A group of charitable foundations have backed a project that will rate them on how diverse, transparent, and accountable they are in a bid to encourage a more open culture.
The project is led by Friends Provident Foundation, alongside a group of trusts including Barrow Cadbury Trust, The Blagrave Trust, Esmée Fairbairn Foundation, John Ellerman Foundation, Joseph Rowntree Reform Trust, Lankelly Chase Foundation, and Paul Hamlyn Foundation.
Danielle Walker Palmour, director of Friends Provident Foundation said foundations in the UK “are almost uniquely unaccountable” and added that although “independence is a great strength” it has down-sides and means foundations “can lack standards of accountability or habits of transparency.”
Research will be compiled by philanthropy consultancy Giving Evidence and the first ratings will be published later this year.
Insight into which foundations follow best practice
The project will analyse information published by foundations to measure their transparency, diversity, and equity and create an index to show foundations' performance.
The index will take a similar approach to that used to assess corporate governance and public accountability in the corporate sector.
It will offer charities and other stakeholders insight into which foundations have best practice in transparency on sources and destination of funding and on diversity and equity.
It will enable grant-seekers and other stakeholders to understand which foundations they wish to work with and will highlight and encourage best practice in the foundation sector.
The research will also provide foundations with a framework to increase their accountability, transparency, and diversity.
The rating will be published in late 2021 and will repeat in 2022 and 2023, and possibly beyond.
By publishing this rating, on an annual basis, along with the data used to create it, information on the UK trust and foundation world will be available in one place on the diversity of its leaders, the nature of its activities, and how these change over time.
Consultation now open
The group is now running a consultation exercise to inform the precise criteria on which foundations will be rated.
All grant-seekers and the wider public are invited to participate and the consultation can be accessed until 4 June.
The research will assess a cohort of UK foundations, representative in terms of their size. The set will be drawn from the 300 largest UK trusts and foundations.
Sara Llewellin, chief executive of the Barrow Cadbury Trust, said: “We were an early supporter of this initiative because we believe that the compilation of a rating system will act as an effective means of addressing deep-seated, long-standing structural issues of power, equity, control of capital and transparency over several years.
“This year-on-year assessment will give trusts and foundations the opportunity and capacity to improve our processes, our data collection and usage, as well as increase and finesse the information we provide about our work.”