Ain’t no stopping us now: ten things we need to sort out, now that charities have a covenant with the government

Introduction

We now have a covenant in place between the sector and the government for our relationship with them. Anybody who thinks this means we can sit back and relax, and everything will be alright in the charity sector, because government is now our friend, is living in another world. We have at least ten areas that I would like the sector to give the same level of attention to as the covenant. Others may disagree about the specific areas, but I would be surprised to find many who thought the Covenant alone solved our problems. So here are my ten areas:

Ten areas where we need to have an action plan alongside the covenant

Our image, profile and reputation need to work harder. The image of the non-profit sector is not working hard enough. We are seen by government and much of the public as worthy and worthwhile, but not critical to the success of our nation. We need to change the brand of charities so that we are seen as being at the heart of solving society’s problems, rather than a worthwhile irrelevance.

Streams of funding need strengthening. Too many charities, especially small charities, are finding their sources of funding coming under pressure, whether it be from local or central government, or grant-makers or the National Lottery. We need a clear plan to have sustainable sources of long-term funding for charities. A key part of that funding is fundraising as a special source of funding.

Fundraising and Philanthropy need to be centre stage. Fundraising is under real pressure. It takes more money and more effort to raise the same amount of funds as ten years ago, let alone 20 years ago. The big charities with the big brands dominate. Fundraising needs new sources of revenue. The government’s philanthropy task force is welcome, but it needs to be inextricably linked to fundraising. Most philanthropy happens because people did the ‘grubby’ business of asking for money, better known as fundraising.

Digital and AI skills and usage need to keep up with other sectors. I would argue that digital technology has not been as transformative or as central in charities as it has been in the commercial sector. And now I worry that AI is heading down the same path – transforming our personal lives, the private sector and even government services – while leaving charities less impacted and less transformed. As the rest of the world is changed by AI and digital, it can’t be good that charities are such laggards.

Being more than the sum of our parts. Does the charity sector create synergy? Do we work together to help deliver benefits where we can punch above our weight?  We can do, in crises like Grenfell or DEC appeals, or in campaigns to fight government plans on disability benefits. But I don’t think it happens that often. Yet we are tiny in terms of the resources that either government or the private sector has. If we work together better to punch above our weight, we can hope to make more of our potential and deliver more impact.

Will the charity sector run out of staff and volunteers? Will there be enough young people to work in charities going forward?  Does the sector pay enough to get the best young people who will drive social change? As retirement age increases and Covid has made people realise life is short, how do we counter the changing nature of volunteering, where more young people and fewer old people are volunteers? Changing demographics, lifestyles, and cultural norms may mean that the people to drive charities may be increasingly scarce.

Board and trustee leadership is critical. Every charity and every non-profit has a board of trustees, yet they are hugely under-invested in by the sector. Training is minimal, and there has been little change in the way boards work over the last 20 or 30 years. Compare that to fundraising or CEO development, or communications. Boards and trustees are an under-utilised and an under-invested asset of non-profits. (This is, of course, the area I am putting a lot of my own time into through the Association of Chairs, so I am biased).

Measuring what really works. It’s tough living in a world where we have neither profits nor share price to measure the success of what we do. Our currency is not profit before tax, or return on capital investment, but changed lives. Not enough charities know which of their activities are most effective at changing lives. And we have even less idea about cross-sector success – which types of activities and services across a range of charities are the most consistently successful in changing lives. If our sector is to deliver to its potential, we need to be better at cross-fertilising ideas between all our work, on what works. Which leads to the next point.

What are charities most effective at? Charities do so many things now, from running leisure centres and health services to campaigning and advocacy. But where are charities at their best? What is the type of work that sees charities deliver the most change? Boosting local communities? Innovating for new ways of solving social problems? Carrying out medical research? Unless we are clearer about what charities do best, particularly in comparison to government and the private sector, it’s hard to see how we can really make charities shine.

You may have other areas for action that you would put on your list. My argument above all is that we need to see the covenant as the starting point for change, not the end. Email me at joe@heyheyjoe.info with your thoughts on whether you think I am talking sense or nonsense.