How Funders are Driving Systems Change in Response to the Climate Crisis

Yesterday, June 5, was World Environment Day. And this year the theme is “Only One Earth,” highlighting the need for us all to live sustainably and in harmony with nature by making transformative changes in our policies and our choices.

This transformation must happen in our communities, in our workplaces, and in ourselves. The nonprofit sector is a broad community of organisations focused on everything from cultural heritage to social housing, from publishing to disaster relief, and while responding to the climate crisis is now a priority we all share, many organisations are still only beginning their sustainability journey.

Funders are seeing this challenge and answering the call, using their influence to not just support the sector’s own path to net zero, but also increase the capacity of the sector to drive an equitable transition to net zero globally.

Across the world, leading funders like the Ford Foundation are implementing climate action strategies that go well beyond their own governance responsibilities to end investment of endowments in fossil fuels and seek opportunities to invest in alternative and renewable energy. They are also pivoting their mission, and driving systems change through new programs that fund climate action, and by integrating sustainability principles horizontally across all other existing programs. 

Throughout the Global South, the extraction of natural resources — metals, minerals, forests, and fossil fuels — is growing rapidly, causing severe environmental damage and social harm, particularly to indigenous and rural communities. By 2030, the Ford Foundation aims to ensure the needs of rural, low-income, and indigenous communities are reflected in policies and practices related to natural resources in the Global South, helping them to secure land rights and have their say in the planning of projects. 

Among other key areas, the Ford Foundation enables indigenous peoples and local communities to establish alliances and networks locally and globally, and access public and private decision-making spaces to build their collective power, so they can shape decisions that affect their land and rights, and curb climate change.

The National Lottery Community Fund is the largest funder of community activity in the UK, uses Salesforce to manage its grant programs and has awarded almost £400M since 2016 to projects that include environmental action. We spoke to Nick Gardner, the Fund’s head of climate action, who shared with us some key questions they needed to address when forming their organisation’s environment strategy.

“Through conversations with colleagues, partners, and applicants, we identified a number of ‘tensions’ in how to prioritise what ‘good’ looks like, and how to shape our programme,” Gardner said. “We asked ourselves: Given the scale and urgency of the climate emergency, do we want to focus on climate adaptation? Or mitigation? On tried-and-tested solutions that are ready to go, or untested solutions that will require more research and development, but are potentially more innovative? And how can we accurately measure the carbon reduction that results from these projects?”

For anyone looking to think through these questions and more for their organisation, Nick shares some sage advice in his blog post “Funding Community-led Climate Action: Exploring Some Key Tensions.”

Beyond the actions of individual funders, communities of funders are also emerging to set standards. The Funder Commitment on Climate Change commits foundations to decarbonise operations, commit resources, and integrate sustainability principles across all programs. 

As funders increase their focus on driving systems change, a key question emerges: What does this mean for grantees?

Gardner from The National Lottery Community Fund highlights how it is becoming increasingly important for grantees to be able to demonstrate their sustainability policies and their commitment to net zero. But help is at hand, and he sees funders having a key role in helping to build the sector’s capacity here.  

For those nonprofits that integrate sustainability and climate action in their strategy, a new stream of funding opportunities is emerging. For those that don’t, the risk to long-term income generation is increasing.

If you want to kickstart a climate action plan in your nonprofit organisation, check out these three tips.

Want to get involved in World Environment Day? Check out these events and promote the Only One Earth campaign on your social networks.

Jonny Elliot
Nonprofit Strategic Industry Advisor at Salesforce.org

Jonny is a technology executive with 15 years experience leading end-to-end digital transformation programmes in the software and nonprofit sectors. He is passionate about the role digital can play in helping organisations advance their vision, mission, and impact.