Fighting Fires: How are charities dealing with the challenge of short-termism?

Charities are finding they’re stuck in a cycle of short-termism, consistently tackling imminent problems and unable to achieve long-term goals. But how has it ended up like this, and what can be done?
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There’s no doubt that charities are under increasing pressures as of late. Research by Pro Bono Economics has found that while attempting to move on from the pressures of Covid-19, charities have now been hit by the cost-of-living crisis, putting them in a state of what is described as “constant firefighting”.

This has never been more evident. When Charity Times asked readers on Twitter what the biggest issues facing charity leaders were, an influx of messages all said the same thing: short-termism.

In 2019, Craig Kielburger, the co-founder of WE, a family of nonprofit American organisations, wrote that there was an “epidemic” of short-term thinking: “Politicians plan in four-year election cycles. Fashions change in the micro-seasons… corporations measure by quarters. News cycles turn over in days and Twitter churns constantly. Short-term thinking has become our default; meanwhile, we can’t marshal the focus or resources to tackle some of the world’s most pressing problems - the kind that loom long term.” This was written pre-Covid, but it’s still applicable; perhaps even more so now.

So why is short-termism an issue and how does it affect charities? Caron Bradshaw, CEO of Charity Finance Group (CFG) explains that short-term thinking leads to short-term responses, creating greater problems further down the line. “Time and time again during a crisis we’ve seen organisations cut back so hard and fast that although they survived, they later struggled to deliver. They pruned back too severely and just couldn’t produce the fruits.”

Amanda Tincknell, CEO of the Cranfield Trust, says that it’s not that they are incapable. Charities are good at setting a vision for the long-term, “it’s in our DNA. All of us have a vision of what we’d like our world to be like and are working towards that,” she says. “But the incredible changes of the last couple of years and the very unstable economic and government environment are making it very difficult for charities to plan ahead.”

A Cranfield Trust survey of over 300 charities in Wales found 85% of leaders said having time to be both strategic and operational was their “major leadership challenge”, now and in the next 12 months. It’s not a stretch to think this reflects in the rest of the country.

“While charities are so stretched to support growing numbers of people, it’s hard not to focus on the short term. I believe that most chief executives do think ahead – and want to have more time to plan – but the pressures on them are substantial,” Tincknell adds.

Rachel Covey, corporate partnerships account manager at a charity has found short-termism to be a real issue in the sector.

She says that charities simply don't have time to focus on strategic goals. “We are constantly firefighting, trying to respond to internal queries as well as donor demands so we never have time to focus on strategic goals.”

“We are currently working, in working groups, on a project to help deliver our departmental strategy but nobody has any time to do the work in between meetings so we can’t make the process we would like to,” Covey explains.

Firefighting takes on multiple forms. Remote working has led to back-to-back meetings and high email traffic leaving little to no time for innovation and reflection, while planning also happens too late that it makes it “impossible” to look beyond the next month. Hierarchies “get in the way too” and capacity is a sector-wide issue each charity is experiencing. “People are frequently responsible for multiple income streams which leaves them constantly trying to get on top of things that are right in front of them.” All of this adds up to a cycle of short-termism.

A perfect storm

How did it get this way? Kielburger suggests that non-profit leaders have taken their cues from business. “That means in our pursuit to do good, we too have defaulted to short-termism.” Funders want to see immediate results, which means charities are directing those funds into short-term projects without wiggle room for long-term goals.

But the current political and economic uncertainty are contributing significantly to the issue. “Since 2008, charity leaders have waited for government to give a clear sense of direction for an operating environment they can predict,” says
Tincknell.

“They’ve waited through elections, several rounds of public sector spending cuts, recession, pandemic and are now anticipating ‘apocalyptic’ food prices…Planning three to five years ahead in a chaotic environment is really difficult.”

Bradshaw agrees that the current political environment has contributed to the issue. Governments operate on a short-term basis, trying to achieve the maximum in the shortest time. “I would describe charities as often smoothing the bumps between elections, but this is hard to maintain in a popularist political environment.”

And short-termism can come from necessity, she points out. “That situation robs you of the ability to think longer-term because you are focused on survival. And although you should still try to carve out space to think longer-term, the reality is that you’re operating in the moment, possibly in crisis mode, so thinking beyond the next pay cheque is difficult.” As Kielburger puts it: “It’s tough to anticipate the future when you’re dealing with an immediate problem.”

Fundraising seems to be one of the biggest barriers. In a survey by The Cranfield Trust, 46% of its respondents said a lack of long-term, core funding was a barrier to development. Pro Bono Economics identified the same issue. Meanwhile, Rachael Jones, CEO of One Knowsley, points out that short-term funding alongside many funders pivoting funds to address the pandemic, means that longer term funding is increasingly difficult to identify and secure.

“Increasing competition for reducing public sector contracts creates uncertainty in long term
planning as does fluxing donor support, particularly relevant in the current cost of living increase and the uncertainty this creates.

“These factors alongside increasing demand for support and responding to immediate and presenting needs of primary beneficiary groups all create the perfect storm for cycles of short-termism rather than long term investment into the future.”

Covey agrees, explaining that a short-term focus has always been the case in corporate fundraising, which isn't helped by the fact that agreements themselves are so short
term with partnerships such as charity of the year.

It’s also difficult to say no, she adds. “To say no to any donation, even if the admin cost of processing outweighs the benefit, no to donors who demand too much, no to people contacting the charity when this doesn’t fall within the charity’s aims. “I think in other sectors people would just ignore the call or email, but in charities we feel a desperate need to be polite, almost in fear of some sort of reputational damage if we don’t acknowledge every
approach.”

Fundraising has ever-increasing demands, she also acknowledges. It’s expected that if you raise a certain amount in year one, in year two that must increase, creating immense pressure with no time to take a step back and say: “If we did this, in the short-term income may fall, but in the long term we could get a big increase.” These are the things the sector funders need to think about, Bradshaw adds. Covering operating costs, as well as the project itself should be a consideration. Resilience funding should also be built in so time can be carved out in organisations to think about long-term strategies.

What can be done?

Speaking to people within the sector, it’s clear that there isn’t one solution, and any solution will not be a one size-fits-all scenario. “In the current environment, just sustaining a charity week-to-week can be a challenge… many charities are operating with very limited financial horizons,” says Tincknell.

Bradshaw suggests looking at strategy can help. CFG moved to a rolling strategy in 2019, allowing them to remain agile to a quickly changing landscape. They didn’t commit themselves to specific actions in quarters or over specific years.

“We’ve agreed where it is we want to go and every step we take is the biggest we can take right now towards that.”

Things might already be changing though, if at a snail’s pace. Both Covey and Bradshaw have noticed more collaboration between causes, suggesting that some are starting to look at the long-term rather than keeping their heads down and focusing on what is in front of them.

Tincknell, meanwhile, believes that external support can help. “Setting aside regular time to plan and to talk to someone with a different perspective… creates space for leaders to think outside the challenges of every day.”

For fundraisers, Covey suggests multi-year contracts could be one of the answers, enabling everyone to think over a much longer term. She also tries to consider how she can bring strategic focus into conversation and have it on the agenda, encouraging all stakeholders to take some responsibility. Time is also critical. “If we can increase capacity in my current teams, while crucially, maintaining the same expected output in the medium term,
then I hope this will allow more focus on longer term goals.

Communication within the sector could be key – if we can keep the staff within it. With staff recruitment and retention also struggling, this is yet another barrier to overcome for a lot of charities. “The sector is fantastic at networking and sharing experience and learnings, if we can keep people in the sector we can develop those ways of working and better develop strategic thinking,” adds Covey.

“There’s also more collaboration between causes than ever, which suggests that some are looking to the long term rather than keeping their heads down and focusing on what isright in
front of them.”

Politics will unfortunately still have an impact and charities should be aware of them and the implications it can have on short-termism. “The changes to rules on campaigning, for example, can push us back into dealing with the symptoms and not the causes,” explains Bradshaw.

“As Desmond Tutu said, it’s not good enough to keep pulling people out of the river, rather we must collectively head upstream to discover why they’re falling in. It can sometimes feel
as if charities are incentivised to just pull people from the river. It makes me think of a photo op celebrating the opening of a new food bank rather than decrying
the fact that in 2022 people are forced to rely on food parcels to survive. That’s short-termism.”

That’s not to say that the short-term doesn’t have its benefits. As Jones points out: “The sector’s agility to respond to current and emergent needs is its strength, however for many of the organisations we work with and support, this response has escalated in both the response and recovery from the pandemic.”

But ultimately, she adds, long-term goals require financially sustainable organisations that can invest into the retention of skills and development of services, thus funding that enables and promotes long-term goals is “essential”.

In Kielburger’s piece, he talks about a Canadian manufacturer who has a 100-year strategy. As part of the plan, they zoned out on short-term plans and looked at the long-term impact of those decisions. But “the challenge is to define short-term metrics that point to long-term goals.”

If charities were asked to create a 100-year strategy, the goal would be for the charity not to be needed in 100 years. However, the sentiment is the same: if we don’t plan for the long term, how can we start thinking about it?

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