The strongest trends within the European foundations


Carsten Terp Beck-Nilsson

A narrower focus, bigger efforts and the tendency to revise the strategy if the reality turns out to be different than first anticipated.
These are some of the currents, which direct the foundations both in Denmark and the surrounding countries, according to a new analysis carried out by the consultancy Kraft & Partners for [Danish fund] Trygfonden.

In order to achieve more value for money several foundations place large, focused efforts on narrowly defined focus areas. (Photo credit: Ritzau/Casper Dalhoff).

The consultancy has through conversations with foundations, researchers and external observers, mapped the foundations’ activities and reached three main conclusions based on 25 underlying tendencies, trends and megatrends.

Combined, this draws a picture of a segment of foundations in rapid transformation, assesses Markus Bjørn Kraft – a partner at Kraft & Partners.’We have observed a significant development in the foundation sector within the last two-three years.This means that several of the foundations operate in a more focused and flexible manner.At the same time, they have become more visible and centred on the effects they are creating’, he says.Flexibility is a strong tendency
In the report, Kraft & Partners outlines the three main currents, which describe the development of the foundations:

  • They have become more flexible in their strategies and organisational process.
  • They have strengthened their accumulated position in society and positioned themselves.
  • They have become increasingly goal oriented and focus more on the effect of their investments.

The flexibility is especially a strong tendency, Markus Bjørn Kraft states.

‘Back in the day, you created five-year strategies and stuck to them, while you believed that society would adapt to the foundation sector. Now, the foundations have become much more conscious of taking advantage of the opportunities presented by society, in order to achieve more visibility and effect of their investments’, he says.

New challenges demand a quick response
As a result the foundations evaluate their strategies at least once a year, he says.

And at TrygFonden, the director Gurli Martinussen recognises the increasing need for flexibility from her own organisation. Under the overarching umbrella-term ‘safety in Denmark’, the foundation has defined 11 civil society issues, which the foundation would like to contribute to the resolution of.

‘The issues that are causing uncertainty are changing over time. Subsequently, new challenges arise. In order for us to quickly address the transformation that is occurring in society, we have an agreement to revise our strategy on a yearly basis, so we can be adaptable to changes’, Gurli Martinussen says.

Another effect of the increased adaptability is that more foundations now have the ability to respond quickly to unforeseen challenges and opportunities, Markus Bjørn Kraft points out.

‘Some of the foundations want to be able to make quick decisions when they find an interesting project or a critical issue arises. Then they will be able to make a decision within a few weeks, rather than wait a half or perhaps a whole year to grant money’, he says.

The foundations’ need to demonstrate agility
From Brussels, the director of the European Foundation Centre, Gerry Salole, observes the European foundation sector. He also sees signs that the foundations have become more flexible and adaptive to the demands of the times.

‘I think the foundations have always been agile and organic, but now they are being forced to demonstrate more visible agility because society is moving faster than earlier’, Gerry Salole says and adds, ‘In the 1950s, 60s, 70s, and 80s, things were more predictable than they are today. I think this is reflected in the development of the foundations.’

Foundations choose big investments
The three main conclusions in the analysis by Kraft & Partners are built on 25 underlying tendencies, trends and megatrends – the megatrends being the most significant signs of change.

One of the new trends is the so-called big bets – bigger investments within a narrowly defined focus area.

‘Some of the foundations have started to concentrate on very few focus areas, but instead larger investments, in order to achieve a bigger effect in the area they are working with’, Markus Bjørn Kraft says.

In Denmark, he points to Egmont Fonden that has narrowed its strategy significantly and, which has now turned its efforts towards securing that every young person by 2030 is able to complete an upper secondary education.

In the UK, the Rowntree Foundation has narrowed down its focus areas from four to one and is now concentrating on eliminating poverty.

It is a tendency that Gerry Salole also follows in the European foundation landscape; ‘It is an expression of the increased complexity of the problems, which the foundations are trying to solve. When you are trying to resolve big issues with limited resources, you’re required to work efficiently’, Gerry Salole states.

He points out that many big investments are made collectively by numerous foundations. And that this is a positive development.

‘When you have to resolve complex issues, you take a risk. And why not do it together? That way you also accumulate collective intelligence. And one of the biggest rewards with philanthropic means is exactly the opportunity to try new solutions,’ Gerry Salole says.

TrygFonden doesn’t want to narrow down
The big investments are one of the trends, which has caught the attention of Gurli Marinussen.

‘This way of thinking is interesting if you really want to make an impact. The question, then, is how you decide what should constitute the foundations’ big bets’, she says.

TrygFonden is already partnering up with The Danish Cancer Society to create a smoke-free Denmark by 2030.

‘You can call that a big bet. But that’s not all we want to achieve. We also want to work with physical activity and reduction in alcohol consumption within the overarching focus area; Live Healthy’, Gurli Martinussen says.

The director of the foundation emphasises that TrygFonden doesn’t have any plans to narrow down its focus areas and place all its eggs in one basket.

‘But I plan to keep an eye on the foundations that make these big bets – for example, the ones that say that they will eradicate poverty in a specific area. It’s interesting to see whether it turns into reality,’ Gurli Martinussen concludes.

Carsten Terp Beck-Nilsson is Editor of Altinget: Civil Society.

This article originally appeared on the Altinget website on 11 October 2017. The original article can be found here.

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