Dr Jan Sheldon, CEO of St Martins in Norwich explains that since charities are doing more than ever with less, and still delivering impact, now is the time to harness the collective strength, rethink old models, and champion the value they bring to society.
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If ever there was a time for positive thinking, it’s now. Finding yourself in a negative spin could happen to any of us after switching on the news. The world is a volatile and dangerous place. Many people, through no fault of their own, have absolutely nothing except the clothes they stand in and every day children are dying of malnutrition.

Closer to home, we see the NHS failing, an increase in violence on our streets and an unprecedented mental health crisis. We see the charity sector propping up statutory services and delivering the only glimmer of hope that people in desperate need have.

Unless you work in the charity sector you wouldn’t realise that this sector too is experiencing significant challenges and is often described as a broken system.

Many flagship charities are struggling. Oxfam, Macmillan Cancer, Guild Dogs and National Trust are just four of the national charities hitting the press with news of redundancies. We’re seeing levels of redundancies in the sector at a record high. National and local charities are feeling the impact of the cost-of-living crisis and the increase in National Insurance announced in the autumn budget.

At central government level there seems to be little thought or recognition of the valuable work that charities do and the support they provide to national infrastructure organisations like the NHS.

Yes, indeed it would be very easy to spin around in the cycle of doom if you work in the charity sector. However, we all know this won’t help. Leaders who decide to work in the sector are driven by a social conscience and a strong moral compass. They are incredibly resilient, innovative and forward thinking. The spin cycle of doom is not for us.

However, leaders in the sector must work together to effect change in five key areas:

Demonstrating our worth

Almost every charity of a significant size regularly produces an impact report, but rarely do we see any Social Return on Investment reporting delivered by any of the key charity umbrella bodies. NCVO and the like are quick to talk about the impact of cost increases or funding cuts but rarely do the flip the coin and shout about the impact the charity sector delivers.

In 2019 Baroness Tina Stowell and Lord Gus O’Donnell called for a better understanding of the impact of the charity sector in a report produced by The Charity Commission and

Frontier Economics1. It’s not just about the number of jobs and GDP that the sector accounts for, we need to be able to shout about Social Return on Investment to really demonstrate our worth. There are many different types of value both for individuals, wider society and central/local government, let’s get better at talking about this at a national level.

Making every donation count

I run the risk of being unpopular with this next statement but……there are too many charities working towards the same aims. There are approximately 171,000 charities in England and Wales and around 100,000 unregistered charities.

If a charity had to demonstrate unique worth before being registered there would be far few charities spending resources on back-office systems and infrastructure. Thus, every donation made to a cause close to someone’s heart would go further.

I do get that families want to set up charities to keep the memories of their loved one alive, but it means that donations made in the name of their loved ones aren’t as effective as they could be.

Unpopular as this view may be submissions made to acquire charity status must be made to demonstrate unique worth in a wide geographical area (otherwise we run the risk of only having national charities which would bring its own challenges).

Common sense approach from central government

Currently, an unprecedented lack of forward thinking is destabilising the charity sector. The current government promised at the general election not to increase taxes on working people. It was suggested that increases to National Insurance wouldn’t impact on the employee.

Well, as a colleague of mine would say ‘paint me surprised’! The working person is working no more because their employer can’t afford the wages bill. Any child with a reasonable grasp on economics and common sense could have seen that one coming.

Indulge me while I just mention one other area which needs a great big dollop of common sense by central government. Unless you work in the homeless sector you wouldn’t be aware that services for people who are homeless are not a statutory requirement.

Local governments have some responsibilities under the Homelessness Reduction Act 2017, but these requirements do not go far enough. So, when local governments want to make cuts, the homeless sector is a very soft target, and we find the services that some of the most vulnerable people need are no longer available. This situation will undoubtably result in more (avoidable) deaths on our streets. As a sector we need to lobby better to help the government to make better decisions.

Share the learning

One of the things I like to do at St Martins is provide senior team members with opportunities for growth, learning and development but not always in a traditional way. My directorate team are qualified, skilled and experienced and when we sit down to think about their developmental goals for the next year, they are non-too keen on signing up for qualifications. Refresher training is fine, but the reality of their situation is that they should be delivering qualifications not taking them.

One of the key things that all directors need to learn is how to work alongside a board of Trustees and what better way to do this than to go and be a trustee in another charity.

It’s an absolute win win for us and the other charity. My team get to share their expertise (there is always room for improvement, but we do pride ourselves on good governance at St Martins) and they also learn from other Trustees. They know what it is like to sit at the other side of the table, and this helps to enhance the quality and delivery of papers that they present to our Trustees. This initiative costs nothing except time but delivers benefits in bucket loads.

If we take this thinking a little further why not set up a scheme which incentivises organisations to share the learning in this way. The business sector has much to offer and could also learn a thing or two from being part of a board of Trustees. Charity trustees would no longer be deemed pale, male and stale. There is a real opportunity to ensure trustee boards are diverse and to provide fantastic learning opportunities for our young leaders. What a productive way to effect change in the charity sector for very little cost.

Fit for purpose funding packages

This could of course been mentioned as a common-sense area of development for central government, but it is worthy of its own heading.

Many charities are stuck in a fight for survival. There is less funding available, commissioners are wanting more for less and don’t always have their eye on quality in quite the way we might like them to.

As for understanding that charities do need to bid on a full cost recovery model……well, clearly that is unheard of. Charities should be able to deliver cheaper services because their costs are less…….right? No, our costs are the same.

What we do have the benefit of is donations and legacies, but both are difficult to predict and it’s not prudent to build a business model on what you think might come in the form of donations and legacies. That would absolutely be the road to disaster. Raising awareness that fit for purpose funding packages are needed for charities would be a great step forward to ensure the continued survival of the charity sector.

There are so many ways in which the charity sector could effect change, but the five key areas highlighted here would be a great starting point. The spin cycle of doom is absolutely not for us, but we do need to work together if we are to continue to provide the services needed in the charity sector.

There is no point waiting or hoping for the government to deliver on all their pledges…. like most governments they won’t. However, rest assured the charity sector can and will survive and continue to prop up statutory services but let’s get better at demonstrating our worth and become recognised for the work we do and the impact we have.

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