Funders and commissioners of social initiatives are in a unique position of privilege and responsibility. At times of seismic political and social change these pressures only increase and stimulate soul-searching questions about purpose and action – what are we for, and are we still doing the right thing? Right now the stakes are high with society feeling less supported and more divided than ever. Inequality rises and budgets decrease and those responsible for supporting communities feel the burden of improving outcomes for some of the least advantaged in society with dwindling resources. Faced with this impossible task, it is tempting for funders and commissioners to retreat to a ‘do what you can’ position and lose the ambition that drew them to the work in the first place – to make lasting, sustainable change. That would be a huge mistake when there is so much excellent work to build on, and an opportunity to move to a new way of working that creates better outcomes; providing collective insight and impact through coordinated approaches to funding.
There’s already a lot of excellent research and practice on what it means to be a good funder/commissioner, with tools, models and case studies abounding. Over recent years, this growing trend towards inward-looking organisational improvement in funding bodies has improved practice and resultant impact. The problem is that this is no longer enough – the context is changing so rapidly current approaches and strategies which are more about internal improvement can’t keep up. We believe it is now vital to support funders to adopt more outward-looking approaches in order to understand the funding context in which they operate, so that coordinated solutions are found and sustained.
These approaches are all part of what we term the ‘Funding Ecology’ which aims to improve coherence and effectiveness of funding and finance for social impact through new debate, research and practice. The theory is that by enabling greater awareness and collaboration among those who fund social initiatives, we might better coordinate long-term solutions to social issues and reduce the unintended consequences of current funding practice (for example overinvestment in some areas and underinvestment in others). It is less about good practice within funding bodies, and more about good practice between funding bodies.
But why is this so important now? As a Foundation CEO described in our research last year, “I think there should be greater recognition of the (funding sector’s) responsibility to society, in addition to more reflection about how it meets need at a time when the social contract is rapidly changing. Alas, the vast majority of us haven’t caught on to the need to do this yet.”
There’s much less money around >> we need to get smarter at coordinating what exists
This one has been obvious since the financial crash of 2008 and resulting austerity. Yet many have not changed their underlying assumptions in their funding models, failing to think or plan for sustainability for the things they fund or long-term impact on the issue – after all, government is no longer in a position to scale lots of social projects. The examples of coordinated funding approaches working across public, private and independent sectors are still rare but badly needed if we’re ever going to make the most of the resources we have and make a long-term impact on the problems we’re seeking to address, whether that be health inequalities or homelessness.
Complexity is overwhelming >> people become alienated
Whatever your position, most seem to agree that the recent Brexit vote indicates a real disenchantment with the political system (whether that be Westminster or the EU). People are fed up with not being listened to and jumping through hoops to get the jobs/support/services they need. Branding people ‘hard to reach’ rather than recognising it is services that are ‘hard to reach’ is just one expression of the arrogance of systems. And it is clearly unintended. It’s not just policies, but the complex structures and systems which people have to battle against which need to change. We’ve all been complacent in doing enough about this.
Structures are complex >> fetishizing the new only adds to this
If I were to be critical, I’d say the actions of the funding sector have not only failed to address this, but in some ways contributed to the problem outlined above. When you ask the not-for-profit sector what most exasperates them about funders, many say the obsession with the new. More and more initiatives spring up adding to the complexity of the landscape and service deliverers are distracted from their long-term aims by creating shiny new projects over and over. This has long been a recognised issue and a good number of funders now look at supporting initiatives to sustain and scale – but the trend remains.
Led by independent funders, A New Funding Ecology, and A Blueprint for Action published last year attempted to respond to these and other issues. These research reports examined some of these drivers for change, problems in how the sector currently operates, a range of new approaches to funding and examples of emerging models that represent a shift towards more joined up, systemic practice among funders. They highlighted models such as Islington Giving, a group of funders, businesses, residents and voluntary organisations working together to tackle poverty and inequality in the borough; and the Environmental Funders Network which provides insight on grant-giving for this issue and support to a group of environmental funders.
In this next phase we are working with a range of partners to do two things; at the macro level, supporting funders to explore their collective impact and purpose as a sector, improving understanding of that broader Ecology; and at the micro level, helping funders to test out how the FE approach works in practice when considering particular issues or areas. We will do this through diagnosis and research – including in-depth research on specific issue areas and the funding supporting them (for example ageing issues with the Calouste Gulbenkian Foundation); building practice – through practical support of funding collaborations and co-designing tools; and sharing thought leadership – through the publication and signposting of learning. While the work has up till now been led by independent funders, for a more complete understanding of the Funding Ecology, it is of course necessary to include all those who support social change – from across public, private and independent funding sectors. And so we are widening the pool of partners, bringing on a range of Trusts and Foundations, testing approaches with commissioners and other local government stakeholders and engaging with CSR funders. Geographical context is key too, so we are working on place-based projects as well as extending the work to Europe following a successful session on Mapping tools at the European Foundation Centre’s conference in Amsterdam in June.
In a complex and ever-changing world, identifying our organisational and collective responsibilities is difficult but essential. Over the next year and beyond the Funding Ecology programme will seek to provide both the space for shared dialogue and practical support and tools to make this possible. We are growing a coalition of partners; if you would like to explore becoming involved with the work, please email Annabel