MMM is working on a major new national research project aimed at designing a new policy framework for building financial resilience in the UK arts & cultural sector. Entitled Capital Matters the research will take an asset based development approach and will focus on two areas:

• Expanding understanding and recognition of the diversity of business models supporting creative practice across the arts and cultural sector, how they are evolving and the factors that will enable that diversity to flourish further.
• Identifying the potential for developing a new generation of specialist financial providers funding and investing in creative practice.

Together with a broad range of industry leaders and a programme of consultations with front line creative practitioners and organisations across England and in Scotland, three interdependent issues will be examined

• The potential for expanding the range of different kinds of financial capital available;
• The development of the skills and knowledge needed to use them and
• The revision of policy and infrastructure frameworks to enable the speedy evolution of both the above.

Why is a new policy framework needed?

MMM’s work to date shows that thousands of arts and cultural organisations in the UK, critical to both the historical and contemporary cultural canon, are over-extended and under-capitalised. In particular, weak balance sheets are endemic in the sector. Often with high fixed costs and inflexible business models, many are overly dependent on annual public sector grants to survive. The fallout of the global financial collapse, which is reducing, contributed income from the private sector is exacerbating this scenario and expected reductions in the availability of public sector grant income will increase stress further.

Nevertheless within this turbulence is an unprecedented opportunity to create a forward looking, national long-term policy framework designed to accelerate evolution of working practices and behaviours by arts and cultural organisations and public and private funders and investors. One which

• helps arts organisations shift away from a subsidy mindset to an investment mindset. From “how can we possibly close the gap between income and cost?” to “what are the core assets of our organisation, intangible as well as tangible, and how can they best be nurtured?” and
• helps catalyse an innovative and fundamental transformation in the sources of financial capital available to arts and cultural organisations. Capital which will enable them to evolve into more resilient, adaptive, organisations delivering cultural excellence to an even wider general public.

The research draws on learning from MMM’s previous work on Expanding the Financial Toolbox and is supported by The Calouste Gulbenkian Foundation’s Innovation Fund, The Northern Rock Foundation, The Scottish Arts Council and Arts Council England.The report recommendations will be published in the autumn.

People

Capital Matters is being supported and delivered by a large array of people who are acting in one of three capacities:

Task Force

• Fiona Ellis (Chair) is also Chair of the NCVO Funding Commission, which has been set up to examine the problems associated with funding in the voluntary sector. She has also served on the Comic Relief UK grants committee and was the vice-chair of Futurebuilders. Until March 2009 she was the director of the Northern Rock Foundation, and before that she worked for other grant makers including the Baring Foundation, the Calouste Gulbenkian Foundation and the Esmee Fairbairn Charitable Trust. Prior to entering the Trusts and Foundations sector, she had a range of arts posts including community arts worker, stage manager, funding officer and director of a rural arts centre. She is joint author of Fairness in Funding, an equal opportunities guide for grant-makers published by the Association of Charitable Foundations.
• Andrew Barnett, Director, The Gulbenkian Foundation
• David Carrington, member of the Supervisory Board of Triodos Bank, member of the Advisory Board of the Centre for Effective Philanthropy
• Mick Elliot, Director, Culture, DCMS
• David Hall, Chief Executive, The Foyle Foundation, Member, Development Council, the National Theatre, Member, Education, Engagement & Access Committee, The Royal Opera House and Co-Director, MMM
• Charlotte Jones, Chief Executive of ITC and Convenor of the ERA21 Group
• Carolyn Maddox, Executive Director, Bridges Ventures
• Mark Robinson, Founder, Thinking Practice and recently Executive Director Arts Council England North East
• Professor Mo O’Toole, Visiting Professor, Newcastle University Business School and member of MMM’s Intelligent Funding Group in the North East
• Jeremy Smeeth, Finance Director, National Theatre of Scotland, Chair of ITC and Member of the ERA21 Group
• Virginia Tandy OBE, Director of Culture for Manchester City Council, Board Member of the National Museums, Libraries and Archives Council, Trustee, National Heritage Memorial Fund
• Stewart Wallis, Executive Director, New Economics Foundation

Specialist Committee

• Penny Vowles, Programme Manager, Northern Rock Foundation and co-leader of MMM’s Intelligent Funding Group in the North East (Chair)
• Dr Claire Antrobus, Clore Fellow
• Pauline Beaumont, Visiting Fellow, Newcastle University
• Catherine Bunting, Director, Research Strategy, Arts Council England
• Maurice Davies, Head of Policy and Communications, Museums Association and member of the ERA21 Group
• Rosie Greenlees, Chief Executive of The Crafts Council and member of the ERA21 Group
• Hilary Gresty, Director, VAGA and member of the ERA21 Group
• Judith Knight, Founder, Arts Admin and member of the ERA21 Group
• Kate Wallace, Senior Research and Evaluation Officer, Scottish Arts Council
• Karl Wilding, Head of Research, NCVO

Research team

• Dr Claire Antrobus, Independent Arts Management Consultant and 2009/10 NESTA Innovation Fellow on the Clore Leadership Programme
• Hasan Bakhshi, Independent Economist and Policy Analyst
• Margaret Bolton, Independent Consultant
• Clare Cooper, Co-Founder and Co-Director MMM
• Holly Tebbutt, Independent Consultant