The relationship between charity, charities and the general public

Earlier this week, the Charity Commission published its report on ‘Regulating in the public interest - The relationship between Charity, charities and the general public’. Never has the interdependence and fragility of that relationship been in such stark view as now, with many charities struggling to survive while demand for their services increases in the face of COVID-19.

Just how vulnerable charities are when the support that they rely on is removed is clear from the millions of pounds lost as a result of shops being shut and the number of voluntary sector employees furloughed during the pandemic – almost a fifth according to government figures. The Commission’s report is well-timed, therefore, in the way that it highlights important expectations that the sector might need to bear in mind if it is to ‘thrive and inspire trust in tough times as well as good’.

Four main areas of expectation are highlighted in the report:

1. That a high proportion of charities’ money is used for charitable activity
2. The charities are making the impact they promise to make
3. That the way they go about making that impact is consistent with the spirit of ‘charity’
4. That all charities show a collective responsibility to each other in adhering to the above.

Knowing where the money goes is a primary concern and the importance of this consideration in influencing public trust cannot be overstated. Some 79% of those surveyed chose this as the most important factor when it comes to the way a charity operates, way above the next highest choice which looked at the importance of a charity operating to high ethical standards (52%).

People want to know how their hard-earned cash is having an impact, so reassurance through real examples, such as lives that have been changed and equipment that has been acquired, is another important way that charities can engender trust. Impact reporting is still underutilised in the sector and can be inconsistent and expensive. There have been calls for annual reports to focus on more than the financials, but any changes to the Charities SORP to include impact are probably a couple of years away, at best.

The fact that the ‘how’ matters as much as the ‘what’ is important. With almost two in one believing that the way charities go about meeting their purpose is as important as whether they fulfil it or not, the public clearly places a great deal of importance on how charities make a difference.

Underlying all of this is the widely held expectation that registered charities have a collective responsibility to uphold the reputation of charity more generally. How a charity, its trustees, staff and volunteers can ‘uphold the values of the sector’ is a discussion that has exercised the Charity Governance Code steering group over the years. The legal and the ethical aspects are challenging, especially when it is hard to agree on what the agreed values for a diverse sector actually are. However, understanding the public’s expectations will be integral to ongoing sustainability. As will ensuring all those involved in a charity ‘live’ the stated values of the charity. This is important as the poor judgements and actions of a few can tarnish the reputation of the sector as a whole.

While the whole issue of what the public wants is another subject for debate – different people have different values and views  –, it is important that trustees have an understanding of what the public values. Coronavirus has shown that in times of great crisis, society needs Charity to thrive. Equally, this report has shown us how much we need a full consideration of public expectations in order to achieve this.

You can read the report here.

Sara Drake, Chief Executive of The Chartered Governance Institute UK & Ireland.