New map shows scatter-gun approach to enviro-funding
by Harriet Williams

I was recently invited to speak at a conference on third sector funding in central London. The environment session was packed with fundraisers from green groups large and small. The panel’s presentations on trends in overall giving and in funding priorities received polite applause, but the ensuing discussion all led back to the same million-dollar question – more or less bluntly, could I and my fellow grants officers share the secret recipe for making successful applications to foundations?

The decision-making processes of environmental grantmakers must appear opaque and at times perverse to organisations on the receiving end. The conference represented a rare opportunity to quiz a group of these strange and seemingly capricious creatures in the flesh.

A closer look at the practice of environmental philanthropy shows that grant-seekers have every reason to be confused. Where The Green Grants Went, the research series produced by the Environmental Funders Network reveals a sharp divide between haves and have nots, with a relatively small number of grantees accounting for a large proportion of total grant spend.

The top 100 recipients of green grants between 2003 and 2007 secured 61.6% of total grants by value, although numbering only 5.3% of all grantees. But for the majority of grantees, the fragmented nature of the underlying grants market makes for a far more turbulent ride.

It is not uncommon for foundations to dramatically increase or cut their environment budgets from one year to the next. And funders often make one-off grants rather than offering ongoing support. Of the 1,900 grantees that secured funding during five years of EFN research, only 42% received two or more grants, and just 15% managed to secure at least one grant per year.

Stop-start funding is clearly a problem for grantee organisations, particularly those that rely heavily on trust income. Moreover, this scattergun distribution of grants goes beyond how money is shared among grantees, and is repeated when we look to the environmental issues that trusts actively support.

A new map available on the EFN website shows how 93 of the funders tracked in the research invest among 13 issue categories, including biodiversity conservation, food, water, energy and transport. The map indicates the monetary value of each funder’s issue-based grants, along with what proportion of their grantmaking is directed towards each issue.

The map shows that most grantmakers are generalists, dividing their funding between large numbers of issue categories. Only one third of the funders can be said to specialise to any great extent, meaning that 60% or more of their green grant spend is targeted on single issue categories.

Does it matter that green grants tend to be scattered far and wide, among a diverse and ever-shifting cohort of grantees? The answer on both counts must be ‘yes’.

Grantmakers with a generalist outlook tend to head to the middle ground, to groups and projects well-established within the mainstream of the environmental movement. But as environmental problems worsen, there is a need for philanthropists to think beyond safe bets and towards calculated risks. Specialists among the grantmaking community could encourage this transition by sharing analysis with their more generalist colleagues.

Among grantee organisations, there is a perception that funders do not always understand the processes of social change they seek to bring about. In 2006, a group of senior fundraisers convened by the EFN highlighted the disconnect between rapid bursts of short-term trust funding and the longer timescales over which social change occurs.

Fundraisers also encounter problems with the transparency of the grant-making process. There is an appetite for more tightly defined funding criteria to help grantees target their fundraising efforts better. There is also frustration at the lack of feedback from funders, for instance on reasons why specific applications were rejected.

Ultimately, the generalism of grantmaking and inefficiencies in the funder-grantee relationship are likely to weaken the impact of green philanthropy, and dissipate valuable time and energy on both sides.

Better communication would be a good start, beginning with a frank conversation between trusts and grantees about the best ways to improve the effectiveness of environmental funding.

Harriet Williams helps coordinate the Environmental Funders Network. The views expressed here do not necessarily represent those of the of the network.