Ending Slavery Through Local Partnerships with the Freedom Fund

Featuring Nick Grono, CEO The Freedom Fund and Leonardo Sakamoto, Director, Repórter Brasil.

Nick: [00:00:03] If you don't break the cycle, highly vulnerable people are being exploited, even when they come out of slavery, are highly vulnerable and liable to be exploited again. So you need to kind of get at the community level. And so that was the model that we brought together was let's work with clusters of frontline grassroots organizations in the countries with the highest burden of slavery, bring resources to them, bring them together, and see if we can identify strategies that will make a difference starting at the local community level. [00:00:29][26.5]

Tulaine: [00:00:36] You're listening to System Catalysts. Each week you will hear personal stories of change makers who are bringing more inclusive connective system level solutions to our most persistent challenges. I'm to Lane Montgomery. In this episode, Jeff Walker spoke with our guests Nick Grano and Leonardo Sakamoto. When tackling big systemic issues, you'll likely find multiple organizations working on the same goal. But what you might not see between these organizations is collaboration. And that's partly because nonprofits often compete for funding. Nick Grunow believes that it doesn't have to be this way. When organizations and leaders come together, the impact is exponential. Ten years ago, Nick was leading Walk Free, an international organization focused on the eradication of modern slavery. [00:01:45][68.5]

Nick: [00:01:46] We reached out with two other philanthropic foundations who were also working on slavery in completely different parts of the world in completely different ways. So one was legatum and the other was humanity united based in the US. So that was a conversation that started there about we're all foundations, we're all committed to ending slavery. We're doing it quite differently. Would it make a difference if we pooled our resources, which, you know, the answer is usually yes. But more importantly, can we find a way to work together effectively with a shared strategy? [00:02:16][29.8]

Tulaine: [00:02:18] Each organization committed $10 million to fight modern slavery over five years. With this $30 million investment, the Freedom Fund was born. Nick transitioned to become their CEO and began working on their strategy. What if, in the same way these big philanthropies had joined forces, front line, small organizations found ways to collaborate. And this is how the Freedom Fund set on this journey to connect and invest in grassroots organizations all around the globe. Today, they are one of the largest anti-slavery organizations in the world. They have reached more than 1 million people through the hundreds of frontline organizations they support. This was achieved thanks to their Northstar belief. The only way to find a long term solution to systemic issues is through collective action. Nick is originally from Australia due to his father's job as a ship's captain. He traveled the world at an early age. [00:03:16][58.0]

Nick: [00:03:17] I actually spent a number of years when I was growing up on a sailing ship, sailing around the world, going to places all through the South Pacific and all through the Caribbean, and places where I encountered different cultures, different approaches for the very, very first time. I actually started my professional career as a corporate lawyer, but by far the most significant time or event during that was I went off for six months to work pro-bono for legal aid in rural and outback Australia for much of it, and encountered hugely disadvantaged communities. Understood for the first time how powerful the law can be and how awful it can be when the law fails, those that need it most. And so I think that's planted the seed. I worked as a corporate lawyer. I worked at the big investment bank. I worked in politics, but I went to study in the US, did a public policy degree, and from there I started working in the nonprofit community on conflict around the world, and I encountered some horrendous abuses, you know, in places like northern Uganda, where I met victims of the Lord's Resistance Army, where boys who had been kidnaped and brutalized and forced to become child soldiers and girls who had been enslaved, forced into sexual servitude, forced to become porters. And so that was my introduction to extreme forms of exploitation slavery. And so when the head of a new NGO that was working on slavery approached me, it was a very attractive proposition for me to say, Yes, I'd love to come and work in this space and see if we can make a difference. [00:04:40][82.8]

Tulaine: [00:04:44] After working at Walk Free for about a year, Nick joined forces with the private investment firm Legatum and Humanity United, a US based philanthropy. [00:04:52][8.4]

Nick: [00:04:54] Philanthropists often find it hard to collaborate, but they have the power of their money. They like to do things their way. And so they sit down at a table and say, effectively, let's constrain how we each want to work for the common good. Doesn't happen that often, but it certainly happened with the Freedom Fund. So I kind of sat down and worked out what are the issues that each of them are most concerned about and how can we meld this into a single strategy? And so that was my role and came up with something that they were willing to support, and that became the board, which comprised at that stage of representatives of the three organizations, signed off on that strategy at our very first meeting. And that's formed the bedrock of our strategy for the last ten years. [00:05:32][38.2]

Tulaine: [00:05:34] Given the scale of the problem, Nick set out to bring together as many anti-slavery organizations as possible. [00:05:40][6.4]

Nick: [00:05:41] Freedom. For now, we've done pretty well, where about a $27 million a year organization that probably makes us the second or third largest anti-slavery organization globally working internationally. The annual profits from slavery are estimated there at least a couple of hundred billion dollars a year. So for me to fund 25 million, 200, $300 billion a year in illicit profits, right, there is a massive resource gap. The only way that we and other nonprofits working in space are going to make a real change is there's two ways. One is by changing systems, changing the laws, getting the authorities, getting governments aligned system change, and the other is by aligning others to our courts. The more people we have, the more impact we can have. The more organizations align, the more businesses align, the more government aligned. So I kind of see our role to align all those, persuade others to bring them in. We will achieve so much more. We as an organization now fund over 120 grassroots organizations working together. We are supporting efforts around strategic litigation because I also think if you want to tackle supply chains, you know where goods are manufactured for export and labor and all the rest of it, you have to start changing the cost benefit equation. So everything we do, I do with an eye to how do we bring others along, because it's the only way you achieve real scale. [00:06:59][78.0]

Tulaine: [00:07:00] Their strategy was to fund clusters of organizations that were proximate to the affected communities. [00:07:05][4.8]

Nick: [00:07:06] So our very first program was to go into northern India, where working in two states, their Bihar and Uttar Pradesh, very, very poor, lots of slavery or bonded labor in a different form of exploitation in brick kilns and stone quarries and factories, and to go into the communities where they had often been intergenerational slavery. I mean, this is how it often works in these countries where your grandfather took out a $5 loan to keep the family surviving through drought and exploitation, had to work it off, didn't realize that there were unimaginable interest rates being applied to this loan. It was all a fiction, but is used to control the grandfather and then the son and then the son all illegal. And all of this is illegal, but it's the fiction of control that then you suddenly find a whole community because of course, they bring in their kids that are forced to make quotas and all the rest of it. [00:07:57][50.4]

Tulaine: [00:07:59] Instead of coming as an outsider, the Freedom Fund approached frontline organizations already working on eradicating slavery. [00:08:06][7.2]

Nick: [00:08:08] I'm not close to the community. You know, I'm some western white guy up north. And but to go to the local grassroots organizations that live in or proximate to the communities that can engage with often a very fearful population and work with them to understand how we how they can support them to come out of this level of exploitation. And then if you bring 15 of these grassroots organizations together working on going into the stone quarries, one of them will do that. Some of them will do vocational training for those that come out to help them. Some will do work on mental health issues. Some will work on getting kids into schools so they're not being exploited by working with a cluster of local organizations, often with different types of interventions. The whole is much bigger than, you know, each of the individual parts. And so that was the model that we thought would work, and it worked beyond our dreams. It's hard and it's messy. But what we found is when you start getting this right, not only do you change the conditions at the local level, but these partners start advocating upwards. Right. And if you advocate to the state government in Bihar, just 200 million people in Bihar, if you get the state government to change and it's not me or the Freedom Fund coming into the government in Bihar to say you must change. It's local organizations that are close to the community saying, here's why we need to change. [00:09:25][76.6]

Tulaine: [00:09:28] By supporting local communities. The Freedom Fund is planting the seeds of policy change. And in order to secure funding for these organizations, they commissioned research. [00:09:38][9.8]

Nick: [00:09:39] That's getting credible university, credible institutes to kind of look at the model, measure the change over time and validate whether or not this is a powerful model of change. And that's what we did in India. So when we were working in India, we commissioned the Institute for Development Studies, one of the leading development institutes in the world, to go and look over four years at the interventions in northern India and southern India and look at the communities and look at the level of bonded labor that existed when we started there. And these were all highly vulnerable communities. And then to look four years later at the level of exploitation that existed and the findings from this study, which have been published and were quite striking when we started. Some 50% of these vulnerable families in these vulnerable communities had at least one member who was in bonded labor at the end of it at four years that was down to 12% and that meant 125,000 fewer individuals in bondage than would have otherwise been the case. Now what we can't say is that all due to us, right? We've got to be very careful about where we claim credit. But what we can say is we started here with a model we engage intensively for four years. Here is the change that we have seen. And we have a story and a narrative. And we do a lot of participatory evaluations to show that certainly our interventions have helped that change over time. We think then by going out to the world and saying, Here's the model, here's how it's done. Here are the results. Why don't we channel resources to these kinds of interventions is a way of amplifying our impact. I'm trying to persuade people to give us funds to drive change. I need to be able to give them a cohesive narrative. [00:11:20][100.3]

Tulaine: [00:11:24] After nine years of working in India, the Freedom Fund left so they could channel their resources elsewhere. Nick believes that for change to be sustainable, it shouldn't rely on a single organization. [00:11:34][10.7]

Nick: [00:11:36] When partners identify it, we provide them with advocacy training. We provide them with support on fundraising because our goal is for each of our hotspots and each of the partners to become self-sustaining. Right? Because part of the model is we can't be there always providing external support and funding support. But when you have a successful story to tell, it's also much easier for you to mobilize resources domestically, for example, and become self-sustaining. We're finding it in Brazil, you know, partners. Partners are keen to go and advocate at the state or even at the federal level when they know they have a powerful story of change to tell. And our role is to find ways best to support them to do that. [00:12:13][37.0]

Tulaine: [00:12:15] One of the partners the Freedom Fund is investing in is reporter Brazil. [00:12:19][3.4]

Leonardo: [00:12:20] When we're talking about the fund, of course, a lot of organizations talking about the economic support and so on. But I believe that the strength of the fund is on this possibility of connections. [00:12:32][12.0]

Tulaine: [00:12:34] That is leonardo sakamoto, director of the organization. [00:12:37][3.0]

Leonardo: [00:12:39] Not just connections to know other people or to bring the solution from one side to the other side. Because let's remember that slavery is a global problem and then we need a global solutions to come in a certain way. Freedom Fund help a lot to organize the fight against slavery global wide. And this is very important to organize the fight against slavery, to organize the efforts against slavery, to give voice to the fight against slavery and help all of these organizations. I don't know any major organization fight slavery around the globe that is not connected or has no dialog with the freedom fund today. [00:13:22][42.9]

Tulaine: [00:13:23] Reporter Brazil has been fighting modern slavery since 2001. [00:13:26][3.2]

Leonardo: [00:13:28] We have slave labor, several different industries in brazil, but they stand there often. Slavery is more or less the same. Someone that's living in a very poor area or without work, without jobs, without opportunities, without conditions. Receive a proposal of work from a middleman. It's a middleman that's working for a farm owner, for example. They make job proposals for this worker, this poor worker. See, while we receive a lot of money, we receive our very good place to stay, very good with food, and then give an advance to this worker. And then they go hundreds or sometimes thousands of kilometers from poor areas in Brazil. And then when they arrive in the farm or they when they arrive the charcoal camp or to the forestation area to the mining camp, they realize that the situation is very different from what they promised to them. And the situation is they don't have salaries, they don't have any wage. Sometimes we have to create their own food to eat, and if they try to run out from the farm, they will suffer violence threats. Sometimes they are murder. I participate of some operations to release workers along the years, and sometimes we found a corpse, a dead body from someone that tried to escape a farm. [00:14:55][87.7]

Tulaine: [00:14:58] Leonardo realized the scope of the issue during his career as a journalist, so he got together with other journalists to launch reporter Brazil. But the nonprofit does so much more than reporting on slavery. [00:15:08][10.7]

Leonardo: [00:15:10] Reporter Brazil is the main news agency to cover slavery in Brazil. Help other journalists to cover these stories, bring the analysis, make huge investigations. But at the same time, we create a specialized group that tracking down supply chains. We work in Brazil. We have 38 people working here full time. And since 2001, we have tracked down more than 2000 different supply chains. We go to the ground. We follow trucks, lumber trucks and Amazon at night. We go on dirt roads and Amazon to discover who are the buyers from where. But at the same time, we use a high level technology in the Internet. We use drones. You use boats. We use different things to discover information. And all of this information about supply chains have been use it to mobilize governments, to mobilize private sector, to mobilize civil society unions, to fight slavery, to report in Brazil, make reports. Journalist Stories. We made investigations, but at the same time, we work in education, training teachers, local leaders, social assistance to fight against slavery in their communities. And we coordinate a network, a huge network with 14 Brazilian states, more than 600 cities that affected more than 1 million and the 500,000 children. [00:16:38][87.8]

Tulaine: [00:16:43] Reporter brazil tracks down supply chains with enslaved people and releases a dirty list revealing hundreds of companies that use slave labor. Thanks to this list, companies are held accountable and people who were enslaved are released. [00:16:57][13.9]

Leonardo: [00:16:58] Some companies came to me and say, Whoa, it's so sad. Slavery is so sad. You touched my heart. And now we're going to do everything to fight to protect these poor workers. And I say, okay, stop that stuff, that it's not true. It's not true. What is say it's not true because huge companies don't work like that. But when representative of the company or the owner came to me say, I hate you, this is stupidity, you will bring me a lot of losses with that. I don't like this. I don't like this. I don't like agree lately. But. But. Okay. Why do I have to do to avoid? The problem is that now we are talking because nobody is happy to find leverage their supply chain. Everybody is very angry with them and they're well, when you say what have to do to clean my work and then we are talking because we are thinking about your core business is not charity. You need to change your core business. And then we have major change in the company. [00:18:00][61.9]

Tulaine: [00:18:02] And this is why the Freedom Fund invests in organizations like Record of Brazil and other investigative journalists. They can create change by bringing the truth to light. [00:18:13][11.0]

Nick: [00:18:14] One of the key objectives in our space is to ensure that there is much more transparency in the supply chain so that you can track where things are going. [00:18:21][6.8]

Tulaine: [00:18:21] That's Nick again. [00:18:22][0.6]

Nick: [00:18:23] So what we start doing is then saying, Well, how do they know that there wasn't any forced labor in their supply chains? And they will usually say, in all honesty, we don't know. We have these policies in place and we tell everyone we abhor forced labor. But, you know, we trust people to tell us they're not engaging in forced labor. And we will say, well, that's actually not really going to work. If there's a financial incentive to exploit people, pay them no wages, maximize your profit. So you need to do more. And so what we then do is fund investigative journalists who do the deep down stories and actually get the proof that the shrimp that's being produced by people who are being enslaved in this factory ends up on X companies supermarket shelf. When you can do that, you get a real response very quickly, right? Because no one wants to be supporting directly slave produced goods. But that's really hard work. And then you need to change all the factors. You need to have the investigations, you need to push companies to become more transparent. You need to have proper audits, not some pro-forma audit of a supply chain. You know, someone says, Oh, well, let the factory know that in three days time an audit is going to come to check that everything is hunky dory. And surprise, surprise, when you audit comes, everything is hunky dory and the auditor goes away and then all the exploitation starts again. So you need to make sure that all of that is in place. And what you really need is companies to be genuinely committed to stamping it out. It's one thing to say, Hey, we have a policy and we say it's bad. It's another thing to say we're going to take proactive steps to ensure that slave produced goods are not in our supply chain. [00:19:52][89.1]

Tulaine: [00:19:54] The Freedom Fund plays a unique and important role in providing financial support to small anti-slavery organizations like reporter Brazil. Traditional philanthropy is often unwilling to do the same. It's a lot more risk averse. [00:20:07][13.5]

Nick: [00:20:09] And let's be clear, working with grassroots organizations in vulnerable communities entails certain risks for thought. They're really, really small, right? Big funders don't fund really, really small organizations because the cost of administering a $5000 to $10000 $20,000 grant outweighs their ability to manage it. So in some ways I see the Freedom Fund as a risk intermediary. We take money from big funders and we put in place the systems that ensure that we can get it to the most effective organizations and we bear the risk, right, because they'll hold us accountable. But now we can kind of have portfolios where we now get significant funding from the US government and supporting work we're doing in Ethiopia. And because we've been working in Ethiopia before, we started getting the US government funding and kind of open up the systems and build the relationships, we don't need as high a risk tolerance to work in Ethiopia, but that works very well and we still have, I reckon probably about 70% of our funding is largely unrestricted in no small thanks to a significant gift from Mackenzie Scott, which was entirely unrestricted. And that gives us the flexibility to take risk and to pay it forward. And again, it gets into that theory about shifting power and these organizations based on being able to work out how they can most effectively use the money. And because we've got the resources, there's not as much pressure to prove immediate impact. Right? It can be a longer term investment. [00:21:32][82.9]

Tulaine: [00:21:36] Besides investing in organizations, the Freedom Fund also invests in people through their Freedom Rising program. They bring together leaders from the communities where slavery is more likely to happen. [00:21:46][10.6]

Nick: [00:21:48] In the end, slavery happens because you have highly vulnerable populations, and those that wish to exploit vulnerable populations can do so. It's migrants who are vulnerable or it's people with a minority religious identity or refugees or often women and girls in patriarchal societies. Those people are vulnerable and therefore liable to exploit it. So the question becomes how do you build power at that level? And the most effective way is through collective action. And so I at my heart, I think that the long term solution to slavery is investing in collective action. That's what we're doing with our clusters of frontline organizations. And now it's what we're doing with investing directly in leaders from vulnerable communities. We've set up a it's kind of a leadership movement building program where we invite leaders either at the top of the organization, the CEO level of frontline organization or the mid-level. Right. And we predominantly want women or survivors to be in this leadership cohort because we think that the more we help them access power, the more change they can drive. And we don't know where this will end up. And it's quite difficult in the philanthropy space because we rightly are supposed to measure the impact of everything we do. It's very difficult to measure the impact of a leadership movement building program which might take five, ten years to really show fruition. But I think it's tremendously important. If your thesis is we need to shift power, then the answer is, well, how do we equip those that are best placed to access the power and to make a difference? So that's what we're trying to do with Freedom Rising, bring together hundreds of leaders and build community around them so that they have their own support networks and so that long survive Freedom Funds intervention. [00:23:35][107.4]

Tulaine: [00:23:36] In the same way Nic is bringing local leaders together. He also values the relationships he has with other leaders in the social sector. [00:23:43][7.1]

Nick: [00:23:45] I think leadership is extremely lonely. I think it's really hard as a CEO. I've got an amazing senior leadership team that I get a lot of comfort from my peers on the team. But you feel the weight of responsibility. You want to know if everything goes, it falls apart. It's on me. I do quite a bit of pro-bono coaching of new CEO leaders, and one of the things I often encourage them do is see if you can find a peer network because you just get so much and there's no direct immediate payoff. It's psychic payoff. When you can share problems, first of all, you will very quickly discover that no problem is yours alone, that if you're struggling or that someone else is struggling with it or has struggled with it. You will also find the joy of being able to share and work through with friends and colleagues these challenges and identify solutions, and it's tremendously powerful. [00:24:34][49.1]

Tulaine: [00:24:35] Nick not only encourages collaboration in his leadership circles. [00:24:38][2.8]

Nick: [00:24:39] Culture is really, really important. How do you build and what do you mean by culture? What culture do you want? So for me, culture that I think we want in consultation with staff is one of psychological safety where people are given a lot of responsibility and a lot of trust. And there's a culture where people feel free to speak up and to raise issues and to have disagreements in a non conflict four way. I think that's really, really healthy. And so I spend a lot of time trying to build that and invest in it. I've made up and it's hard and now would be great. But I sit down with every new employee and talk to them about the history of the Freedom Fund, culture, our values. And encourage others to do it because it can't just be a top down process, right? It has to be organic. As you get bigger and bigger. But if that works and it seems to work, I do annual anonymous surveys of all staff of the organization's performance and my performance, and I share all the results with everyone and the board again, as a way of ensuring that there is a constant feedback loop. If it works, the payoffs are immense because you have an organization that doesn't have to be run in a top down, hierarchical way at every level, but kind of has some clear precepts and thoughts about what the organization is trying to achieve and how it can best do that and a lot of autonomy. And then staff flourish and that means you have to recruit well and all the rest of it. And I think recruiting is always hard. I kind of think the obligate you because you never know how staff will turn out really through a recruitment process. Your obligation is to let go of staff who don't fit. Once you've done everything that is kind of reasonably possible to check, well, that's an option and that's how you ensure you have the right team and keep the right team. I'm kind of fan of Jim Collins. You know, get the right people on the bus, the wrong people off the bus and the right people in the right seats kind of thing. But it takes a lot of work beyond raising funds. That's my major kind of occupation, is how do we keep that? But it is so powerful when it works well. [00:26:30][111.9]

Tulaine: [00:26:34] And now our Rapid Fire. [00:26:36][1.6]

Jeff: [00:26:39] What's one word to describe your journey as a system catalyst. [00:26:42][2.5]

Nick: [00:26:43] Learning, I suppose. [00:26:44][0.6]

Jeff: [00:26:45] What's been one of the most gratifying moments along the journey? [00:26:47][2.2]

Nick: [00:26:48] Seeing that we can drive real change, understanding that we can directly change the lives of the most vulnerable communities. [00:26:54][5.7]

Jeff: [00:26:56] So what? What about your organization keeps. [00:26:58][2.0]

Nick: [00:26:58] You up at night? Collaboration is hard, right? I need collaboration on my board. I need collaboration in my funders. So I'm always worried if one piece slips out of place, I'm always focused on making sure that our major funders and our board members are internalizing the need for collaboration in the same way that we do at every level of the organization. So that's one level too. You know, we work in some pretty messed up places and it's our partners that are on the frontlines of all of this. But that keeps me up. Safety of partners, frontline organizations, communities that we work with that's always front and center. [00:27:35][37.6]

Jeff: [00:27:36] You know, for listeners who aspire to be someone like you as System Catalyst, where and how do you think. [00:27:41][5.0]

Nick: [00:27:42] They should start? Well, it depends where they're starting from, right? I mean, I used to be a corporate lawyer. I used to be a banker, I used to be a political advisor. But I kind of was determined to get into the nonprofit world. So I think that nonprofits are at the cutting edge of systems change. So if you're not in that world, you have to find ways to get there. That can be hard. But then once you're there, that's that's, you know, you have to change your mindset, which is how do we bring others together to drive change? I am not a very collaborative person. I really I'm impatient, overly decisive on occasion, but I've internalized that the greatest change we have is by bringing others together and aligning them around a shared purpose. And I see the payoffs on that. So I'm willing to invest to try and bring people together and collaborate around that shared objective because it's the way we drive real change. I mean, I talked earlier on it. The philanthropists don't collaborate very much. Well, nonprofits don't. They find it hard, right, Because you're often competing, you're competing for resources. You want to promote yourself. You don't want to promote others. But I found and it's not a cliche, you know, generosity is generative. And if you find ways to work with others, first of all, people recognize. So even from a self-interest perspective, I think finding ways to collaborate effectively is a really effective strategy. [00:29:00][78.0]

Tulaine: [00:29:09] If you want to learn more about the Freedom Fund, head on over to Freedom Fund board.