OSF’s new strategy bets on longer-term, more flexible funding

The Open Society Foundations’ dramatic transformation is now complete, and it has fully “stepped into a new operating model,” its President Binaifer Nowrojee told Devex. The shift follows a significant, multiphase restructuring first announced in 2021 that included what Nowrojee called a “difficult decision” to reduce staff and offices. While OSF had already been moving toward a leaner structure, the foundation has now finalized that transition — cutting staff from around 2,000 to 500 and reducing its global footprint from about 40 offices to 13, according to Nowrojee. The restructuring was driven by Alexander Soros, founder George Soros’s son, who took over as OSF’s board chair in December 2022. But it meant cuts to a variety of programs that relied on its funding — for example, LGBTQ organizations working outside of the United States as well as public health programs. At the same time, OSF faced accusations that it was retreating from Europe, claims which it denied. The new operating model also includes sweeping changes to OSF’s grantmaking. The foundation has simplified its internal processes to make it easier for partners to access funding, enabled multiyear commitments, and expanded core support for organizations in the global south. Founded by George Soros in 1979, OSF has spent an estimated $23 billion advancing its mission of promoting human rights, equity, and justice in over 120 countries. And while the foundation has lately been urged to fill gaps left by the rollback of U.S. foreign assistance — particularly the dismantling of major U.S. Agency for International Development programs — it is opting to stay focused on its original mandate rather than again expand its philanthropic giving, Nowrojee said. Still, Nowrojee said, OSF is advocating for the restoration of U.S. funding, while also giving some existing grantees more flexibility to adapt to a rapidly changing development landscape. Speeding up timelines “We're trying to make it better and easier for grantees and partners to access funds,” said Nowrojee, who took the helm at OSF after longtime President Mark Malloch-Brown stepped down last June. She had previously served as vice president of programs. Previously, “every grant, regardless of the risk level or the renewal number of years, would go through 40 touch points and a very strong application process that actually was adding uncompensated complexity to the process,” she said. The foundation has since streamlined its grants cycle and created a fast-track for lower-risk and renewal grants. The average grant once took three to four months to be processed, depending on its complexity. “We are trying to get to a situation where we can get a grant out within a week to two if it's a low-risk or renewal grant,” Nowrojee said. “We should move from months to weeks.” In addition, OSF has shifted toward providing more multiyear support. “This brings down the administrative burden, but it also allows for grantees, partners, ourselves to really take a longer view and to be able to move beyond just a vision of one year,” she said. These changes respond to long-standing calls from civil society organizations for simpler, more sustainable funding models. Groups have long argued that burdensome application processes and a lack of long-term funding make it difficult to plan, scale up, and sustain their work. This transition also includes a move toward larger grant sizes. “Once you do a multiyear grant, the grant gets bigger by default,” Nowrojee said, adding that funders are also encouraged to provide bigger support to organizations that are capable and well-positioned to use the funds effectively. She noted that OSF’s decision to close certain areas of programming and scale back staff has made additional resources available for larger grants. A paradigm shift in global aid OSF’s 2025 budget is $1.27 billion, compared to $1.7 billion in 2023 and $1.5 billion in 2021. “We got a lot of requests to fill the gap left behind by USAID,” Nowrojee said. “We could have taken our whole budget this year and filled the gap. At the end of the year, we’d be back where we started — and we’d have diverted all our funds away from our mandate.” “In the end, what we decided to do was not to fill the USAID gap, particularly on humanitarian provision, which is not our mandate,” she said. Instead, the foundation is using its advocacy capacity to push for the restoration of U.S. assistance and encourage other donors to step in. She added that OSF has adjusted its own grant terms to allow existing partners more flexibility as they respond to current crises: “We allow our grantees to loosen the terms of their grant agreement a little bit to allow them to actually take into consideration the changed circumstances.” Nowrojee described this moment as one of reckoning for the broader development sector. “There’s always been a lot of talk about aid dependence,” she said. “And so here is the moment now that nobody wanted to actually address: What happens when aid is switched off?” “What you're seeing is a huge amount of hardship because governments — African governments and other governments — have not been paying for HIV medication or humanitarian refugee support. And the question is why?” Nowrojee pointed to rising debt burdens as a key factor. “When you look at African governments, a lot of the time you will find that their debt payments exceed the amount they spend on education and health,” she said. Nearly half of all people in the world live in countries whose governments spend more on debt servicing than they do on servicing their debts. Investing in a different future To help shift this dynamic, OSF is working with governments to make better use of their existing resources — including in Africa’s critical minerals sector, which has become a flashpoint for both development hopes and geopolitical competition. Nowrojee said OSF has approved an $80 million, eight-year initiative focused on ensuring that mineral extraction on the continent benefits local communities. “Some of the political insecurity in Africa is very much tied to economic hardship,” she said. “We want to help countries leapfrog development using resources that already exist — but in a way that is not exploitative.” The critical minerals work is part of a broader strategy to support countries developing new models of economic growth that do not force a choice between poverty reduction and climate action. “We’re leading an effort to work with governments in Africa, Asia, Latin America, to develop green industrial policies in countries that refuse to choose between development and climate action,” Nowrojee said. These efforts aim to help countries “look beyond our failed economic models to think about how we create new economic models that give jobs and also protect the planet.” This, she said, is the larger goal: “It’s a moment for rethinking of this paradigm of aid — foreign aid that is usually from the global north to the global south. There’s been a lot of critique of that. Well, now what’s the alternative?”