What information does a funder need to understand the work of an organization it supports?

Do more data and more oversight always lead to better understanding? How much does it cost both sides to produce and review all this information? These are central questions in philanthropy and, in particular, in trust-based philanthropy, because they challenge an intuitive but not always accurate assumption: that more oversight necessarily leads to better understanding.

Before going further, it is useful to clarify what we mean. Trust-based philanthropy is not simply a way of practicing philanthropy that includes an element of trust between those who provide resources and those who receive them. It is a specific approach to philanthropic practice, developed over the past decade within the international philanthropic sector and formalized by the Trust-Based Philanthropy Project. At its core is the recognition of power imbalances within the philanthropic system and, in particular, in the relationship between funders and organizations. The two sides have different roles, responsibilities, and areas of expertise: the funder is responsible for managing and allocating resources, while the organization brings knowledge of the context and the expertise to act within it. Recognizing and respecting these differences helps both sides work more effectively toward a shared social mission and respond more effectively to the needs of the communities involved. Trust-based philanthropy seeks to address these imbalances by promoting more transparent relationships grounded in mutual responsibility.

This is where trust and oversight come together. In this article, we use “oversight” as an umbrella term for the reviews, information requests, reporting requirements and monitoring activities through which a funder follows how resources are used and how the funded work is progressing. Trusting organizations does not mean giving up verification of how resources are used or what is happening in practice. It means asking which forms of oversight generate useful knowledge and which risk adding mainly procedures and administrative work.

We have already explored part of this topic in our article on intentional trust. Here, we want to look more closely at one specific question: how responsibility and verification can help us understand what is happening more clearly, without turning oversight into an end in itself.

Trust is not the absence of oversight

Trust can be thought of as an invisible resource in the relationship between a funder and an organization. It does not replace responsibility or verification, but it can make oversight more proportionate and more useful. When a funder knows an organization well, understands its work and recognizes its expertise, there is less need for constant reassurance through overly detailed procedures and information requests.

This does not mean that standardized oversight tools are of little value. On the contrary, they are often useful in monitoring processes because they make it possible to collect the same information from different sources and track data over time. Precisely because they are designed to work across many different contexts, however, they cannot always capture on their own the specific characteristics of an organization, the place where it works, or the problem it is trying to address.

For this reason, alongside quantitative data and information collected in standardized ways, it can be useful to choose different tools depending on what we are trying to understand. A funder may need to know how resources have been used and how many people an initiative has reached. At other times, it may be just as important to understand why an organization chose a particular strategy, what unexpected challenges arose along the way or what it learned in the process. Some of this information can be captured effectively through a quantitative indicator or a report; other insights are more likely to emerge within a relationship of trust built over time through listening and open dialogue.

Nurturing this relationship requires time, attention and openness from both sides. For the funder, this means listening and recognizing the organization’s expertise in the context where it works; for the organization, it means being able to engage in an open exchange, sharing not only results, but also challenges, changes in direction and new opportunities. Trust grows through this kind of reciprocity: each side needs to be able to rely on the other and feel free to bring more complex issues into the relationship, rather than simply presenting what it thinks the other expects to hear. In this way, both become active participants in the relationship, and greater mutual understanding can make some forms of standardized oversight more targeted and less burdensome.

In this sense, trust-based philanthropy does not argue for less oversight as a matter of principle. It calls for avoiding unnecessary forms of oversight that add little to our understanding of the situation, in favor of a different kind of knowledge: the kind that can emerge from a relationship of trust built and sustained over time. Investing in the relationship, just like standardized and extensive oversight, requires time and energy, but it produces something different: not only confirmation of what has been done, but a deeper understanding of the context, the choices being made and the changes shaping an organization’s work.

Oversight does not necessarily lead to understanding

Having more information does not automatically mean understanding a situation better. Understanding also means knowing how to make sense of data, place it in the context in which it was produced and see how its meaning may change over time. This is particularly important for organizations working in the social and philanthropic sectors, which seek to address vulnerabilities affecting places and communities and therefore need, first of all, to understand the context and the relationships that shape it.

A funder may receive very precise data about what has been delivered: how many people took part in an activity, how many service hours were provided or how resources were used. This information is important, and often essential, but understanding what those numbers actually tell us requires knowledge of the context. The same figure may be positive in one situation and signal a problem in another; it may be meaningful at one point in time and take on a different meaning a few months later if conditions change. This is why interpretation cannot rely on a detached reading of the data alone. Organizations working directly in a community or on a particular issue have knowledge rooted in experience and in relationships built over time. A funder can read a report, but it is difficult to fully understand what it means without trusting and listening to those who know the context firsthand.

In fact, a first element of trust is already present in the very decision to fund an organization. That choice implies recognizing, at least to some extent, its expertise and its ability to act. Trust-based philanthropy encourages funders to extend that trust beyond the initial funding decision: not simply providing resources, but valuing the organization’s own understanding of the context in which it works and its ability to explain why something is working or why a change in direction may be needed.

An example can make this more concrete. Imagine a reforestation initiative in a deforested area inhabited by indigenous communities. The fact that 10,000 trees have been planted is a clear data point, but it does not tell us whether the initiative is actually achieving its intended conservation goal. If, for example, the soil were unsuitable for the trees’ survival because it had been contaminated by waste discharged by companies with an interest in keeping the area uninhabited and devoid of vegetation, it might be more effective to scientifically document the environmental effects of that pollution and support the communities in advocacy efforts with local authorities, rather than continue planting trees that are unlikely to survive. In this case, measuring only the number of trees planted would present an apparently positive picture, without helping to identify either the real problem or the most effective ways to address it.

This is where dialogue becomes essential. An organization that knows the area can explain, for example, that a reforestation initiative cannot succeed until the underlying causes threatening the trees’ survival are addressed, and can suggest more appropriate strategies based on its own experience. This interpretation does not contradict the data collected – it gives the data meaning, helping the funder understand whether resources are contributing to the intended results and make better decisions based on the organization’s on-the-ground expertise.

Without a sufficiently open relationship, however, there is a risk that both sides continue to focus on formally sound indicators without noticing that something important is changing beyond what is being measured. This is why trust is not simply an added element in the process of understanding: it creates the conditions for challenges and changes in direction to become part of the conversation rather than remain invisible.

This is also the thinking behind the framework developed by the Trust-Based Philanthropy Project together with the Center for Evaluation Innovation, which encourages us to see evaluation not only as a tool for accountability, but also as a tool for learning and decision-making. Data remains essential, but it becomes much more valuable when it can be interpreted together with people who know the context and is connected to the changes taking place.

Every form of oversight comes at a cost

When a funder asks an organization for information, producing that information takes time and resources. There is also a cost for the funder receiving it: once the information has been produced, it needs to be reviewed and assessed. The cost of oversight therefore affects both sides, although it can weigh particularly heavily on organizations, which often have to adapt to different procedures and formats for each funder.

This work can be entirely justified. Complex funding may require thorough oversight, and there are good reasons for that. The question is how much work should go into oversight in relation to the value that oversight provides. Indeed, the time an organization spends responding to a funder’s requests is time it cannot spend advancing its social mission.

It is worth remembering that this mission is precisely the shared goal of the funder and the organization. Imagine, for example, an organization working to prevent students from dropping out of school. In this case, both the funder and the organization want more young people to be able to continue their education. Verifying that certain administrative requirements have been met may be necessary, but compliance with those requirements remains a means, not the outcome the funding is intended to achieve.

One figure helps make this more concrete. Partnering for Progress, a 2025 report published by the Center for Effective Philanthropy, draws on responses from 5,104 organizations supported by 26 Europe-based philanthropic funders. For each grant, organizations report spending a median of 55 hours on funder-required processes, from the initial proposal through final evaluation. That amount of time is not necessarily excessive: if the process provides access to significant resources and helps support the funded work effectively, it can be a fully justified investment. The figure becomes more meaningful, however, when we consider how many organizations seek and manage funding. They often face similar requests from different funders, each with its own rules, formats and timelines, requiring organizations to adapt the same underlying information again and again. In this context, the 55 hours required for each individual funder can become highly significant. These procedures also carry a cost for funders themselves: reviewing and assessing documentation from dozens, or even hundreds, of organizations takes time, especially in competitive selection processes such as open calls for proposals.