Ratings given to Russian CSOs
Digitalization, grant availability and solidarity: CSOs and the trends in ratings
How the first ratings of charities have surprised CSOs and how the sector looks set to develop in the future.
In April 2020, Dmitry Grishankov, CEO of the RAEX rating agency, presented the first initial charity rating based on data from 2018. Grishankov said that they plan to present a second rating at the beginning of 2022, as well as a benchmarking system for CSOs so that organisations can “not only find out their rating but compare themselves to their competitors.” The ratings are available on the ASI website.
Falling CSO proceeds
As shown by the RAEX ratings, fundraising proceeds amongst CSOs are on the decline: in 2017 the total figures increased by 18%, in 2018 they fell by 1%. At the end of 2018, both income and expenditure fell for 64% of CSOs that were included in the rating.
Yulia Danilovna, Editor-in-Chief of the Miloserdie.ru portal, believes that the stagnation seen amongst fundraising CSOs in 2018 has already improved.
“I am quite confident that the pandemic will show us a dramatic change in the landscape. Our proceeds have doubled. And I know of many other charities that have dramatically increased their fundraising proceeds. There are a lot of us.” Danilova said.
Danilova was surprised by the data on organisations’ transparency. “For example, according to RAEX, some of the largest organisations are not leading in terms of transparency and this really shocked me. At the same time, there is the rating category ‘Starting Point’ in which I’m sure all big organisations have the top gold standard” she explained.
Access to grants
Tatyana Apatova, the Executive Director of the Pravmir Foundation, noted that the ratings took into account the participation of CSOs in state grant programmes. The availability of grants is one of the important trends in the sector.
“Grants are a simple and accessible source of money for CSOs. It’s become much easier to obtain a grant for a wide range of projects. If you can highlight a problem area, donors appear, budgets grow and so does access to grants. I would advise other small but ambitious charities like Pravmir to look into receiving various grants,” Apatova said.
Financing statutory activities
According to experts, the grant system itself is changing. Natalya Polyakova, Executive Director of the Absolute Help Foundation, noted that institutional support for CSOs is becoming the norm.
“For us, as a foundation that funds many projects, the effectiveness and implementation of these projects is very important. And in this regard, we are interested in organisations’ sustainability. And this is where we see social investment take off – through institutional support. We provide CSOs with financial backing, including the financing of statutory activities,” said Polyakova.
She noted that this trend began in the spring of last year, at the very beginning of the pandemic and lockdown. And not only the Absolute Help Foundation, but other grant-giving organisations too, for example, the Potanin Foundation.
“For the first time we redistributed the finances for anti-crisis measures and advance-released part of the grants. Amongst other things, organisations could spend their funds on statutory activities” explained Natalya Polyakova.
Tatyana Apatova predicted that two trends will develop in the near future: digitalization and diversification of revenues.
“We, like other foundations, will strive for a balance between private donations and donations from legal entities and grants, because we want to create a sustainable system, to work consistently and to help effectively,” explained Apatova.
Natalya Polyakova stressed that this requires a growth of professionalism in the sector – digitalization and diversification require the training of specialists.
According to Faina Zakharova, the President of the Life Line Foundation, the digitalization of the sector helps develop the awareness of charity among young people.
“Since the digital is developing now, a trend is gradually emerging in the development of youth charity. Because young people have the best grasp of technology, we need to learn their language in order to appeal to them,” Zakharova noted.
Lev Ambinder, President of Rusfond, believes that social entrepreneurship can become one possible route for the development of fundraising organisations.
“But here we have a problem – government funding. We do not have a market for social entrepreneurship and we never will have one, because we do not have a market economy […] So, it is possible to create a social project from charitable donations, such as the register for bone marrow donors, which can bring in about 500 million roubles a year, but charity money cannot be exploited,” Ambinder added.
Experts also noted the growing trend of intersectoral interaction: collaboration and partnership, including with the state. Olga Drozdova, Project Manager at ASI , stressed that last year there were a number of collaborations between CSOs and small businesses.
“In general, the message of solidarity is growing. The interest in social issues from the media will also grow,” Drozdova said.
The discussion The Landscape of Russian Philanthropy as Reflected in the Ratings was held at the Forbes Forum of philanthropists and patrons on 2 March. The Agency for Social Information is information partner of the forum.