Training and support
Many UK charities are feeling the pinch financially. In our latest Impact Report, 35% of charities in our network reported that their income has decreased in the past year and we hear every day on the phone about the new financial pressures they're facing.
We asked Beth Williams from Charities Aid Foundation for some advice. Here is what she had to say:
Four ingredients of a resilient charity
When I worked for a youth charity, developing personal resilience was considered essential to helping ensure bright futures for young people. A resilient person is one who has the mentality to take challenges in their stride. For individuals, resilience is measured by the speed with which they can bounce back from psychological stress. It’s easy to see how instilling this in someone who is starting out in life equips them with a coping mechanism to handle whatever life throws at them.
There are four ingredients to personal resilience:
- Awareness – Noticing what’s going on around you
- Thinking – Being able to interpret the events that are going on in a rational way
- Reaching out – How we call upon others to help us meet the challenges we face, because resilience is also about knowing when to ask for help
- Fitness – Our mental and physical ability to cope with the challenges
So why is it that when we talk about resilient charities the conversation often turns exclusively to finance?
A resilient charity is more than just one with a healthy income and reserves, although these are important. It also goes beyond managing to keep the lights on during difficult times, although that too can be an indicator.
Resilience may be harder to define for organisations. But to me it’s about being able to quickly recover from setbacks. It’s the type of charity which can anticipate the challenges ahead and be prepared for them. A resilient organisation is one which is streamlined, flexible and responsive.
Pressures on charitable sector
The challenges to the UK’s charitable sector in recent times are well documented. But essentially they boil down to an economic climate that makes individuals feel less wealthy so less likely to give; a government reducing financial support to charities; and an increasing need for charities’ services from those across society who are most vulnerable.
Small to medium sized charities are particularly squeezed by these pressures. CAF’s Social Landscape survey 2017 found that 54% of charities have used or will need to use their reserves to cover income shortfalls; this figure was higher in small charities. The overwhelming majority had seen an increase in demand over the past year, and were anticipating a further rise the following year. Even more worryingly, among smaller charities (those with an income less than £1m per year), more than one in four (28%) chief executives said their organisation was ‘struggling to survive’.
Here at Charities Aid Foundation (CAF), our finance and fundraising services are used by many thousands of charities, so we’re very aware of the pressures on them. The main focus of our strategic consultancy work is to help charity leaders build and maintain a resilient organisation.
From our experience, the four qualities of a resilient person highlighted earlier can apply to charitable organisations too:
- Awareness – Is the organisation aware of the context they are working in, not just locally but nationally, politically, economically?
- Thinking – Are their trustees and leadership team making time to talk about these challenges and able to creatively determine the best way out or are they solely focussed on day to day operational issues?
- Reaching out – Is the charity well networked and both able and willing to get support or work in partnership with others?
- Fitness – And finally, are they ‘fit’? This is where it makes sense to consider if they have enough income and from a range of sources, and how healthy their reserves are.
To explore resilience more deeply, CAF’s Charity Consulting Team would be more than happy to discuss how we can support your organisation. Simply contact us through our website cafonline.org/charities/strategic-consultancy or call us on 03000 123 251.
Author: Beth Williams, Charities Aid Foundation