Already battered by the impact of the Covid pandemic, charities have spent 2022 facing a new challenge caused by the cost-of-living crisis.
Double digit inflation this year has seen the value of donations plummet, increased charities’ running costs and caused demand to rocket, as low-income families struggle to pay fuel and food bills.
This comes amid an already lengthy to-do list for charities to tackle, including exploring flexible working arrangements and offering hybrid services and fundraising options that combine digital and face-to-face activity.
The government’s levelling up agenda also presented opportunities. But charity’s lobbying teams battled to get their voice heard as the Conservative government lurched from crisis to crisis and ministerial briefs changed regularly.
In addition, 2022’s to-do list also included work by charities to address racism in their own organisations.
It has been a lot for charity leaders to tackle and 2023 to do list is no less daunting.
The cost-of-living crisis is likely to deepen, with government spending cuts set to further reduce public service delivery contracts and increase the number of people needing support, especially from food banks.
Charities will need to ensure they are able to withstand Austerity 2.0 and look at more innovative ways to support people.
Meanwhile, 2022’s bulky in tray is far from cleared, particularly inaction on confronting inequality within charities.
This year has also seen further climate emergencies, from floods in Pakistan to soaring temperature across Europe. The charity sector will need to do more in 2023 to ensure it is championing net zero.
Social media is also changing, which is set to impact on charities’ promotional efforts next year.
Here we look through some of the key considerations for charities as they prepare their to-do list for 2023.
Brace yourself for Austerity 2.0
Already the cost-of-living crisis is the biggest challenge charities are facing, due to the triple threat of soaring demand, rising prices, and the falling value of donations.
According to a survey of 9,500 charities, supported by food poverty charity Fareshare, more than seven in 10 are supporting people who need their help for the first time. Nine in ten say they cannot meet extra demand.
A look at some of the key findings from our #CostOfLivingCrisis survey.
— FareShare (@FareShareUK) October 27, 2022
The numbers are clear: charities need support to keep up with soaring demand.
We can help support them by supplying good surplus food for their communities.
Donate to help now: https://t.co/la9B1vERvI pic.twitter.com/bVrHz6u8NC
Meanwhile, 4.9m people chose not to make a one-off donation to charities during the autumn due to the cost-of-living crisis, according to the Charities Aid Foundation.
Charities in 2023 will have to find new ways to ensure they remain viable and offer valuable support.
This could include offering families money rather than food parcels and other one off goods and services, according to think tank New Philanthropy Capital.
It says that the move would help empower people facing financial hardship to better control their lives as they can buy their own goods and services with the money.
“Instead of forcing people to be passive and grateful recipients waiting upon generous charity, why would we not give people some of their agency back,” asks NPC policy manager Theo Clay.
“In giving goods rather than cash, we’re saying that we know best. Why aren’t we allowing people to make their own choices about how to overcome the barriers they face?”
During 2022 charities have been able to rely on legacy donations to boost their finances, due to increases in property prices and a clearing of post-pandemic probate cases.
Consultancy Legacy Foresight predicts that in 2022 income from gifts in will for charities will reach a record £4bn.
But it warns that over the next two years a fall in the value of homes, as the property market stalls amid rising interest rates, will contribute to a decrease in legacy income of around 3%.
This is based on house prices falling by up to 14%. Legacy Foresight warns the dip in legacy income will be even greater if the value of properties falls further.
Charity finance directors used to rising legacy income will have to consider alternative income streams in 2023 to help meet any shortfall.
Meet Net Zero Commitments
Floods and forest fires decimated huge swathes of the globe during the year and next year will be no different. Action will be needed by all countries and sectors to tackle climate change.
A priority for charities in 2023 will be to ensure they are taking the lead in both words and actions on green issues.
This includes developing a robust net zero strategy that details firm processes to put in place to ensure their charities’ organisation, including investments and supply chains are green.
Considerable work is needed by the charity sector to achieve this, according to evidence to emerge this year.
A survey by Newton Investment Manager during the summer found that just 29% of charities exclude fossil fuels from their portfolios and 38% say they have not discussed fossil fuel free investing.
Corporates are also questioning charities’ commitment to tackling climate change. Only a quarter of businesses believe charities have “holistic” plans and frameworks in place around environmental, social and governance (ESG) issues, warns a separate survey by C&E Advisory Services
Tackle charity’s class issue
Many charities still have considerable work to do to effectively address the racism that continues to blight their organisations.
A damning report by MPs sitting on the International Development Committee last June warned that racism is “particularly pertinent” in the aid sector, due to its roots in colonialism.
Meanwhile, according to the NCVO’s UK Civil Society Almanac for 2022 the charity sector is “less ethnically diverse than the private and public sectors” and action to improve diversity has stalled in recent years.
During 2023 charities need to markedly improve their work to tackle racism in their ranks and to address the sector’s class problem. According to a report by Manchester charity Missing Expert most charity and think tank staff from a working-class background surveyed think the sector has a “class diversity problem”.
Action charities need to consider over the next 12 months include collecting data on class and diversity and to ensure they are actively encouraging class diversity within recruitment and succession planning, particularly in senior roles.
LAUNCHED TODAY. Our 'Missing Experts' report shows that working-class people are missing or hidden from some of the most influential anti-poverty think tanks and charities.
— RECLAIM (@RECLAIMproject) September 22, 2022
Get some of the reports key findings below - and find out more: https://t.co/9lKdKtObo1 pic.twitter.com/htmS24MmMd
Elsewhere, NGO group Bond has produced guidance to international development charities on how they can ‘decolonise’ and create locally led organisational structures as part of efforts to be anti-racist.
Consider job sharing to get the best leaders
The pandemic saw the sector boost remote working to main social distancing. Last year saw such practices, including four-day weeks incorporated into hybrid working arrangements.
During 2023 charities are advised to look at further flexible working practices such as considering job sharing applicants, who share the workload of leadership each week. This is especially important in senior and chief executive roles so that the pressures at the top are shared.
Already several charities are considering the move. Human Rights charity Birthrights has recruited Shanthi Gunesekera and Janaki Mahadevan as joint chief executives from January 2023. They have already worked on a job share basis since 2019 in senior social integration strategy roles at the Greater London Authority.
ANNOUNCEMENT🌟
— Birthrights (@birthrightsorg) November 8, 2022
We are pleased to announce the appointment of Shanthi Gunesekera and Janaki Mahadevan as joint Chief Executives, who will lead our mission to protect human rights during pregnancy and childbirth in a job share from January 2023. pic.twitter.com/USLvO2b4oc
In November Leukaemia UK has recruited Lizzie Afonso and Anna Wilson on a job share basis to fill its newly created director of communications post. They had previously job shared in senior marketing and communications roles at Shelter.
Prepare for social media changing
Just when charities thought they had mastered social media promotion, the landscape has begun shifting.
Twitter has been the go-to platform for charities to promote campaign, launch fundraising appeals and share their news. But following Elon Musk’s takeover of Twitter in the autumn some organisations are questioning its future.
At the time of writing the jury is still out on the future of Twitter. But already some organisations and Twitter influencers are looking elsewhere and exploring new platforms.
This includes the Mastodon platform, which is a collection of servers, with no one owner and a focus on tackling disinformation. Charities are advised to review their social media strategy in 2023, to take into account the effectiveness of their most used platforms and consider new and emerging social media players.
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