Changing attitudes
Lindsay Boswell believes that more leaders need to ‘get’ fundraising if charities are to counter the challenges of an uncertain economic and political future.
Now that we are all getting used to our coalition government, it is worth looking at the future challenges that face fundraising as a result of the political and economic world we now operate in, as well as more broadly.
The Institute of Fundraising is home to the ‘Remember A Charity’ coalition of charities that are seeking to increase their legacy income. When the Tories announced a major policy shift to increase the inheritance tax threshold to £1m, we knew that this would hit legacies hard if it was delivered. Luckily, the coalition has seen to it that this policy seems to have been dropped – at least for now. This is one of the few bits of good fortune for our sector.
Making giving easier
Both parties have gone public before now on their desire to ‘improve’ Gift Aid. This is something that has been on the IoF agenda for a long time but inherent in our definition of ‘improvement’ has always been to make it easier for donors to give tax-effectively and easier for charities to explain and maximise. This, logic dictates, has to result in increased levels of Gift Aid and time will tell if there is an appetite to be giving away more, when there is a major commitment to curb spending and balance the books as soon as possible.
If the government is serious about its idea of ‘Big Society’, then channelling support and resources into our sector, where effort is rewarded and those who are the most efficient and effective stand to gain the most, could be a neat policy. Investing in growing Gift Aid works in exactly this manner and it does not need great teams of grant givers and impact assessors sitting in the form of civil servants to achieve it either.
In the shorter term, the sector faces a cut in Gift Aid in real terms in April of next year when transitional relief ends. This was a fixed-term top-up to support the sector after the rate of Gift Aid fell when 2p was taken off the basic rate of income tax. We want transitional relief extended until Gift Aid reforms are in place and the money is filtering through to charities’ services. We also want assurances that if (some say ‘when’) the income tax rate increases then Gift Aid will increase along with it.
Giving recession?
I think we are facing a really difficult future in fundraising terms. Our members will be OK as demand for their services will increase but I believe that we are only now just about to enter a potential ‘giving recession’. We have all been worn down by the worry and fear of what the last 18 to 24 months might be like…but in truth, and in most cases, it has not been too bad. Some people have lost their jobs and it has been devastating for them, but the majority of our donors have enjoyed low interest rates and smaller mortgages as well as the income tax and VAT cuts that were designed to get us spending. In the near future, we will all have tax rises. There will be many more jobs lost as public sector cuts begin to bite across the civil service, across health and education. Things are going to get tough!
Diversified income
Many charities depend on public sector contracts for a large part of their income. These contracts will shrink, and we have known this for some time, yet too few have put plan B into place. Mergers, or more realistically, failing charities being wound into those hanging on will increase. So will the rate of those who go to the wall and stop what they are doing. For some, plan B will be to diversify their income and we can expect to see an increased demand for fundraised income leading to more fundraisers. I am quite clear that an experienced fundraiser with a proven track record of delivery will be a highly desirable resource. Wages will increase and recruitment companies will do well. We’re already on the edge of a skills crisis in fundraising. We have not been developing the staff we have while, at the same time, the market for good fundraisers has expanded massively.
The next stage of growth
Our learning strategy, which was launched late last year, identified these issues and realised the solutions would take time and not at the click of a switch. We need to change cultures and attitudes and this takes time. So what needs to happen? Below I have identified and addressed a range of steps and measures that, between them, will go a long way to change things. Collectively, these are taking the profession of fundraising on to its next stage of growth – adulthood; a fully-fledged identifiable and recognised profession in every sense of the words.
Fundraising is far too important to just be left to the fundraisers. Done well, fundraising links the services a charity supplies and the difference it makes to its supporters. Often it is fundraising that drives an organisation to be able to measure its impact and to quantify the difference that it makes. It’s no coincidence that many charities that integrate fundraising into their leadership and governance are successful and progressive. Those who don’t are never going to generate the income they need to succeed.
Across the board
Too many organisations still do not have fundraising as an established seat at their senior management teams. I can think of charities that are trying to recruit high quality directors of fundraising yet exclude that person from the senior management team. It does not matter how much they are prepared to pay, they need to place that person, and therefore fundraising as well, at the heart of the organisation if they are to succeed. Too few chief executives actively engage in fundraising themselves and seem to pretend that it is either not happening or it just happens by osmosis.
The same can be levelled at boards. All is not doom and gloom and there are many organisations where the board and the CEO see fundraising as a vital cross-organisational bridge. You can easily find out who they are. Look at their results. If you find a charity that has a sustained programme of fundraising successes then I guarantee that you will find the leadership ‘get’ fundraising.
Now do not misunderstand me, you need to have excellent fundraisers in place to deliver.But even when you have a superb director of fundraising, if they are not supported properly and the organisation does not allow fundraising the scope to join up the various parts of the organisation, then success will not follow.
Identify talent
There is a need to take a longer-term approach within fundraising. Far too many fundraisers are measured just on their performance in a 12-month period and too many fundraising KPIs do the same. As a result, managers are desperate to keep good performers in their current roles and fight to avoid losing them. This means too many fundraisers do not get developed within their own charities and end up switching jobs in order to get the breadth of experience that they feel they need. We need to get back to identifying talent, investing in that talent and then promoting it. It is that lack of our own talent development within fundraising that has resulted in a skills shortage at middle management levels.
Integral to our learning strategy is providing the tools and resources to those who have responsibility for fundraising to be able to manage this area better. This will appear as practical advice about recruiting, retaining and developing staff as well as how to performance manage fundraisers… this will, if we are to provide really useful support, include dispensing with the services of those not up to the job! It is essential that fundraisers adopt high standards and deliver against these and that when it is their fault that this does not happen, then we need to be grown up about it. When it is because they are set up to fail, then we will support them to the hilt.
In concert with this work, we are looking to develop an effective and credible system of continuous professional development (CPD) and link this to membership of the Institute. CPD is at the heart of fundraising, taking the next step in its development. It’s vital that fundraisers gain and retain the skills, knowledge and contacts to be able to be effective at their jobs now, and in the future.
If we do all of this, and we are successful at getting our sector to play a large and significant role in our new Government’s plans, there is the chance that we will come out of the rocky road ahead stronger than we are now… but it’s still looking like a bumpy journey.
Author: Lindsay Boswell
Lindsay Boswell is chief execuitve of the Institute of Fundraising with more than 17 years' experience in the voluntary sector.
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