Arbeitsgemeinschaft für Entwicklung und Humanitäre Hilfe
Recap (EN)
In an online session on 9 September, experts Kaela Glass (NRC), Pierre Vischioni (DRC) and Ghaida Nawam (Nusaned) discussed how fair and flexible overhead sharing can address chronic underfunding, strengthen local and national actors, and advance more equitable partnerships and meaningful localization in the humanitarian sector.
In our online session with the title Overhead sharing in international partnerships, Kaela Glass, the Head of Humanitarian Financing Policy and the Geneva Partnership Unit at the Norwegian Refugee Council (NRC), discussed the gap between the donor-provided overhead rate for indirect costs and the actual operating costs of partner organizations.
While there is a sectoral trend towards localization, most international donors remain reluctant to fund national and local actors (LNAs) directly and instead prefer to cooperate with international intermediary organizations. This dynamic forces intermediaries and LNAs to split the overhead, which leaves both parties to be chronically underfunded. How the overhead is split is often at the discretion of the intermediary, a decision LNAs experience as top-down, undermining equality in a partnership. If LNAs are unable to cover the funding gap by having another source of income, they are systematically marginalised in the sector. Therefore, Kaela advocated for flexible and additional overheads without restrictions or multiple complicated audits to ensure that each organization within the delivery chain is sufficiently supported.
To achieve this shift in donor funding practices, Kaela argued that organizations should make clear to donors that strong frontline delivery depends on LNAs being adequately and predictably resourced, and that overheads help mitigate risk across the delivery chain while signaling a genuine commitment to localization. In addition, the NRC advocates for an additional intermediary fee to be included in donor contracts, allowing intermediaries to transfer a fair share of 7-10% of the overhead directly to the partner organization. She concluded that from an LNA perspective, the most cost-effective option would be for donors to cooperate directly with them, sidelining Global North NGOs to be consulted for specific functions or responsibilities only.
Pierre Vischioni, Senior Policy Advisor with the Danish Refugee Council (DRC) in Geneva, questioned more generally why intermediaries have traditionally considered overheads to be „theirs“, arguing that this practice has effectively deprived local partners of resources they need to sustain their organizations. He stressed that it is time to change this approach. At the same time, he acknowledged that organizational change can be difficult and requires persistence and strong arguments to secure senior management buy-in. To wrap up, Ghaida Nawam, Co-Founder & Executive Director of Nusaned, introduced the participants to her perspective on the issue as a representative of a local, female-led NGO in Lebanon. She argued that overheads should be understood as covering the cost of meeting the compliance requirements imposed on local organizations by donors and intermediaries. Flexible and equitable overhead allocation enables local organizations to maintain the institutional systems needed for quality, accountability, resilience, and long-term sustainability. In addition, she pointed out that Nusaned represents, mentors, and coordinates other local NGOs for donor-funded projects, but the funds they receive do not account for these key organisational tasks because they are not directly linked to a specific project. She finally argued that adequate overhead funding is essential to genuine localization by giving local organizations the financial space to decline grants that do not align with the priorities of the communities they serve.
(IR/LF)
Invitation: Overhead sharing in international partnerships
This event was part of
