Better data, better giving

We don’t have to imagine how chaotic the financial services sector would be without basic information like Bloomberg and Reuters – we can see it for ourselves in the charity sector. Lacking universal, current information about who is spending and what they’re spending on adds huge transaction and information seeking costs for investors and funders.  It adds to the workload of hard-pressed people trying to raise money. And it increases risk and reduces effectiveness per pound spent.

We can build a better future for philanthropy and charities by improving transparency about money flows in the sector. I founded 360Giving, a charity that helps grantmakers publish data about grants they make. So far, we have published data from over 200 grantmakers on more than 600,000 grants, with a value in excess of £100 billion.

Improving data isn’t an abstract issue: when the pandemic struck, many charities had to adapt to new and startling operational environments with a brutal immediacy. Philanthropists rapidly sought to understand how they could best make a difference. It was imperative for philanthropists to react quickly and collaboratively, in an informed, evidence-led fashion. At 360Giving we built a Covid-19 Grants Tracker to allow philanthropists to see where emergency funding was going. The timeliness of the data has been crucial in giving us an up-to-date picture of how emergency response funding has been distributed, allowing grantmakers to make quick, informed decisions on what they should do next. The COVID-19 grants tracker now has information on more than £1.5 billion worth of grants made as a response to the pandemic.

The use of data and technology are not emergency-use only.  Data published on platforms like 360Giving provides donors and philanthropists with an invaluable resource to understand funding flows and identify gaps. It allows us to better coordinate our giving and to understand where we can make the greatest difference. As Tania Cohen, 360Giving’s Chief Executive, says:

“Information is an asset. It is also knowledge and power. With 360Giving data, we can map the landscape of UK funding so that anyone can easily find who is funding what, how much and what for. In so doing, it saves time and money for the sector, gives us a fuller picture of grantmaking in the UK and, crucially, helps bring about better outcomes for recipients.”

For many of us, the speed and frequency with which things have changed over the past 18 months have been unlike anything in living memory. Perhaps more than anything, the pandemic has demonstrated to philanthropy the need for agility, speed and flexibility. But beyond the pandemic, these must be essential elements of modern grantmaking. If we are serious about improving the future of philanthropy, we must be able to incorporate them skilfully into the planning, execution and analysis of our work.

Of course, data isn’t just about giving. Randomised control trials, scientific papers and economic data, as well as qualitative data provided by people with lived experience, help us understand need, design better services led by users, and see what is working (and what is not). But combining and comparing different data sources means we can build a much richer picture of need, spend and effectiveness.  At Indigo Trust we made £2.5 million of emergency grants within a couple of weeks of lockdown. Our emergency grant of £0.5 million to Oxfordshire Community Foundation was made with confidence based upon their intensely data driven approach to understanding need and effectiveness.

The biggest data gatherers in the sector are HMRC and the Charity Commission England and Wales (CCEW), the OSCR in Scotland and Charity Commission for Northern Ireland. But output of the data they gather is poor. The CCEW should follow sector-led innovation as it modernises its processes. HMRC gathers very detailed data about grants that claim tax relief without making it available as a public resource. The regulators should gather and publish information about individual grants made by medium and large grantmakers – it’s a simple matter of fairness that the public should know where money goes, when it often has favourable tax treatment.

While we wait for regulatory change (and the long silence of the government in response to the Charity Tax Commission suggests it may be a long wait) we continue to build a non-profit, free to use data infrastructure at 360Giving. Some data publishers now publish their latest grants data monthly.

Data and technology is of course no use without a future-facing, digitally skilled workforce in the charity world. Better coordination of funding, evidence-led selection of grantees and causes, and more efficient reporting are just three of the ways tech and data can be harnessed to improve philanthropy. But to make the most of the potential of data and technology, philanthropists and those who work alongside them need the skills, understanding and inclination to work in a digitally-savvy fashion. The pandemic has highlighted the need for charities to be able to pivot towards digital technology, but to support better integration of tech and data in the sector we need a generation of grantmakers who can distinguish between good and bad digital projects, who understand issues like user-centred design and accessibility, and who can incorporate lived experience into their work. As grantmakers, we need to be confident about using and interpreting data, while being sufficiently self-aware to recognise our limits and seek expert advice where appropriate.

As a sector we need to become much better at doing all of these things and we need to learn and improve quickly. If we don’t, we will soon be left behind.