By Andrew Holt

Charity Finance Group (CFG) and PKF Accountants and business advisers have today published the findings of the 2012 Risk Survey Managing Risk Making the most out of your resources.

Responses from over 200 charities show continued anxiety arising from income uncertainty, with many seeking better value for money by improving how they use their assets.

However, access to the right skills, retention of good staff, employee motivation and rising stress levels are all emerging risk areas that threaten an organisation’s ability to get the most from its resources.

Staff are spread more thinly with 77% rating time availability as an important or very important risk factor to making improvements.

More than 60% identified lack of funds to invest in skills as a risk factor.

Staff motivation, which 38% are concerned about, is likely to be complex and offering financial incentives clearly isn’t always an option.

For almost half of respondents the main incentive on offer to boost performance is that of being valued and thanked by the charity. And around a fifth of respondents said they were not sure what incentives to provide to staff.

Caron Bradshaw, CEO at CFG, said: “The sector’s most significant asset is our people. In a time of financial and strategic uncertainty, considering how to motivate and reward staff and volunteers is critical. The sector always has attracted, and will continue to attract, a dedicated workforce.

"But it is essential that we bring in and maintain the right skills to adapt and change. The evidence here is that we are facing both a time and skills deficit – we can’t create more time, but skills we can work on.

“The survey shows that more can be done in terms of performance management of staff, volunteers, and even trustees, to get the best from them. I am delighted that many charities seem to be looking internally at how they can up-skill those staff they already have as well as looking outside the organisation.

"Charities need to think about the types of experience they need and how they can motivate and develop their teams in the areas where they would like to focus. This is a bit of a catch 22, as without the right skills, charities are often not able to capitalise on some of the other assets they have.”

There is also increased pressure on charities to achieve greater ‘value for money’.

However, charities feel that different stakeholders, such as funders and beneficiaries, have different priorities, and there is a balance to be found between costs and quality of services in order to satisfy key stakeholders that value for money has been achieved.

Richard Weighell, a partner at PKF and author of the report, said: “Charities across the country are having to do more with less. They face increasing demand from their services against a backdrop of generally reduced resource – and, not surprisingly, some are able to square this circle more effectively than others.

"Although there are no easy answers, the work we are doing in this area indicates that there are a number of options that charities can explore, such as improving their investment management procedures and engaging more effectively with volunteers.

“For many charities, the other important strategic challenge involves reconciling the differences between how their various stakeholders view ‘value for money’ so that they can maintain the confidence of both funders and beneficiaries. Quite rightly, trustees realise that they need to reconcile these views in order to rationalise a meaningful concept of value for their organisation, but that is a tightrope act which requires considerable skill.”

Other findings from the report include:

Skills: Less than one third had carried out skills audits in significant areas to identify the gap between skills required and those present within the organisation.

Procurement: Almost 80% use tenders and forecasts to ensure value for money, and many are assessing support costs and property needs. However rising costs are a concern for 63%.

Property: 62% feel their property portfolio meets their current needs – although running costs, quality and capacity pose challenges. However only 36% expect it will still do in 5 years’ time.

Intangible assets: Brand, logo and partnerships are highly valued by charities with almost half recognizing the need to maintain relationships and reputation they have built.

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