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Communities need flexible funders to influence the public sector

Over the last three weeks, I’ve met 32 leaders of small and medium voluntary organisations at four online peer support sessions. I have been inspired by their dedication and creativity: by hook or by crook, they have made it possible for services to reach people in dire need. Used to a turbulent environment and light on bureaucracy, their organisations moved remarkably quickly in response to the immediate crisis of lockdown, and have proved remarkably adaptable and resilient throughout the twists and turns that followed. Children with learning disabilities; undocumented young migrants; families of prisoners; housebound older people – all, and many more, have been supported by local organisations.

But the duration of the crisis, and the extreme levels of uncertainty, have stretched many close to their limits. And now, as we emerge out of an extended period of restrictions into a period of unpredictability, leaders are faced with harsh realities. On the one hand, demand for services is growing, from people with increasingly complex needs; on the other, staff are exhausted and funding is precarious.  

Our recent conversations – like with charity CEOs we met through our Leading in Uncertainty peer support sessions   echo much of what we heard in our 2012 study of social welfare voluntary organisations and their experiences of navigating their way through the recession. Then, as now, we heard stories of resilience and determination, as well as anxiety and despair.

‘I found the lack of recognition of our sector during the pandemic difficult… it was often forgotten that charities were still open and providing essential services too.’

At the same time, through both the recession and the pandemic, we have been reminded of the disproportionately important role that trusts and foundations play in supporting these organisations. Since March 2020, their flexibility has offered a lifeline, ensuring the continuation of essential services and activities.

In particular, the emergency has shown us that lighter, more flexible, more trusting funding practices are possible.  And hopes are now high that trusts and foundations will ‘keep the faith’ through the period of prolonged upheaval and uncertainty that lies ahead. This is the driver behind the open and trusting grant-making campaign , with its commitment to sustain and build on progressive practices for the future.

In 2012, we heard a plea for trusts and foundations to step into an advocacy role, using their influence to stimulate and facilitate debate and action about the adverse effect of public sector funding cuts and the decimation of public services. The response was, largely, to remain silent. For some, taking on this role felt like a step too far away from independence and into ‘campaigning’. For others, there was a concern that sweeping statements would ignore the constraints faced by public agencies, and might ‘tar everyone with the same brush and ignore the pockets of flexible public sector practice’.

However, almost ten years later – faced with similar difficulties around government funding, and in ‘the foothills of the economic shock’, the need for someone to speak out remains urgent:

‘We have put in a massive shift. Often unheralded, or taken for granted. Our work is vital, but it can’t just happen on a wing and a prayer. And it’s not just about one tweak here, and one tweak there. We need the whole system to change.’

‘If reporting deadlines on one grant shift, or processes for another become easier, that’s great. But unless that becomes standard practice across the board, the stress and the burden are still there.’

‘Our vital contribution isn’t really understood by statutory authorities. But without the support of these bigger players, we will not be here to make the system work: reaching minoritised communities, interpreting the benefits system, plugging gaps and mopping up mess.’

Trusts and foundations – with their prize assets of independence and leverage – are perfectly placed to step up and argue for greater consistency and flexibility in how the work of voluntary organisations is funded, both within their own sector, as well across all levels of government. This is not the moment to be bashful. For, without vocal and concerted effort, there is a genuine risk that vital organisations providing essential services will buckle under the strain.

Three ways City Bridge Trust approached flexible funding during the pandemic

City Bridge Trust (CBT) have signed up to our eight commitments for open and trusting grant-making. They join us as one of our 70 #FlexibleFunders to share their experience of responding flexibly.

 

I recently joined 10 funders at one of the first Community of Practice meetings to discuss Commitment Six – “We will enable them (funded organisations) to respond flexibly to changing priorities and needs“. It was a stimulating and enlightening discussion, which I look forward to building on as the community grows over the coming year. Inevitably, we discussed how the pandemic has catalysed funders to enable flexible and responsive work more than ever before. At the Trust, we approached this in several ways:

 


  1. Collaboration 

By joining London Funders’ ‘London Community Response’ (LCR) funder collaboration, administering the “pooled” funding element, we were able to direct more than £30m of funding to organisations that were pivoting their work to respond flexibly to the needs of London’s communities. We know from listening to our own funded organisations that much of London’s voluntary sector was involved in response work; at points, over 70% adapted their work in some way. By working together, funders were able to draw on each other’s skills. We also utilised the knowledge and expertise of voluntary and community organisations, including the LCR Equity and Inclusion partners, Ubele Initiative, Inclusion London, Women’s Resource CentreLGBT+ Consortium, Council of Somali Organisations and London Gypsies and Travellers, more efficiently as a collective.

 


  1. Core funding 

At the beginning of the crisis, we contacted our funded organisations to confirm our commitment to support them at such a crucial time. We had signed up to the London Funders “We Stand with the Sector” statement and wanted to back this up with tangible action.

We offered organisations that were holding project grants the opportunity to convert their funding to a core grant until March 2021. This allowed partners the freedom to quickly make decisions on expenditure changes using their knowledge and expertise of how best to run their organisation.

As the impact of the crisis became clear, we renewed the offer for a further 12 months. 36% of those offered the initial conversion took up the offer. Some organisations couldn’t utilise core funding, so we were open to other ways of supporting them, for example, pausing funding until projects could get up and running again.

We also offered many of our funded organisations with an annual income of under £0.5m a one-off payment equivalent to one-quarter of our usual yearly support. This was not tied to the project that we usually funded – organisations were free to apply the money to any of their costs, as they saw fit[1]. We heard from our own funded organisations and learnt from research, such as the Greater London Authority’s London Community Response survey, that smaller organisations could be much more flexible (and were less likely to have furloughed staff). They were uniquely placed to quickly respond to the emergency and to be trusted in their communities.

 

In Wave 5 of the London Community Response, recognising overwhelming feedback from the sector regarding the lack of longer-term non-project-related funding, we decided not to restrict grants to Covid-related work or specific projects. Instead, we invited organisations to apply for core funding towards any element of their work, including developmental costs.

 


  1. Minimising bureaucracy

We explored ways to free up more of our funded organisations’ resources, allowing them more space and time to reimagine services in light of the crisis. Our Impact and Learning team considered what we could do to reduce the administrative burden of our reporting systems; we drastically cut down the number of questions and amount of detail in monitoring forms. Funded organisations were still able to tell us about the impact of their work, but with a more focused lens. This approach was well-received, particularly in tandem with a relational approach to monitoring deadlines, extending where necessary. For emergency response grants, we offered a choice between completing a short form or participating in a phone conversation. Our Funding Managers reached out personally to organisations in their portfolio; to offer a listening ear and explore whether there were other ways we could ease the burden.

 

What next?

 

Over the year, these actions felt like authentic and realistic commitments to the spirit of the sixth principle. We’ve repeatedly heard how helpful a flexible and open approach was, particularly the early contact to check in with organisations.

 

Our funded organisations report that core support enabled them to adapt speedily, with the most significant shift being to online delivery. Many organisations had to make multiple adaptations – core funding was crucial to respond in this way. Grantees have told us that they’ve developed their partnership working, increasing referrals and signposting to reach more people and providing enhanced support for staff and volunteers. They’ve also integrated peer-learning and co-production approaches, improved “keeping-in-touch” activity and enhanced the level of tailored support on offer.

 

There’s more work to do; we want to integrate learning from the LCR collaboration into our practice in the future. We awarded almost 2,000 LCR grants, and quickly found that an even more flexible approach than we were used to was necessary. We amended our grant offer letters to reflect that we trusted organisations to change how projects were delivered.

Monitoring data collected so far demonstrates that organisations consistently delivered on the aims they initially set out (even if the delivery itself was tweaked along the way). Almost 90% of grant recipients spent the funds on what they had anticipated – organisations were able to accurately predict the support their communities needed, even in a time of unprecedented crisis.

 

We are reviewing our approach to core funding, having interviewed funded organisations (those who both accepted and declined the offer) and our Funding Managers and using other data from the last year. This will feed into the design of what core funding will look like for us in the future.

 

Our funded organisations have access to a Funding Manager with authority to approve reasonable adjustments; we will continue to ensure this built into our culture.

 

These steps have been taken alongside a wider journey towards become a values-led funder, which is still a work in progress.  Alongside continuing to fund, read and listen to, act on, and value the work of the voluntary and community sector, including infrastructure organisations like the LCR equity and inclusion partners, this approach will facilitate our partnership work with funded organisations to ensure that projects we support can be flexible across the lifetime of our funding.


How to get involved


You can find out more about open and trusting grant-making at our Flexible Funders webpage, including how to sign up to our Community of Practice. For more details or to share your own Flexible Funders story with us, please contact enquiries@ivar.org.uk


 
Footnotes

[1] We are limited by our own charitable objects to funding work that benefits Londoners. Therefore, all funding referenced in this article was restricted in this way. This is one of the reasons that we refer to “core” funding, rather than “unrestricted” funding.

Having meaningful conversations about your funding approach

The Shears Foundation have signed up to our eight commitments for open and trusting grant–making. They join us as one of our #FlexibleFunders to share their experience of our first Community of Practice and their key takeaways:

 

The Shears Foundation Approach

 

The Shears Foundation is a family foundation, set up in 1994, which makes grants of around £600,000 to £700,000 each year, mostly in the North East of England.

 

When I first heard about IVAR’s #FlexibleFunders call to action for open and trusting grant-making, there was an immediate appeal. The Shears Foundation is founded on principles of trust and mutual understanding between us and those we are helping to support. As a family foundation with a board of committed trustees, we are in an ideal position to be flexible, agile and take a degree of risk. Our philosophy is that we can be an effective funder through:

 

HAVING MEANINGFUL CONVERSATIONS > BUILDING RELATIONSHIPS > ESTABLISHING TRUST

In fact, the reaction from some of our trustees when I proposed that we should take the pledge and sign up can be illustrated with this one response:

“I think we are already doing everything we can, in the best possible way”.

After some discussion, we agreed that joining IVAR’s Community of Practice would give us a great opportunity to further develop what we do, hear about others’ best practice, and also share our own experiences in a cooperative and collaborative forum.

This ties in with my own philosophy and that of the Shears Foundation’s founders: it is vital for any organisation to adapt and improve through self-evaluation and continuous improvement. Hearing and learning from what others do is a key component of this.

 

In this blog, I’d like to share my experience of attending the first Community of Practice online event in April 2021.

 

 

The Community of Practice

 

I wasn’t sure what to expect from the first online meeting, apart from a warm welcome. What struck me straight away was the range of attendees: large and medium-sized family trusts and foundations; place-based funders; national funders; funders with interest in a particular field or theme; CVS’s and Community Foundations were all in attendance. The beauty of this was a diverse range of perspectives and challenges that were discussed in moving closer to the eight commitments.

 

What was particularly interesting were the lessons learnt by funders from the Coronavirus pandemic. Many of the participants recognised that the groups that they supported had to adapt, change and think on their feet, almost overnight in March 2020. Funders overwhelmingly recognised that they had a responsibility to match the adaptability, resourcefulness and agility of their grantees.

 

Funders had employed several important strategies in response, proving that we can work more flexibly. Strategies included automatically unrestricting grants, allowing delays and repurposing of grants for project funding, and accelerating and simplifying application processes.

 

Most importantly, there seemed to be a common thread: as funders we needed to value what a charity/beneficiary achieves, not how they achieve it.

 

Another key takeaway was to recognise the need for unrestricted funding and trust our grantees to know the best way to spend funds to achieve their goals. We currently offer core funding for funding a particular role / paid position or perhaps a specific non-project aspect of running costs. However, this isn’t truly ‘unrestricted’, and this is a discussion I’d like the trustees to have at our Annual General Meeting (AGM).

 

It was clear that the organisations attending were at different stages of their learning journey to being more open and trusting in their grant-making.

 

The session provided the ideal introduction, with open and honest discussion, respect for differing viewpoints and a positive and optimistic atmosphere.

 

I’m looking forward to being part of this as time goes on and incorporating insights into our practice.

Word cloud of what grantees says about the Shears Foundation.

 

 

 


Beneficiary feedback

 

One thing we could improve is getting feedback from the groups and charities we support on how we work. It’s something that we will be building into our processes in future.

 

However, I was asked to make a presentation recently on how we had responded to the Coronavirus pandemic. I wanted to get some “quick and dirty” feedback and asked 25 of our recent grant recipients (a mix of groups we’ve known for years and some new to us) to honestly describe our relationship in just three words.

 

The word cloud above shows we have the basis we need to build even more open and trusting grant-making in the future.

 

The biggest challenge for The Shears Foundation

 

We are fortunate to have a strong board with different backgrounds and wide-ranging attitudes to risk. I think balancing this range of perspectives and settling on an agreed attitude to risk is our next step, but it could be a challenge going forward.

In the words of one of our trustees:

“My only query would be in relation to commitment 3: accepting risk. I was just wondering how this squares with our duties as trustees and in relation to what the Charity Commission expects from us. I know that every grant we approve comes with a degree of risk, and I’m sure in practice, we would continue to assess each application with the same degree of rigour. But if this initiative is successful, I wouldn’t want it to evolve into something binding that might clash with our own due diligence processes.”

What is clear is that sharing experience, practice and solutions with others through this group will really inform how we approach this challenge and others in the future.


How to get involved


You can find out more about open and trusting grant-making at our Flexible Funders webpage, including how to sign up to our Community of Practice. For more details or to share your own Flexible Funders story with us, please contact enquiries@ivar.org.uk


 

Summary of new briefing: Birds in a hurricane

Since the beginning of the coronavirus pandemic, we have spoken to over 1,000 voluntary organisations across our portfolio of research. In every conversation, whatever the focus, we have heard about how small charities, social enterprises and community groups have been coping and adapting.

 

Along the way, we have been capturing snapshots of the live situation through our regular briefing series, drawing specifically from our peer support sessions for voluntary sector leaders. We have been inspired by individuals, holding their teams and organisations together in the toughest of times. And we have reflected on how funders, in particular, could best support their efforts.

 

This latest briefing, however, draws material from a wider range of projects – most of which began before the pandemic hit. In early 2020, we were facilitating local, cross-sector health partnerships, and looking at how small charities were using technology, not knowing just how vital these already important and interesting fields would become.

 

We decided to explore how organisations have survived – and in some cases even thrived – since the pandemic began. And we share the things that we believe will help both voluntary organisations, and those who support them, to sustain and develop their contribution for the longer term.

Summary

 

Leading a small VCSE organisation is a tough job at the best of times: ‘As a CEO, you’re the HR department, the marketing department, the finance department, the operational manager and so on. It’s difficult managing all this and the staff’. But Covid-19 has turned the volume up right across the spectrum: ‘I feel like a bird in a hurricane!’.

 

Core Funding

1/6

Key pressures organisations have faced

 

  • Funding

  • Increasing/changing demand

  • Going online

  • Taking care of their teams

  • Leadership

Core Funding

2/6

Funding. Many funders worked hard to provide emergency funding that supported rapid responses, and to take a light-touch approach; but the pipeline for longer-term applications remains seriously disrupted. 

Core Funding

3/6

Increasing/changing demand. Many organisations uncovered new needs. Some transformed their services; others went into a holding pattern, providing what support they could from afar. The sense of never being able to do enough was profound: ‘People in need are falling off the radar’, ‘Our users don’t always cope well with change’. 

Core Funding

4/6

Going online. The shortcomings of ‘communicating on squares’ have become clear – from the loss of informal spaces, through to trying to support vulnerable service users, or even mediate conflict, virtually.

Core Funding

5/6

Taking care of their teams. The welfare of staff and volunteers has been a pressing concern. To begin with, staff often ‘threw their all into it’, but, as the weeks turned into months, leaders wondered how long staff could ‘survive this intensity’ and keep going.

Core Funding

6/6

Leadership. Leaders have had to make ‘tough decisions with no perfect answers’, like whether to develop, flex or close services. There have been multiple balancing acts, for example between the welfare of users and that of staff.

The past year has been a ‘story of extraordinary resilience and adaptation’; a rare, shared period of experimentation and taking risks; and a time when new possibilities and options have sprung up: ‘Learning from the crisis will stand us well in the future’.

 

So, what has helped VCSE organisations to stay afloat in a period of adversity?

 

Core Funding

1/7

What has it taken to keep going?

 

  • Collaboration

  • Taking care of staff and volunteers

  • Discovering new ways to connect

  • Responsible, supportive funders

  • Financial cushions

  • A space to share

Core Funding

2/7

Collaboration. The need for joined-up thinking’ was pressing. The sense of urgency and shared purpose dissolved many common obstacles. VCSE organisations worked together to share data and enable cross-referral; they felt valued in partnerships for their distinctive reach and contribution; and they found and used a stronger voice.

Core Funding

3/7

Taking care of staff and volunteers. From coffee mornings to candle making, leaders found ways to support their teams, and provide spaces for people to unload. Some used furlough funding in a supportive way to respond to individual circumstances; while others benefitted from experienced volunteers on furlough.

Core Funding

4/7

Discovering new ways to connect. Going online provided unexpected benefits for many – reaching new people, enabling new conversations, and hearing more diverse voices.

Core Funding

5/7

Responsible, supportive funders. Many funders shared risks, relaxed targets and reporting requirements and were active partners, saying: ‘We want you to be responsive to your community needs’.

Core Funding

6/7

Financial cushions. Where they had them, reasonable reserves or unrestricted income gave leaders some assurance as they regrouped.

Core Funding

7/7

A space to share. Leaders often talked about the isolation of their position. They valued opportunities to reflect, whether that was with their chair, trustees, an external coach (although most were reluctant to spend on support for themselves), or through peer support sessions.

It is clear that the pandemic has both stimulated new thinking and demonstrated the value and workability of approaches to funding and collaboration that VCSE organisations have been advocating for years. The intensity and visibility of need during Covid-19 has accelerated the pace of change, but its foundations feel fragile.

 

Core Funding

1/6

What next? 

 

We end with reflections on some key questions and challenges that both VCSE organisations and those who support them will need to consider if the transformative capacity of the voluntary sector is to be strengthened and developed to help meet the challenges ahead.

Core Funding

2/6

Judging progress. We will all need to learn how to work well with uncertainty – having the confidence to act on the basis of ‘what we think we know right now’, then to look critically at how that went and try to do better.

 

Embedding joined-up working. Can the collaboration, networks and the trust that have been established survive in the face of new challenges, lack of capacity, resumption of conventional roles and fierce competition for tight budgets?

Core Funding

3/6

Blended services and ways of working. We have learnt about the ways technology can help us to work more flexibly, but also about its limits. We will need to take a mixed approach – to how we work, collaborate, and provide services.

 

Making digital inclusion a reality. Many small VCSE organisations now have both the relationships and practical skills to reach communities so often left behind – but digital exclusion is a problem that needs to be tackled nationally.

Core Funding

4/6

New thinking about unrestricted funding and income diversification. Many small VCSE organisations had turned to trading and donations to achieve flexibility – but both have been hit hard by the pandemic. A greater shift to unrestricted funding is urgently needed. VCSE organisations can then focus on listening to their communities and implementing solutions based on what they need. 

Core Funding

5/6

Embedding a more responsive, agile, proportionate and trusting approach to funding. Anything that funders can do to lighten the fundraising and reporting load and to share the burden of risk makes an immediate and tangible difference to small VCSE organisations.

 

Organisational health and wellbeing. When resources are tight and demand is pressing, it can be hard to create time and space to ‘look after our people’. The pandemic has shown just how vital this time is.

Core Funding

6/6

Mutual aid. Many small VCSE organisations benefitted from the surge in community spirit at the outset of the pandemic. How can they retain volunteers and maintain good safeguards, while also avoiding disproportionate red tape, regulation and formalisation?

 

User voice. Small and medium-sized VCSE organisations have a distinctive and vital contribution to make to the debate over ‘what next?’. How can they best be supported in giving voice to their users? And how can their own contribution be kept in the public eye?  

We have all been affected by the pandemic. It has upended our lives, both at home and at work. Across our families and our organisations, we see exhausted and anxious faces. And the uncertainty isn’t over. At such a moment, there needs to be a premium on patience and kindness, and a concerted effort to bring imagination and empathy to our work. If the last year has taught us anything, it is that voluntary organisations have these qualities in abundance; and that if they are trusted and respected, they will deliver for those they exist to serve.

 

Click here to read the full briefing, Birds in a hurricane

 

Photo by Fer Nando on Unsplash.

Four lessons for funders from a complex and uncertain year

One year ago, on 9th April 2020, we published The pressures of uncertainty – the first of fifteen Covid-19 briefings for funders, based on our peer support sessions for the leaders of small to medium VCSE organisations across the UK. Having heard from more than 500 leaders, we offer four reflections on what matters most in how funders go forward.

 

  1. Think and act strategically

The coronavirus emergency created the imperative – and the freedom – for funders to be responsive, flexible, and agile. But it has also shortened our horizons. And many of us are now looking at how we can retain the creativity of the emergency, in the urgently needed shift back to longer-term planning cycles.

 

VCSE organisations and funders alike face hard decisions about strategy and priorities. Extreme uncertainty is now a fact of life, and the challenges facing all social purpose organisations as the longer-term implications of Covid-19 take hold are immense. And yet, over the last twelve months, we have seen that you can achieve a lot when things are difficult and changeable: if you move beyond simply having a strategy, to thinking and acting strategically. 

 

This starts with being clear about your purpose, focus, and underlying values. The essential – and often neglected – next step is making sure that all of your systems and practices are aligned with these commitments, not working against them. Finally, it calls for a willingness throughout the organisation to live with complexity and uncertainty, and act anyway – to let go of the fallacy of certainty and give up the fruitless search for measures and metrics that prove impact, committing instead to an agile and iterative way of learning, that supports informed judgments about making a better contribution.

 

You can read more about how the idea of alignment can help to navigate uncertainty here.

 

  1. Recognise how much ‘how you do it’ matters

Without your support, good organisations doing work that you care about will be lost. This is what risk looks like now – not about knowing every detail about an organisation or exactly how every penny of your funds is being spent. There is a pressing need to bring day-to-day grant assessment and grant management practices in line with the new realities. And to ensure that they respect and build on the strengths of VCSE organisations that have been so evident over the last year.  

 

This emergency has shown us that lighter, more flexible, more trusting processes are possible. The powerful message from VCSE organisations is that it is time to make these changes widespread and permanent. And that doing so will enable better work – during an emergency and beyond. A growing movement of funders is responding to this call to action, determined to move beyond words – ‘trust’, ‘speed’, ‘light touch’ – and translate them into visible, tangible, durable changes to behaviour and practice. To find out more and be part of this effort, visit www.ivar.org.uk/flexible-funders.

 

  1. Support the voices of VCSE organisations

It is easy to feel overwhelmed by the social, economic, and environmental impact of Covid-19, and the deep structural and material inequalities it has exposed. But VCSE organisations are well-placed and eager to be part of the collective effort to tackle them. Close to the ground and to the individuals and communities that are at the sharp end of economic recession and accelerating social change, their voices – and the voices of the people they serve – must be part of the debate about what happens next. You can support their participation – by reserving some funds to support advocacy and campaigning work; creating spaces for hard pressed front-line organisations to get their heads above water and share what they know; and using your leverage and brokerage to provide a platform from which the sector’s contribution and voice can be amplified and championed.

 

  1. Make your thinking visible

Closer to home, you can open your policy and practice to the influence of others, by making your thinking more visible, and by seeking out and hearing diverse and dissenting voices, ready to say when practices are falling behind the curve of front-line experience. Making our own messy, imperfect thinking visible is what humility looks like in practice. It invites in people with alternative views on the world and with different interpretations of what’s happening, so that we can make meaning together about what we’re seeing and what it suggests we should do next. The more you can make your own thinking visible and invite others to do the same, the better we will all move towards transformational learning that helps us to understand what’s needed. And make our best contribution to delivering it.

Two practical ideas to increase unrestricted funding

The William Grant Foundation have signed up to our eight commitments for open and trusting grantmaking. They join us as one of our #FlexibleFunders to share some practical ideas to developing practices from their experiences and ideas:

One of the eight commitments IVAR is calling for funders to adopt as part of its #FlexibleFunders initiative is to ‘enable flexibility’. Unrestricted funding, in particular, is highlighted as the best way to allow grantees to respond flexibly to changing priorities and needs.

I’d like to share two practical ideas to increase the unrestricted funding flowing from funders to the third sector. The first describes an approach we’ve adopted at the William Grant Foundation. The second is something we don’t (yet) do, but which I think could have a meaningful impact if widely adopted.

1 – Turn restricted project grants into ‘designated’ unrestricted grants

One might assume that shifting to unrestricted funding means making radical changes to a funder’s application and grant reporting processes. But it doesn’t have to.

Many of us will make a grant for a project or activity that an organisation has applied for help with or that we are particularly interested in – and the grant size and duration will probably reflect the cost of it. In such instances, it’s common practice to make a restricted grant that can only be used for that purpose.

But do we need to formally restrict those grant offers? The answer depends on the degree to which your grant programme is specialist and targeted. If your strategy is focused on funding only a specific category of additional intervention or activity the grantee will undertake – and that’s the only reason you’re funding them – then you probably will. But if – like our foundation – you aim to find dynamic, effective or important organisations in your field or community of interest and are prepared to fund a range of costs and activities depending on what they tell you they need, then I’d suggest you don’t if the following conditions apply:

  • Is the grantee an asset-locked organisation whose objects are in line with your programme focus, and which you’ve assessed as competent and well run?
  • If the organisation had happened to apply for another aspect of its activities, would you have been just as interested in helping them?

If so, could you ask them to report back on the project or activity you’ve mutually identified, but make the grant unrestricted?

The benefits will be:

  • a reduction in resources spent on bureaucracy and compliance on both sides – not least the accounting gymnastics that restricted funding streams necessitate
  • freedom for the grantee to get the most value from your funding by having flexibility to adjust delivery or even reallocate the funding, for instance if it obtains another grant that can fund the project you’d discussed with them
  • a more open and trusting relationship from the outset.

At the William Grant Foundation, we call this – internally – ‘designated unrestricted’ funding. It’s important to note that for the grantee a grant is either unrestricted or it isn’t, so we’re at pains to make clear in our grant letter there are no strings attached. This means we’re trusting the organisation to follow-through on the plans we’ve discussed with them, or explain to us if their plans changed (though – importantly – without having to ask our permission first) and share what they learned along the way.

I’ve written more about how we choose when to use restricted or unrestricted funding here.

 

2 – Add general operating support to project support

My second suggestion is perhaps more radical but I think could be transformative. (I should be clear that although we often ‘round up’ project grants, the William Grant Foundation doesn’t currently implement this systematically.)

Here’s the idea: What if we added an unrestricted general donation on top of every project grant we made? (I’m already assuming the grant includes an appropriate contribution to the organisation’s central overheads on a full cost recovery basis.) There’s no yardstick here, but I’m going to suggest 10% of the value of the project grant might be a start.

Outside work, I chair a small charity with an income of about £200k per year, probably 50% of which is from restricted grants. So, a 10% top up to all those grants would give us another £10k unrestricted per year. Not a game changer but it could support a pilot project, upgrade our IT, or build reserves.

And if you’re interested in shifting power in your grant-making, not only would you be strengthening the organisations you support, you would be putting a percentage of your grants budget directly into the hands of people working in the fields or communities you support to allocate as they see fit.

We are comfortable with the private sector pricing-in a profit margin when we buy its goods and services – profit that can be reinvested in growth, innovation, technology, communications, workforce development, loan repayments etc. Or even extracted for private benefit. Yet we consistently fund the not-for-(private)-profit sector on the basis of break-even budgets, clawing-back underspends and reducing future payments to reflect previous accruals.

The pandemic has shone a light on the importance of charity reserves – how little some have, and how surprisingly reluctant others have been to use them. But for there to be reserves (and for trustees to have the confidence to spend them) there must first be surplus.

Funders have to think about how we help organisations generate a surplus in unrestricted funds if we want them to build and deploy reserves and maintain working capital. By working capital here, I mean funds that can be used at the organisation’s own discretion on its own priorities when it needs to. Without this kind of flexible buffer, organisations have less ability to adapt, innovate, learn and improve or ride out challenging times without first having to successfully apply to a funder (or more often, multiple funders!) in order to get a grant to do anything.

If we want to receive applications in future from an agile, creative and resilient third sector, learning and innovating its way towards ever more effective solutions to stubborn social and environmental problems, then we need to see contributing to core costs, working capital and reserves as part of the cost of doing business with it, just like paying the profit margin priced-in by the private sector.

I guess both these ideas could be seen as a significant departure from conventional practice. But I believe they are practical choices many funders could choose to make to address the ‘starvation cycle’ that characterises third sector funding.


Funders’ traditional ways of working are not set in stone. We should be prepared to review them, especially when the organisations we aim to support are consistently and clearly telling us they undermine the benefits our funding could achieve.


How to get involved


You can find out more about open and trusting grant-making at our Flexible Funders webpage, including how to sign up to our Community of Practice. For more details or to share your own Flexible Funders story with us, please contact enquiries@ivar.org.uk


 

Four ways now can be a moment for transformational learning

Since March 2020, funders and charities alike have learnt to work in a new way: remotely, and in extreme uncertainty. Many of us are wondering how we can avoid snapping back into inflexible structures that can’t easily accommodate complexity or, indeed, crisis.

We tackled this head-on at the Evaluation Roundtable convening in December 2020 – a space for learning staff in trusts and foundations to reflect on the design, development and use of different approaches to evaluation and learning, drawing out implications for practice in their organisations and networks.

Four ideas surfaced about how to make now a moment for transformational learning:

1. Build a clear line of sight

Shared organisational purposes and values, that are rigorously worked through into day-to-day practice, provide ‘the foundation for agile action – there are no disconnects’. This organisational alignment creates a pathway for action ‘when need is huge, and the options are endless’. For learning staff, it ‘enables us to actively embrace uncertainty. To accept the limitations on what we can know – and act anyway’. So that you’re always learning towards something specific, and your system is sufficiently aligned so you have, in effect, some guardrails and parameters for action.

2. Retain a sense of urgency and collective effort

What happens to partnership working, or working collaboratively, under the context of extreme pressure? The answer is that all the junk that usually gets in the way – like ego and territory – disappears, because the work becomes the thing that matters most. The idea that we have to make something happen stays front of mind.

3. Make thinking visible

If we think out loud with each other – if we ‘make our thinking visible’ – it provides an opportunity for people to offer alternative perspectives or identify the powerful questions we should be asking that would enable action. It stops us getting caught in the paralysis of constantly trying to get it perfect or right. In a crisis, in uncertainty, what matters is: are we focused on the right thing, given our position in the ecosystem? And does what we are asking enable us to act?

4. Return learning to the system

We need to be looking hard at the mechanisms that are set up in our institutions to enable learning – both formal and informal – to flow back to the system, so that it’s not stuck in one head and everybody can benefit. One of the key questions is how much freedom the system enables people to have. How much agency are they given to experiment with solutions that work in their own contexts? More specifically, to what extent do the constraints built into the system – for example, your reporting arrangements for grantees, or how staff are expected to perform, or the structure of board meetings – get in the way of that?


Read more about these four ideas in our short report Learning in uncertaintyor join our Community of Practice for learning staff in UK trusts and foundations.


About the Community of Practice 


The February sessions will build on one of the key themes that came out of the recent Evaluation Roundtable convening in December: Returning learning to the system. During 2020 everyone has been dealing with large quantities of rapidly changing information and intelligence – both formal and informal. Finding the right mechanisms to capture this data and keep learning flowing through to the system has been challenging. How can we learn from this experience to develop learning systems that are both robust and agile? Systems that, for example, enable us to be more light-touch and flexible and grantees to experiment with solutions that work in their own context
while still drawing learning back into the system so that everybody can benefit. You can sign-up for the event here (spaces subject to availability): https://calendly.com/ivar-social-change-/community-of-practice 

Where to start when everything is so uncertain

In this 10-minute blog, Ben and Sara explore the idea of ‘alignment’ and how it could help trusts and foundations to navigate uncertainty. 

Focusing on ‘impact’ is backwards – we need to look ahead

Ben Cairns, Director of IVAR

Since the outbreak of the coronavirus pandemic, we have heard from staff in trusts and foundations about often frenetic searches for information and inspiration to help them see the right way forward. As if more data might provide the answer to often overwhelming choices about priorities and preferences.

 

In thinking about how to support people through this unprecedented period – one for which there was no rehearsal – we have been sharply reminded of a project that crystallised IVAR’s thinking about what it really takes for foundations (and organisations of any kind) to manage well in uncertainty and complexity. In particular, of the critical importance of alignment: between mission and process; and between values and behaviours.

In 2014 we worked with Barrow Cadbury Trust trustees, staff, and partners to carry out an assessment of how the Trust was doing against its 2013-16 strategic plan. Some weeks into the process, during a conversation with trustees, we wondered out loud whether they might find it useful to frame their thinking about progress in terms of ‘learning’ rather than ‘impact.’ We were not suggesting that they adopt a cavalier attitude to what success looks like for a programme or initiative. But a focus on proving impact is essentially backward looking – ‘what were the inputs and what did they deliver?’ – and too often leads to sterile debates about causality and attribution.  While a concentration on learning is forward looking and flexible – ‘what is all this telling us about how the changes we want to see can most effectively be achieved? And about how we might improve our contribution to pushing them forward?’.

 

Concentrating on learning is forward looking and flexible: ‘What is all this telling us about how the changes we want to see can most effectively be achieved?’ 

We saw Barrow Cadbury as an engaged funder, driven by its values and with a long-term perspective. Trustees were clear about wanting to ‘swim in murky waters’, shining a light on complex, intractable and unpopular issues. They embraced causes where success is far from assured and engagement often felt like both a moral imperative and an act of faith. They trusted that things of value would emerge, but did not prejudge what they might be and where they might lead. Framing questions about progress in terms of the learning that had been achieved, and its value in shaping their next steps, sat well with work that is unpredictable and emergent. And with an organisational mindset that accepts, and is comfortable with, the high level of ambiguity inherent in tackling complex social issues.

Seven years later, with uncertainty and complexity as far as the eye can see, we have found ourselves going back to these conversations. We know that, in their immediate responses to Covid-19, funders were able to step outside the normal: embracing unrestricted funding, lightening up reporting processes, trusting and talking more, and letting go of impact. For some, this has been relatively painless, and there is appetite to continue. For others, these actions have felt more counter-cultural. Lurking in the shadows is an anxiety that key stakeholders, be they trustees or grants staff, may seek to revert back to ‘business as usual’, which is often a shorthand for heavier processes, tighter demands in relation to reporting, and higher expectations in relation to impact.

Funders have stepped outside the normal – but lurking in the shadows is an anxiety that things may revert back to ‘business as usual’. 

In this context, our experience with the Barrow Cadbury Trust feels instructive. Our big takeaway from our time with them was that their approach – so much of which resonates with the culture of recent emergency responses – was made possible because they are properly aligned. Roots, values, beliefs, purpose, process, and behaviours – are all connected and interlinked. None of that guarantees everyone’s experience of the Trust will be a good one, or that they always get it right. But this alignment does enable everyone within a foundation to set aside the fruitless quest for more data to provide ‘the right answer’ or ‘the right thing to do’, and to work confidently to achieve the intelligent, compassionate and flexible responses that are now called for, by focusing instead on: “given who we are, what we believe and care about, what we have heard and learned and what we are seeing right now  – what should we do next?”.

The secret is alignment, but what does this mean?

Sara Llewellin, Chief Executive of Barrow Cadbury Trust

Alignment is crucial for any organisation to be successful in pursuing its vision and achieving its mission. In our particular case, the vision derives very clearly from the Quaker social justice belief system and the values inherent in it. Over the past century, the fundamental values of the Trust have mainly been constant – but their manifestation in our work has been iterative, dynamic and organic. We aim to apply these values to the ever changing ‘present day’, so this means constantly updating and flexing what we do to reflect the rapidly changing external environment in which we operate. 

 

So, what do we mean by alignment and what are the key features needed to achieve it? Essentially, I would say people coming together to pursue a values-driven shared purpose. Alignment is achieved when all parties have the same prize in view and each plays their particular part in order to achieve more than any of us could alone. As the Barrow Cadbury Trust works to achieve structural change in injustice and inequality, this is a true imperative for us as – by definition – structural change can rarely be brought about by atomised or uncoordinated approaches. Or, indeed, by concentrating only on the grassroots or only on power elites.

 

For foundations, this means navigating and calibrating very carefully the power and trust dynamics between different parties so that resources, especially financial, are best used to facilitate change. Easy to say, but also easy to lose sight of when you control the resource base and can so easily slip into careless high-handedness.

 

Our approach to power sharing is to consult deeply and iteratively on what needs to change and how best to achieve it. Then, the money and other resources at our disposal are used to vigorously pursue that change.  For this to be most effective our board, our staff and those we work with need to be on the same page, confident of each other’s goodwill, able to be honest about what is going to plan and, crucially, what isn’t. And this is not a one-off task – we have to work at it in the spirit of solidarity all the time.

This is not a one-off task – we have to work in the spirit of solidarity all the time.

The image below shows how IVAR visualised alignment between our trustees and staff.

A diagram which shows foundation alignment approach.
An image which shows the alignment approach taken by the Barrow Cadbury Trust.

In our organisation, staff are appointed who demonstrate a personal lived commitment to our social justice values, although we are of all faiths and none rather than all Quakers as in the past. We don’t all agree all the time – what an echo chamber that would be – but for all of us this is not just a job and we do aim to go that extra mile to strengthen the organisations we work with and the hands of the change makers within them.

 

Good governance is key both to creating and to maintaining alignment.  In our model of work, this means the board needs to be comfortable with working longterm on knotty issues, rather than working in three-year cycles and then moving on to wholly new areas of work.  The board and senior management team need to be prepared to take risks with seeking out new solutions to old problems and also to tackle things which are very hard to measure.

 

The Trust has long prioritised speaking truth to power by enabling the voices of experts by experience to be heard in the corridors of power.  To make this happen we have to listen to, work alongside and understand those with varied perspectives and find our commonality from which to build solidarity. This is both the product of, and the goal of, values alignment at the core of our work.


We hope that this helps you to think about and understand alignment within your own organisation. You can read more about how foundations are putting learning at the heart of their responses to Covid-19 here 

How can funders learn, meaningfully?

When persuaded to write this blog, I was asked to reflect on big transformational changes for 2021, no small task. It reminded me of the importance of purposeful questions and how our reflections shape questions that are truly meaningful.

If there is one thing that 2020 has taught me – we are all human and have the imperfections that come with this. This last year has at times felt like The Truman Show with our lives on camera all the time, and while extremely hard for lots of people, for many different reasons, we have all shown vulnerability. But isn’t that a good thing? I believe it is, and although there have many ups and downs it has allowed us to connect with each other in ways we have never connected before.

So, you can imagine how good it was to hear from 50+ other people at the IVAR Evaluation Roundtable event, who openly shared similar experiences and how this played out in the role of meaningful learning. Conversations naturally gravitated towards connections with people, particularly the value we place in relationships. During the pandemic we have embraced the ability to hold different conversations; out of necessity respond quicker; had the willingness to be more open; to collaborate and take decisive action even if it didn’t always work out. In one word, trust. Reflecting on this helped focus my thoughts on big
transformational change and I was struck by one question posed at the event, ‘How do we behave in trustworthy ways?’ For me, it wasn’t one question but two: How do we behave to ensure trust is there? And how do others see us as trustworthy?

Isn’t it significant that the perception of trust has increased rapidly during the pandemic, especially between funders and organisations they seek to serve? Trust is something we earn based on our ability to be open, acknowledging our responsibilities, being accountable for our actions and responding to what we hear. If we want to take learning and create transformational change, we all need to find ways to show that we are open, we are accountable and we are listening. This isn’t always easy, especially when shining a light on things that we didn’t get right. Never so apparent for the people and communities we fail to reach.

At Corra we believe that we are unable to do our job well without communities, charities, other funders and partners trusting us. I am extremely lucky to work in an organisation like Corra, that accepts its own fragilities, and is committed to listening. While trust may not appear to be big, shiny or new, it is a building block to transformative change. The next step for us all is ensuring trust doesn’t stay a perception but is a given.



The UK Evaluation Roundtable 2020 ‘teaching case’ told two stories – of the Pears Foundation and Corra Foundation. 
You can read reflections from the Pears Foundation here

Four principles to shape your grant-making today

With months of local restrictions now extended to a national lockdown, it is clear that ‘Covid-recovery’ is far from us – even with the glimmer of hope in recent news about a new vaccine. And eight months on from the first national lockdown, we all desperately want to move out of emergency response mode. We need to find the confidence, skills and ways of working to operate effectively in our current environment, accepting that changing restrictions will feature in our lives for the foreseeable future. Let’s embrace this ‘new normal’ as best we can.

 

Although ‘paddling furiously’, VCSE leaders are increasingly assured in the face of the certainty of uncertainty: ‘We’re open, but it’s on my mind that we may need to close again.  But we know how to do this, and we will be able to do this more quickly’. And they are finding ways to combine planning with flexibility, enabling them to ‘move with the fluidity of the situation, in a pragmatic way’.

 

Some funders are finding it harder to make this leap. Used to a relatively structured environment of strategies, programmes, funding cycles, grant management and reporting, the constantly changing external context can be highly destabilising: We responded with the speed and agility that was required. But this placed strains on systems which were not developed to respond to such a scenario’. Meeting the requirements of the foreseeable future will be equally challenging. Adaptations introduced during the early stages of the pandemic need to be sustained and further developed. And other elements of the tried, tested, traditional, familiar ways of doing things will also need to change if funders are to make good the heartfelt commitment of so many to stand by the sector – and stand by it still.

 

Many funders felt freed by the imperative of the immediate emergency: ‘There was a lot of licence in the early months to respond generously’. But looking to the longer term calls for hard choices in the face of overwhelming need, a highly complex and changing environment and the imperative to act quickly: ‘The challenges before us are immense. And funders need to make decisions and contribute now’. Whatever strategic decisions individual funders make about their priorities, all have the opportunity to ensure these decisions are underpinned by day-to-day grant-making practices that best support applicants and grantees at the sharp end of delivery.

 

‘Become more of a partner and less of an auditor’

From very early in this crisis, we have heard a drumbeat of consistent and emphatic messages from VCSE leaders – ‘be brave’, ‘be flexible’, ‘trust us’, ‘be clear and open’, ‘understand the pressure we are under and reflect this in how you work’, ‘become more of a partner and less of an auditor’.  Looking back across the learning that has been generated from IVAR’s work with both VCSE leaders and foundation learning and evaluation staff, we would highlight four principles to guide funders in shaping the nuts and bolts of their grant-making and grant management practices now and for the future:  

 

  1. Express priorities, requirements and exclusions with absolute clarity. Funding criteria and guidelines do not always help VCSE organisations to make cost-benefit judgements about potential applications – whether because they have been put together too quickly, not rigorously reviewed from an applicant’s viewpoint, or deliberately written to allow funders to keep their options open. Ambiguity in guidelines is costly and frustrating for applicants at the best of times. In the current circumstances, the obligation not to waste time is paramount – for both applicants and funders.

 

  1. Scrutinise and simplify application and decision-making processes. ‘Pre-Covid expectations’ (about adequate reserve levels, robust forward plans and value for money, for example) may well be unrealistic in this new environment. And small changes make a big difference to applicants – such as testing every question for clarity and removing any that are not essential; relaxing word limits on online forms; or requiring less supporting information. There is much experience to draw on: 85% of funders who responded to IVAR’s recent survey have streamlined their application processes during coronavirus.

 

  1. Give the organisations you support the freedom to act. Make funding decisions based on ‘the spine of an organisation’: its mission, values, aims and track record. Trust these organisations to make good operational judgements about volume of activities, delivery mechanisms and managing risk day-to-day: ‘Funders need to trust us to know what we can do and achieve in our communities. We know how disproportionately some are going to be impacted, so funders need to give us a more blank paper rather than being too prescriptive with too many targets’. Now is the time to have real confidence in your funding judgements – by making longer grants; by giving unrestricted funding; by making reporting as light touch as possible.

 

  1. Act, learn and improve. Everyone is trying to make their best contribution in a context of huge uncertainty: ‘Some of the best solutions come from having some courage – saying “I can live with that risk”’. So, learning is critical: balancing data with intuition; combining evidence with instinct; and turning inevitable problems into better practice: ‘The question is “what can we do better”, not “what is the right answer”. Then we can try out multiple ‘better’ things quickly and back the ones that work’.

 

Read reflections from other funders on their evolving Covid-19 responses in our Learning from lockdown blog series.

 

Invite your grantees to take part in our peer support sessions – we are funded to deliver weekly drop-ins.

 

This blog is based on our work with over 390 VCSE leaders and over 100 trusts and foundations since March 2020.