Impact as a funding concept

The goal of impact orientation is to develop a shared understanding of impact, reflect on it with the funding partners, and apply it consistently. This involves planning, capturing, and assessing impact, so that learning can take place. The Foundation’s Board is responsible for the normative management. This means translating the foundation’s purpose into values and a funding strategy. The foundation uses a deliberate, consistent language with clear terminology when it comes to impact.

Efficiency and effectiveness are prerequisites for achieving the maximum impact of funding activities. As a basis for its funding activities and impact measurement in its three themes, Somaha Foundation uses ToCs. The awarding guidelines define the conditions and criteria for the foundation’s allocations. These are regularly reviewed and adjusted if necessary.

Governance establishes processes for targeted impact management and the further development of impact. The Foundation’s Board outlines its responsibilities, tasks, and competencies in a manual. The Board maintains an open and efficient culture of discussion and decision-making. The broad range of funding partners is currently not represented on the Board. The expertise within the foundation's office fills this gap. Somaha Foundation follows a clear separation of competencies between the Board and the office. The implementation of funding decisions is solely the responsibility of the Somaha office. The staff members of the office have clear, individual goals and targeted key outcomes. Impact is a fixed agenda item in board meetings, planning and reporting meetings, and internal partner meetings. Team members who are in direct contact with funding partners and participate in Steering Committee Meetings are part of the impact discussions in projects.

Orientation creates frameworks for simple and guided impact presentation. An example of this is the Somaha Localization Model. This model provides a structure for analysing the initial situation and developing the interaction between international NGOs and their local partners. Written reporting is carried out annually for each project by the funding partner.

Participation enables possibility of inclusive involvement of stakeholders. In exchange with funding partners, there is active involvement in joint project development and during the project through regular exchange within the framework of a Steering Committee. In these Steering Committees, alongside Somaha Foundation and its funding partners, other stakeholders are also represented, such as other funding foundations that promote projects with Somaha Foundation, and independent experts.

The Somaha Impact Model is publicly accessible and open to the participation of further actors in its development, together with the Foundation’s Board, office, and funding partners. This also allows for the continuous development of impact orientation.

To structure its funding activities, the Somaha Toolbox defines both funding methods and impact types. The funding methods of Somaha Foundation are primarily project funding, program funding, impact investing, and its own operational activities. The targeted types of impact are emergency relief, capacity development and sharing, capacity application, and community-building. In all three Somaha themes, the foundation supports capacity development and -transfer through its funding partners. In the first and third funding themes, it also supports capacity application. In the first funding theme, the Somaha Foundation additionally provides emergency relief; in the second, it contributes to community building. All foundation activities are carried out in the form of project and program funding, as well as through impact investing. Currently, Somaha Foundation refrains from its own operational activities due to resource constraints.

The Impact Model of the Somaha Foundation presents the ToC of the three funding themes in a generic way:

• People in need
• Open and diverse society
• Nature protection

The three ToCs show the involved actors and their interactions. The impact of the funding activities, shown below in the Somaha Impact Model, results from a causal chain extending from the foundation’s resource allocation to changes at the systemic level. In doing so, the foundation fulfills its purpose and contributes to the relevant Sustainable Development Goals (SDGs).

The structure follows the logic of a so-called IOOI Model (Bertelsmann Foundation, 2010), which structures the impact as follows:

• Input: Foundation's resource allocation
• Output: Offers for the target groups; prerequisites for impact in terms of links in the causal chain
• Outcome: Contribution to a vision; impact for a specific target group
• Impact: Vision to which the funding makes a contribution; impact in the sense of changes at systemic level