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Challenges Faced by Small Arts Organisations

by | Aug 2, 2022 | Emma Willder

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Over the past two years, the charity sector and, in particular, small arts organisations have not only faced a reduction in available funding, but many have also faced a great deal of public scrutiny.

Funders now want clear evidence and communication on how public money is supporting the initiatives of the charity, and studies carried out by the University of Sheffield, the University of Kent, and the Chartered Institute of Fundraising report that approximately 62% of charities stated a significant decline in funds during the pandemic and a 63% increase in workload!

Agreeing unanimously with the increase in workload is David Allen from Skylight Circus Arts (a small arts charity that uses creative circus performance techniques and skills to support personal, physical, and social development as well as wellbeing). We recently chatted to David to discuss the challenges the arts and culture sector has faced over the past few years and the impact he has seen and indeed that Skylight Circus has felt.

However, in this post, we aren’t focussing on the negative; there is light at the end of the tunnel and what we’re beginning to see is how this highly creative industry is shaping challenges into opportunities, opportunities to grow, and create sustainable futures.

Challenges faced

Lack of awareness

There is an inherent lack of awareness surrounding arts organisations and where funding comes from to support such charities, especially smaller cultural charities.

One of the most significant challenges faced is that due to many arts organisations receiving government funding and large sums from the Arts Council England, individual contributions and donations can often seem insignificant in comparison.

This is a big challenge for smaller charities, as these perceptions and beliefs can and do have a negative effect on fundraising efforts and activities.

The funding landscape has changed

Funding has substantially changed over the years, with money no longer readily available to be soaked up.

Now, there is a significant increase in competition for funding, with organisations now pipped against each other for the same pot of money.

Funding applications can also be complex and not everyone’s forte.

Often horrendously complicated, many charities, especially smaller arts charities, aren’t meeting or fitting the criteria for funding, with no feedback or reason why.

Public and private donations have also fallen over the past few years; as for all, the UK is known as being very charitable; our giving nature is often pulled toward human, animal, and environmental welfare needs, rather than the arts, as we feel a stronger emotional pull.

No clarity in roles and responsibilities

There are very distinct differences between Trustees and management, and during the pandemic, roles and responsibilities within charities were placed under a high degree of scrutiny.

Clarity around roles and responsibilities is a must, that and how confident your trustees feel in all areas of governance—understanding what is expected of them, carrying out reporting and assessments as required, providing evidence-based data, and more.

Reliance on a small number of income sources

Do you only have a small number of income sources?

Can you diversify your income streams? Or are you overly dependent on Arts Council England Investment or your local authority?

Are you considering public investment? How much of this is relative to earned or contributed income?

All of these questions and more have most likely cropped up over the past 12-18 months, and small charities must assess and show where their funding comes from, how secure this is, and if there are other funding streams available to tap into.

Combatting these challenges and coming out of the pandemic slumber

Culture Recovery Fund

In July 2020, the government announced a £1.57 billion rescue package compiled for the UK’s arts and culture sector with:

  • Arts Council England providing £270 million in repayable finance options as well as supporting cultural organisations with £880 million in grant opportunities.
  • National Lottery Heritage Fund receiving £100 million to distribute to those within the heritage sector.
  • England’s cultural infrastructure and construction projects receiving £120 million in Capital Investment support.
  • A grants programme set up and administered by ACE supporting cultural organisations that have been severely affected by COVID-19.
  • General funding for those organisations applying for less than £1 million.

Collaboration in funding opportunities

Now small arts organisations are working together to share funding opportunities rather than competing against each other or be pushed out of the funding arena by larger arts and culture organisations.

Working in collaboration and finding partnerships in your local area can lead to larger joint funding and further opportunities.

Local investments and funding issued from local authorities are happening, albeit just a little slowly.

Tell your story

People want to give something back. To support friends, see heritage sites remain open, support emerging artists and talent, etc., the arts sector needs to draw on this emotional pull to motivate donors to give more.

It is about drawing on audience development and social engagement to increase and maintain fundraising efforts.

It is the story you tell that will support and build stakeholder engagement.

Be clear in communications

To tell your story and then get people to act, you must be clear in your communications. You must ask directly for donations and follow this up by clearly showing people how to donate.

For many organisations within the arts and culture sector, this type of direct communication is out of their comfort zone; however, in today’s world of mass information, direct communication is a must.

Communication should be open, honest, supportive, and authentic.

You must also ensure that you’re transparent in all information you share. You respond positively to information requests. You’re careful and compliant with how you use personal data, and this data is correct, relevant, and appropriate.

You need to build and retain trust, which comes from excellent communication.

Engage boards

Boards need to be engaged, adaptable, and resilient, with trustees playing a greater role and having a deeper understanding of governance and their role and responsibility.

Regarding governance, accountability areas can be complex and certainly not restricted to legal and fiscal responsibilities. This means ensuring that work is aligned to the best interests of communities and stakeholders, considering all social, cultural, and societal responsibilities.

Look at what qualities and skills you need on your board, then carry out a board review gauging approaches to strategy, risk, complexity, creativity, control, people skills, and emotional intelligence – all areas that make an effective trustee.

ChariTEA and Biscuits

Our catch-up with David during our ChariTEA and Biscuits brought to the forefront how we all benefit from the arts, whether learning new skills through circus tricks, visiting a museum, or attending live music venues and people’s theatres.

Yes, small arts and culture organisations face many challenges and will continue to come under much public scrutiny; however, these challenges can be overcome, and with good governance, scrutiny is not a problem.

Tune in to our regular ChariTEA and Biscuits conversations with….. and to catch up on our full chat with David, click here.

In addition, if you would like support with governance, accounting, reporting or assessments and evaluations, make sure to call us on 01204 582 104 or email hello@beyondprofituk.co.uk, we’re always on hand to help.

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