Each charity is different.  When choosing a charity, one point I always try to consider is whether its mission is well defined and distinct from that of others. After I have satisfied myself on the mission, I next look at the charity’s business model.  Each has its own its own modus operandi, culture, and sense of itself.  As part of my commitment to the organization, I want to get a feel for what that is.

So here  is how I would characterize the CNF business model.

We are  a small, agile organization, that seeks to make a big impact by  leveraging existing institutions.  CNF is a Conservation Trust Fund that operates as a Public-Private Partnership with national governments in funding and managing their countries’ protected areas.  We think that our  approach gives us an advantage in the world of development aid, where there is a continuing debate on “project” versus “budget” models of assistance.  In diving more deeply into our model, I will  focus on these two concepts—CTFs and PPPs.

Why Conservation Trust Funds (CTFs)?

The short answer is because they work—Conservation Trust Funds (CTFs) are the most effective way to save the last remaining wilderness in developing countries.  CTFs are a proven strategy supported, among others, by:

  • Major nature conservancy charities like WWF, Conservation International, The Nature Conservancy and The Royal Society for the Protection of Birds, and
  • Foreign aid agencies of large countries, such as– the US, Germany and France.

Strained national budgets have not been able to keep up with the rapid growth of protected areas (PAs) over the last 50 years. Inadequate funding for staff, vehicles, fuel and other basic management costs has led to progressive degradation of the natural areas and wildlife that PAs were established to protect.

CTFs raise and invest funds to make grants to NGOs, governments, and agencies, such as PAs, which then manage and implement conservation projects. As a source of secure, predictable financing, CTFs improve grantees’ ability to do long-term planning. Other stakeholders, in turn, often increase their support—reassured that core funding will continue to be available.

While some CTFs have fully funded endowments, our endowment is only partially funded at this point. So CNF relies on fundraising and donations from foundations, individuals, corporations, and government sources.

To find out more on CTFs and how they work, download “Rapid Review of Conservation Trust Funds” commissioned in2008 by the Conservation Finance Alliance.

CNF’s Conservation Trust Fund Model

In the Caucasus as in the other developing regions, CTFs have the mission of reducing biodiversity loss and increasing sustainable use of natural resources.  As part of the work, our Caucasus Nature Fund also works more broadly to strengthen civil society and governmental accountability—working directly with PAs in partnership with responsible government ministries and local NGOs.

Our CTF model is a “parks fund”.  The primary mission is to support protected areas through our arrangements with our partner governments.   To ensure accountability and transparency, the parks we support  are required to meet specific conditions, procedures and benchmarks, which improve overall management practices.

We ensure leverage by insisting with our partners on the 50% principle described in our website.  But we also try to leverage the work of others whose work touches the protected areas as you can see from our web pages devoted to our partners.  We are looking for results and are happy to share recognition.

Why a Public-Private Partnership (PPP)?

First, let’s recall what PPPs are.  They are typically arrangements between government and the private sector that seek to improve or increase the efficiency of a government service. They usually involve long-term contracts in which a private sector entity provides a government service—paid for in part with government funds or through revenues generated from supplying the service.

But PPPs can also involve the reverse arrangement—as with the Caucasus Nature Fund (CNF)—where governments retain the operational role and the private sector injects funding and know-how.

CNF supplements the resources of partner governments and provides management and technical assistance and oversight. We focus on directing resources to the field, where they are urgently needed, and on helping PAs operate more effectively to achieve conservation and sustainable development goals.

An Alternate “Middle-Way” to Conventional Aid Approaches

As noted above, we think that our public private partnership approach gives us an advantage in the world of development aid, where there is a continuing debate on “project” versus “budget” models of assistance.

The more traditional project aid model assumes that direct aid to the governments of developing countries would be wasted. So aid is provided in the form of turn-key projects— roads, bridges, dams—to assure completion, quality and cost. But this model is criticized for too often producing “white elephants”—projects that recipient countries do not need or haven’t bought into—that are not supported after delivery. Fragmented programs from a variety of donors are also said to result in high transaction costs and competing requirements and structures.

The standard alternative approach aims to empower recipient governments through direct budgetary aid. In addition to corruption, risks here include the misuse of funds and poor planning that project aid is intended to reduce.

CNF’s model can be seen as an intelligent middle way in this debate, avoiding the pitfalls and taking best practices from conventional approaches. Through our PPPs, we provide direct budget support—thereby empowering governments to improve management of the region’s magnificent protected areas. But we don’t stop there: we continue to act as partners helping with the planning process and then monitoring and spending and operations. This middle way builds local capacity while ensuring outcome management.

David Morrison is Executive Director of the Caucasus Nature Fund

The following two tabs change content below.

David Morrison

David is the Executive Director of CNF. Prior to joining CNF, David was widely recognized as one of Europe’s leading financial lawyers. During his 28-year career at Sullivan & Cromwell LLP (S&C), he advised principally on capital markets transactions of all kinds, including many of Europe’s most important privatizations
Tagged with →