Charities must change their culture and behaviour so that it is more in line with what the public expects from charities, the chair of the Charity Commission warned last night.
Baroness Stowell was speaking at the RSA following the launch of the Commission’s new strategic direction that sets out how the regulator intends to do more encourage better standards in charities and also change its own focus to offer more support and encourage the right behaviours.
She warned about a lack of ethical standards in fundraising and too much focus on the pursuit of growth.
Last night she said charity “in its purest form” is an expression of people’s desire to help others and is “about altruism and selflessness”.
She said that in a “country marked by divisions and disruption” charities have a “unique potential to bridge divides and help us confront uncertainty with purpose and hope”.
But to do this charities and the regulator need to change.
“I am not complacent about the challenge ahead, or the burden of responsibility on the Commission’s shoulders. We need to change,” she said.
“And I urge charities, of all sizes, to recognise that they too must read the writing on the wall, and respond.”
‘Not fulfilling potential'
Stowell said that that collectively charities are “not fulfilling their potential” and that the public are “no longer giving charities the benefit of the doubt”.
Stowell said this is partly because of “uncharitable behaviour” in areas such as fundraising and the “the single-minded pursuit of organisational growth”.
She said people feel that the “promise of charity has not always been kept” and that “charities are not always motivated by the same sense of decency, concern and selflessness which drives them when they donate”.
Other ways to do good
Stowell warned that: “Charities do not have a natural, eternal monopoly over the channelling of our altruistic impulses”.
She added that: “We cannot assume that the concept of the registered charity remains the primary vehicle through which people express their charitable instincts into the future.”
There are now “other ways to do good” such as through crowdfunding, peer-to-peer support and social enterprises.
She said that “there will be ever more new kids on the philanthropic block” which is why being a registered charity “will need to amount to more” if the concept is to “survive”.
She said that whole sector shares a “collective responsibility” to meet public expectations of charity avoid “being complicit in its decline”.
“Charitable aims cannot justify uncharitable means,” she said.
She gave the example of a large charity which had recently told her that it had decided to not compete for contracts if the service is currently being provided by another charity.
“That leader understands that the charity’s purpose is to help their beneficiaries, not to grow bigger and stronger for the sake of it – or worse, at the expense of another, smaller charity,” she said.
This is the kind of behaviour and appreciation of the “wider responsibility” she said the Commission wants to encourage because it is what “separates a charity from a profit-making business, that’s the attitude, the ethos the public expect”.
She added that anyone working in the sector who does not want to hold themselves to high standards should question why they are “involved at all”.
We want to offer more
Stowell said the Commission itself wants to “offer more, and amount to more”.
She said it had improved “enormously” in the last few years and is now “in a position of relative strength”.
But it “must now steer a new course, if we are to do our duty by the public we serve”.
This includes providing better services to trustees to help them run their charities well and doing more to bring charities together and facilitate conversations around things like mergers.
Stowell suggested that the Commission will be bolder.
“Fulfilling our purpose may involve making judgements that risk challenge – political, and indeed legal,” she said. “But we will not be put off from doing what’s right just because it’s difficult.”
She added that she does not want an “adversarial” relationship with the sector and will seek to work in partnership.
Ambition exceeds capacity
“Our ambition for the charity sector is greater than our current capacity,” she said.
The Commission has its budget effectively halved as result of austerity a few years ago, though it has been successful in securing targeted additional funding from the Treasury. In recent years it has often mooted the possibility of larger charities paying some kind of levy.
Last night Stowell said: “Before any debate about resources, it is right that I set out what role the Commission intends to play in maximising the benefit to the public that we and the sector together have the potential to create.
“Work is now underway to develop the map that will get us there. That will translate our strategy into a work plan for the next five years. The details are yet to be worked through and I don’t want to pre-empt that work.”
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