The Failure to Fund Refugee-Led Organizations: Why the Current System is Not Working, and the Potential for Change: ODI Report

Authors: Caitlin Sturridge, Fran Girling-Morris, Alexandra Spencer, Andhira Kara, Carina Chicet. Illustration: Ada Jušić via ODI

Refugee-led organizations (RLOs) play a vital role in the refugee response sector. They have deep experience with the problems facing their own communities and expertise on what works and what doesn’t. Yet, there is a widespread failure to properly fund the RLOs doing some of the most important and effective work on the front lines of these crises. 

This five-year research project from ODI and Development Initiatives (DI), independent global affairs think tanks, aims to provide detailed snapshots of funding to RLOs over time and an evidence-based advocacy tool to enhance both the quantity and quality of funding directed to RLOs. The research also provides a rationale for donors to fund RLOs with steps needed to enhance direct funding. 

Our Refugees initiative is committed to funding underinvested RLOs and refugee leaders. According to this report, we accounted for 46 percent of the total trackable dollars supporting RLOs. We are concerned by the insufficient funding from the development sector and intend to use this report to urge major institutional donors and international non-governmental organizations to invest directly in refugee-led organizations. 

Key Findings 

• Chronic Underfunding: RLOs received only $26.4 million in 2022, compared to $6.4 billion provided to UN-coordinated refugee response plans. The average grants to RLOs are also ten times smaller than grants to local or national NGOs. 
• Intermediary Funding: Most RLO funding goes through intermediaries. While intermediaries can support RLOs, a balance is needed, prioritizing direct funding to well-established RLOs. 
• Lack of Transparency: Few major humanitarian agencies and donors track or report their funding to RLOs, with private philanthropies driving most support. 
• Risk Perception: The assumption that RLOs are “too risky” to fund is unfounded and has led to stringent compliance requirements that many RLOs cannot meet. A more pragmatic approach to funding requirements is necessary. 
• Tokenistic Funding: RLOs often experience international funding as performative and tokenistic. The international community must recognize RLOs as key actors in advancing locally led development efforts and increase quality funding to them. Transforming the system requires action from those at the top. 

Read the full report and view the five key research findings.