I'm an optimistic soul and I fundamentally believe that, as a species, we perform best when we are challenged. The current economic environment is certainly challenging, but I have two unrelated observations that have made me feel more positive than the doom-and-gloom-mongering economists that I spend my time listening to.
You might be forgiven for believing that these austere times bring out the worst in people: the lucky ones cutting expenditure and shutting their doors while the unlucky suffer. Perhaps this is a fair description of what is going on, but my recent experiences suggest otherwise.
The first of these has been my involvement in a survey of charities, foundations and endowments, which I wrote about in my last article. This survey looked at how charities with long-term assets allocate between current and future spending - how much to spend now and how much to save? The full results will be published in February by the Association of Charitable Foundations, but the initial findings make interesting reading.
The vast majority of respondents are aiming to preserve or grow the asset base of the charity over the long term, with most not expecting to be able to 'top up' with additional funds. This, of course, means that they are seeking sustainability, or only spending what they generate in excess of inflation. As a numbers person, I would expect charities to have cut back their expenditure over the past five years to reflect the reduced returns available on investment, often falling well short of inflation. I was wrong: 80 per cent of the 226 charities, endowments and foundations that responded have continued to spend at the same rate since the beginning of the financial crisis in 2007, and 5 per cent have actually increased their expenditure. These are amazing statistics, given the returns that have been on offer, and the stated aim of long-term preservation.
My second observation is less statistical, or indeed scientific, but again illustrates a society rising to the challenge rather than turning a blind eye. In my role as chair of the Charity Investors' Group, I have been part of an initiative to try to connect investment professionals with charities looking for volunteers or trustees with financial skills. This pilot scheme was run in conjunction with the Charity Finance Group during Trustees' Week earlier this month.
I have been overwhelmed by the number of investment professionals who have come forward to volunteer their time and expertise, free of charge, for charity. In just one week, we have had 61 responses from investment personnel, including some very senior individuals, spanning a wide range of expertise. If any charities reading this are seeking a new trustee or investment committee member, please email firstname.lastname@example.org to tap into this incredible resource and wealth of knowledge.
So I have been pleasantly surprised by both of these experiences in recent weeks. It reinforces my belief in the 'blitz spirit' - or, to put it another way, we're all in this mess together. As the Greek poet Horace wrote: "Adversity has the effect of eliciting talents, which in prosperous circumstances, would have lain dormant."
Perhaps the challenging economic environment will mean that more people engage with the charity sector. It is up to the sector to respond to this opportunity.
Kate Rogers is client director at Schroders