♣ Fideicomisos

"♣": Estrategias específicas empleadas por los estudios de caso para incrementar su nivel de auto-sustentabilidad.Pueden estar en inglés o español. Por favor usa el traductor del menú lateral 

"♣": Specific strategies used by the case studies to increase their degree of self-sustainability.They might be in English or in Spanish. Please use the side menu translator
  • The Banking Trust Fund Scheme:
  • All financial resources obtained are deposited in the capital fund, the use of which is subject to control by a banking trust fund mechanism, which provides the project with credibility to encourage donations to contribute with those resources.

    Donors, foundations, governments, and international NGOs trying to support the so-called “developing countries” frequently face the same problem: corruption. Money frequently doesn’t arrive at its destination and stays in intermediary hands. It also happens that the money is distributed but the recipient organizations don’t have projects to offer, even if the money is there. With a Trust Fund, the money doesn’t have to go through the organization’s hands but rather goes through the Trust Fund’s hands which gives transparency to the money’s management, and certainty to both the organization and the donors.

    A Trust Fund is composed of 3 parts:

    1. The Trustee (the Bank) that is the one that generates the confidence (the trust), as it is the one that monitors how the money is being spent and ensures that it is used in the way and with the purpose agreed, by contract, between the beneficiaries and the donors.
    2. The Donors/Foundations that put money in the trust for a specific purpose.
    3. The Beneficiaries (the organization and/or local people).

     

    1, 2, and 3 elect an Executive Board (also called Technical Committee) that supervises/manages the Trust Fund on a daily basis and under the general supervision of the Trustee. It is formed by representatives from donors and beneficiaries.

    All rules applicable to the operation of the Trust are convened through a contract among 1, 2, and 3.

    All decisions (the designation of the Executing Board, the use of the money donated, etc.) are settled in that contract. All parts would like to advocate for their own interests but the ideal is to find a balance between them – respecting the beneficiary’s project objectives and the donor’s aims. The donors participate in the model because they accept it, which means that once they sign the contract they cannot make changes to it. That has to be clear in the original contract.

    The content of the contract is to establish that what is being settled is a Trust Fund, that is, a contract based on trust because there is someone (the bank) that looks after the contract’s compliance (e.g. “We agree to ensure that the obtained money will be dedicated to x and the bank will supervise that it is done that x way” ). When, during the implementation process, money has to be spent, the Executive Board decides how to use the money and the bank watches that the conditions are in line with what was agreed both on the contract and in the conditions to which the granting of the funds were subjected, that is, the original objective and destination of the funds.

    • Mechanisms such as the banking trust, the participation in the carbon bond market, and the parity funds also bring attention to the way in which local ownership can be capitalized for addressing funders’ concerns on corruption and the lasting effect of their donations without compromising beneficiaries’ capacity to negotiate their views and responsibilities.

     

    • Another strategy commonly used to this end is the establishment of schemes, such as the banking trust funds mentioned before, that assure that all stakeholders’ interests and responsibilities are negotiated, defined by contract, and supervised by an external actor — dealing concurrently with potential treats to self-sustainability that could emerge during the implementation process and keeping the communities stewardship of the programs by delimiting their rights and responsibilities.

     

    • Making investments at fair value and searching for beneficial interests in trusts.

     

    • Regarding the Banking Trust Fund Scheme:

    To arrange a Trust Fund, the[This/the initiative] would have to prove that if it receives donations it would use them wisely and effectively. This should not be a problem since the College’s current budgeting process is already highly decentralized, which means that there are many actors supervising it at the same time. After receiving a donation or grant, the [This/the initiative]’s main office, known as the Tilonia office, sends the money directly (that is, bank to bank) to its branch offices – the Field Research Centres (FRC) and the Associated Partner Organizations – who, in turn, transfer it to the Village Education Committees (VEC)’s accounts. The latter are managed together by a member of the FRC and those of the VEC, which are closer to the communities. A mechanism to ensure certainty on how the money is spent would strengthen the model.

     

     

    • R4: The establishment of a Trust Fund will strengthen the effort of giving certainty to both, the organization and the donors, by increasing the transparency in the money’s management. It will not affect the autonomy of the Village Education Committees because, as members of the Trust Fund, they will be able to ensure their requirements in the agreement between all members of the Trust Fund.

     

    • Because of the[This/the initiative]’s high level of contribution to its own project, it could suggest to be Beneficiary and Donor at the same time, offering its Community Contributions Inventory (referred before in R1) as a contribution.