Global LGBTQ+ orgs lose out in Open Society’s restructuring

The Open Society Foundations is turning the page on its massive restructuring effort and has begun announcing funding pledges under its new operating model. But that new approach has created winners and losers, and OSF’s decision to eliminate programs that supported LGBTQ+ organizations working outside the United States has severed a vital funding lifeline, advocates told Devex. The move to end its global LGBTQ+ grants spells trouble for a sector that was heavily reliant on OSF for years and now faces a future without the foundation’s support. “Many of our grantees had previously gotten OSF funding. They don’t anymore,” Alli Jernow, vice president at the Arcus Foundation, told Devex. “Its loss is deeply, deeply felt,” she added. “Small organizations will not survive, and it’s an especially perilous time.” Before its reorganization, OSF, the philanthropic powerhouse founded by billionaire George Soros in 1979, was the top foundation funder for global LGBTQ+ rights, according to research by the Global Philanthropy Project. Through its restructuring process, OSF eliminated its human rights initiative and public health program, which both managed large portfolios of LGBTQ+ funding. While undertaking its transformation, OSF sought to mitigate the consequences for grantees in sectors poised to lose funding by analyzing funding gaps and issuing “tie-off grants” — flexible, multiyear donations aimed at helping organizations manage the transition away from OSF support. But LGBTQ+ rights experts say that OSF’s pullback on global LGBTQ+ funding will be hard to overcome. With multiple African countries advancing anti-LGBTQ+ laws — and several key bilateral donors either already reducing funding or facing elections that could lead to major policy changes — they say the timing is particularly bad. “Change is never easy, but in this case, it was necessary and worthwhile to meet the demands of the moment and empower lasting change around the world,” a spokesperson for OSF wrote to Devex. The foundation’s “new operating model allows us to look at our funding through a more integrated lens where fields and issue areas, such as LGBTQ+, intersect with key goals and political opportunities,” the spokesperson wrote. The restructuring has been driven by Alexander Soros, George’s son, who took over as OSF’s board chair in December 2022. It has entailed major layoffs — about 40% of the foundation’s workforce, or roughly 800 people — and has been pitched as an effort to allow the organization to make larger, nimbler investments in areas where it sees political opportunities for its financial and advocacy resources to bring about significant change. Last month, OSF announced an eight-year, $400 million pledge to support green industrial policies in the global south to support economic development. Those who fear the consequences of OSF’s restructuring agree that the foundation has the right to set its own priorities — and to change them. “Every foundation, every grantmaker obviously has the prerogative to change strategy,” Jernow said. But that does not lessen the blow of losing a unique funder in an area that struggles for financial support — and the relationships between a foundation and its grantees. “There’s a lot of knowledge in those relationships, and it’s sad to see that knowledge leave the field,” Jernow said. Funding impact While she is worried about the impact of OSF’s restructuring, Jernow also emphasized that the organization got some things right in the process. While OSF was undergoing its restructuring, it created a unit tasked with concluding relationships with grantees that would no longer receive funding — known as the “Reassigned Grants Unit.” “During this period, Open Society has honored its existing commitments to minimize the burden of the transformation on grantees and partners, especially for actors working on largely under-funded fields,” the OSF spokesperson wrote to Devex. “We made a commitment to end funding responsibly, which led us to structure tie-off grants to give grantees longer periods of time to use the funds,” they added. The OSF unit also worked with the Global Philanthropy Project — a nonprofit network that aims to expand philanthropic support for global LGBTQ+ rights — to examine the likely impact of reduced funding from OSF for overall LGBTQ+ philanthropy and then present those findings back to OSF. GPP found that in the decade before embarking on its reorganization, OSF accounted for 8% of all funding to LGBTQ+ movements outside the United States, awarding an average of $7.2 million per year to LGBTQ+ communities. For an already underfunded sector, that was a vital contribution. But what made OSF’s funding more valuable was that it often came in larger, multiyear grants that allowed organizations to grow and develop, while targeting grantees in areas that other funders have been unwilling or unable to support, multiple experts told Devex. The foundation “tended to fund LGBTI organizations under attack from antidemocratic and authoritarian movements, and leading the pushback for LGBTI human rights,” Ezra Nepon, a senior program officer at GPP, wrote to Devex. OSF’s new direction will fall particularly hard on trans and intersex organizations “under attack by the ‘anti-gender’ movement,” Nepon noted. Jernow told Devex that OSF was a major supporter of sex work advocacy, organizing, and decriminalization. “That’s a stream that I don’t see being replaced at all,” she said. A terrifying time OSF’s restructuring comes as several other donors have thrown the global funding landscape for LGBTQ+ rights into question. The top global funder of LGBTQ+ rights has been the Netherlands, contributing $56.9 million in 2021-2022, according to GPP. But in May, a new right-wing governing coalition announced plans to cut official development assistance by roughly $326 million. The second largest global funder of LGBTQ+ rights in terms of money given in proportion to official development assistance is Sweden. In March the country’s right-wing government abruptly announced it will terminate all its funding agreements with Swedish NGOs and overhaul its approach to foreign aid. In the U.S., some Republicans supporting Donald Trump’s presidential candidacy have vowed to stamp out any U.S. government support for LGBTQ+ rights, describing these efforts as a liberal campaign of “social reengineering.” “Losing any one of these funding streams will be a blow to the global LGBTQ+ movement. Losing all of them would be catastrophic,” Matthew Hart, GPP’s executive director, wrote to Devex. Meanwhile, governments in Uganda, Ghana, Kenya, and elsewhere have passed or proposed legislation restricting LGBTQ+ rights or even — in the case of Uganda — making homosexuality punishable by lifetime imprisonment. Even before anti-gay laws are passed, said Jernow, LGBTQ+ rights groups have seen rises in other forms of persecution, such as evictions, vigilante violence, and incitement. “It’s a terrifying time,” she said, adding that it is also “a terrible time to withdraw.” Earlier this year — before his resignation as OSF’s president in June — Mark Malloch-Brown told Devex that the foundation has “tried everything we can by way of funding to prevent” these anti-LGBTQ+ crackdowns. Asked at the time about the repercussions of OSF’s restructuring for LGBTQ+ rights grantees, Malloch-Brown acknowledged that OSF is often their only funder and said: “The last thing we want to do is leave any beleaguered human rights defenders without resources.” “My successor president is herself a Kenyan Asian woman with a long human rights background, so I’d be astonished if we were to forgo that funding, but equally I can’t speak for what her priorities will be in this area,” he added. OSF’s new president is Binaifer Nowrojee, formerly the foundation’s vice president of programs. Opportunities lost? OSF has described its new approach as one focused on seizing “opportunities” to support democratic rights. “In this next phase, Open Society will be nimbler in our grant making, setting aside more of our budget in reserves to allow us the flexibility to respond quickly to changing conditions and new opportunities,” the OSF spokesperson wrote to Devex. “We will make larger grants but fewer of them. Strategies for new programs are being developed this year, and we are looking forward to ramping up our grant making again.” But Jernow warned it is only possible to seize opportunities when there is an existing civil society infrastructure to support it. “You can’t dip in and out of issues,” she said. “You actually need advocates and activists to take advantage of the opportunity.” That is the infrastructure that OSF played such an important role in building for years, Jernow said. “I hope that there is an internal effort to respect the legacy of that amazing work,” she said. Rob Merrick contributed reporting.