled rating results will be displayed, and only if there is a sufficiently large sample size, and so your assessment will remain anonymous, but your participation in the survey will not, if you opt to be on-the-record.
Summary
To sum up:Biodiversity conservation is badly underfunded. We should press rich-country governments to spend more on it. At the same time, NGOs play an important role and could play a much larger role given the huge potential for private philanthropy. Donors want some assurance that their donation will be spent effectively and they would also value a source of information on the various options for donating. The new Greendonor website hopes provide such information to donors and perhaps to assist the conservation sector itself by providing an informal means of sharing information.
So perhaps next year, I'll be able to report some actual findings, based on our own work and
input provided by contributors like you.
TOP
A miscellany of money
| Billions of dollars US per year |
Source | |
| Estimated value of ecological services | 33,000 | 4 |
| Perverse subsidies (2 estimates) | 1,450 950 | 3 2 |
| EU agricultural subsidies | 45 | 16 |
| U.S. Government spending - 2005 (estimates) | 2,400 | 15 |
| Defense & homeland security | 430 | |
| International assistance | 19 | |
| Agriculture | 19 | |
| NASA | 16 | |
| Private philanthropy (all sectors, 2004) - U.S.A. | 249 | 17 |
| Additional funding needed for conservation: | 1 | |
| comprehensive global program | 300 | 1 |
| expanded protected area system | 16.6 | 1 |
| funding shortfall in developing countries | 6 | 7 |
| funding shortfall in managing existing protected areas | 2.3 | 1 |
| Conservation International "hotspots" | 0.68 | 8, 9 |
| Existing public funding of conservation (partial list) | ||
| Bilateral spending (1998-2000) | 1 | 11 |
| World Bank Group, mean for 2002-2004
(total with co-financing) | 0.168 (0.340) | 12 |
| Global Environment Facility (2004) | 0.129 | 10 |
| Combined spending by five largest North American conservation NGOs in 2003 | 0.884 | |
References
1 James, A.N., K.J. Gaston, & A. Balmford, 1999. Balancing the Earth's accounts. Nature 401: 323-324.2 Myers, N. and J. Kent. 1998. Perverse subsidies: Tax $s undercutting our economies and environments alike. International Institute for Sustainable Development. 23 pp.
3 Van Beers, C. and A. de Moor. 1998. Perverse subsidies, international trade and the environment. Institute for Reseaerch on Public Expenditure, The Hague, The Netherlands. 68 pp.
4 Costanza, R., R. D'Arge, R. de Groot, S. Farber, M. Grasso, B. Hannon, K. Limburg, S. Naeem, R.V. O'Neill, J. Parquelo, R. G. Raskin, P. Sutton & M Van den Belt. 1997. The value of the world's ecosystem services and natural capital. Nature 387: 253-260.
5 Chape, S., J. Harrison, M. Spalding and I. Lysenko. 2005. Measuring the extent and effectiveness of protected areas as an indicator for meeting global biodiversity targets. Phil. Trans. R. Soc. B 360: 443-455.
6 James, A.N. 1996. National investment in biodiversity conservation: a global survey of parks and protected areas. World Conservation Monitoring Center. 39 pp.
7 Report on "Investing in Biodiversity" from a Workshop of the 5th Global Biodiversity Forum, Buenos Aires, 1996.
8 Myers, N., R.A. Mittermeier, C.G. Mittermeier, G.A.B. Da Fonseca & J Kent. 2000. Biodiversity hotspots for conservation priorities. Nature 403: 853-858.
9 Conservation International website (www.conservation.org)
10 GEF Draft Annual Report, 2004 (dated 12 July 2005) at http://gefweb.org
11 Indicators for assessing progress towards the 2010 target: official development assistance provided in support of the Convention. Prepared by the Ad Hoc Technical Expert Group On Indicators for Assessing Progress Towards the 2010 Biodiversity Target for the Convention on Biological Diversity, UNEP.
12 Ensuring the Future: the World Bank and Biodiversity, 1988-2004. October 2004. The International Bank for Reconstruction and Development/ The World Bank. 49 pp.
13 Lapham, N.P. and R.J. Livermore. Striking a balance: ensuring conservation's place on the international biodiversity assistance agenda. A publication of the Center for Applied Biodiversity Science and the Center for Conservation and Government, Conservation International. 64 pp.
14 McShane, T.O. and M.P. Wells (eds.), 2004. Getting Biodiversity Projects to Work: Towards More Effective Conservation and Development. (Columbia University Press), 442 pp.
15 Office of Management and Budget (http://www.whitehouse.gov/omb/budget/2005/tabkes.html).
16 Wikipedia.org, entry for Common Agricultural Policy.
17 Giving USA Foundation website, http://givingusa.org, June 2005.
18 annual reports for The Nature Conservancy, Wildlife Conservation Society, The Conservation Fund, Conservation International, and the Nature Conservancy of Canada
19 Super-rich widen lead over rest of Americans. The Seattle Times, June 5, 2005.
20 Business Week online, November 29,2004. The Top Givers: In our annual rankings, normally generous philanthropists played "supersize me".
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