If Foreign Aid were a Potluck, What Dish Should the Faith Driven Marketplace Bring?
Summary
Those of us in the faith driven marketplace are invited to have a seat at the foreign aid “table.” We should accept this invitation to ensure redemptive solutions are competitive within the aid ecosystem. A community of faith driven marketplace actors (FDMAs), rooted in a biblical theology, is primed to work more effectively in the aid sphere through Public Private Partnerships (PPPs).
Christians are often skeptical of the role governments can play in addressing global challenges in developing countries—and with good reason. My career was spent working for the U.S. Agency for International Development (USAID), and I know the dangers of government entanglement. Our tendency is to go it alone, avoiding the strings that can corrupt faith-based economic development. Certainly, there is an important role for purely private aid, but there’s also a place for Christians to partner with government. Like it or not, governments will continue to be major actors in addressing poverty, hunger, disease, conflict, and the like. At least some of us should work with governments to alleviate suffering and contribute to human flourishing within the foreign aid sphere.
As a philanthropist and impact investor in the developing world, I see the issue from many sides. I am convinced that to tackle global problems we should deploy not just philanthropic models but for-profit business approaches, as well. Profit shouldn’t be a dirty word when it comes to addressing global ills. When rooted in the biblical framework, it’s the goose that lays the golden eggs. For too long, Christians have relied principally on philanthropy to address global problems, and business has been viewed as merely a piggy bank to fund charities. But this worldview reduces business to a necessary evil—instead of the world-transforming and life-giving force it was intended to be.
Thankfully, there is a Spirit-led movement restoring business to its proper place in the Creation Mandate. Good stewardship is about multiplication, not addition. A faith-based business model holds the potential to powerfully upend a charity-dependent mindset. Despite the inherent challenges of working with the government, Christ-followers should deploy this transformative and biblical business model to reshape government foreign-assistance programs through Public Private Partnerships (PPPs). Without compromising our faith commitments, we must wisely engage the public sector on behalf of the poor, the powerless, and the oppressed worldwide. Business and finance will play a transformative role in the 21st century.
The nonprofit ministry Faith Driven Investor estimates that Christians manage $150 trillion—over half the world’s wealth. And that amount is over 200 times greater than annual charitable giving globally (faithdriveninvestor.org). This gift calls us to lean into a renewed vision, courage, and conviction for stewardship.
Charitable dollars and government dollars have limited capacity. They only self-generate (one through fundraising and one through taxation) when there is profit. Profit lies at the roots of wealth generation. Additionally, long-term dependency on charity (private or government) can diminish human dignity, something USAID has recognized with its long-term goal of moving foreign aid recipients towards self-reliance. Moreover, traditional development aid from public and philanthropic sources is not enough to realize the United Nations Sustainable Development Goals (SDGs), which face an annual $2.5 trillion funding gap.
To reimagine the marketplace, Christ-followers in the business ecosystem need to work with other stakeholders including government, the academy, and nonprofits. Redeeming the marketplace can be framed as seeking biblical shalom—with people made in the image of God—and stewarding God’s creation for human flourishing. Flourishing, this side of the Fall, includes communities advancing in proximate well-being, peace, and justice.
Many faith-driven movements are converging around a global vision of biblical shalom. Faith driven marketplace actors (FDMAs, including investors and entrepreneurs and their associated affiliates), are poised to have a greater impact in foreign aid. This includes believers active in:
the Economics of Mutuality (EoM) movement, making inroads into the non-Christian business world and the academy (led by Mars Corporation and Oxford University)
equipping organizations (e.g., Faith Driven Investor, Faith Driven Entrepreneur, Business as Mission, BAM); vocational stewardship advocates (e.g., Steve Garber, Amy Sherman); faith and work communities (e.g., Redeemer’s Faith and Work initiatives)
mentoring and accelerator groups (e.g., Praxis, Lion’s Den, OCEANS)
intermediaries (e.g., National Christian Foundation, Impact Foundation)
the generosity community (e.g., The Gathering, Generous Giving, Generosity/NY)
These movements are poised to foster learning, growth, and communal creation for the common good—aligning perfectly with God’s mandate to fix what is broken. Within Public Private Partnerships (any formal or informal collaboration between public actors like the federal government or UN and private actors), Christians have a vital role to play.
Two examples of PPPs include:
The United Nations Global Fund Coral Reef (GFCR) is a PPP investment vehicle funding innovative sustainable business models that increase resilience of coral reefs and the communities that depend on them. It is an alliance among UN agencies, financial institutions, and philanthropic actors in both the charitable and for-profit space.
Convergence is the world’s first platform blending private, public, and philanthropic capital to achieve global solutions to global problems. It was developed through an independent organization, spearheaded by Canada’s Department of Foreign Affairs, along with the Gates Foundation, the World Economic Forum, and others. It connects private, public, and philanthropic investors for blended finance opportunities in emerging and frontier markets.
In FY2020, USAID dispersed $15 billion in foreign aid to over 80 countries in a myriad of sectors including agriculture, health, education, human rights, and economic growth. Close to $10 billion of that aid was in grants to as many as 3,000 partners, including businesses, nonprofits, and universities. Congress has mandated that 12.5% of the funding has to go to small business—an opportunity for faith-based entrepreneurs. Governments acknowledge the essential role played by the private sector as the engine of economic growth and empowerment that can bring solutions to global problems. USAID, under previous administrations, pursued many ways to strengthen and catalyze PPPs. Under the Biden Administration, although there will be a shift in emphasis and programming, significant opportunities abound for advancing shalom if FDMAs partner with USAID to tackle global challenges.
PPPs are not easy, quick, or trouble-free. There are tedious government regulations, embedded players in the private sector who often have the inside track to contracts and grants, and temptations toward mission drift. Add to this the difficulties inherent in working within bureaucracies, legislative timelines, and the pace of government vs. business, and partnerships aren’t for everyone. But for those who are called to co-labor in this space, at a minimum, we need to:
Explore countries, services, products, or policy goals with which our network could best partner. For example, we might be well positioned to further USAID’s goal of food security in Africa through agribusiness innovation. Or at the top of the food chain, we could help shape US congressional funding targets towards market-based solutions.
Spell out the potential dangers and pitfalls in partnering with USAID, including challenges that faith-based entities face in the public sector.
Identify the key secular players in the “partnership” equation and discern how best to both collaborate and compete (e.g., Palladium, Development Alternatives).
Collaborate with faith-based nonprofits, such as World Vision, that are strategically engaged with USAID.
Participate in faith-based development forums, such as ACCORD Network, and secular forums, such as InterAction and Center for Global Development.
Put resources, talent, and time behind this effort, avoiding duplication.
Through USAID’s New Partnerships Initiative, the Agency is simplifying and opening access to new and underutilized partners, attempting to leverage the full marketplace of ideas and solutions by collaborating with partners from all sectors of society. One initiative under NPI is called “co-creation,” a process whereby all relevant stakeholders of a development activity (funders, implementers, governments, local actors, international government officials, and private sector) are involved in various aspects of co-designing the objectives and approaches. A seat at the table of this collaborative experience could produce a win/win outcome for both FDMAs and foreign aid recipients.
Our endgame could be as simple as a loosely affiliated cohort of like-minded people to share opportunities and build sub-contracting and grant opportunities. Or it could institutionalize into the creation of a single entity (for profit, nonprofit, or hybrid) that could act as a conduit for our community of FDMAs to engage with USAID. We have an opportunity to build bridges, play matchmaker for our community, and leverage government funding towards human flourishing.
Interesting models for engagement abound. USAID has leverage awards that provide 50% funding of partner initiatives that advance Agency goals. “Local Impact” is a PPP between USAID and the nonprofit Aga Khan Foundation, a multi-year, multi-sector, and multi-country partnership creating an innovative framework for sustained impact across Asia and Africa.
Another example for engagement is USAID’s CATALYZE, projected to mobilize $2 billion in blended finance with investors and financial institutions, small and large enterprises, a diversity of market intermediaries, and other key stakeholders to develop commercially viable business models that create jobs, expand sustainable social services, and optimize supply chains. CATALYZE is a contract managed by a private company tasked with bringing in new and underutilized marketplace partners.
Our community could work under a USAID Global Development Alliance (GDA), a partnership where USAID and the private sector work together to develop and implement market-based approaches to development challenges. Activities under GDA leverage assets and expertise to facilitate private sector-led development and drive sustained development impact.
We could also work with USAID INVEST, a contract managed by a private company that facilitates work between USAID and partners in the investment community. The projected value of mobilized capital is estimated at $1.6 billion.
Through PPPs, FDMAs stand to gain increased sophistication and access to government grant and contract funding, to develop new values-aligned partners, and to gain exposure to best practices in the private and nonprofit sector. Motivated by a quadruple bottom line (purpose, people, planet, profit), we have the patience and sustainable capital to navigate the complexities and headaches associated with such PPPs.
My hope is to see a collaborative group of faith driven investors, givers, and entrepreneurs to pursue funding opportunities via USAID, aligning with shared international economic goals of sustainable job creation, poverty prevention, food security, peace, and justice through rule of law initiatives, environmental stewardship, and more. Benefits would include funding for entrepreneurs, collaborative investment opportunities for investors, and a demonstration that faith-based initiatives are good for America and good for the world.
Governments are major players in attempting to solve global problems, for good or ill. Christians need to engage the public sector with grace and civility, knowing all actors have the image of God within them. We should assume the majority of those in the foreign aid ecosystem are striving to bring shalom in the best way they know how. Finally, we need to engage with excellence, truth, and courage, speaking truth (in love) to power on behalf of the voiceless and defenseless.
In the Parable of the Talents, the master lauded the wise servant who deployed his talents to multiply the capital entrusted to him. As Christ-followers, we are called to multiply our gifts on behalf of God and the world. For-profit business can foster human flourishing by providing sustainable and life-giving employment, preventing global problems from occurring in the first place. This powerful force should hold a central place among the Lord’s people, transforming private and public aid to the poor. We should be God’s entrepreneurs, leaning into profit-making, not to build our small kingdoms but to further His glorious and eternal Kingdom.
Through PPPs, believers can bring nutritious and creative “dishes” to the foreign aid table. Casserole, anyone?
——
Article originally hosted and shared with permission by The Christian Economic Forum, a global network of leaders who join together to collaborate and introduce strategic ideas for the spread of God’s economic principles and the goodness of Jesus Christ. This article was from a collection of White Papers compiled for attendees of the CEF’s Global Event.