Big charities behaving badly: what are the consequences?

Has the behaviour of large charities contaminated the whole charity sector? This was the question posed at a debate hosted by NPC and Deloitte in London this week.

As Russell Hargrave from NPC wrote in Pioneers Post back in April: "The press has run gory headlines for months about mismanagement, high pay and hostile fundraising." Stories about Kids Company and Olive Cook reached far beyond the realms of the sector press.

Paul Streets OBE is the CEO of the Lloyds Bank Foundation for England and Wales and is not convinced that these high profile stories tarnish the vast amount of small charities working across the country. “The public don’t blame the local corner shop for the actions of Tesco – those actions might even drive people to the corner shop so maybe there’s an opportunity here." 

Highlighting cuts to charities that support sex workers, victims of domestic violence and those addicted to drugs and alcohol in particular, he continued: “Instead of shouting from the rooftops about the scandal – and it is a scandal – of the government withdrawing lock, stock and barrel from small charities who reach the most disadvantaged in society, we’re defending ourselves from our bunkers on issues that affect a tiny proportion of the sector.

“We need to start ranting about the issues that affect the smaller organisations, because these are critical. And if you’re from a large charity, stop moaning about these things that affect only you and get your house in order. Let’s have some solidarity,” urged Streets.

Aside from the headline grabbing issues around fundraising, executive pay and mismanagement, the other key point of tension covered was the issue of competition and contract tenders. Cathy Ashley, CEO of the Family Rights Group, explained that the last few months have been extremely testing on her organisation, which has a turnover of under £1m.

Family Rights Group was established in 1974 and works with parents whose children are ‘in need, at risk or are in the care system and with members of the wider family who are raising children unable to remain at home’. One of the key services the charity provides is a free and confidential telephone and digital advice service that provides legal and practical advice to families.

There was a feeling that they just didn’t care enough

Ashley and her team have researched and investigated thoroughly various ways in which the advice service can be funded, including the possibility of social finance, but have concluded, along with a government department, that the only feasible solution is through a grant. This year the charity experienced months of uncertainty as to whether they would receive this grant from the government, which led to redundancy notices being issued and eventually withdrawn when it was announced they would indeed receive the funding required to run the service.

Ashley said: “I suspect there were some very big boys and girls competing for that advice line tender. For us it would have basically meant the end of the charity… Whereas for them (the bigger charities), they wouldn’t have hardly noticed it in terms of their bank balance... When you’re working with big charities it is important for them to realise the impact they are actually having when they attempt to go for some of these tenders. There was a feeling that they just didn’t care enough about the specific contribution that we make in relation to families that we work with.

“There is a passion and a drive within our organisation because we’re absolutely committed to that particular route. For other bigger organisations it is just one of the many problems they deal with.”

At the other end of the spectrum in terms of charity size sits the Royal National Institute of Blind People (RNIB), which employs 2,500 members of staff, has around 5,000 regular volunteers and runs three care homes and produces 40,000 talking books and CDs every week. Last year alone it produced 13 million pieces of braille.

CEO of the RNIB Lesley-Anne Alexander said: “I don’t think the debate is really about big or small. I think the debate is about good or bad.” While Alexander emphasises that there should not just be one charity for each social issue, she argues that the current number of organisations registered with the Charity Commission, which sits at approximately 180,000, is simply too many.

Big and small need to co-exist in our world

“At the last count there are 733 UK charities that have something to do with sight loss in their projects… 733 charities gives us the opportunity to be very divided as a sector,” she said. Division essentially hands policymakers a reason on a plate as to why they should not take action because they can claim "we don’t know what you lot want".

One of the ways in which Alexander believes the sight loss community of charitable organisations has overcome this division is through the creation of the UK Vision Strategy, which brings as many of the charities as possible quite literally into one room on a regular basis to discuss what is best of the people they serve. The united front allows the charities to establish “a collective view of what we all want to achieve” and provides an opportunity to move beyond viewing others as competition and instead as partners, and ultimately makes the voice of the sector stronger.

Alexander concluded: “Big and small need to co-exist in our world. We all have a role to play and once you start to move to a place where you understand what those roles are and once you move to a place where you stop blaming other people because you can’t do exactly what you want to do the world becomes a better place”.

Matthew Sherrington of Inspiring Action Consultancy broadened the debate even further, leaving the audience with some thought-provoking questions. He highlighted the fact that whether you are a “mega-million” charity or a much smaller one, if you are predominantly committed to one source of funding this in itself poses a serious challenge.

“To what extent are you independent? What extent are you a subcontractor delivering somebody else’s agenda? I don’t think the sector is honest enough about that dynamic and that risk. When the government changes its priorities, cuts things because of austerity, chooses to cut programmes, the sector screams about its survival... Can you really complain if you are fundamentally existing to deliver somebody else’s agenda?” he asked.

Sherrington also concluded: “The real issue is about effectiveness, impact and quality – not about size… The challenge is around behaviour.”