The Quality of Money: Donor Behavior in Humanitarian Financing

Donor behavior currently represents a patchwork of policies and activities by individual governments which, taken together, do not provide a coherent or effective system for financing the international humanitarian enterprise. Humanitarianism is the foundation and rationale for donor assistance to persons affected by humanitarian emergencies and natural disasters. Its underlying proposition is that international assistance and protection activities will reflect the severity of need, wherever it exists, and that the world’s humanitarian apparatus will operate according to acknowledged principles of proportionality, neutrality, impartiality, and independence. The study finds, however, that humanitarian action is largely imbedded within competing and sometimes inconsistent domestic and foreign policy priorities. Much donor behavior reflects foreign policy concerns, as was the case during the Cold War, but domestic politics now plays an even greater role. The influence of the media and of personal and institutional leadership on policy and action is evident as well.
The overall effectiveness of humanitarian action is compromised by donor earmarking, by short funding cycles, by unrequited pledges and late funding, by tying contributions to a donor’s own nationals, NGOs, and contractors, and by donor political interests. The lack of standard donor definitions, priorities, time-frames, and reporting requirements places the onus for efficiency and effectiveness on delivery agencies that are, as a result, unable to perform to their own satisfaction or to that of most donors. One of the most striking and disquieting themes to emerge from the hundreds of interviews conducted for this study is that mistrust and opacity pervade humanitarian financing and donor behavior. Some donors express a surprising degree of doubt as to the capacities and even the bona fides of front-line UN humanitarian agencies and NGOs.
The paper addresses a number of implementation issues, finding that there are both advantages and disadvantages for donor governments in spending bilaterally and multilaterally. These cover a range of considerations, including coordination, coverage of need, profile, management, and accountability for resources. In sum, however, choices regarding the allocations of resources appear to express broad preferences for bilateral over multilateral channels, for military over civilian aid providers (most notably in high-profile crises), and for northern over southern non- governmental structures. These preferences are expressed largely in the absence of qualitative assessments of the relative effectiveness or cost-effectiveness of available institutions. Moreover, while it makes good sense for individual donors to seek to carve out a particular niche within the humanitarian financing economy, greater thought needs to be given to the composite puzzle into which the separate pieces fit.