Tata Trusts vs NGOs?

In the NGO sector, the Tata Trusts are a bountiful tree under which many have found shade. They have a reputation of backing projects that others would not consider, and making far-sighted and progressive grants. It’s no surprise that the NGO sector has been alert to the rumblings of change from their offices. An article on the Tata group website mentions that Ratan Tata was evaluating the role of the Trusts after his retirement in 2012. The changed role was summed up in a new five-point agenda for the Trusts: enhanced scale, measurable impact, a finite period of support to projects, ensuring that the projects were sustained after the Trusts withdrew, and benchmarking with global peers and practices.

Predictably, it’s the news of the reduction in NGO funding that has got the most attention. Earlier in June, Prabhat Pani, head of technology and partnerships at Tata Trusts said, “The earlier approach was to give grants. If we need to be part of scalable programmes, we need to go directly.” NGOs are anguished, understandably, as it is reported they received ‘85% of the Rs3,000 crore in grants made by the Trusts between financial years 2012 and 2016’. This loss in funding could be irreplaceable. The move is being seen as anti-NGO, and NGOs are upset that their role with the Trusts will be diminished.

But the big news is not just about the reduction in funding, or a perceived anti-NGO stance. Going forward, it seems like it will not be business as usual at the Trusts. They seem to be conceptualising a larger role for themselves, given their access to infrastructure, suppliers, technology and expertise across the Tata group of companies. They could definitely leverage these advantages to create a lasting impact rather than funding small projects of varying sizes at multiple organisations. NGO projects may be high calibre, but the scattered focus means less overall impact than if the Trusts threw their entire weight behind an issue. R Venkataramanan, Managing Trustee, Tata Trusts, gives a small but telling example of this in his interview with Forbes. The Kamala Nehru Memorial Hospital approached the Trusts with a request to fund a linear accelerator for their operations. The accelerator cost Rs25 crore, while the hospital’s budget was Rs20 crore. The Trusts reached out to the procurement committee that purchases equipment for the group hospitals, and were able to source the accelerator for only Rs11 crore.

The Trusts are looking for ways to enable transformational change for society. Their new approach seems to be a combination of investment in research, innovation and last mile partnerships. The Trusts have invested in the India Innovation Programme (IIGP), a joint initiative of the Department of Science and Technology and Lockheed Martin. The programme invests money in companies that develop technology-based solutions that can improve the quality of life and services of people in need. Manoj Kumar, head of innovation at the Tata Trusts, talked about the creation of a part-philanthropic, part-venture capital like fund investing in social enterprises. Interestingly, the fund will draw on innovation centres that the Trusts have already funded in the Indian Institute of Science (IISc), IIT and Massachusetts Institute of Technology. Investments in research take a longer time to pay off than most philanthropic efforts. However, the results are worth the wait, and can cut down the time taken to tackle an issue.

The Trusts have indicated that they are interested in taking more ownership of the end outcome of their activities. McKinsey’s Designing Philanthropy for Impact report would define this as Category C philanthropy – ‘Working with the institution that serves the beneficiary at scale’, a move away from directly donating to beneficiaries.[1] In their new role as a platform, they will be able to leverage their size and reach to create a larger impact in their chosen sectors. Rather than restrict themselves to funding existing projects, they can partner with government, NGOs, the private sector – anyone who can deliver the impact needed. This can span work in research and development, infrastructure development, innovation or technology which tend to have a multiplier effect. Rather than focus on stop-gap solutions, they’re going in for the kill.

Is the move anti-NGO? Probably not. It’s not a judgement against NGOs as much as it is an understanding of their own size and scale. In the end, it may prove the best way to fulfil the task they have set for themselves!