Source

Source
IVAR: Thinking about Sustainability, 2016
This study also draws upon a series of studies which has brought us into contact with 24 trusts and foundations & 200 small to medium voluntary and community organisations, operating in the field of social welfare (2012 – 2016)
Full references and acknowledgements can be found at the bottom of the page.
In recent years, we have seen growing tension between funders’ encouragement – sometimes requirement for – sustainability, and the turbulent environment that voluntary organisations operate within. Specifically, we have seen funders use the concept of sustainability as a key element in deciding what and how to fund.
Expectations and requirements for sustainability can become a source of misunderstanding and difficulty in relationships between funders and small to medium-sized voluntary and community organisations. IVAR’s Research Development Fund has been used to carry out an independent exploration.

What does sustainability mean?
How should funders evolve & adapt?
Assumptions
- Business models provide suitable analogues
- Organisational strength should be defined by balance sheets
- Organisational survival is always ‘a good thing’
- Fragility and transience are fixable ‘deficits’ regardless of context and size
Sustainability is often applied by funders as a kind of diagnostic, in which the patient has little say, while changes in communities and how VCOs work with and within them are overlooked.
Multiple meanings Sustainability is not well explained and has multiple meanings. In the table below we show the different meanings which emerged from our research. |
|
---|---|
VCOs must or ought to become sustainable |
Based on the assumption that sustainability is a ‘good’ thing. Often attached to statements or injunctions by policy makers, commentators, foundations or organisations. |
Financial and organisational survival |
Excludes all other issues e.g. mission creep, change of target beneficiaries. |
Diversify (types of) income and create ‘business income’ streams |
Used as a code to encourage organisations to diversify income and become more enterprising, to consider scaling up and to rely less on grants. |
Avoiding over-reliance on restricted funds |
For example, government contracts with highly restrictive clauses, direct fee income from clients and some types of commercial income. |
A long-term organisational process |
Implies that an organisation moves towards sustainability by a range of actions and, as a result, sustainability is something that happens over the long term: it is a journey. |
Organisational continuity |
Frequently implied, usually in relation to the existing mission. |
Organisational capacity for service delivery |
For government agencies, the focus has tended to be on the sector’s role in public services. |
Adaptable to take advantage of the financial environment and change |
Including scaling up its work, securing loan finance, social impact bonds, engaging in mergers and strategic alliances, etc. |
Continuance of a particular stream of work rather than the organisation |
To ensure the quality and equity of this work for stakeholders, beneficiaries and communities. |
Organisational characteristics for a ‘sustainable organisation’ |
For example, a clear mission and aims; good governance; qualified and committed staff; sound leadership and financial management; adequate reserves; communication strategies; good marketing, etc. |
Internal organisational capability |
For example, internal strengths to have a reflective, critical and analytic approach, which includes awareness of organisational resources, mission and beneficiaries. |
Collective local networks – strong organisational interdependence |
With an emphasis on the importance of a local ecology of social actors. This includes a stock of trust drawn from engagement, networks, and relationships which give the organisation reputation and legitimacy over the long term. |
Equated to other terms and ideas |
For example, resilience, adaptability and viability.
|
Terminology

Terminology
Voluntary and community organisations or VCOs:
Organisations belonging to the: charitable sector; voluntary sector; community sector; voluntary and community sector; voluntary, community and social enterprise sector; third sector; non-profit sector; NGO sector; and civil society.
VCS:
We use the term to denote the voluntary and community sector.
Funder, trust and foundation:
We use these terms interchangeably to refer to independent charitable trusts and foundations.

What are funders trying to sustain?
A single definition of sustainability does not appear to be realistic. What matters is that foundations:
- Are crystal clear about what they mean by ‘sustainability’
- Design their approach to funding and engagement to support it
- Communicate these things really clearly, particularly in grant application guidelines

Source

Source
This page and our publication Thinking about Sustainability draws from a review of the literature and on the record interviews with voluntary organisations and foundations.

Funders should always…
-
Be crystal clear about what they mean by sustainability
-
Design their approach to funding and engagement to support it
-
Communicate what they are looking for really clearly, particularly in grant application guidelines
How can funders help?
Whatever views funders have on sustainability, all want to see their grantees do good work and deliver benefit to those they serve.
1. Provide core funding: Ask what they need, be flexible on how funds are spent
2. Provide long-term funding: Take a positive attitude to continuation of funding
3. Allow for grantee-led support: Seek out what it is that enables an organisation to do good work, think about offering grants plus support
4. Get the relationship right: Nurture honest, trusting relationships, create relational rather than contractual relationships which value partner contributions
Download the report

Research reports:
Thinking about sustainability
Richard Hopgood and Ben Cairns, with Mike Aiken and Liz Firth
Expectations and requirements for 'sustainability' can become a source of misunderstanding and difficulty. This report looks at the meanings and assumptions behind the word and what funders can do to help.
What needs sustaining? |
Why is it important? What might this involve? |
Possible approach |
---|---|---|
Organisation |
An organisation may have a key role in a locality or sector because of what it is and what it does; its network of relationships (including the trust of hard-to-reach communities); its key people; its ability to be a nimble, challenging actor in areas of social policy and its potential to change systems; the long term impact and nature of its work; and the fact that it may have better prospects than others. |
If the organisation is what needs to be sustained, then longer term core funding is likely to be the right answer. |
Values |
This may involve exemplary work on beneficiary voice or inclusion; a willingness to speak truth to power; and to fight for the values of local people and communities; and to strengthen the agency of beneficiaries. Those values may reflect a history and particular people or relationships which are at risk, both from market forces and the erosion of a local community infrastructure. |
Again, long-term core funding may be the best form of support, perhaps allied with support for learning and sharing values and experience. |
Model or general ways of working |
The work (project) needs to be supported and funded in a way which provides stability and continuity. However, no work exists in a vacuum and funders should take a holistic view and be prepared to help if there are organisational problems which could destabilise the project. |
The right funding mix might be project funding plus help with evaluation and, where there are acute organisational needs, some core funding (or ‘in kind’ assistance) to support the management and help the organisation to assess the future development of the work, and who is best placed to carry it out. |
The focus on the beneficiary |
Over reliance on targeted funding streams can make it difficult for small organisations to deliver holistic services to their beneficiaries. |
Funders can sustain this broader approach by framing their funding in a way which is specific to the beneficiary and which is realistic about what needs to be funded (which may require a higher level of grant if other funding streams have been cut). |
The process of evolution or development |
This may apply to experimental/high risk work where the learning to be distilled and disseminated is (or might be) of particular importance. |
Funding therefore needs to focus on enabling that to happen (and particularly the dissemination, which needs proper resourcing). |
Evers, A. (2005) ‘Social enterprises and social capital’ In C. Borzago & J. Defourny (Eds.), The emergence of social enterprise. London: Routledge.
Hailey, J. (2014) Models of INGO Sustainability: Balancing Restricted and Unrestricted Funding. INTRAC Briefing Paper 41, Oxford: INTRAC.
York, P. (undated) The Sustainability Formula: How Non-profit Organizations can Thrive in the Emerging Economy, TCC Group. http://www.tccgrp.com/pdfs/SustainabilityFormula.pdf (Last accessed 10/8/2015)
IVAR (2013) Thinking about Core Funding, IVAR: London
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