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— To reflect on current goals, values, models espoused by arts
funding bodies around the world as they relate to
sustainability for arts organisations
— To hear about some recent research findings and initiatives to
do with arts funding, management and sector practices that
can increase sustainability for arts organisations
— To consider some proven alternate models which may be of
relevance and value to NZ arts organisations in their search
for sustainability
— Sustainability (NZ, Australia, Singapore, UK, US)
— Artistic vitality (NZ)
— Artistic vibrancy (Australia, Singapore, US)
— Excellence, creativity, innovation (Australia, Singapore, US) = High
quality arts, innovative work (NZ)
— Cultural diversity (Singapore) = diverse participation (NZ)
— International success (NZ)
— Arts leadership (NZ, Australia, UK, US)
— Sector development approach (NZ)
— Capability-building (NZ, Australia, Singapore, UK, US)
— Arts development (NZ, Australia, Singapore, UK, US)
— Cultural/artistic engagement (Australia, Singapore, UK, US) =
Participation (NZ)
— Relevance (US, UK)
— KArtistic vibrancy͟ includes artistic quality/excellence,
audience engagement and stimulation, innovation - a
fresh approach to the preservation/development of
the artform, development of artists and relevance to
community [Australia Council for the Arts]
— Artistic vitality - how strongly your organisation
supports the creation, presentation or distribution of,
or participation in, high-quality New Zealand arts
experiences and the commissioning, development,
presentation or re-presentation of distinctive New
Zealand work. [CNZ]
a) continuing to do what do now, much in the same way as
we do at present, with similar outcomes and levels of
financial viability as at present?

b) continuing to do what we do now, only more effectively for

all involved, and with improved financial viability?

c) doing much Kbetter͟ than we are doing now, with greater

value achieved in all outcomes for all involved, and improved
financial viability

d) something even better than that plus great art for

everyone?
— In the US, arts analysts have bluntly declared that there are simply too
many "walking dead" non-profit/arts organisations which make very
little impact and do little more than duplicate what other organisations
are doing.
— The analysts note that growth in the NFP arts sector has meant,
almost without exception, growth in organisation size, not growth in
artistic complexity or depth of reach.
— And that the Kart of sustainability͟ now outweighs the quality of the
artistic expression such organisations are achieving ʹ that
sustainability has come to be measured by the organisation simply
remaining in existence, regardless of the outcomes achieved.
— This has to be turned around , they say - better art is the goal, not
increased organisational survivability

[State of the Art: Innovations and Impediments in Not-for-profit Arts.

http://www.artsjournal.com/state/ 2010-11.]
— to act in ways that nurture, and do not deplete or damage, now and in the
future, enabling people to provide for their social, economic and cultural
wellbeing, and health and safety. [ NZ Govt Resource Management Act]
— sustainability is integral to developing respect and care, protection and
restoration of diverse communities of life, and to social and economic
justice, tolerance and peace [--Karen Barbour Sustainable dancemaking]

— ! 
 

   
  
 

  

 



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— Shared artistic purpose in company ʹ to be mission-led
— Strong artistic leadership and governance
— Openness to feedback from peers, staff, audience,
community, other artists, funders
— Organisational mechanisms to receive feedback and engage in
dialogue
— Self-awareness and willingness to undertake self-reflection
(Australia Council for the Arts )
— The 7 Pillars of Audience Focus concept has been developed by UK
arts consultancy Morris Hargreaves McIntyre in partnership with
Creative New Zealand. It and encourages an approach that is:
— vision-led
— brand-driven
— outcome-oriented
— inter-disciplinary
— insight-guided
— interactively-engaged
— Personalised

— These attributes have been the focus of successive CNZ arts

conferences since 2009. The next is during June 2011 in Auckland
creativenz.govt.nz/assets/ckeditor/attachments/69/7_pillars_of_audience_focus.pdf
— Investment, support and advice to help organisations
evolve their business models towards sustainability
— The ability to reduce running costs
— Development of increased financial resilience
— The ability to develop and exploit their assets and
develop income-generating products and services
aligned with their mission
— Access to capital assistance for research and
development purposes
— 

 
 
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— üour organisation must be a trust or an incorporated body (such as an
incorporated society or company), and the organisation͛s governing document
(for example a Trust Deed or Constitution) must provide for it to carry out
artistic activity.
— üour organisation must be non-profit-distributing, which means that it has a
structure that ensures that the distribution of funds is transparent and there
are safeguards against self-interested decision-making.
— üour organisation must offer a regular or continuous programme of arts
activity.
— üour organisation must be based in New Zealand and be delivering work or
services within New Zealand.
— It must not be seeking support to undertake a programme of activity that is
the core business of either a tertiary training institution or an institution (an
art gallery or museum, for example) that is mainly supported by a central or
local government agency.
— üour organisation must have a successful funding track record with CNZ ie
have received at least three grants or investments from Creative New Zealand
within the last three years. [p10]
— The standard arts non-profit organisation model is Y
 

Y


Y
— This is a company established with the intention of providing a service
to the community, rather than with making a profit.
— It has legal status as an incorporated company, with any liability for
damages as the responsibility of the 501(c)3 corporation. Personal
possessions are safe from creditors in case of business failure.
— 501(c)3 corporations are exempt from paying income tax, and donors
also receive tax exemptions on their donations.
— Such entities must be in operation for three financial years before
applying to government bodies and Foundations for grants.
— Many such entities also rely on volunteers ʹ from board members
down to office workers..
— 
 - an arrangement under which an existing
501(c)3 tax-exempt charitable company (commonly referred to
in this context as a KSponsor͟) assists an individual or
organization with a charitable program (commonly referred to as
a KProject͟) by permitting the Project to solicit tax-deductible
contributions or grants through the Sponsor that the Project is
not eligible to receive on its own. Through such an arrangement,
funds intended for the Project are deposited with the Sponsor,
which then disburses them to the Project.
— Typically, the fee for such Ksponsorship͟ is a 10% flat levy on
funds raised that covers ALL administrative costs including
accountancy or bookkeeping and grant management

[ www.publiccounsel.org/cdp/fiscal_sponsor.pdf or
www.fracturedatlas.com ã
 KNon-profit or for profit is not important. Creating and sustaining a revenue
stream that makes your mission possible.... Find the best business model for
achieving your mission͟

Standard non-profit company with ownership or shared ownership of a

commercial entity ʹ eg a building, a ticketing business, a caterting business, a
talent agency, licensed software͙
Arts commercial company (umbrella) has an embedded arts non-profit company
ʹ eg providing an array of services at affordable prices . Good example is
World Café Live [www.worldcafelive.com] multi-venue club with
educational/community programme subsidiary Live Connections [
www.liveconnections.org ]
L3C ʹ a low-profit limited liability company with a primary charitable mission and
a secondary profit concern - designed to attract private investments and
philanthropic capital in ventures designated to provide a social benefit. Any
profits after taxes can be distributed to owners or investors.
[money.cnn.com/2010/02/08/smallbusiness/l3c_low_profit_companies/ ]
— a Sector Development approach will encourage arts
organisations to adopt a collaborative, sector-wide view of
the development of the arts and of the delivery of high-
quality arts experiences for New Zealanders.
— Funded organisations are expected to play leadership roles
in their areas of arts practice ʹ for example, through
supporting the creative and professional development of
New Zealand arts and artists.
[CNZ ʹ Arts Leadership Investment Programme July 2010]

KAn arts and culture sector should be organized to best meet the artistic
and cultural needs of its citizens ʹ the artistic mission needs to
determine the organisational design. And then there͛s the question of
who provides leadership...͟
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— ..Collaborative working practices /shared services
can be used more widely in the sector to free up
capacity, enable cost savings and improve delivery
and experience of great art... as well as increased
organisational and financial resilience...
— KThere are so many opportunities and so many
things we can do togetherʹ and so much benefit we
could all get out of it. It is kind of unimaginable and it
is too big actually.͟
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— èthe non-negotiable core purpose of your
organisation
— è
your legal structure, business model and
organisational capacity
— è
your financial capacity ʹ your assets: cash,
working capital, reserves, debtors, fixed assets and
liabilities - short and long term debt.
— !



Y



Y any change in one of those
three elements inevitably has an impact on the other
two
— Fully Integrated Merger - two (or more) arts and cultural
organisations combine their operations and missions into a
single organisation.
— Partially-Integrated Merger: Two or more A&CO͛s might be
formally merged in a partial integration, but the individual
characters of the merged organisations are maintained in
some way ʹ eg Trinity Laban Conservatoire of Music and
Dance
— Joint Programme Office: two or more complementary
organisations combine on one or more programmes for the
purpose of strengthening the efforts of all the organisations
involved
— Joint Partnership with Affiliated Programming: two or more
organisations join their operations for programming or delivery of
services and their complementary strengths enable the
development of new and/or greatly enhanced services.
— Joint Partnership for Issue Advocacy: collaborators lend leadership
and staff to joint committees as needed, which allows them to
move, communicate and mobilise in unison.
— Joint Partnership with the Birth of a New Formal Organisation : two
or more organisations determine that their joint activities are best
implemented by forming a separate, independent organisation  a
new structure offers the freedom that is sometimes necessary for
new joint enterprises to flourish. Eg Festivals Edinburgh (12
combined with one voice)
— Joint Administrative Office and Back Office Operations:
efficiencies are achieved through shared administrative office
and personnel, including financial and human resources
management and information technology.
— Confederation: an umbrella organisation exists because of the
constituent parts, to which it provides services, co-ordination
and other support. Eg Audiences UK
— Creative Adhocracies: loose, highly organic, flexible
organisational forms that often bring individuals motivated by
super ordinate goals together in order to progress a specific
project.
— Goal ʹ to thrive, excel, flourish, be successful and
sustainable in a world of ever-increasing change and
uncertainty
— A way of doing/being that integrates relevance,
resilience and ethical practice ʹ that is, adapting to
changing conditions in a life-friendly way to people and
planet in order to maintain the function of making
great work happen
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— the capacity to be externally aware, responsive, rigorously self
critical
and risk positive
— the capacity to respond to/withstand the unexpected , cope with
uncertainty and ambiguity
— being passionate and committed in things one gets involved with
— accepting oneself, being self-motivated
— seeing problems as opportunities
— being positive and optimistic
— knowing how to evaluate opportunities for collaboration, spot the
barriers to collaboration and tailor collaboration solutions are
prerequisites for building the capacity for resilience
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— ability to self-finance development
— arts organisations can develop financial resilience by
spreading their funding across a range of sources, developing
earned income streams with good profit margins, valuing and
realising the value of intellectual property (intangible assets)
ʹfunders can help by such practices as paying in advance,
giving longer term commitments, allowing margin. A mutual
insurance fund which seeks to share the risks arts and cultural
organisations face across the sector could play a role, as
could venture philanthropy (which provides reserve capital /
equity-like investment).
[CAPITAL MATTERS (UK) ã
— à

reflect on the relevance of your mission at this
time and consider whether it needs to be revised or refreshed

— à

 

interrogate four key aspects of

your business model/organisational capacity - audience
development; artform development; value creation; business
management and governance - how might these evolve in order
to become more resilient, relevant and responsible.

— à



 Y
fully identify your assets/capital
structure and strengthen, and where appropriate revise, the
income generating strategy. Include intangible assets in this
review ʹ they too have value.
— %the leadership practice of properly assessing when to
collaborate (and when not to) and instilling in people
both the willingness and the ability to collaborate
when required.͟ - Morten Hansen
— Detailed analysis and advice about what is needed to ensure fruitful
collaboration, and case studies of successful projects, are available from the
MMM web site - www.missionmodelsmoney.org.uk
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— Cultural Venture Business Development
— Performing arts presenters as curators
— Other models: Crowdfunding/Crowdsourcing, Live
Broadcast, Trysumer , Baby Matinees͙
— Art itself can be seen as a currency. It is the currency of
experience, that coordinates the economy of meaning.
— Art allows us to share the value that accumulates in
our individual lives through their living.
— The challenge is to understand the relationship
between the economy of money and ...the economy of
meaning... to optimise returns in both economies at
the same time ... We need to develop art and
audience together.

vGraham Leicester ʹ Making Money and Making Meaning, Jan 2010]

— Much cultural engagement occurs in non-arts spaces such
as the home, places of worship and community venues.
Personal participation levels are high.
— Heritage-based and socially based forms of cultural
engagement attract racially diverse participants.
— The emergence of Kself-guided͟ arts activities is changing
the landscape of cultural engagement.
— Significant interest in arts learning activities goes unmet.
— Role models are key players in the cultural ecosystem.
vþ
 

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— D 

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watching art created or performed by others
—  
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— 
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a cultural heritage or ethnic identity.
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— Connecting programmes to the cultural ecology
— Offering a variety of ways to engage - inventive, interpretive, self-
guided or observational programs, family-based, heritage-based
— Delivering and packaging programmes which appeal appeato a
broader and more diverse cross-section and/or to distinct audiences
— Selecting community venues and settings and/or delivering
programmes in people͛s homes
— Motivating cultural role models who will involve their friends and
family in creative and cultural activities
— Partnering with other organizations for increased reach
— Programming more effectively for diverse cultural communities

vþ
 

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— A highly successful 2 year Cultural Venture Business Development
Pilot project has been tested in UK (partners were Business Link,
Arts Council, NEEIC, ERDF) with 4 arts organisations:
— Selected arts organisations were provided with business/product
development, R&D costs (such as access to finance for new
equipment and work space refurbishment), access to advice on
product development/bring to market, tailored business support,
professional development support, and other related consultancy
needs. Associated capital support was also provided.
— K!he process͙.has taken longer than conventional business development
because the organisations are trying to balance social as well as economic
outcomes. !he overall objective of the work is of course to better help
them achieve their mission.
 
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— The crowdfunding model is now being applied to artistic and cultural
projects through the Swedish membership organisation þþY

in partnership with The City of Stockholm
— The crowdfunding website presents cultural ideas and projects seeking
funding ʹ these include dance, theater and puppetry, among others.
— Members may submit a project for investment, or become an investor
ʹ the annual membership fee is SEK 100 per year, and an Kinvestment͟
contribution is SEK 50 per project of choice
— It is possible to become a member for free, with the opportunity to
offer feedback and development advice to the projects seeking
investment.
— During CrowdCulture͛s three month beta period nearly 500 people
participated across 28 projects, ultimately leaving 6 fully funded.
— Website: Y


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— Music and dance companies often need to retain a group of professionals (e.g.
an orchestra) as a fixed cost with little connection between income and
expenditure (tickets sold or grants to develop new work). This drives an
increased need for working capital.
— Theatre and dance companies need to commit significant development capital
to new productions ahead of generating income from them.
— Visual arts are less people intensive and therefore more flexible in
expenditure and might need less working capital.
— Artforms with stronger earned income flows may need greater working capital
to fund product development costs and working capital ahead of payment in
arrears.
— Artforms with an artistic programme that relies upon a small number of
substantial outputs (e.g. one major production, two large exhibitions etc) will
have highly irregular income flows and need additional working capital to
mitigate this issue
[From CAPITAL MATTERS report ʹ Mission, Models, Money 2010]
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