New report finds funders switched on to importance of impact

Only one in five (21%) funders say they are not measuring their own impact and 72% plan to boost their impact measurement over the next three years, according to a new report launched today by NPC.

However, one in ten funders (10%) remain unconvinced about the importance of measuring their own impact.

Funding impact, published by charity think tank and consultancy NPC, also found that while most funders collect some information about impact from the charities they support, many are not making the most of this data.

Many funders are not using the information they collect to help select grantees (38%) or to understand the overall impact of their grant programme (42%).

This is partly due to the poor quality of some of the evidence fed back to funders, but there is also scope for funders to improve their use of data, for example, through talking to each other and sharing information.

Funding impact is the first piece of research to examine the impact practices of UK funders, based on a survey of 114 funders as well as in-depth surveys.

The research identifies three types of funding (responsive, targeted and goal orientated) and shows that different levels of impact measurement work for different types of funding—for example aggregation of impact does not make sense for every funder.

Dan Corry, chief executive of NPC, said: "It is heartening to see from this report that many funders are now tuned in to the importance of impact, both their own and that of their grantees’.

"However, since the point of measuring impact is to improve, it’s a concern that the data collected is not used as much as it could be and instead just gathers dust on a shelf .

"There is still progress to be made when it comes to funders measuring their own impact.

"In Funding Impact we lay out three distinct funding types and look at what they could each do to better use evidence of impact for themselves, their grantees and the sector.

"There really are few excuses for not giving this the attention it deserves as it will if we are to allocate funding in a sensible and rational way, and so maximise the good that charitable funding does."