Five perspectives to celebrate three years of Open and Trusting

Removing the hoops charities have to jump through

Gina is Director of Communications and Learning at the Esmée Fairbairn Foundation.

For the foundation, four core challenges have been showing up consistently in learning conversations with the organisations we fund for over a year:  

1. the long term effects of Covid on people and their work; 
2. struggles to recruit and retain staff; 
3. difficult relationships with increasing pressed public services; and 
4. the effects of the cost of living crisis.  

These challenges are too big for trusts and foundations to tackle, but this year has been another reminder that the most effective tool we have to help as a funder committed to open and trusting grant-making is still long term, unrestricted, grant-making.  

The pandemic brought us closer to the organisations we fund 

During Covid, many funders (including Esmée) took action to make things easier for the organisations and people we funded: giving extra money without application processes, responding quickly, not asking for written reports, making grants unrestricted. By taking away the hoops we funders make organisations jump through, we made it possible for them to deal with the uncertainty of the situation. We gave the people on the ground the freedom to take action quickly and easily, and make more of a difference.  

For Esmée, working in a more flexible way during the pandemic also brought us closer to the organisations we fund. We had more conversations instead of asking for reports, and were able to react and respond more quickly to what was needed. We got a lot of positive feedback, and felt like a valued part of the sector in a time of crisis.  

Investing in impact means accepting risk 

Making flexible grants was not new for Esmée. From 1961, the founding trustees had an investment mindset – they wanted to give people what they needed for long term impact, and let them get on with it. Esmée was originally a corporate as well as a family foundation, then linked to M&G investments. Writing cheques at the boardroom table, Trustees have always given unrestricted grants. Of our 800 active grants today, 37% are unrestricted and an additional 32% are for core costs.  

Likewise, Esmée Trustees have always accepted risk. In the investment world, financial performance came with the acceptance that some work would fail. We take our role seriously when it comes to safeguarding, equity, and due diligence. But when it comes to doing the work on the ground, we are not the experts, auditors, or regulators. We back the organisations we fund to make their own decisions.  

We need more flexible funders  

We are just one funder among many for the organisations we support. If we – and they – are going to make a real difference, we need to join with other funders to make a change. The Open and Trusting grantmaking movement was set up to make sure that the benefits of flexible funding felt during Covid are not lost, but kept for good.  

There is very little to hold funders to account for the way we work, and funding application and reporting systems are set up for our benefit. Applying for funding puts most of the work on the people with least resources. That means that changing this is tough…: for individual funders, Trustees, staff, and for funders working together as part of Open and Trusting. Because it means making life a little bit more difficult for ourselves.  

But changing the funding system is within our gift. We need to make it better because applicants and funded organisations can’t. It is hard, but when I’m tempted to give up, I remember that small changes can have a big impact. Saved time, saved cost, less duplication – matters to the organisations we fund.  

Small changes make a big difference 

I’ve been working at Esmée for 16 years, and the things I’m most proud of are the small things we’ve done to save people time and work:  

• For organisations we fund, following Commitment 8 (‘Be proportionate’) means that 36% of them submit a report they’ve already produced for their board or another funder, saving 179 organisations a year from days of wasted report writing.  
• For the organisations we will never fund, when we co-designed a quiz with declined applicants (in line with Commitment 1: ‘Don’t waste time’), it cut down applications from 3,000 to 1,000 per year – still too high, but progress.  

Signing up to the Open and Trusting grant-making initiative is a public commitment that has helped us define what it means for Esmée to be more open and trusting. It’s very easy to add restrictions, but it’s also liberating – for everyone – to take them away.

Why applying for funding with us will never feel like a ‘black hole’

Bruce is a Trustee and Grants Manager at The Shears Foundation.

When we first started our pre-application conversations, we were surprised by how many people were totally shocked by the idea that a funder wanted to have a bit of a chat with them, before they started the hard work of making an application. One conversation particularly sticks with me. The person I was talking to described applying for grants as ‘like throwing something into a black hole… you don’t know where it goes, where it ends up, what happens to it and, in all probability, you’ll never hear from it or see it again.’  

I made a bit of a vow that day: The Shears Foundation should never be that black hole. 

As funders, good communication should be at the heart of everything we do. Since first making our IVAR Open and Trusting Grant-making commitments in March 2021, much of our focus has been on trying to make what we do transparent and understandable. Through information on our website and pre-application conversations, we’re open about: 

• What we do, and what we don’t accept applications for
• Our scoring criteria
• How many applications we typically receive, how many go to trustees and how many get approved 
• Our success ratios – we have finite resources, but so do our applicants. Who wouldn’t want to know the chance of success before investing time and effort in applying? 
• What our trustees’ current priorities are and how they arrive at their decisions
• What things might make an application more likely to succeed
• Our timescale and deadline commitments. 

Charities exist in an ever-changing world where demand for their services is increasing all the time and the cost of delivering those services is getting greater and funding is harder to find. These aren’t just the findings of recent research, but the stories we are hearing from almost every introductory phone call we have with a potential applicant. 

I’m sure it’s because of such challenges that we had a 53% increase in grant applications last quarter (October to December 2023). Suddenly, the goal posts had changed.

We’d been happily telling people on the phone that we had a success ratio of between 1:3 and 1:4, and that our pledge to turn around applications was six weeks. The reality was that the ratio had dropped to 1:5 and we didn’t have the resource to honour our six-week pledge. 

It made us realise that, for our communication to be effective, it had to be dynamic and responsive. We made the decision to fire off an email to all our applicants, explaining what had changed since we spoke to them.  

I’m perhaps a little naïve in thinking that keeping the people you are working with updated if something unexpected crops up is a blindingly obvious thing to do. But, judging by the reaction to the simple heads-up email we sent out, perhaps it’s not so obvious.  

We got 22 emails back, all positive and understanding. Here are a few snippets: 

‘Thank you for letting us know about the changes to the timescale – we really appreciate this, as it helps with our planning and forecasting.’ 

‘Thank you for being so open and transparent in your communication, it’s so nice to know ‘where we stand’ and to catch a glimpse of what is happening on the other side of grant making.’

‘Thank you for your prompt and transparent update on our grant application to The Shears Foundation. We appreciate your commitment to openness and accountability, as reflected in your adherence to The Institute of Voluntary Action’s principles of better grant making.’

So, my message to funders is just keep talking to your applicants through the whole process: what might seem like a very simple step is truly valued. Be human, be respectful and be transparent – and it will be very much appreciated.  

My top three wishes for grant-makers

Emma Pears is founder and Chief Officer of SELFA Children’s Charity based in North Yorkshire.  She reflects on the reporting challenges her organisation faces and what open and trusting practices funders can adopt to make a real difference.  

One key area where a few small changes can make a big difference is what and how funder ask us to report.  

SELFA Children’s Charity has been around for almost 17 years and over that time our income has grown to just under £500,000 a year. With that growth has come an onus to complete lots of reporting templates placed on us by those who are supposed to help us the most – our grant funders.   

Of the 30+ funders we have, most ask us to complete a report of varying length and complexity each year. However, there are an increasing number who ask us to report every quarter, including the collation of a wide range of data, photos and case studies – so that they can showcase the great work they fund.  

I’ve many stories I could tell here, like one funder who asked us to complete individual questionnaires for every participant as well as for staff and volunteers, multiple case studies, photos and video footage as well as monitoring reports – all for £6,000. I raised this innumerable times with the funder, asking if there was another way and – surprise, surprise – we haven’t been invited to reapply for funding.   

Add to this the ‘rise of the digital platform’ where many funders are now asking us to use their electronic systems to report back. This makes it much easier for the funder to measure their impact as a whole and spend less time on admin, but the amount of extra work this has placed on us is huge.  

We now not only use our own digital platform, Salesforce, to record our overall impact as an organisation, but also have to manually input our data on the chosen platform of individual funders – most of which are different and none of which will accept a ‘bulk upload’ of data from a spreadsheet or csv file (or at least the version the funder has purchased won’t allow this). We’ve had a customer relationship management (CRM) software solution for over five years now and have invested a lot of time and effort in development, whereas many of the other systems adopted by some of our funders are new, glitchy and have a lot of down time. The really sad part is that this takes us away from supporting children and families who desperately need us, with some of our children’s workers spending around 10% of their time just inputting data.  

Don’t get me wrong, there are some truly wonderful funders out there who are embracing open and trusting grant-making, supporting us with multi-year funding and light touch monitoring. There are also funding officers and grant managers with whom we have fantastic relationships; they do their best to support us, but without strategic change it’s not going to have the impact we so desperately want to see.   

My top tips for funders  

If I had three wishes around charity reporting, it would be this:  

1. If you do your due diligence at the application stage, then why can’t you accept our annual report or one we’ve done for another funder? You’re more likely to get an idea of how your funding fits into the bigger picture. 
2. If you’re thinking about setting up you own digital platform for reporting – do your research and make sure that by lightening your administrative load you’re not just putting more work onto small charities. Or even better – support funded organisations to develop their own digital platform where we can record what’s meaningful to us and then funders can access this to download the data they need.
3. If you really need us to report in a certain way, be aware that will take us more time and be willing to pay us for that time. If you want us to fill in your lengthy, detailed paperwork, then give us an extra 10% on top of what we’ve applied for. 

Notes:  

Emma Pears is the founder and Chief Officer of SELFA children’s charity  based in the Yorkshire Dales and is well-known for her campaigning on children and young people’s mental health. Follow her on Twitter @SELFA_Emma   

Why are we still talking about trust-based philanthropy?

Chantias Ford is Director of Programs at the Trust-Based Philanthropy Project, based in the US. Chantias’s reflects on why talking about trust remains important. Her reflections, while grounded in work across the US, have resonance for the Open and Trusting movement here in the UK.

Philanthropy is full of trends. We oversaturate the field with programming, resources, and think-pieces responding to the latest buzz. We write reports, host roundtables, and do interviews elevating the ‘hot topics’ funders are grappling with. We talk and talk and talk, and after a set amount of time, we shift our focus to new trends. It’s a tale as old as time. Perhaps you think trust-based philanthropy – or, in the UK, Open and Trusting Grant-making – falls in that same category: a dated philanthropy trend that has oversaturated the market.  

I get it. Prior to joining the Trust-Based Philanthropy Project team, I had various run-ins with trust-based philanthropy. I understood the gist – that it was about shifting the power imbalance and centering equity – and it seemed like an amazing way to reframe conventional philanthropy. I was excited to see where it could go. But I have to admit, I also saw it as another potentially fleeting trend. Some of these trends were great – many born from the tragedies of social injustices and inefficient harmful practices.  But unfortunately, I was unsure (and frankly, a bit skeptical), about the lasting power and sector-wide adoption of trust-based philanthropy. 

As I’ve gotten more intimately involved in the trust-based movement, it has been wonderful to see how widely the approach is being discussed and adopted among funders around the world. And if you, like me, find yourself in spaces where sector influencers have been discussing this repeatedly, you may be wondering ‘why are we still talking about this?’.  Maybe you’re tired of hearing about it, maybe you don’t believe the hype, maybe it feels like it has enough momentum, maybe you don’t feel any personal power to make change, or maybe you just have critiques or questions that you have yet to find answers to.  

Wherever you may fall, and whatever position you may have in the philanthropic sector, I encourage you to consider the following reasons why we need to keep this conversation alive.  

So why are we still talking about trust-based philanthropy? 

Because many funders still haven’t heard about it. Although the phrase seems to have saturated the field, there are still plenty of funders who are not familiar with it. If we want to make this approach the norm, it will require ongoing conversation and education.  

Because the majority of the sector is still operating in the conventional way. Trust-based philanthropy was born out of the harmful practices funders were perpetuating to their grantee partners, and those harmful practices are still the overwhelming norm for most funders. Although there is promising evidence of funder shift, (as has been illustrated by the widespread adoption of the eight Open and Trusting commitments, as well as our recent grantmaker survey), the majority of the sector is still operating in conventional ways, and shifts such as multi–year unrestricted funding are still not the norm. People may be talking about trust-based philanthropy and implementing aspects of it, but there is still more work to be done before it becomes ‘the norm.’  

Because there is a difference between awareness and action. Many that have been introduced to trust-based philanthropy get the general concept and are beginning to shift some practices, but that’s just an initial step. In order to deepen the knowledge and the practice, we have to go beyond the “trustwashing’ we’ve seen, and towards deeply living and embodying trust-based values at the deeper level of culture, structures, and leadership. Transforming at this deeper level requires time, patience, collaboration, and constant self-reflection. The more we can collectively discuss, demonstrate, and embody this ethos, the more we can inspire action and achieve transformation.  

Because the majority of nonprofits have not yet experienced the benefits of trust-based philanthropy. Nonprofits deserve mutually accountable, trust-based, equitable, transparent relationships. They deserve relationships that are not compliance-based or rooted in fear and distrust. If nothing else, it is beneficial to keep lifting up trust-based philanthropy so that nonprofits of all shapes and sizes can experience this sort of transformative funder relationship, and so that funders will feel more emboldened to not only shift practices, but to make their trust-based priorities visible to nonprofit partners seeking these sorts of transformative relationships.  

In an ideal philanthropic world, trust-based philanthropy would be the standard, but there is clearly much more work to be done to get us there. So perhaps the next time you hear about trust-based philanthropy, or Open and Trusting grant-making,  and are inclined to click away or to offer a dismissive retort, I warmly encourage you to see it as an opportunity for you to be reflective and think through opportunities to elevate and implement what you’re hearing.  

See it as an opportunity to reflect on why this approach resonates with you, how you can improve your practice, and how you can be an advocate. Transforming philanthropy is a collective journey, and it’s going to take commitment and collaboration from many of us to actualise the deep change this sector truly needs. 

Entering our fourth year with four reflections

As we enter the fourth year of Open and Trusting, we are seeing how changes to grant-makers’ practices enable more flexibility for funded organisations to focus on responding directly to changing needs. 

Reflecting on this progress, four things stand out for us at IVAR:  

1. While it can be hard to achieve, a strong, diverse charity voice is critical to this effort. 

Our conversations have shown that we can all benefit from broader and deeper conversations between the charity sector and the funding sector. But only if they lead to the kind of visible and meaningful changes argued for by Emma, and described by Bruce, in their blogs. 

We know that power dynamics can make charities wary of giving robust feedback to funders, and too often new rhetoric (impact measurement, systems change, or any number of other terms that have spread through the sector) makes little or no difference to what funders do in practice. More open and trusting grant-making can ease the extreme pressure on charities and shift the widespread cynicism about the influence they have. 

2. Every day we work with charities and funders ambitious for change – not soon, but now.  

It’s clear that both know what would make a difference to their funding experience. Although some are looking for more radical transformation, the top priority for most is ‘making better use of everyone’s precious time’. This is important. It tells us that bringing meaningful change is possible – but won’t happen without people who hold more power taking the lead. As Gina Crane wrote in her blog: ‘changing the funding system is within our gift.’

3. Open and trusting practice flourishes once it mirrors and is supported by organisational culture, structure and leadership.  

In a busy foundation, it can be hard to step back and scrutinise – at all levels – how well-established assumptions and ways of working are supporting the commitment to be more open and trusting. But we have seen it happen.  

This is an essential step in achieving the best possible alignment between ‘how we do things’ and ‘what we are trying to achieve’. To quote from Chantias: ‘Transforming at a deeper level requires time, patience, collaboration, and constant self-reflection. The more we can collectively discuss, demonstrate, and embody this ethos, the more we can inspire action and achieve transformation’. 

4. A sense of shared purpose and togetherness characterise the approaches and experiences across the Open and Trusting community. 

It’s working together – not for or against each other – which has enduring value, both to funded organisations and the funders committed to supporting their work.  

This is what our colleagues and friends in the Trust Based Philanthropy Project in the US describe as being ‘partners in a spirit of service, leading with trust, respect, and humility.’  

Ultimately, that is the essence of the Open and Trusting movement; and those are the values that we hope will continue to shape and drive our work together as we go into our fourth year.