Institutional support: a grant for the organisation, not a project

A project grant pays for a specific action with a start, an end and results. Institutional support pays for the functioning of the organisation: the things projects cannot happen without, but which barely fit into a project budget. It is known as core funding, general operating support or, in EU rules, an operating grant.

How the EU defines it

Article 183(2) of Financial Regulation 2024/2509 distinguishes action grants from operating grants, which finance the functioning of a body whose objective forms part of, and supports, an EU policy. An operating grant takes the form of a contribution to the organisation's annual work programme. The same Regulation allows a beneficiary only one operating grant from the EU budget per financial year.

Programme examples:

• LIFE. Operating grants for non-profit organisations active in environment and climate. The scheme has two steps: a framework partnership agreement (FPA) and annual specific grant agreements (SGA). In the 2026 call the framework agreements cover financial years 2027 and 2028, and the co-financing rate is up to 70% of eligible costs. The applicant must have a structure and activities covering at least three EU Member States or associated countries.
• CERV. Operating grants to framework partners: European networks, civil society organisations active at EU level, and think tanks.

Both schemes are designed for organisations of European scale. For a local Ukrainian organisation it is more realistic to look for institutional support in the calls of foundations and programmes working in Ukraine, including through regranting.

What can be covered

The exact list is set by the call, but typically it includes:

• salaries of the permanent team: director, finance, communications, administration;
• office rent and running costs, communications, software;
• developing a strategy, internal policies and procedures;
• external audit, staff training, fundraising development;
• statutory activities that no project covers.

What the donor wants to see in the application

• A strategic plan with multi-year goals and an annual work programme.
• A governance system: separation of the board from the executive team, minutes, policies.
• Financial transparency: the budget of the whole organisation rather than one project, a list of income sources, audit reports where available.
• Diversified income. Donors look at dependence on a single source. The LIFE call analyses it separately.

Before the contract the donor usually runs an organisational capacity assessment.

How results are measured

You report not on the activities of one project but on delivery of the annual programme and on organisational change: policies adopted, an audit passed, new income sources, outcomes and impact achieved against strategic goals. Propose the indicators yourself in the application, otherwise the donor will write them for you.

The link to indirect costs, and typical mistakes

In project grants administrative costs are covered by the indirect cost rate. If an organisation holds an EU operating grant, it may claim indirect costs in parallel EU action grants only if it can demonstrate cost separation through analytical accounting. Details are in the AGA, in the annotations to Article 6.2.E, and in the article on eligible costs.

• Writing an institutional application like a project one: a list of activities instead of a strategy.
• Showing a budget without the organisation's other income sources.
• Funding the same salaries from the institutional and a project grant without allocating time.
• Taking on permanent commitments under the grant that nothing will cover once it ends.