Why the Gorta Group has made 5 mergers in 13 years

Earlier this year, United Purpose merged into Gorta Group, a collection of British and Irish organizations with a focus on nutrition, agriculture, and enterprise development. But it was far from the first time this group — which now employs more than 700 people and has a turnover above $40 million — had joined with another. Gorta’s structure involves several organizations operating semi-independently under a single banner. And Ray Jordan, chief executive of the Gorta Group, said his plan is to grow further. “Our ambition is to actively keep growing and adding more partners,” he said. “We’re looking for like-minded organizations that we respect and get on with.” The mergers began back in 2008, when Self Help Africa, an Irish NGO, merged with Harvest Help, a Shropshire-based agricultural charity. In 2010, the merged organization took over the work of Africa Now, an Oxford-based NGO which was closing. An ethical auditing business run by Africa Now was relaunched as Partner Africa, which still exists in the group as a standalone organization. Then in 2014, Self Help Africa merged with Gorta, Ireland’s oldest agricultural development NGO, giving rise to the Gorta Group. In 2018, it merged with War on Want Northern Ireland, and this year with United Purpose — a merger which almost doubled the size of the group. Today, the group consists of Self Help Africa, United Purpose, and several trading subsidiaries. Gorta is the sole member of each organization. Those organizations have their own boards, and the chairs of those boards sit on the group board. Why a group structure? Jordan said that the mergers have been driven by a desire to create greater impact. “We’re a hell of a lot stronger and more robust and better by any measure you care to name as a result,” he said. “The word merger makes people think about winners and losers, but in the nonprofit world it’s much more about integration to bring the best of both worlds.” He said that the environment in which NGOs work encourages scale, but smaller organizations are often wary of that scale because they want to stay close to service users. A group structure helps them to retain their specialized skills but access the benefits of size. “We see more and more focus on accountability, governance, reporting,” he said. “Small- and medium-sized organizations need to invest a lot of effort to bring themselves up to international standards. They need a lot of tools in the toolbox. And you need to get to a critical size to easily manage those requirements. There are also huge economies of scale when you’re bidding for institutional finance. The strength of your balance sheet and your geographic spread make a huge difference.” Another benefit, he said, is that a merger allows organizations to access new knowledge. “The cross-learning across the organization is massive,” he said. “The whole point of a group structure is that not everyone has to be good at everything, but everyone brings different skills and knowledge.” A consequence of the mergers has been to expand the scope of Gorta’s work. Gorta still helps farmers grow more and better food, but it also looks more at how to build markets and find buyers. It has also started to support humanitarian work. “The word merger makes people think about winners and losers, but in the nonprofit world it’s much more about integration to bring the best of both worlds.” --— Ray Jordan, chief executive, Gorta Group “We’re talking to people about lack of access to markets, climate, lack of structure,” Jordan said. “At one end, growing green beans 400 miles from Nairobi, it’s all about agricultural processes. But in Nairobi it’s all about food standards. And then those beans are going to be on a supermarket shelf in the U.K. 24 hours later and that’s all about transport and logistics. It’s important to be able to draw in the technical expertise to do all those things.” Avoiding a ‘car crash’ merger But he also says that bringing organizations together involves serious challenges. “Probably every single time you find yourself making redundancies,” he said, noting that 2021 saw both layoffs and salary reductions due to the grim financial situation. “Everyone signed up [for pay cuts as high as 40%] so we didn’t have to pass the impact on to our colleagues in Africa and our work in Africa.” Jordan said that he has seen many examples of “car crash” mergers over the years, largely because the organizations involved weren’t adequately aligned. “I have a checklist of different things that you need to agree on before you can possibly go ahead with a merger: governance, strategy, structure, human and financial resources, back-office systems, and brand and identity,” he said. “If you can’t get agreement on all of those things before you start, don’t merge.”