Foundations with few trustees and a lack of online presence are most likely to perform poorly in terms of accountability, diversity and transparency, a report into 100 UK grant makers has found.

The annual Foundation Practice Rating, which is now in its fourth year, found that “diversity remains the weakest” area of their work. This is the same as the previous three years of the research.

Only one foundation has ever achieved its highest grade of A on diversity, last year.

Almost half of grant makers scored the lowest grade of D on diversity and 13 scored nothing at all, up on the 11 who did so last year.

Only seven grant makers published analysis of their own effectiveness, as opposed to just listing grantees, the research found in terms of transparency.

However, of those “most were feedback from grantees”. While researchers give credit to grant makers that gather such feedback, this must be collected systematically and not be “just a few quotes with no logic of how those voices were chosen”.

Recruiting more trustees to funders’ boards can help improve performance, the report found.

Foundations with five or fewer trustees “are more likely to rate D than are foundation with more trustees”. Only grant makers with six or more trustees were able to achieve ratings of A overall.

Recruiting more staff can also help improve performance. Funders which achieved a D grade overall had ten or fewer staff.

But while average scores increase “with many more staff” improvements are greater when the number of trustees rises.

In contrast to trustee and staffing levels, financial size is not a predictor of performance in terms of accountability, transparency and diversity.

“Some small foundations scored highly”, researchers found, while two of the five largest foundations looked at, Gatsby Charitable Trust and Quadrature Climate Foundation, only scored C overall.

Just one of the largest five funders Wellcome, achieved A overall.

Better online presence

Funders also need to improve their online presence, researchers found. One in five foundations included had no website at all, compared to 13 the previous year and 22 in year two.

None of the 12 foundations that rated D in diversity, transparency and accountability had a website, found the research.

“Some other foundations have overly cluttered or limited websites that impede finding basic information. This matters because often the website is how potential applicants view a foundation, as well as how others see the sector,” the research found.

Poorly performing grantmakers are urged to follow the led of community foundations, which “continue to outperform the broader sector, and by an appreciable margin”.

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