Anyone reading the press over the past year could be forgiven for thinking that working in the charity sector is like living through the Blitz. It feels like the sector’s marketing, lobbying and remuneration in particular have been under constant siege: constrained by government, denigrated by the media and misunderstood by the public.
The bigger charities have borne most of the brunt, yet the latest National Council for Voluntary Organisations UK Civil Society Almanac shows sector income has continued to increase with those same large charities leading the charge. Conclusion? These external factors are nothing like as threatening or damaging as we think. In fact, what is really holding us back is not those prejudices, but our desire to conform to them.
I recently had lunch with the chair of one of our biggest and best-loved charities, and I asked him what frustrated him most. He turned immediately to the perception of what charities should be, not just in government, the media and the public mind, but also in the minds of trustees and staff – and he went on to give a painful example.
A few years previously, his charity had invested heavily in a new customer relationship management system. "We lost a lot of money on that project," he explained. "It would have cost about £200,000 to get someone really good to deliver it, but we knew we’d risk our reputation if we paid a salary like that, so we took the traditional charity approach. That decision probably cost us nearer £2m in the long run."
So how do we deal with the pressures of conforming to the acceptable image of charity? Do we bow to it – and pay the capability price? Or ignore it – and pay the reputational price? Or could we take a different tack?
The bottled-water social enterprise Belu released its latest annual report on world water day. In 2011, after several loss-making years, it shut down all its own charitable work and instead pledged all its profits to WaterAid. Since then it has dramatically improved profitability, donated £2.2m so far to WaterAid and could well pass the £3m mark by Christmas.
Belu needs to care about only five things: its brand, its product, its distribution, its carbon footprint and increasing its donations to WaterAid. It can market, lobby and remunerate its employees however it likes; it can invest, make mistakes, hire, fire and pay bonuses in whatever way it sees fit. If it chose to spend £1m developing a CRM system as a gift for WaterAid, no problem. It’s free of all the legislative, perceptual and mental shackles of a charity. Belu was neither set up nor seed-funded by WaterAid, but it could have been, and it’s exactly the kind of strategic asset that other charities should be trying to build.
Charities that want to increase resilience, create flexibility and shed their shackles, especially those that are heavily dependent on fundraising and vulnerable to public perceptions, could do a lot worse than building or engaging arm's-length social enterprises: ethical businesses with profits permanently committed to the charity, but with the independence to do, say and pay what a charity can’t. If that sounds subversive or "un-charity-like", it is meant to.
The Blitz ended only because Britain found new ways to combat it: with technology in the air, special operations on the ground and strategic alliances around the world. Many of these ideas were considered distinctly un-British – or, as General Clive Wynne-Candy, the eponymous Colonel Blimp in Michael Powell and Emeric Pressburger’s classic war film The Life and Death of Colonel Blimp, described it: "not playing by the rules". The moral of that film is that sometimes we need to shed the outdated rules that constrain our ability to succeed. Perhaps now is a "Blimp" moment for charities.
Martyn Drake is founder of the management consultancy firm Binley Drake Consulting