Funding on a finite planet

As the membership body for grantmaking charities across the UK, the Association of Charitable Foundations (ACF) explains how it is supporting funders to be ambitious in using their resources to tackle the climate crisis.

The recognition of philanthropy’s role in addressing the causes and impacts of climate change is growing.

In 2020, we began hosting the Funder Commitment on Climate Change, which had been developed by a group of our members. Nearly 100 UK trusts and foundations have now publicly signed on.

By signing the Funder Commitment on Climate Change, grantmakers pledge to:

  • educate themselves on climate change
  • commit resources to addressing its causes and impacts
  • integrate climate change into their existing programmes, priorities, and processes
  • consider climate change in their investment strategies
  • decarbonise their operations
  • report on progress annually

This is no small feat, and the trusts and foundations who are signatory to the commitment are each operating with different charitable missions, governance structures, stakeholders to consult, places to consider, and time horizons to keep in mind.

They are at quite varied stages in their climate journey. Yet all grantmakers signatory to the Funder Commitment on Climate Change (and the many others who are planning to sign) have in common a recognition of the urgency of the climate crisis.

They acknowledge that no matter what they might fund or what their charitable mission might be, the impacts of the climate crisis multiply risk and have far reaching impacts for all civil society.

The commitment asserts that: 'climate change is a health issue, an equality issue, an educational issue, an economic issue, a cultural issue, a scientific issue, a security issue and a local community issue, as well as an environmental issue.'

This awareness extends to foundations beyond the UK too. Parallel funder commitments have been established in Italy, Spain, France and Canada, as well as an International Philanthropy Commitment on Climate Change.

Around 500 charitable foundations around the world have publicly committed to rise to the challenge of the climate crisis, creating a global #PhilanthropyForClimate movement. A similar commitment has also been set up for individual donors and philanthropists.

Taking steps to act on climate change

Many grantmakers are aware they must get their own house in order. This means they are educating their staff and boards on net zero, creating opportunities for climate learning, and encouraging behaviour change within their own organisations.

It also means others are reviewing their investment policies, with some funders divesting from fossil fuel extraction while others use their power to lobby for change. Some grantmakers have also been looking closely at calculating their own emissions, commissioning eco-audits of their operations, and exploring how to make their virtual work carbon neutral.

Funding for environmental issues is slowly rising too. Research by the Environmental Funders Network shows that UK foundation funding for environmental issues almost doubled between 2015/16 and 2018/19. For the grantmakers who aren’t already climate or environmental funders, recognising the climate emergency has meant reflecting on how the climate crisis intersects with their current funding area.

The causes and solutions of climate change are intertwined with many other areas of civil society activity, and funders are working to articulate and strengthen these connections. Some funders are reviewing their overall strategies and setting clear priorities around climate in their funding programmes.

The whole voluntary sector needs to be part of the solution and grantmakers are aware that more needs to be done to help other charities start the journey to net zero.

Conscious of their unique connection to the charities they fund, grantmakers are thinking through how they can influence and support partner grantee organisations. In this, foundations are finding a balance between inspiring and requiring action.

Some have taken the approach of adding climate change questions to their application process – and prompting from funders was seen as the biggest driver for charities to take action on climate change in a recent SCVO survey. Others, though, have considered but rejected additional application or reporting questions. Particularly when funding smaller charities, there is a concern from funders to avoid creating "an additional burden or tick box exercise", as one grantmaker put it.

Many grantmakers are realising that the charities they fund might already be taking or considering action to reduce their own emissions and improve the environment. They are therefore focusing efforts on offering additional resources to their grantees.

This might look like supporting a transition to higher environmental standards in grantees’ buildings; or it might be offering a climate literacy or sustainability leadership course; or even connecting grantee organisations to other partners who can advise on the best approach.

Below are some direct quotes from foundations signatory to the Funder Commitment on Climate Change explaining how they are integrating climate concerns into their funding programmes:

  • We ask all funded partners to tell us what actions they have taken on reducing their carbon footprint.
  • “We are in the process of refreshing our application and monitoring forms and have included questions here about action on climate change.
  • We encourage all our grantees to act in an environmentally-sustainable manner and are in the process of making specific requirements for our grantees.
  • We are funding organisations that are very aware of the environmental impacts of their work, but we would call them out if we felt they weren't doing as much as they could.
  • We have introduced criteria and conditions on environmental sustainability and reducing CO2 emissions in our awards and grants.
  • We have started work to scope… how we can better support our grantees to transition to net zero through additional support.
  • We have looked at [opportunities] to be more environmentally minded within some of our existing, non-climate partnerships.


What does this mean for the charities they fund?

It’s clear the climate crisis needs urgent action. But for many organisations this urgency is competing with countless other pressures, issues and beneficiary needs that are equally urgent and visibly demand attention. This understandably creates barriers to engaging on climate change, and grantmakers ought to be working to support their partner organisations to overcome these.

Nonetheless, momentum is growing as climate change rises in prominence on funders’ own agendas and more foundations are intentionally considering their role in addressing the causes and effects of the climate crisis. This may result in more funders expecting to see grantees being intentional in their response to the climate crisis too.

Based on how funders are approaching the issue, below are three areas where they might like to see grantees act too. These align with the sustainability leadership principles framework identified by the charity chief executives’ body ACEVO:

  • Acknowledging and articulating the risks posed by the climate crisis is a prerequisite to any meaningful action. This has been a starting point for grant-makers in their own work and is an important step for other charities too. Developing an understanding of climate change and climate justice, exploring how these intersect (explicitly and implicitly) with your own mission and charitable objectives, and considering the implications for your work and your beneficiaries or service users are key actions. Within this, bring senior staff and trustees on the journey with you.

  • Get started and learn as you go, however small your first steps might be. This might mean looking at your emissions, measuring your carbon footprint, asking questions about your pensions, or undertaking a climate literacy course. Connect with others who are in a similar place to you to share learning as you go and ask your funders how they might support you or connect you to others. There are plenty of organisations in this space who have resources and knowledge to support you in integrating a climate lens to your work.

  • Use your voice to influence others and champion climate within your space. Civil society should be at the heart of debates around a fair and just transition to net zero emissions. Your organisation is best placed to share expertise and make visible the intersectional impacts of the climate crisis for the communities or causes you work with. Use your platforms and networks to amplify the voices of those advocating for change, shar your progress and learning, and hold peers and partners (including funders) to account on their climate work. It is a challenge that requires collective and collaborative solutions.

Written by Joanna Pienkowska, Senior policy and engagement officer, ACF



1. Introduction from Richard Sagar, CFG

2. It's time to get real about ESG

3. Building a net zero strategy

5. Understanding energy consumption

6. Net zero and procurement part 1

Part 2: Steps to becoming verified carbon neutral

Part 3: What are scope 3 emissions? Why account for them?

7. Pensions and net zero part 1

Part 2: Risks and opportunities