Our COVID Recovery Funding

The key criteria for the COVID Recovery programme was to fund charities that had an ‘appetite for development’, and were providing an important service locally as part of the community COVID response; we wanted to ensure that these charities were still there in 12 months.

Harriet Stranks, Director of Grants at Lloyds Bank Foundation

Every quarter we draw out themes from annual monitoring reports submitted by charities and think about how we can respond to their needs. We have published two reports since the start of the pandemic, these reports tell a mixed story of incredible resilience and utter despair.  

Few charities had considered contingency planning, income sources changed overnight, and uncertainty became the norm. Unexpected costs were troubling charity leaders, and many had to draw on reserves. Staff anxiety and workloads increased, and the needs of clients grew ever-more urgent.

We felt that we had a responsibility to respond, quickly and decisively in our grant programmes in order to support as many charities as possible to get through the next 12 months.

The pandemic also exacerbated existing racial inequalities, with Covid-19 having a disproportionate impact on the health outcomes of Black, Asian and minority ethnic communities. These structural inequalities are further compounded when the charities set up to support them are not getting an equitable share of funding. Research from the Ubele Initiative suggested that “9 out of 10 Black, Asian, and minority ethnic micro and small (community and voluntary) organisations are set to close if the crisis continues beyond three months following the lockdown”.

Early in 2020 we set out to understand the diversity of our grants portfolio to learn whether we were living up to the commitments we made in our EDI strategy. Using the assessment framework of the Funders Alliance on Race Equality we analysed past applications and found ourselves lacking. We found that applications from Black, Asian and minority ethnic led charities had lower success rates than white led charities.

Trustees agreed as part of our response to the pandemic and to ensure we are more equitable in our funding, that we would ringfence 25% of the available funds for grants towards Black, Asian, and minority ethnic led charities. The grants would be completely unrestricted and projected outcomes were dispensed with to give charities as much flexibility as possible. Providing unrestricted funds meant that charities could rebuild depleted reserves, remodel services or adapt in line with government regulations.

We recognised that in order to meet that 25% target we would need to do things differently and acknowledged that we were likely to be blind to the structural inequalities in our processes and that we needed some external support. Initially, we recruited Bonnie Chiu and Ngozi Cole to help us critically evaluate our processes and understand our data,

Bonnie and Ngozi helped us see that we needed to peel back layers of processes embedded over years which contributed to the systemic racial inequalities within in our funding.

It was important that the team understood what we were trying to achieve. We created spaces to reflect on our own biases and to review the ways we assess funding applications. We discovered that fear of causing offence by saying the wrong thing, or using the wrong words was a huge barrier and created a lack of confidence to act and speak up. Bringing in external consultants really helped us to agree what language we use and how we use it effectively in internal and external communications.

We also knew that we needed to approach outreach in a different way, to attract charities who in the past might have self-selected out or been rejected because of our eligibility criteria. We needed to question why these rules were in place and how could we look at them differently? How could we mitigate perceived risks, particularly in governance and finance?

The key criteria for the COVID Recovery programme was to fund charities that had an ‘appetite for development’, and were providing an important service locally as part of the community COVID response; we wanted to ensure that these charities were still there in 12 months.

We appointed a Development Partner to walk alongside each funded charity to support them with both practical and strategic challenges for the first 12 months.  While the offer of the Development Partner was received across the board, it was especially well received by charities that had applied under the racial equity strand, as there was a lot of willingness and interest to develop their organisations and to enhance resilience.

We were very pleased surpass out target of 25% and were able to distribute 38% of the funding to charities working with, and led by people from Black, Asian and minority ethnic communities.

We have made some progress but we still have a long way to go, such as ensuring that our Enhance programme will be representative of the charities we now have in our portfolio and making sure that we categorise our data in a standard way. It seems that the more we learn about racial equity, the more we find we don’t know. But, we want to learn and are committed and determined to put racial equity at the front of our minds in everything we do, this has already started to make a difference in the way we think and act as a team.