How to grow it Archives - The Beacon Collaborative

In a week when Beacon was involved in the launch of two reports, a pertinent comment from one of Beacon’s close friends came to mind: “Do we need all these reports being produced by the philanthropy and social investment sectors? Is this a good use of philanthropic resource? Don’t we really need more action?”

These are fair points, especially as the mission of many of the organisations producing these reports is “to increase philanthropy and social investment by….doing something”.

While one could dismiss it as a post-Covid flurry, however, I would argue there is something more significant happening here.

R&D matters

In 2019, the public and private sectors in the UK spent £38.5 billion on research and development, or 1.7% of GDP.

R&D is usually defined as “…creative and systematic work undertaken in order to increase the stock of knowledge – including knowledge of humankind, culture and society – and to devise new applications of available knowledge.”

Furthering humankind might be in the definition, but this is no philanthropic act. R&D drives innovation and it drives value – so much so, the government has set a target that 2.4% of total GDP should be spent on R&D by 2027.

If the philanthropy sector were going toe-to-toe with the public and private sectors, even on current spend there would be £85 million spent per year on R&D to support the estimated £5 billion of philanthropic value annually contributed to public benefit organisations.

Now there’s a thought.

While the philanthropy and social investment sectors have an excellent track record on bootstrapping innovation, it is hard not to think of Henry Kissinger’s most famous plagiarism: “If you don’t know where you are going, every road will get you nowhere.”

Research identifies opportunity, it de-risks action and it enables progress to be measured.

If there is a common goal, there must also be one agreed critical path

In the absence of deep R&D budgets, the philanthropy and social investment sectors have become adept at sharing.

Knowledge, ideas and insights have been shared and woven through a number of recent reports, in many cases intentionally, as different organisations build on earlier work.

If each iteration drives cohesion around a common agenda, this is not duplication but an increasingly refined analysis of the critical path toward a shared goal.

If each organisation brings a different perspective and a fresh set of insights, this enriches the map and helps to chart the best route through tricky terrain.

Without advocacy, we are nowhere

Philanthropy occupies a space that sits between the public and private spheres. It, therefore, relies on actions from both sides in order to thrive.

Philanthropy and social investment will only grow when policymakers are clear about their role in the public agenda and when regulators provide a targeted framework, thus enabling private sector players, as well as the charity, philanthropy and social investment sectors themselves, to professionalise their support for end donors and investors.

This value chain isn’t functioning well in the UK.

In the absence of a clear narrative on the role of philanthropy and social investment from the government, and with regulators unable to provide targeted guidance for socially-driven action, private sector providers are left in the unsustainable position of trying to drive donor engagement through meaningful experiences in an incoherent marketplace.

To grow philanthropy and social investment, we need policies from the government that can enable the work of the sector.

Policymakers are more likely to champion the needs of the philanthropy and social investment sectors if they can offer refined, evidence-based, and agreed proposals. This kind of high-quality advocacy requires a shared platform of research.

Unlocking private assets for public benefit

With this preamble, it will come as no surprise that the reports we launched last week included vital contributions from partners across the philanthropy and social investment sectors.

Unlocking Private Assets for Impact is a summary of the work of the 12-month Individual Impact Investing Commission, which was co-led by the Beacon Collaborative and Big Society Capital.

Eleven commissioners, representing investors, impact investment firms and sector organisations, shone a forensic light on the barriers that prevent more private individuals from putting their capital to work in impact investment opportunities.

The report puts the needs of high-net-worth investors in the context of the wider growth and development of the impact investing sector. It concludes that private capital flows are being choked at source due to a lack of effective intermediation between opportunities and investors.

This partly reflects the lack of maturity in the impact investment marketplace, and partly the lack of responsiveness among wealth advisers to support their clients to invest across the values-based spectrum.

It makes 12 recommendations, supported by a detailed action plan, showing how different actors within the sector can contribute to change.

During the same week, the All-Party Parliamentary Group held its second meeting in Westminster to launch Unleashing the Potential of Philanthropy and Social Investment.

The report offers a 10-point plan setting out how government can help the philanthropy and social investment sectors to be more effective.

This action plan is based on insights and recommendations from organisations across both sectors. It highlights the essential role that government needs to play in order to enable more private capital to flow toward social impact.

Outlining a common agenda, highlighting innovation and advocating for government support, these reports aim to encourage all those with the capacity to drive change to play their part in unlocking more private assets for public benefit in the UK.

We, therefore, invite any colleagues to take forward the ideas outlined in these reports and to share with us actions they are already undertaking on these themes.

At its best, philanthropy is a shared endeavour. Growing philanthropy too will be an act of partnership, driven by a common goal and shared understanding.

Unlocking private assets for impact

Author(s)

The Beacon Collaborative, The Individual Impact Investing Commission (IIIC)

Year

2022

View

Unleashing the potential of philanthropy and social investment

Author(s)

The All Party Parliamentary Group on Philanthropy and Social Investment

Year

2022

View

Funding the Future – What we’ve learnt and where we’re heading next

Guest Blog by Geraldine Tovey, Membership, Communications and Events Manager at London Funders.

Much like the Beacon Collaborative, London Funders strives to enable our members to not just give, but to give well. In this guest blog, we’re covering how we’ve supported London’s communities during the Covid-19 crisis, what we have learnt so far, and (perhaps most excitingly) what we’re doing next.

Before we get into the details, here’s a bit more information about who we are and what we do… London Funders was established 25 years ago to bring together the capital’s many local, regional, and national charitable foundations (many of which were established by philanthropists) with other key funders such as local government, housing associations and corporate givers.

Now 170 members strong, we’re uniquely placed to enable funders from all sectors to be effective. We’re focused on collaboration – convening funders to connect, contribute and cooperate together, to help people across London’s communities to live better lives.

Back to the current situation, like many other organisations our normal work came to a dramatic halt in March 2020, and a completely new programme was created almost overnight. Our first step was to draft a funder statement: ‘We Stand with the Sector’. Originally published on March 13th 2020, over 400 grant-makers have now committed to show an understanding that many services provided by civil society organisations will need to adapt because of the pandemic. Signatories have also promised to be financially flexible and to take a conversational approach to their relationships with grantees.

During the second national lockdown in November, a further 150 funders signed a renewed and reiterated version of the statement, which placed an emphasis on reflection and listening to civil society organisations post-crisis. Throughout 2020, we heard first hand from voluntary organisations that both ‘We Stand With the Sector’ and ‘We Still Stand With the Sector’ provided much-needed reassurance at a time of great uncertainty, and we were delighted that they were referenced in Civil Society’s charity sector highlights of 2020.

The statement was only the beginning. Over the past year we have been coordinating funders from across sectors through the London Community Response – an unprecedented funder collaboration. So far, £46m (and counting) has been given away by 67 organisations (many of whom received generous donations from high-net-worth-individuals), and funders are currently assessing applications for fifth round of funding.

Focusing initially on crisis support grants for food, protective equipment and digital resources, the most recent wave of funding aligns with the London Recovery Board’s post-Covid missions. Renewal grants are being distributed by funders to ensure that the capital’s voluntary sector is well equipped to tackle the longer term economic, social and wellbeing consequences of the pandemic.

Although the size and scope of the London Community Response is unique, our processes were heavily influenced by previous learning. In 2017 we brought together 18 different funders (including national government) and coordinated a £4.8m grants programme in North Kensington following the Grenfell Tower Fire. This is a very different crisis, but the principles of listening, proactive outreach and recognising inequality have remained the same. Our report on the North Kensington funding programmes – ‘The Possible Not the Perfect’ has been an incredibly useful re-visit and a reminder of what we can achieve together.

What have we learnt so far? To summarise in three words: data, data, data. The £46m given via the London Community Response is undeniably a large sum, but London is a city of 10 million people and has the highest poverty rate in UK. To ensure that money has been spent well, we’ve been working with our friends at DataKind UK to analyse where the funding is going in real time, and to ensure that it aligns with needs at a local level.

Plenty of our members are not involved in the London Community Response, and we’ve been making sure that they are equipped with everything that we think they need to know. Our Covid-19 Resource Hub has expanded rapidly over the months and we send a weekly policy briefing to our members – the ‘Funder Five’. In addition, we have held hundreds of (virtual) meetings, intelligence calls and events since March on Covid and non-Covid topics alike (we haven’t forgotten about Brexit…).

We’ve also been helped hugely by partners from across the sector who have far greater knowledge of their what their communities need, and who have worked tirelessly to make sure that marginalised voices are heard. It has been obvious that Covid-19 is not a leveller, and instead has shone a light on just how unequal our city (and country) is. The best early decision made by the London Community Response collaboration was to proactively fund six equity-led organisations to act as a critical friend and provide outreach to smaller, traditionally underfunded groups.

Although the crisis is ongoing, we’re mindful that eventually the pandemic will end and that the funding sector needs to have a clear vision of what the future should look like. On this note, we strongly encourage all grant givers and philanthropists to read our latest report – ‘After the Storm’.

Based on interviews with 17 of our members, the publication identifies three key challenges for funders in the medium-term. They are – the expectation of a second wave of demand as unemployment rises and recession takes hold; navigating the sector and identifying gaps, overlaps and commonalities; and the financial precariousness of the sector and what that means for maintaining social infrastructure. We hope that this publication and our upcoming briefing on ‘What London Needs’ will assist funders in navigating the difficult decisions ahead.

We are also going to host our first-ever Festival of Learning in the spring. Building on the success of our autumn Camference, we will look at how grantmakers, commissioners and philanthropists can support communities and the capital to not just survive, but to thrive in a post-Covid world. This will cover not just traditional grantmaking, but other ways of giving back too. We’ll be saying more soon, and do get in touch if you would like to join us for these lively and thought-provoking conversations. And of course we’re looking forward to hearing more insights from the Beacon Collaborative in the upcoming months.

See more of London Funders at their website