The Challenge

The National Lottery Community Fund is the largest community funder in the UK with the purpose of awarding funding that strengthens society and improves lives across the UK.

The Fund has a commitment to being an environmentally regenerative funder and, to ensure this commitment is met, requires an understanding of the environmental impact of its grantmaking. 

As a first step towards developing this understanding, the National Lottery Community Fund commissioned CAG to do some research.

The Solution

This involved a desk review to look at whether and how other funders are looking at this issue, plus a desk review of 60 projects, selected to be broadly representative of those supported by the Fund.  We then did some initial work to develop project archetypes with an assessment of the likely impact of each. 

We found that the approach of other funders varies considerably. Some require any funded organisation to have a sustainability/net zero plan whilst others offer a grant uplift for environmental action. A minority have carried out detailed analysis of the carbon impact of their grant making – calculating average carbon emissions by size of grant, and some are considering introducing requirements for grantees to meet higher environmental standards for their projects.

Our analysis of the sampled projects indicated that the majority of projects supported by the Fund do not have a significant environmental impact – either positive or negative.  Around 10% had a significant positive impact – through sustainable land management, awareness raising and increased accessibility to sites/services. Another 10% were assessed to have a significant impact that could be either positive or negative – mainly dependent on specifications for construction projects. Only one project had a definite significant negative impact, due to the large number of journeys generated by the project.

We developed 16 project archetypes provide an illustration of the range and scale of impacts, both positive and negative, split across the following project focus:

• Workshops, training sessions or events
• Construction or refurbishment and use of a building
• Nature, gardening and environmental awareness

The Result

We looked at the ‘typical’ environmental impact of each archetype in terms of carbon, waste, biodiversity and awareness.  These archetypes suggested that projects with the most significant negative impacts will be those involving international travel,  demolition and/or building or refurbishing buildings and rural projects involving travel.  

We also provided some options for the Fund to measure and model the impact of its grantmaking, and for individual projects to measure their impact – mindful of ensuring that this is not overly burdensome. Finally, we presented a number of opportunities for the Fund to reduce the negative impact of its grant making – both at the project design/application stage (for example through additional guidance) and through project delivery (for example through the introduction of a light-touch environmental impact reporting tool).

“We gave CAG a very tight timeframe of just 6 weeks to carry out this work and we were very impressed with the depth and coverage of their work. We’ve shared the report internally and are reflecting on the findings; working with our innovation unit we will use it to generate a fuller response to our ‘environmentally regenerative funder’ ambition”. Nick Gardner, Head of Climate Action, the National Lottery Community Fund