Over the last couple of years on this blog I’ve come back a few times to Foundation Scotland and the role that well-designed community benefit funds can play in building social licence around big renewable projects. I’ve argued that:
- funds should be long-term, strategic and community-led
- good support for communities matters – especially when local capacity is thin and power imbalances with developers are stark
- there’s a need to ensure that CBFs don’t become a narrow compensation mechanism, but instead serve as a lever for genuine community wealth building.
I was somewhat taken by the Foundation Scotland model through my Churchill Fellowship and this new review of Foundation Scotland’s approach to community benefit funds, commissioned from the University of Strathclyde’s Institute for Sustainable Communities (SISC), goes much deeper into how Foundation Scotland works – providing a detailed look at how this model actually works in practice – and where it could be strengthened.
What the Strathclyde review looked at
In Scotland, CBFs are no longer fringe – in 2024 they channelled about £30.7 million into communities across 283 projects, with growth expected as offshore wind, transmission and nature-based projects scale up.
Foundation Scotland is a major player in that ecosystem:
- supporting around 100 CBFs (closer to 150 separate arrangements once devolved funds are counted)
- helping to administer nearly 30% of CBF investment in Scotland – roughly £11 million per year – and
- having worked on CBFs for about 20 years.
Strathclyde’s team combined:
- analysis of ~40 internal and public documents (fund agreements, strategies, reviews)
- interviews with Foundation Scotland staff, board members of independent community organisations and members of local grant-making panels.
They then assessed Foundation Scotland’s practice against Strathclyde’s own “Guiding Principles and Actions for Enhancing Community Benefits from CBFs”.
Foundation Scotland as a “one-stop shop” across the fund lifecycle
The review is structured around four stages of the CBF lifecycle: initiate, design, operate and evaluate. Across those stages, Foundation Scotland plays multiple roles:
- Initiate – helping communities understand what’s on the table, advising on negotiations, and suggesting appropriate governance structures (for example, whether to use an incorporated organisation or a community panel under Foundation Scotland’s umbrella).
- Design – working with communities to develop fund strategies, drawing on community action plans or local place plans, and shaping decisions about eligibility, priorities, and how funds are split between areas or themes.
- Operate – providing the “back office”: promoting rounds, processing applications, supporting community decision-makers, managing payments and tracking awards. Many communities deliberately outsource this to free up their limited capacity for actually delivering projects.
- Evaluate – reviewing fund performance, capturing impact stories, and advising on changes such as adjusting award caps, re-balancing geography, or involving young people more directly in decisions.
Importantly, the report distinguishes two customer groups:
- Project owners (developers, utilities, sometimes community-owned projects), who value a trusted intermediary that can streamline negotiations, manage relationships and provide credible reporting to shareholders and boards.
- Communities (through incorporated entities or panels), who value independent advice, help to navigate internal tensions and the ability to offload heavy administration while retaining decision-making power.
This matches what I’ve observed on the ground in Scotland: communities rarely need more “consultation”; they need technical support, honest brokerage and help to translate a stream of payments into long-term local assets.
How well does Foundation Scotland stack up?
Strathclyde’s overall verdict is very positive. They find that Foundation Scotland’s approach:
- is strongly aligned with the Guiding Principles and Actions framework; and
- provides an “exemplary case” of how an intermediary can help maximise community benefit.
A few themes stand out.
1. Community-led, not developer-led
The report emphasises that Foundation Scotland works to ensure CBFs are “led by communities for the benefit of communities” at every stage – from negotiations, to designing fund strategies, to panel composition and evaluation.
That aligns with what I’ve previously written about the importance of communities being more than “stakeholders” – they need meaningful control over how benefits are defined, distributed and judged.
2. Strategic and long-term
Rather than encouraging a scatter of small grants, Foundation Scotland pushes communities to link CBF strategies to local plans, focus on outcomes, and invest in community wealth building – for example, supporting local revenue-generating assets, jobs and skills.
This kind of discipline is hard work, and not always popular in the short term, but it’s critical if funds are to leave a legacy that outlasts the project.
3. Innovation and learning
The review highlights a history of innovation: multi-community funds, combining local and regional pots, “distributing differently” through commissioned projects or thematic funds, and increasingly sophisticated impact evaluation frameworks.
Foundation Scotland has also been active in shaping wider guidance – from the Scottish Government’s Good Practice Principles for Onshore Renewables, to the Community Benefit Toolkit and now this independent review.
4. Still some gaps
None of this is painted as perfect. The report points to several areas for improvement, including:
- Capacity constraints: demand for their services is growing faster than internal resourcing, raising the risk that support to communities becomes thinner.
- Visibility of the value proposition: many communities and developers only fully appreciate the value of an intermediary, like Foundation Scotland, after they’ve worked with one – which is not ideal when you’re trying to make the case up front.
- Data and transparency: despite a strong commitment to openness, CBF data is still scattered, and there’s a call for a more accessible portal covering all Foundation Scotland-managed funds.
- Justice and just transition: the authors suggest future work to map CBF practice against procedural, recognition, distributional and restorative justice – a useful lens for any jurisdiction thinking about “fairness” in the energy transition. (If you’re keen on this, go and have a read of some of Dr Madeline Taylor’s work too.
How does this speak to the Australian context?
Australia is at a much earlier stage in the CBF story. We have examples of good practice – including some community-led benefit arrangements and a growing community foundation sector – but nothing like the density and maturity you see in parts of Scotland.
We are moving forwards, but compared with Scotland’s 20-year journey, Australian frameworks are still largely focused on “what” (the size and type of benefits) rather than “how” (the governance, intermediaries and long-term strategy needed to translate dollars into durable community outcomes).
The Strathclyde review offers three big prompts for us:
- Don’t stop at value ranges. Baseline $/MW figures are useful, but if they’re not paired with strong processes and governance, you might be locking in sub-optimal arrangements for decades.
- Centre community wealth building. Think about the broader benefits (jobs, local procurement), but go further in explicitly prioritising investments that build local assets, skills and revenue streams over time – all with a community wealth-building focus.
- Think about intermediaries early. The Scottish experience suggests that expecting small regional communities to negotiate, govern and administer complex CBFs without specialist support will be setting some up to fail.
The role of community foundations – and the gap
Australia has an emerging network of community foundations, coordinated nationally through Community Foundations Australia. The sector is growing but still relatively small. Scotland shows what’s possible when you have specialist intermediaries with wide reach, deep community relationships and a clear mandate to support CBFs. What could this look like in a local context?
- resourcing an existing community foundation (or a coalition of them) to build specialist CBF capability
- establishing a dedicated independent body – akin to Foundation Scotland – focused on community benefits and community wealth building across energy, transmission and nature-based projects
- partnering more deliberately with organisations like FRRR and Community Foundations Australia to grow capacity in regions that are, or will be, hosting large projects.
Whatever the model, the Strathclyde report underlines that intermediaries need stable funding (which can come from project proponent support), clear accountability and the trust of both communities and proponents – and that this takes time to build.
Maturity, expectations and “starting where we are”
Finally, there’s a question of maturity. Scottish communities in wind-rich regions now often have:
- multiple CBFs from different projects
- local organisations with a decade or more of experience in grant-making and community planning
- access to Foundation Scotland and other intermediaries who’ve seen many models, including what hasn’t worked.
By contrast, many Australian communities are encountering large-scale renewables – and the idea of a “community benefit fund” – for the first time. The Strathclyde review is a reminder that good CBFs don’t just happen because someone writes a value range into a guideline (although that’s a good start!). They’re built through:
- hard, sometimes uncomfortable conversations about priorities and trade-offs
- investment in local governance and leadership
- a willingness to adapt, review and – when necessary – restructure arrangements over time.
Closing thoughts…
For me, the takeaway from this report is not that Australia should copy-paste the Scottish model (but it remains the one that I think works best, based upon the jurisdictions I have looked at). Our planning system, land tenure, local government sector, First Nations context and energy market all look very different though. I’ve spent a lot of time and words arguing for the need for bespoke approaches to community benefits (because all regional communities are different). A Foundation Scotland-style approach may work for some communities, but it certainly won’t work for all.
That said, there are some clear principles we can import:
- community-led design, anchored in local plans and priorities
- an explicit focus on community wealth-building, not just compensation
- strong, transparent governance with independent support (shoutout to the Scottish Community Benefit Register, and tools like it)
- a commitment to learning across projects and regions, not reinventing the wheel each time.
When it comes to learning from others, this report from SISC into Foundation Scotland does a fair bit of the heavy lifting.