Giving Compass' Take:

• It's important to understand the problem and prevalence of restricted funding methods in order to change donor behavior toward unrestricted support.

• What are the key hurdles for donors when it comes to offering unrestricted funding? 

• Read about how unrestricted funding can help organizations achieve impact. 

Esmee Fairbairn Foundation released a report about its experience of providing core funding. Entitled Insights on Core Funding, one of its aims is to “provide the organisations doing the work [with] the ammunition to continue to make the case for what they need to thrive” – in other words, to encourage other funders (and presumably also non-institutional donors such as wealthy individuals) to give better.

Yet, if we are really to reduce the harmful practice of restricted funding, we need to be more sophisticated than simply producing reports about not doing it. Reducing restricted funding involves an exercise in behaviour change, and we should treat it as such.

First, we need to understand precisely where the problem is if we are to pick the battles within it that we are most likely to win. For example, in which types of funders is restricted funding most prevalent? Second, we need to understand what benefits donors perceive it brings them, and what could offset those benefits. Third, we need to know why it happens: where do donors even get the notion from, and what encourages that behaviour? And fourth, what messages, communications channels and influencers are most likely to change the behaviour?

Read the full article about restricted funding at Giving Evidence.