lysa ralph and philip goodwin: institutional funding
TRANSCRIPT
Institutional Funding in tough timesA practitioner’s guide
Lysa Ralph, Head of High Value Giving, British Red Cross Philip Goodwin, Chief Executive, Tree Aid
Session overview> Clarification and definition > Outlook for general fundraising > Institutional donor trends / features > Savvy INGO’s – commonalities & success rates> INGO growth 2008-12> Tree Aid’s approach > Last thoughts > Useful sites / resources> Questions
Point of clarification…
Money is not a dirty word!!
Fundraising, funding co-ordination, resource mobilisation…
…essentials and disciplines are the same
Definition of Institutional Funding
Funding from governmental donors plus those whose assessment
methodology / priorities share the characteristics and requirements -
i.e. project cycle management - of governmental donors:
UK government streams – e.g. DFID, Island donors eg Jersey
Overseas Aid, Scottish Government International Funds
European Commission – ECHO / DEVCO
Other countries government funding streams e.g. USAID
‘Foundations’ sharing those behaviours - Comic Relief, Big Lottery
Outlook for general fundraising
> Supplier capacity
> Increased competition
> Demands for donor engagement
> Social media creating closer relationships
> Potential to flatline ??
Trends – Institutional income
> Between 2006-11, despite the economic outlook, increase in state funding to the voluntary sector of 4%, plus ringfenced Int’l Aid
> EC budget reduced for first time, down 1.5% for 2014-2020 €960bn, from €975 bn 2007-2013
> DFID’s ringfencing / commitment to 0.7 GDP may not last beyond 2015
State Funding of Voluntary Sector (£bn)
11.3
11.9
12.8 12.8
11.9 11.8
10
11
12
13
14
2006 2007 2008 2009 2010 2011
£ b
n Public Funding ofVoluntary Sector
> Shift away from grants to contracts: > 2001 grants worth £4.6 billion, contracts £3.8 billion> By 2008, grants worth £3.7 billion, £9.1 billion worth of
contracts
> Full cost recovery principles widely accepted, set margins
> Increase in ‘payment by results’; Social Return on Investment / Social Impact Bonds
> Polarisation of the sector, consortia development> Need to evidence outcomes / impact> Increase in competition > Introduction of private sector, new landscape
Trends – IF features
Donor trends / savvy INGO’s
> Decentralised operations / decision making
> Preference to reduce admin costs / deal with consortia lead /
Int’l orgs / input to central funds eg Global Fund
> Assessment via programme cycle management methodology:
‘theory of change’
> Ownership by local actors
> Shared policy environment / MDG’s etc
> Value for Money / having policies around this
Return on investment, success rates
> High return on investment: IoF Fundraising Index 2012 - £16:1
> BRCS success rates:– EC 1:5 rising to 1:3 where closest to core mission
= ECHO. – Lottery 85% against a sector average of 15%
> Tree Aid: 1:3 success rate by number of submissions, 1:4 by project value
INGO’s ranked by institutional income (2012)Rank Total income Institutional funding
1 Oxfam 367.90 162.10
2 Save the Children 283.75 150.66
3 Merlin 60.86 54.88
4 CARE International 43.68 31.98
5 Christian Aid 95.45 27.44
6 British Red Cross 200.10 21.40
7 World Vision 68.79 21.06
8 Plan 54.25 20.06
9 Islamic Relief 100.37 19.47
10 Tearfund 60.05 18.56
11 Action Aid 59.45 15.33
12 CAFOD 48.80 11.11
13 Concern Worldwide 14.62 6.79
14 UNICEF 62.33 3.99
15 MSF 23.89 0.00
1299.776 1,337.97
1,544.791,694.56
1,544.28
409.25 425.57535.47
638.18564.84
0
200
400
600
800
1000
1200
1400
1600
1800
2008 2009 2010 2011 2012
Inco
me
(£m
illio
ns)
Total income
IF income
Total income and IF income, 15 INGO’s 2008-12
> Many grew their Institutional income quite dramatically, avg +38%
- British Red Cross, + 570% 2008-11
- Tree Aid, £195k to £1.1m and growing, doubled since 2011
IF income of charities (2008 - 2012)
0.00
20.00
40.00
60.00
80.00
100.00
120.00
140.00
160.00
180.00
200.00
British RedCross
CAREInternational
Christian Aid Merlin Oxfam Plan Save theChildren
World Vision
Inco
me
(£m
illio
ns) 2008
2009
2010
2011
2012
Institutional funding as a proportion of total income
0.00
50.00
100.00
150.00
200.00
250.00
300.00
350.00
400.00
British RedCross
CAREInternational
Christian Aid Merlin Oxfam Plan Save theChildren
World Vision
To
tal i
nco
me
(£m
illio
ns)
Other income
Inst. Funding
Tree Aid - Key Principles
Key Principles for Institutional Fundraising
Building Capacity to Attract Funding
1. Building strategic relationships
2. Understanding the "market"
3. Building credibility and track record
4. Increasing visibility and evidence of impact
5. Resources
1. Building strategic relationships
• Technical knowledge
• Policy insight and influence
• Intelligence on funding
opportunitiesNetworks
• Technical insights• Field knowledge• Impact on the
ground• Policy influence
• NetworksInfluenceScale
Credibility
IMPACT
Strategic Partners
TREE AID
2. Understanding the market
3. Building credibility
4. Increasing visibility & evidence of impact
5. Resources / tools to pursue funding
> Fundraisers = highly valuable assets = not cheap> Interpretation – EC, DFID, Lottery
– Experience: programme management, track record fundraising success, building / monitoring complex budgets
– Knowledge : technical donor knowledge (<ECHO / DEVCO)– Skills: relationship building; communication; negotiation,
financial, creativity, research, statistical analysis– Characteristics: resilience, patience and ….Zen!
> Investment of staff time– In-house teams – How they are constructed– Use of external support
Last thoughts
> Match - European Commission: co-financing – from 15% International to 50% domestic - can include cash and / or in kind match
> Stewardship – Trusts approach to Inst Funding > Know your place / added value in your sphere> Be nimble, react to trends / corporate dfid wash> Understand risks / resources needed & investment /
don’t just follow the money> Know your theory / story of change …can you hook
them emotionally?
Useful sites
EuropeAid / Search – ‘calls for proposals’
http://ec.europa.eu/europeaid/index_en.htm
Local, regional, national and European sources
http://www.governmentfunding.org.uk/default.aspx
fundsforngos.org http://www.inprogressweb.com/
http://www.trustfunding.org.uk/default.aspx
http://www.biglotteryfund.org.uk/funding
