Funding audit: current practice in racial justice funding

The Funders for Race Equality Alliance is a group of charitable foundations working together to advance race equality in the UK and support a sustained and thriving race equality sector. It does this by increasing funders’ focus on race equality; seeking more and better funding for race equality and Black, Asian and Minority Ethnic-led organisations; and improving meaningful racial representation in foundations. Equally Ours acts as the secretariat for the Alliance.

You can read more about the Alliance and its work here (pdf).

The racial justice funding audit

One of the Funders for Race Equality Alliance’s aims is to increase the amount of funding that is allocated to the Black, Asian and Minority Ethnic* sector and to racial justice work. To achieve this, we need to be able to track how both project funding and core funding changes over time.

*We understand and recognise that there can be differing views on terminology and how best to discuss the race equality agenda. “Black, Asian and Minority Ethnic” was the language chosen when the tool was initially developed in 2019 after consulting race equality campaigners and advocates in order to ensure consistency with the sector. However, we are conscious of the evolution of language, identity and limitations of these terms, as well as the sensitivities and complexities involved. Therefore, since this data has been published, the audit tool has been revised, which includes updating the terminology to “communities experiencing racial inequity”. We endeavour to constantly review this language for future work.

We designed a simple audit tool to enable funders to analyse their portfolios, and to help them develop targets and strategies to ensure they are properly supporting race equality work.

The audit asks funders four questions about each grant:

  • Is the grant-holder’s mission and purpose to support Black, Asian and Minority Ethnic communities and is it led by the communities it seeks to support?
  • Is the grant intended to benefit Black, Asian and Minority Ethnic communities?
  • What type of work will the grant be used for (for example services, buildings, campaigning)?
  • Is it aimed at the root causes of inequality or at alleviating the consequences?

The audit gives funders a snapshot of their current portfolio and will support greater transparency of current foundation expenditure. It is also intended to be used by the Alliance as a baseline against which to measure progress in achieving our aims, and to better our understanding of racial justice funding.

This page reflects all audit results up to November 2021.

Audit results

20 funders who audited either a sample, or their entire portfolios, shared their data with the Funders for Race Equality Alliance. In all, they audited over £271 million-worth of grants, approximately 9% of the value of the total given by the top 300 foundations in the UK as of 2019 (pdf).

1. Grant intended to benefit BAME communities?

Pie chart showing percentage of grants intended to benefit BAME communities?

(You can view a larger, interactive version of this chart here.)

As chart 1 shows, of the funding awarded:

  • 66% was granted to beneficiaries whose ethnicity was unknown or not mentioned by the applicant
  • 17% benefited Black, Asian and Minority Ethnic groups, but the project was not specifically designed for this purpose
  • 16% was for projects designed to benefit Black, Asian and Minority Ethnic groups
  • 1% was not classified

The audit also looked at which types of organisation were funded:

  • 5% of funding went to Black, Asian and Minority Ethnic sector organisations*
  • 95% of funding went to organisations that were not classified as Black, Asian and Minority Ethnic sector organisations

*The criteria used to classify a Black, Asian and Minority Ethnic sector organisation required that organisations have both a mission and purpose to benefit Black, Asian and Minority Ethnic communities and the majority of their leadership (at least half of the senior team and the Trustee board) are from the minority community(ies) the organisation serves.

2. Project type

A pie chart showing the type of projects funded

(You can view a larger, interactive version of this chart here.)

As chart 2 shows, of the funding that went to Black, Asian and Minority Ethnic organisations:

  • 62% was for service provision
  • 15% went on core/general funding
  • 9% went to campaigning/influencing projects
  • 3% went on organisational capacity building
  • 3% went on individual capacity building
  • 3% on other projects (including the arts)
  • 3% on research/policy work
  • 2% went on capital projects
  • <1% went on community cohesion/understanding

3. Project focus

A pie chart showing the focus of projects funded

(You can view a larger, interactive version of this chart here.)

As chart 3 shows, of the funding intended to directly address racial inequality 27% was aimed at addressing root causes of racial injustice and 69% at alleviating its consequences (for example improving access to services or providing culturally-specific support).

How has the audit impacted racial justice funding practices?

“Lloyds Bank Foundation used the Audit tool to categorise our active grants portfolio and to analyse the success rates of Black, Asian and Minority Ethnic-led charities applying for funding.

“Alongside our wider commitment to Equity, Diversity and Inclusion, the evidence from the audit tool led to changes in our foundation’s grant-making approach, including the introduction of a 25% ringfenced fund in August 2020 for Black, Asian and Minority Ethnic-led charities. The findings were also used as a tool to advance organisation-wide conversations and a more targeted approach to work towards becoming an anti-racist funder.”

Next steps to increase funding for racial justice

Since the audit’s conception, it has gained significant attention and uptake from both members and non-members. Two cohorts of results, with data contributed by 20 funders, have been published to date (as of November 2021), with the aim of annually adding data from more foundations. A blog piece comparing the findings of cohort 1 and 2 will be published shortly to highlight emerging themes.

Funders were initially hesitant to conduct the audit and share data on their grant-making portfolios, but it is because of their data transparency that funders have succeeded in inspiring their peers to analyse their data and make real change.

We encourage all funders to use the audit as a ‘starting step’ towards having a more focused and specific approach to race equality funding. The audit should be used as a snapshot of funders’ current portfolios, with the aim of repeating the audit annually or bi-annually, depending on capacity, to track progress.

Since this cohort, we have revised our racial justice audit tool to integrate it with 360Giving’s new DEI Data Standard and to update the language and terminology we use to “communities experiencing racial inequity”. If you’re a charitable foundation and you would like to complete the racial justice funding audit, please contact No individual funder data is published in the Alliance’s findings.

Participating funders:

  • AB Charitable Trust
  • Barrow Cadbury Trust
  • Bedfordshire and Luton Community Foundation
  • Clothworkers’ Foundation
  • Comic Relief
  • Esmée Fairbairn Foundation
  • Goldsmiths Company
  • Henry Smith Charity
  • Indigo Trust
  • John Lyon’s Charity
  • Joseph Levy Foundation
  • Joseph Rowntree Charitable Trust
  • Joseph Rowntree Foundation
  • Lankelly Chase
  • Lloyds Bank Foundation for England and Wales
  • Paul Hamlyn Foundation
  • People’s Health Trust
  • Smallwood Trust
  • The National Lottery Community Fund
  • Trust for London

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