5^th Ministerial Conference "Environment for Europe"

Kiev, May 2003

With the political changes in the beginning of '90ties, the societies of CEE and NIS regions have started a transformation process towards democratic regimes and free-market economies. The civil society has been an important driver of this process and especially the environmental NGO sector proved itself as one of the most effective factors for change. The NGOs have also made progress in building their capacity that in turn enabled their good performance and increased competence. However, the NGOs in this region(s) have been facing various obstacles in their work and one of the most significant one is their financial sustainability. This has been a continuously increasing difficulty in the NGOs' work, particularly in the past years. Decreasing foreign assistance, undeveloped domestic sources and limited local philanthropy are just some of the reasons for concerns that NGOs in both regions have expressed since late '90ties.

During an NGO/Donor workshop that took place in May 1997 in the premises of REC for CEE, 5 key recommendations were made by NGOs to the donor organizations how to increase the NGO financial stability:

• to help establish and participate in an NGO/Donor working group
• to help establish an endowment fund to assure financial stability
• to research the economic conditions required for a reliable local philanthropy
• to work for improved tax and legislative conditions for non-profit and philanthropic activities
• to increase transparencies of development bank policies and project planning.

Some of the recommendations have been followed, some of them not. The conditions for NGOs activities have changed. Yet, the concerns regarding the NGO financial sustainability seem to remain the same.

Goal of the event: raising awareness about environmental NGOs financial sustainability issues and bringing in new perspectives, experiences and practices; investigating the progress made by NGOs.

Timing/location: May 22, from 11.00am to 13.00pm/ room 24

Format: workshop discussion

Representatives of the donor community/support organizations, international organizations and NGOs (possibly also corporate or governmental sector) will have the opportunity to present ideas and debate about opportunities and limitations regarding NGOs financial sustainability in CEE and NIS regions. There will be 1 or 2 keynote speaker contribution (from the donor community/support organizations) followed by a moderated discussion with the participants in the event.

Possible key speakers and contributors to the discussions are: MOTT Foundation, USAID, Milieukontakt, REC, EU, representatives of Norwegian, Dutch and Danish governments (TBC).

The framework for discussion will be around the issues and challenges faced by NGOs nowadays. Specific issues to be addressed could include:

• decreasing funding from international donors and shift in their interests
• limited domestic support for NGOs
• need for diversification of funding mechanisms for NGOs; opportunities for self-financing
• fundraising vs. financing;
• changes in the regulatory and financial systems related to NGOs (especially in the accession countries);
• tax and philanthropic conditions in their countries;

The workshop is expected to:

• give more insight into the current financial sustainability problems facing the NGO community;
• investigate new tools and mechanisms that would enable the NGO financial sustainability;
• outline directions for a sustainable future of environmental NGOs in both regions;
• provide a forum for experience sharing and exchange of information on current NGO financing practices and their limitations;
• introduce the self-financing as a way to increased financial viability;
• initiate the transfer of expertise and know-how between CEE and NIS;
• explore new possibilities for cooperation between NGOs, support organizations and the donor community at large, and enable them to accommodate the changes in funding.