As I look out across the rooftops of central Brussels, helicopters buzz through the air, traffic is diverted, and roads are closed to ensure the speedy and safe arrival of Heads of State and their ministers at the latest EU summit.
A Trump-led US has quickly brought economic instability and physical threats to our doorstep here in Europe. While a certain amount of “shaking things up” can improve efficiency and refine objectives, this assumes that values are shared, and goals are negotiated and agreed upon with all key stakeholders. They are not.
Instability has the double negative effect of increasing humanitarian crises and therefore needs, while simultaneously diverting funding away from those crises, either to cover national government shortfalls at best or to support rearmament at worst.
Let us examine how economic uncertainty, shifting donor priorities, and evolving government policies are shaping the way charities and social enterprises secure resources to sustain their missions.
Current Challenges in Non-Profit Funding
Economic Pressures and Inflation
The global economic climate presents formidable challenges for non-profits. Rising inflation has increased operational costs, while economic downturns have led to a decrease in both individual and corporate giving. Many donors, both private and institutional, are becoming more cautious with their funds, prioritising essential services over broader social causes.
Shift in Government and Institutional Funding
In Europe, the European Union (EU) remains a key funding source for non-profits, particularly in areas such as humanitarian aid, environmental sustainability, and social inclusion. However, the complexities of accessing EU grants, coupled with increased competition, make it difficult for smaller organisations to secure long-term funding. Additionally, post-pandemic recovery efforts have shifted public funding towards economic resilience, leaving some non-profits struggling to maintain previous levels of support.
Even before the current freeze on spending (France has reduced its development budget by 34% compared to the previous year, and the Netherlands is planning cuts amounting to two-thirds of its development spending over the next three years), the United States Agency for International Development (USAID) had evolved its funding priorities to focus on global health, climate action, and governance. One clear observation here is that the fluctuating political dynamics in Washington impact the world, prompting organisations to diversify their revenue streams to ensure stability.
Increased Scrutiny and Compliance Requirements
Both in Europe and the U.S., funders are demanding greater transparency and measurable impact from non-profits. Organisations must invest in data collection and reporting capabilities to meet the stringent requirements of grants and large philanthropic donations. While this shift encourages efficiency and accountability, it also places yet another administrative burden on already stretched teams and comes at an additional cost.
Future Trends in Non-Profit Funding
The Rise of Impact Investing
Impact investing where investors seek social and environmental returns alongside financial gains is growing in popularity. Foundations and high-net-worth individuals are increasingly channelling funds into social enterprises and mission-driven organisations rather than traditional grants. Non-profits that align their initiatives with impact investment criteria stand to benefit from this trend.
Technology and Digital Fundraising
The digital transformation of the non-profit sector is accelerating. Crowdfunding, peer-to-peer fundraising, and blockchain-based donations are becoming more prevalent. Organisations that leverage digital tools to engage donors and demonstrate transparency will be better positioned to attract funds. Additionally, artificial intelligence (AI) and big data are helping non-profits personalise donor engagement and optimise fundraising strategies.
Strengthening Public-Private Partnerships
Collaboration between non-profits, corporations, and governments is expected to grow. In Europe, the EU is encouraging such partnerships through initiatives like Horizon Europe and the European Social Fund. In the U.S., corporate social responsibility (CSR) initiatives are driving more private-sector involvement in philanthropy. Non-profits that align their missions with corporate ESG (Environmental, Social, and Governance) goals will likely find increased funding opportunities.
Implications for Candidates and Hiring Trends
For professionals in the non-profit sector, these shifts mean organisations are looking for leaders who can navigate complex funding landscapes, build strong partnerships, and implement innovative fundraising strategies.
Key skills in demand include the ability to craft sustainable strategies that are agile enough to adapt to changing policy and funding landscapes while keeping all key stakeholders on board and committed to the end goal. The not-for-profit sector would do well to place increased focus on financial and risk planning as an integral part of strategy development.
Experience with measurement and evaluation tools that underpin accountability to both donors and beneficiaries will be even more highly valued.
Now is the time to take a step back and re-evaluate relationships and priorities—diversify income streams, but focus output and expenditure. Practise your values and be authentic in your outreach. This is the moment to be bold and brave, to stand up for your principles.
Oxford HR will play a crucial role in identifying talent with these capabilities.
The funding environment for non-profits in Europe and the U.S. is evolving rapidly. While economic pressures and regulatory challenges present obstacles, new funding opportunities are emerging through impact investing, digital innovation, and cross-sector collaboration. Non-profit professionals who develop strategic fundraising and financial resilience skills will find themselves in high demand.
The cold winter sun reflects blinding light off the helicopter tails as they pivot over Schuman Square, heading back to the airport. Will we have peace by springtime?
Dr Rachel Barlow
Dr Rachel Barlow joined Oxford HR in May 2020, She is a headhunter for the EU not for profit sector, recruiting for civil society organisations, business associations and alliances. A Professor of lobbying at Vesalius College, Brussels, Rachel is also a Board member of the leading Thinktank, the European Policy Centre.
A self-confessed governance geek, Rachel relishes re-structuring complex organisations so that they can better serve their members and fulfil their respective missions. More recently, she has worked closely with NGOs to assess their “fitness” to take on the challenges of the new EU legislature and advises on best practice for team structure and cohesion for public affairs success.
As a former Vice President of Kellen Europe (an association management company), Rachel has led, created, managed, advised and represented European and International multi-level organisations throughout her 25-year career.
Rachel is British (soon to also be Belgian), Brussels based, and speaks fluent French and Italian.
