HOW CAN THE ARTS BECOME SUSTAINABLE IN A TIME OF CRISIS?
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Author(s): Lindsay Dunbar Type: Provocation Paper for the Clore Leadership Programme Fellowship 2017/18 Note: The paper presents the views of the author, and these do not necessarily reflect the views of the Clore Leadership Programme or its constituent partners. As a ‘provocation paper’, this piece is a deliberately personal, opinionated article, aimed at stirring up debate and/or discussion. Published Under: Creative Commons
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Lindsay Dunbar (Creative Scotland Fellowship supported by Creative Scotland) Lindsay Dunbar has more than a decade’s worth of experience in delivering cultural and cross-sector events/projects. Founder of Play Pieces Arts and creative thinker, she is a leading rural innovator. She has extensive experience of engaging with audiences across rural communities as well as developing cultural and social enterprise networks. Lindsay is a Clore Fellow as well as a Fellow of the Royal Academy of Arts. Currently, Lindsay has been selected to undertake research for the Arts and Humanities Research Council into creative hubs in rural regions. While Highland-based, she seeks inspiration outwardly, acting as an advocate and muchneeded voice for cultural and creative industries in Highlands.
This paper was written as a part of the author’s Fellowship with the Clore Leadership Programme in 2017-18.
The Clore Leadership Programme is a not-for-profit initiative, aimed at developing and strengthening leadership potential across the cultural and creative sectors in the UK. The Programme awards its flagship Clore Fellowships on an annual basis to exceptional individuals drawn from across the UK and beyond, and runs a choice of programmes tailored to leadership needs of arts professionals at different stages of their career. This provocation paper has been produced under the aegis of Clore Leadership Programme. For more information, visit www.cloreleadership.org.
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How can the arts become sustainable in a time of crisis?
In 2007, Mission Models Money (MMM), a national action research programme and campaign for change, suggested that “Despite the brutal facts our sector faces at this time we have found a real appetite for radical change from within the sector”. If we were hungry for radical change a decade ago, we must be starving now. Co-founders of MMM, Roanne Dods and Clare Cooper, suggested That “opportunities for positive transformation need to be exploited by all the different players now if we are to design for transition into a healthier arts and cultural ecology”. More than ten years later, these opportunities have neither been exploited nor even explored. There are many reasons this did not happen. Shortly after the MMM paper was published, the U.K faced the financial crash of 2008. The fiscal environment was not one that looked favourably on the public sector. There were year-on-year cuts across all sectors that impacted directly and indirectly across the cultural sector. We are in a time of crisis across the arts, and our current model of practice does not work in a crisis. The facts, as identified by MMM in 2007, have barely altered. The cultural sector has never before seemed more at risk. We have ignored the warnings from a decade ago and no one is offering solutions. Increasing dependency on public funding, lack of growth, failing to embrace digital innovation, inability to generate income, sector support agencies failing and an institutional approach all continue to fail the sector. There is a structural weakness in the cultural sector that is evident when we look at organisations such as Creative Scotland, which has yet to hold on to a CEO without losing them to another tumultuous news story. With Brexit on the horizon and political
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turmoil in Westminster, the fiscal environment shows no sign of improving and is facing a time of great uncertainty I would argue that this is exactly the time to explore and exploit our hunger for radical change, which addresses decade-old failings across the sector. We are where we are now and there is plenty of understanding about what is wrong. So how do we move forward? Where are we and how did we get here? For many years now, funders have encouraged applicants to demonstrate sustainability in long-term business planning. In many cases, this means offering a product or service as a means to generate income. One problem with this model for the art world is that, usually, one partner in the exchange will need to be in receipt of funding. For instance, a promoter can become sustainable if they can keep the majority of their box office, but that would depend on the touring company being able to subsidise their fee through public funding. Alternatively, a touring company could become sustainable if they were able to receive a representative fee for their work and a box office split on top of that, however that would be dependent on the promoter receiving public funding. If one person in the exchange is vulnerable to risk, neither partner is able to demonstrate sustainability. The current model means we are continually dependent on each other and public funding. Thus, we are never able to produce a financial model that will become sustainable. If the creative world continues to rely on funding bodies for core income, we will forever be stuck in a cycle of dependency. Instead, imagine a creative world that was encouraged to actively make a profit, rewarded for generating more income than they had projected and supported to implement sustainable business models. When will funders start to encourage the creative community to be financially successful, without restricting the ability to create profit for purpose?
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Josiah Lockhart, Chief Executive of Firstport, a social enterprise support agency, agrees that the sector should be comfortable talking about profit instead of thinking of it as a bad thing, and that the trend towards social enterprise is not exclusive to the creative industries. In his opinion, the current funding model died a couple of years ago but we are hanging on to it. Hilary Carty, Director of the Clore Leadership programme and former Arts Council England Director of Dance, suggests funders need to prove to themselves and the government that their funding objectives are correct. This then creates a cycle as applicants are only successful if they can meet the objectives which then confirm this is what is needed by the sector through the successful delivery of the work. Despite this, many organisations and artists are aware of objectives which have not been identified by funders as they are the ones delivering work on the ground. Many arts organisations don’t appear to have the confidence to challenge the criteria set by funders, to take a commercial and creative risk that’s grounded in confidence in their work. And yet artists and the creatives should acknowledge their power to question much more than they realise, given that the system is dependent on them applying and responding to the criteria. Orchestrator of social enterprise The Stove, Public artist and cultural provocateur Matt Baker agrees: funding bodies need creatives just as much as we need them, but he warns that it is a myth that sustainability means not being reliant on public funding. While arts subsidy has been referred to as investment by funding bodies in the past can we commit to language around profitability and reserves as well?
Traditionally, arts organisations apply to national arts funding bodies to subsidise their work. This is because it costs more to produce than it may ever make back. There are various funding avenues currently available but the application process is very similar. You explain your project, your track record, how you will manage it – and, of course, no
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funding application form is complete without a budget. The golden rule for arts budgets is that the income and the expenditure must be equal. There cannot be any loss because that would be a terrible waste of public funding. And equally, there cannot be any profit, because that would be a sign that you don’t need as much subsidy as you think you do. So if an arts organisation does better than projected, should the funder simply deduct any profit from their final instalment? Only in the art world can success and profit be viewed as a bad thing while subsidy is acceptable and the norm. This culture of ‘breaking even’ is draining arts organisations up and down the country because they continue to remain dependent on funders to keep them going. It keeps the funders inundated with applications so they can report back to Governments how much money is needed for the arts all the time, and the cycle goes on and on. As Lockhart explains, we will get there, but there is a risk that experienced but traditional thinkers will feel marginalised. He believes these marginalised thinkers still believe that the best action is to keep doing what they’re doing but with less. For years, this has been an unofficial policy for many organisations as they wait out the difficult financial period, but with so many talented and experienced creatives leaving the sector, there is a need for change. Lockhart sees this traditional thinking as a barrier to development. Traditionalists think that the answer is a new Government cultural policy -- which Lockhart sees as a barrier. The entrepreneurial mindset sees things differently. Why wait for a Government-led consultation into a new cultural strategy that will be out of date by the time it’s published? Why not come up with an active solution now? The social entrepreneur wants to share how they changed the world, with everyone. This is currently not happening in the creative and cultural sector. The creatives seem to look to funders and the Government to lead the way when really they are the cultural leaders and should be dictating the way forward directly through action.
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This would be a radical step for the art world to take in the face of funding bodies and Governments reflecting internally on cultural policy. Action, not strategies. If we don’t like where we are, what are we going to do about it? Social enterprise provides a model that breaks this cycle and challenges the fundingdependent way of thinking. A social enterprise isn’t a legal entity. Instead, it is a belief in how a charity or company limited by guarantee should be run. For starters, a social enterprise must have a clear social, environmental or community purpose. Many arts organisations will already have this embedded in their articles of association. Social enterprises aim to generate at least 50% of their income through trade. For many arts organisations, this can be box office sales, workshop fees, membership and of course selling artwork. The key factor that makes social enterprise a model more arts organisations should be embracing is that any profit must be reinvested within the organisation to support the social purpose. Within the creative industries model, the enterprise of a fashion designer or craft maker appears very clear. They are creating a product which has a market, and if there is a social impact then the profits from the company can contribute to that social impact. While these enterprises may apply for grant funding from time to time, the use it as an investment for growth, rather than existence. Can creative organisations or artists move towards this model within the limitations of current support? Many new social enterprises don’t think about grant funding in the same way creatives do. For them, grant funding is not a sustainable part of their financial model and as a result, they have navigated the barriers of commerce to become sustainable. For social enterprises, funding is seen as a financial step to take them from point A to point B, to allow for growth, rather than existence. Lockhart cites exceptional leaders in the creative industries who are changing the way we think about sustainability. The Cultural Enterprise Office is the main business
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support for creative industries in Scotland and, despite having received support in the past, did not receive regular funding from Creative Scotland in 2018. Their model reflects what they support individuals to do: think entrepreneurially. Arts Council England and Creative Scotland regularly fund Sector Support Organisations (SSO) to provide entrepreneurial advice. In England, 7% of National Portfolio Organisation (NPO) are SSOs and in Scotland, 10% of Regular Funded Organisation (RFOs) are supporting the wider sector. With so little support from funding bodies for sector support agencies and with no clear model for entrepreneurial advice within the funding institutions, where are creatives meant to find the support to become sustainable? At the same time, many of the SSOs in existence are supported primarily by funding bodies. How can you advise someone how to generate income when your own financial model is dependent on public funding? Baker suggests that most artists have a strong social purpose and own the impact that they make, so the start of the conversation is around this change. There needs to be a shift to rediscover the social purpose of art and have an adult conversation about that. The artistic community and funding bodies need to start building bridges. Carty agrees the conversation needs to move in a positive direction, exploring how creatives and funders can share and reward success. Working within aspiration, rather than criteria, would be a radical approach for funders to now consider along with a reach that is far enough, wide enough and inclusive enough. What might working within aspiration look like? The current project-to-project funding applications do not allow applicants to demonstrate long-term aspiration. If conversations with funders allowed creatives to set out their aspirations – creative, financial and social – the creatives could become mission-led, aiming to engage more people, allowing them to fulfil growth potential. It’s a new way to support organisations to become sustainable.
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Carty suggests that the funders wish to continue to be part of the successful narrative. The balance of the relationship between creative and funder seems to be waiting for someone to lay out their true intentions, but who is going to make the first move?
What is the way forward from here? For a long time, we have been hearing that it is going to get worse before it’s going to get any better. The good news is, we are heading close to – if not already in – the worst. So we can start to look at what needs to change. Despite the many variables such as the financial climate, the institutional structures and changing markets, there are models of change that the sector can look to for solutions. Even organisations which have adopted a social enterprise model are still dependent on grant funding. It’s not a sustainable approach to call an organisation a social enterprise. There needs to be a focus on social purpose, income generation and reinvestment. Baker thinks the creative sector needs to agree on a shared set of values and an ethos around the social impact of art. Once this has been achieved then the need to move towards a social enterprise model becomes clearer. The sector can prove its financial and social worth. Lockhart suggests the art world needs to start looking for the evidence of the social impact by changing the reporting, and presenting those who support us with good data analysis of the success, the social impact and the increased participation. He says reports should allow us to demonstrate the capacity to do more good. In doing so, the arts sector will start to understand a values-driven economy. Carty concludes that the way forward is for funders to celebrate the success along with the artists. This would demonstrate that funders have efficiently utilised the public money invested. Suddenly this has become sustainable; it becomes a bigger, better, broader investment with the potential to have an impact across the sector.
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This can be achieved by: ● Creating a shared set of values and shared ethos, and then developing an understanding of what the social purpose is so that the social enterprise model is applicable. ● Acknowledging the support needed to enable sustainability, with enterprise advice from funding bodies and entrepreneurial action from artists. ● Starting to work within aspiration – what is it that we want to achieve creatively, financially and socially? How are we going to make the world a better place through the arts? ● Exchanging learning with social enterprise organisations and CICs. ● Reinvesting profits in ways that meet the social purpose of cultural organisations and benefit the public. To conclude, the social enterprise model offers the arts sector a model of independence, sustainability and social impact which the sector has been seeking for many years. It’s time for creatives and funders to start thinking entrepreneurially and, understanding what that really means, to take action. We may not have another decade to think about it.
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