European foundations are making progress on their impact measurement and management journey but “blind spots” must be addressed in order to “future-proof philanthropy”, according to report by Esade Center for Social Impact and BBK.
A report launched last week by Esade Center for Social Impact and banking foundation BBK, sheds light on the progress made by European foundations when it comes to impact measurement and management (IMM) practices.
The ‘Walking the Tightrope. How Foundations Can Find a Balance Between Learning and Accountability Lenses’ is the result of two years of collaboration involving 85 professionals from 48 European foundations part of a Community of Practice (CoP), who shared insights and knowledge related to their IMM practices.
The paper looks at how foundations with different profiles and at different stages of development are approaching IMM, and dealing with the many challenges and complexities they face.
Speaking at a webinar to launch the report, Lisa Hehenberger, director of Esade Center for Social Impact, said their aim is to move Europe’s foundation sector forward and promote collaboration: “What we are trying to do with this community of practice is to cultivate transparency, knowledge sharing and peer exchange on this topic of impact measurement and management. We realised that foundations really needed a safe space to share what works, what doesn’t work, and how can they learn from each other.”
Impact GPS
Discussions among CoP members covered some of the big questions facing philanthropy, ranging from how to amplify their impact and use resources more effectively, to assessing how much good they are doing and whether they can do any better.
A key ally in this questioning is a strong IMM system, the report notes, likening it to having a GPS in the car. “It should allow organisations to evaluate in real time the best way of getting where they want to go.”
However, getting this “21st century impact GPS is not as easy as buying a normal GPS machine. It requires time, skills, commitment, patience, and a paradigm shift in power relationships with partners, staff, and society in general”, the report says.
The impact journey
The report summarises key insights from the second year of listening to, and collaborating with, the CoP. A previous report highlighting the main learnings from the first 12 months of collaboration was published at the start of 2022, as reported by Impact Investor.
Five key insights were highlighted by the authors of this year’s report. First, foundations should look at impact management as a journey and not just a problem to solve, or a set of skills.
Secondly, the complex and changing nature of IMM tools and frameworks means it is not possible for foundations to buy an off-the-self solution that can continue working as their impact journey progresses. Instead, foundations should focus on “steady, intentional progress”, with the report stressing that for a mission-oriented organisation, where impact is the end goal, “there is really no other choice than to set off on this impact management journey, find fellow travellers, and learn by doing”.
Learning and accountability
A third key insight relates to need for finding the balance between learning and accountability, which the report describes as “two distinct but not necessarily exclusive agendas”.
Speaking at the webinar, senior researcher at Esade and co-author of the report Leonora Buckland, said: “[Something] that has come up a lot in all our conversations is this tension, or dance, between learning and accountability and we put that as the title of our report.”
This was one of the main topics of discussion for panellists speaking at the webinar. Savi Mull, senior evaluation manager at Laudes Foundation, said: “Going back to the classroom in school, the teacher always told us that poets have a poetic license. And I think when we are in the philanthropic space, we have philanthropic license.” She added: “We need to have the license to power up learning alongside accountability.”
“Impact is not easy”, she added. “It’s been a journey for us to bring along staff at the foundation, including our partners, to make this transformational mindset and move away from these scary words of evaluation, measurement and performance and go more toward accountable learning.”
For panellist Jeremy Nicholls, assurance framework lead for SDG impact standards at the United Nations Development Programme, it is “stakeholder involvement and being held to account that actually drives learning. Learning in it itself is not the end point.”
Nicholls explained that many organisations would answer ‘yes’ if asked whether they have learned anything but when it comes to the implementation of those learnings, “it all goes a bit quiet”. He added that asking specific questions and setting targets for the organisations they support is key. “If you don’t set targets, there’s never any consequences because you are always fine, whatever you do. I would move to asking two questions: How many ideas did you have? And, how many did you actually implement?”
Stakeholder participation and ‘blind spots’
Another key insight from the report is the need for greater participation in IMM by different stakeholders, both internal and external. The report notes IMM can still be “quite top-down and internally focused”. Including a wider range of stakeholders creates opportunity but also increases complexity.
Buckland noted that foundations have started to move away from the “command and control” approach to IMM prevalent years ago, to one that allows for more involvement from stakeholders, including grantees or partners, but also from the communities that foundations “exist to serve”.
Finally, the report warns about some ‘blind spots’ in the areas of governance, impact transparency and inclusion, where more work needs to be done to “future-proof philanthropy”.
In particular, it focuses on the need to properly consider and incorporate diversity, equity and inclusion (DEI). IMM frameworks “are often developed based on the needs of the foundation and funder, rather than being sensitive or responsive to the communities they serve”, the report said.
“In general, what we see across Europe, is that foundations have a good long road to travel ahead in terms of diversity, equity, and inclusion,” said Buckland, adding that the concept of transparency and impact governance are also areas that need improvement. “That really comes to how impact data and information moves within foundations across different levels, and how impact is governed to ensure that the most impact is achieved for the resources that each foundation has.”
Asked about tips for other foundations at different stages on the IMM journey, panellist Tinne Vandensande, senior programme coordinator and head of evaluation at the King Baudouin Foundation, highlighted the importance of creating space and time. As foundations grow, there is a risk they become “too operational and that we have not enough free time to create these spaces for really deep learning”, she said, adding it is in their DNA to be “reflective practitioners”, continuously updating the way they do things, and embracing and learning from failures.
