Ghosts of reporting requirements past: Missed opportunities to build trust and strengthen relationships with grant partners

Written by: Lisa Ranghelli

Date: February 27, 2018

Editor’s note: This post was originally published on PEAK Insight Journal.

The arrival of a new year often spurs us to reflect on our past behaviors and think about what we may want to do differently in the future. If, like Ebenezer Scrooge, foundation managers were forced to go back and visit with grant partners of years past, what would they hear about their grant reporting practices?

They might hear any of these real quotes from nonprofits:

Annual reports could be sufficient in some cases where six months [reports] are currently required.

[We experienced] unwieldy and overwhelming report requirements.

The reporting requirements require a lot of our small staff of 6.

[This foundation has] reasonable expectations and reporting requirements.

The reporting requirements always make us stretch, but that becomes a management tool as a result.

We send a comprehensive stewardship report to the foundation headquarters each year, so perhaps they are satisfied with that?

Do any of these quotes resonate with feedback you’ve received from grant partners? In fact, they came from NCRP’s Philamplify initiative, which assesses the grantmaking and operations of major foundations. Over the last three years, we have surveyed more than 1,800 nonprofit leaders about grants management processes. Some of what we learned will bring cheer; some of it may spur new thinking about reporting practices.

We heard good news when it comes to right-sizing grant reports. We asked nonprofit leaders whether their funder’s outcomes measurement and reporting requirements were appropriate relative to (a) the size of the grant and (b) the size and capacity of their organization. In both cases, the answer was overwhelmingly “yes.” On average, 85 percent of respondents said “yes,” and the median “yes” response was 90 percent across nine foundations studied.

This is encouraging despite PEAK Grantmaking’s own survey results indicating that 74 percent of grants managers do not know how long it takes grantees to do reporting. Only 12 percent have even asked grantees this question.

When we asked nonprofits which characteristics most contributed to an effective partnership with the foundation, and which characteristics were most in need of improvement, evaluation and reporting requirements rarely made it into the ‘top 5’ list for either praise or critique.

Other Philamplify survey data were more discouraging when it comes to using reporting to gain feedback from grant partners:

Overall, only 3 percent of ALL survey respondents reported the foundation made changes based on feedback.

NCRP has found similar results in workshop sessions with funders. Not only are foundations missing out on opportunities to gain valuable feedback through grant reports or other methods (especially anonymous feedback), even when they do, they usually fail to report back to their grant partners about what they learned from this feedback and how the grantee feedback influenced their policies and practices.

PEAK Grantmaking’s survey findings are more promising, showing that 29 percent of its members do solicit feedback through the grant reports, at least about reporting practices. We don’t know how many of those also close the feedback loop with grant partners. Doing so helps promote transparency, mutual trust, and a stronger relationship between funder and nonprofit, a key goal for grant reporting according to PEAK Grantmaking’s members.

Strong feedback loops also promote shared learning; organizational learning is the other top goal PEAK Grantmaking’s members want grant reporting to support.

Philamplify can help, with forthcoming self-assessment tools for achieving more equitable philanthropic impact. The tools can help grants managers ask themselves and grant partners questions on these topics to inform operational changes that can lead to better relationships with nonprofits and communities.

PEAK Grantmaking challenges foundations to unite practice with purpose. If indeed one purpose is building stronger relationships with grantees, reporting can be elevated from a simple accountability mechanism to be part of an ongoing conversation that promotes trust and shared learning.

What’s your new thinking about grant reporting?

Lisa Ranghelli is the senior director of assessment and special projects at NCRP. Follow @lisa_rang and @NCRP on Twitter.