nfpSynergy report calls for charities and grant-makers to set up joint code of good practice and forum for developing intelligent funding

Charities and grant-making trusts need a code of best practice and a discussion forum to move their relationship forward, a new report claims. ‘Inside the mind of a grant-maker’, published by research consultancy nfpSynergy, calls for the Association of Charitable Foundations (ACF) and the Institute of Fundraising (IoF) to take significant action to make it easier for charities and grant-makers to work together.

Written as a follow-up to ‘Taking nothing for granted’, published last year after research with charities, the new report looks at the relationship from the grant-makers’ point of view and how it can be improved. nfpSynergy says that the current situation is promising, but “there are a host of ways charities and grant-makers can work together better with a few nudges in the right direction.” Together, the reports contain details of interviews with both sides and a raft of recommendations to improve the relationship.

The report makes the following recommendations:

How charities and grant-makers can work together better

• Grant-makers and charities need a code of best practice

We think that a code of best practice is needed, or at least a code of worst practice to be avoided. The section on Trusts in the Institute of Fundraising’s code of practice could be developed into an equivalent code for ACF members.

• Grant-makers and charities need a forum to discuss issues

There is no forum where charities and grant-makers can meet and discuss issues. Grant-makers meet together through the Association of Charitable Foundations (ACF) and discuss issues through the Intelligent Funding Forum, while charities discuss trust fundraising, for example in the Institute of Fundraising’s Trusts and Statutory Fundraising Special Interest Group. A forum where grant-makers and charities can meet, discuss issues and move the overall relationship forward is needed. We believe that ACF and the IoF need to develop one.

• Grant-makers and charities need to appreciate how they are stronger together

Grant-makers and charities need each other. Charities are a key route through which grant-makers deliver to the beneficiaries they exist to serve. We would like to see the two sectors focus more on what they have in common than on what separates them. By working together, both grant-makers and charities can be stronger.

Advice to charities

• Quality over quantity

Evidence shows more time on fewer applications makes sense. Too many charities believe that doing countless applications means one will finally work.

• Know your grant-maker

The more you know about your grant-maker, like who else they fund, the more likely it is that your application will be given due consideration.

• People and ideas win grants

Crucial to an application is the quality of the people and the ideas. For those organisations not doing new projects, people become even more important.

• Honesty beyond necessity

Grant-makers want grantees and applicants to be honest and flag up problems early. They have a wealth of knowledge that charities shouldn’t be afraid to use.

• Make sure grants are only part of your income mix

Some charities can become too dependent on grant-makers. A grant is easier than traditional fundraising, but charities must have a range of income sources.

Advice to grant-makers

• It’s a power relationship

A grant-maker decision can make or break a charity. Charities can feel they have too much to lose and too little to gain by be proactively honest about processes.

• Every application costs everybody time and money

It should take a lot of time and energy for a good grant application and just as much to assess one. Clear, up to date criteria, clear guidelines and proportionate processes, such as two stage applications, are critical for reducing time wasted on applications that are written and not funded.

• All charities love the idea of feedback

Many charities feel their feedback is poor or non-existent. We think that every second stage application should get individual feedback and that grant-makers should look at aggregated feedback to highlight the most common reasons applications fail. Today’s great feedback is tomorrow’s great success.

• Small charities love core funding

Core funding is also one of the things charities want most. Small charities face a battle to stay afloat and we think that more grant-makers should be prepared to decide whether they love a whole charity, rather than just a particular project.

• Grant-makers have more than financial assets

Many grant-makers can offer knowledge based on all the projects that they have funded and we think more should do so. The Institute of Fundraising and the Association of Charitable Foundations should explore how this might be done.

nfpSynergy’s Driver of Ideas, Joe Saxton, said:

“Grant-makers are a vital source of income and are invaluable contributors to social change, but the overall relationship with charities could be improved significantly. Both regularly meet up to discuss grant-making issues, but not with each other. It is high time the IoF and the ACF created the discussion forum we believe is well overdue.

We’re also calling for the IoF and ACF to develop a code of best practice, or at least a code of worst practice to be avoided. There’s already a section on Trusts in the IoF’s code of practice and this could easily be developed. The current approach is ignoring the substantial benefits and cost-savings which we believe could go to both charities and grant-makers.”

Please see the attached report and executive summary for more details.

For further comment from nfpSynergy’s Joe Saxton, please contact him directly on 07976 329 212 or joe.saxton@nfpsynergy.net

SOURCE:  ‘Inside the mind of a grant-maker: Useful stuff on how grant-making works’, written by nfpSynergy with the Institute of Fundraising. Download it here: http://nfpsynergy.net/inside-the-mind-of-a-grantmaker

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To interview nfpSynergy’s Joe Saxton about these findings, please contact him directly on 07976 329212 or joe.saxton@nfpsynergy.net. If you cannot contact Joe, please contact Rob White (07512 709140; E: rob.white@nfpsynergy.net) for further assistance.

Note to editors:

nfpSynergy (www.nfpsynergy.net) is a research consultancy dedicated to the not-for-profit sector. They aim to provide the ideas, the insights and the information to help non-profits thrive. They provide a unique insight into the social and charity-related views of everyone from public and parliament to media and business, not to mention not-for-profit organisations themselves. nfpSynergy has a vast and ever-growing knowledge pool and shares this with the non-profit sector, through both paid work and regular free reports and seminars.