ACF publishes new report on Strategy and Governance
The Association of Charitable Foundations (ACF) has published a new report on the crucial importance of strategic thinking and strong governance practices for charitable foundations that want to be ambitious and effective with all their resources.
'Strategy and Governance: The Pillars of Stronger Foundation Practice' is the third report emerging from ACF’s Stronger Foundations initiative.
It sets out seven characteristics of excellent foundation practice, which include being aware of the external context and its role in the wider ecosystem, publicly articulating its vision, mission and values, and continually strengthening its governance arrangements, including board diversity.
Based on more than a year of evidence gathering, the report asserts that stronger foundations are those that both ‘stick and twist’ – pursuing long-term objectives while pivoting to best meet the needs of today. Stronger foundations are also those that pursue short and long-term goals, and regularly review their own perpetuity, including in the context of the climate crisis.
The report argues that stronger foundations involve people with lived experience when setting strategy, seek out and respond to criticism, and find ways to be accountable to the causes and communities they care about.
Informed by the Strategy and Governance working group, external experts, the wider literature (including the Charity Governance Code, which ACF commends to foundations) and ACF's own analysis, the report asserts that these pillars can be interpreted and pursued by all foundations whatever their remit, size or starting point.
Commenting on its publication, ACF Chief Executive Carol Mack said:
“Strategy and governance are incredibly important and easy to take for granted. They are at the heart of what makes for an ambitious and effective organisation which maximises its potential for social good. For foundations – who frequently have few of the checks and balances that come with the need to raise funds, or to deliver services – these are especially important issues. A strong strategic and governance framework is vital to clearly set out what the organisation is working towards and how decisions are made, allowing trustees, staff and stakeholders the confidence to know that decisions serve the public benefit the charity is committed to deliver.
I am particularly struck by how the governance and strategies of stronger foundations recognise the wider context – perhaps more relevant now than ever. Part of this is recognising the history of foundations, whether the centuries for some of our older members or more recent years for newly founded organisation. We can make our own history, but we cannot – and should not – kid ourselves that what has gone before is not relevant or valuable to build on and to inform our choices now and into the future. Seeing governance and strategy as essential tools for enabling us to make effective use of all of the resources that we have at this most challenging moment in time is a central concern of this report.”
Jo Wells and Steph Taylor, joint chairs of the Stronger Foundations Strategy and Governance working group, said:
“It is hard to do justice to the breadth of discussions held within the Governance and Strategy working group, but some clear themes that we felt should be an essential part of a foundation’s strategic thinking and governance emerged. Firstly, real clarity of purpose and vision over longer-time horizons, utilizing the independence so many of us have, was seen as a huge and perhaps under-utilized strength. Secondly, taking time to consider the foundation’s place in relation to its local, national and global contexts was key, not ignoring bigger issues like climate and artificial intelligence, which often feel outside of scope. Thirdly, questions of where power lies, within the foundation, with those it funds and crucially those it ultimately seeks to serve: Who makes decisions, how are these decisions informed, how do we value lived experience in our work, and how does the lack of diversity on boards in the foundation sector at present limit our understanding of the impact we have on others? If foundations aren’t engaging with these and other issues covered by this report, then our potential for true and sustained impact will be limited.”
For more information, please email ACF's Head of Policy, Max Rutherford on Max@acf.org.uk
More details of the Strategy and Governance working group and its terms of reference are here
About Stronger Foundations
At their best, charitable foundations are the most transparent, intentional and efficient way of transforming private wealth into public benefit. They are an immense source of public good, with the top 300 awarding more than £3bn every year in the UK to individuals, causes and communities. They are motivated by an incredible range of passions, from enabling scientific discovery to giving voice to the most marginalised, from restoring historic buildings to increasing access to education. They are unconstrained by political or market cycles, independent of the state, able to think in the long-term and agile to respond emerging need.
Over the last two years, The Association of Charitable Foundations (the membership body for charitable foundations in the UK) has led the largest foundation engagement initiative globally to date, examining what it means to be a stronger foundation in 2020 and beyond. The Stronger Foundations initiative has involved more than 100 foundation representatives drawn from across the UK, 50 external experts and critics, offering perspectives that are both grassroots and global. Through six member-led working groups, ACF has facilitated inquiry on issues including diversity, transparency, governance, funding, impact, and investing. This is the third report in a series of six that will be published by ACF as part of this phase of the Stronger Foundations initiative. Previous reports have been published on Diversity, Equity & Inclusion and Impact & Learning.
The product of this first phase is a series of reports showcasing the ‘pillars of stronger foundation practice’ in each area. These pillars set a high standard for foundation excellence. While examples of all of them can be found somewhere in the UK foundation sector, every foundation has room for improvement, and some will be at an early stage of their journey.
By pursuing these pillars of practice, all foundations can become more effective and achieve greater impact – no matter their size, remit, history, source of income, geography or resources. Being a stronger foundation is an aspiration not an event, a journey not a destination. The pillars themselves will continue to evolve, and the bar for excellence will continue to rise. By embedding this approach in everything that a foundation does, it will ensure it is not only fit for purpose, but confident of its mission, and realising its potential.