Charities should be deliberate about their impact reporting, the Charity Commission chief executive has said, as changes to accounting rules are introduced from next year.
The new Charities Statement of Recommended Practice (SORP), which applies to accounting periods beginning after 1 January 2026, states that impact reporting will be “a ‘must’ for all charities”.
Directory of Social Change chief executive Debra Allcock Tyler last week criticised the impact reporting requirement, warning that many charities are unable to measure their impact easily and would instead resort to a “cut and pasted” statement.
Speaking at NPC Ignites in London on Tuesday, David Holdsworth said the new impact rule “can’t just be an annual tick-box”, comparing it to current requirements to make a statement on public benefit.
Holdsworth said: “I think one of the worst practices I see for charities who have to comply with the public benefit test is that awful paragraph that I see cut and pasted across tens of thousands of charity annual returns which says: ‘We the trustees confirm we comply with the public benefit.’
“You’ve immediately lost your audience, you’re not bothering to explain the fantastic work you are doing, the impact you are having – and all charities have an impact every day.”
Holdsworth said that conversations about credible impact reporting “should already be happening within trustee boards anyway”.
He said: “I think the real first thing is being deliberate about it, how you follow through the conversations that are clearly happening at trustee and leadership level.
“I don’t think it’s for us as the regulator to try and straitjacket people here with one answer for what is a very deep and broad sector.
“I think we’re at the exciting start of the conversation about impact reporting, how we can demonstrate it and the difference it can make, and I’ve seen it make.”
