Using impact strategy to make a bigger difference

How to best give away money? There’s not a single right answer. It depends on your goals, your values, and your beliefs. But regardless of your convictions, impact matters.

When doing good, you aim to do the most amount of good possible, while ensuring you do no harm. This requires measuring outcomes and impact, and being guided by the evidence.

But it’s not easy. The world of impactful grant-making is full of challenges. Often what seems like the right thing to do includes a difficult trade-off:

• You want your grant holders to measure their impact. But this requires you to provide them with sufficient resources to do so. To support them to reflect, learn and grow.
• You want to invest in what works, But you also want to leave room for innovations and explorations, to allow passionate people and communities to pursue their dreams and ideas.
• You want to use existing evidence and resources, to make sure you don’t reinvent the wheel or duplicate. But this requires you to work in the open. Collaborating, sharing and championing the great work of others.
• You want to consider evidence from different perspectives, centre lived experience, and ensure you place value on what people and communities care about. But this means you have to be willing to let go of your own views if you’re truly listening to their perspectives.
• You want quantitative and qualitative data to guide decisions. But you want communities to help design programmes. By making needs and impact data widely available, you can support people to shape their projects.
• You want to acknowledge the multiple barriers that exist for people and communities to apply for your funding. But you understand that acknowledging and understanding barriers is only the start – you want to actively try to remove those barriers.

How can you manage these tensions, trade-offs, and challenges? It can be overwhelming. But a well thought-through impact strategy will help.

This is exactly what The National Lottery Community Fund has been working on in the past year. It has been a great pleasure for NPC to support the community fund as a critical friend, asking difficult questions that are equally difficult to answer. The result is an excellent new evidence and impact strategy that marries a focus on impact and evidence, a genuine consideration for diversity, equity and inclusion, and a commitment to collaboration across the sector.

The three things I’m most excited about?

• As part of their efforts to enable an equity-based approach, The National Lottery Community Fund will commission research into the barriers communities face when accessing their funding. At NPC, we believe that understanding barriers is key to diverse, equitable, and inclusive grant-making. (See our 2023 report on DEI in grant-making for more.)
• The National Lottery Community Fund has taken a very collaborative and open approach to this strategy. They’ve signposted to existing evidence and resources in the sector. And the strategy contains plans for new partnerships to make best use of collective evidence, improve access to data, and publish independent impact evaluations. NPC support open approaches full-heartedly – see our open-for-all initiative.
• The National Lottery Community Fund will offer support to communities and grant-holders to learn and improve. This new learning offer includes an interactive learning bank. Two vital elements are is that it will be informed by a community learning panel, and that The Fund recognises that different communities learn in different ways, each with their own starting point. This really chimes with our guidance from our 2024 publication Monitoring, evaluation, and learning with trust and equity: a guide for grant-makers and philanthropists

It’s great to see a major player in the UK impact sector like The National Lottery Community Fund take this ambitious turn towards a more intentional focus on impact and equity. At NPC, we are obviously delighted to have played a small part and to see our recommendations in action.

But more widely, with around £600mn of funding a year this new impact strategy has the potential to truly make a big difference in our communities across the UK. And that’s ultimately what it’s all about: doing great things for great people.

Read the National Lottery Community Fund’s Impact Strategy.