Charitable foundations should work together better and relieve some of the pressure felt by fundraisers, says Dan Corry.
According to the Association of Charitable Foundations, there are more than 10,000 foundations in the UK, and last year they collectively gave away a substantial £3bn. Foundations, like most things in the charity sector, come in all shapes and sizes. There are thousands of organisations making four or five-figure grants, with really sizeable spending left to a few hundred big hitters.
Those larger foundations are serious players. They deal in amounts of cash that most day-to-day fundraisers can only dream about. As a result, they have an opportunity to exercise real clout over how social problems are identified and addressed.
Get this right and the knock-on effect elsewhere in the sector could be significant.
The better foundations use their resources, and the smarter their grantmaking, the more effective the help for vulnerable people can be. And if some of these resources are directed to effective early action – always a challenge – many a fundraiser may be relieved from the constant scramble to resolve urgent crises.
Some foundations have started to make a concerted effort to exploit their power and move the dial on how social problems are understood and solved. This is extremely welcome, although not before time. Foundations, which are subject to relatively little accountability and benefiting from a generous tax regime, can and should use their substantial resources in more effective ways.
The Big Lottery Fund and the Calouste Gulbenkian Foundation got together earlier in 2015 to fund a new funding ecology for social change, a paper published by Collaborate. It explored why foundations hadn’t made as big a collective impact as hoped.
Major funding bodies need to work together to find solutions as flexible as the problems they are trying to fix, the paper argued. Foundations should be ‘collaborating to maximise our impact’; their work should focus on ‘the need to build in heterodox understandings of the underlying drivers and dynamics of social change’.
So far so sensible. The Collaborate paper is itself an example of foundations working together. Adjusting to the sheer complexity of social problems, and gearing solutions to that complexity, is a tricky but crucial challenge.
It isn’t always enough to tweak the way a charity works or to promote an innovative intervention. Sometimes the systems in which we operate need to be transformed completely, and that is something the bigger, more strategic foundations can try to achieve.
So if foundations are funding the same thing – say, helping the long-term unemployed find work – they should use the same measurement approaches and metrics to test if the money has made a difference. When they have learnt some answers to that, they should share them. Then they can jointly pay for research to learn a bit more, and then invest on the back of what they have found. This could revolutionise the way resources are used in the sector.
With a bit of co-operation foundations could address smaller bugbears as well. For example, if funders had the same reporting requirements for charities doing similar things, charities would no longer be forced to waste precious hours reporting in different ways to a multitude of funders.
Charities and fundraisers need to innovate, to maximise the social good they can achieve. Quite right too. But the power of charitable foundations – and their influence over the rest of the sector – means that they need to be changing and adapting too. The rewards for charities, and for their beneficiaries, are substantial.
Dan Corry is the chief executive of NPC
