Paying what it takes: Funding indirect costs to create long-term impact 2022

New research by Social Ventures Australia and Centre for Social Impact has shown that not-for-profit organisations are underinvesting in critical capabilities, thanks to a belief that funders are unwilling to fund the full cost of impact. Solving this issue requires substantial shifts across not-for-profit, philanthropy, government, the public and the media to ask the question – are we paying what it takes?

Thriving not-for-profit organisations are critical to the future productivity and wellbeing of Australia. But right now, when they are needed most, many not-for-profits are struggling. Recent reports have shown that:

• Many charities operate with thin or no margin and did so even before the COVID crisis.
• Many charities operate with limited reserves.
• A majority of charities reported that recent events had put strain on their financial operations, and more than half of the organisations were worried they would not be able to provide their services in the current economic climate.