Charities Prepare to Weather the Economic Downturn
Monday, 15th December 2008 at 1:50 pm
Research in the UK has shed new light on the impact that the economic downturn is having on charity finances and fundraising.
The report of the findings, which surveyed 362 charities, showed that although there was a wide range of experiences the average charity’s income is currently stable. The income from legacies, trusts and corporates has, however, seen a downturn.
The research was carried out by the Institute of Fundraising, the Charity Finance Directors’ Group and PricewaterhouseCoopers LLP.
According to the report, charities are already taking proactive steps to protect themselves from future instability, with 71% of respondents taking action in light of the current economic climate.
Prudent initiatives carried out by charities so far include 32% of charities putting capital projects on hold and 34% of charities planning to restrict IT projects.
In further evidence of good charity management and monitoring, 74% of charities reported that they felt they had adequate budget setting and regular monitoring systems in place. 47% of charities expected to take pre emptive actions ahead of potential increases in costs or reductions in income.
Half of the charities which took part in the report have even identified positive advantages of the downturn with 62% of charities expecting to increase their fundraising activities in the coming months, in order to fundraise out of the downturn.
Overall, it is clear that charities are not expecting a growth in income, but they are wary of predicting what the next few years may hold for them. It is as difficult for them as for other organisations to predict what will happen in the near future.
Lindsay Boswell, the Chief Executive of the UK Institute of Fundraising, says whilst the credit crunch is a ‘chill wind’ for charities, this report shows that with the right tools, knowledge and support charities can weather the credit crunch, and in some cases it may even provide opportunities for further fundraising.
Boswell says even in the best of conditions, charity fundraising remains a challenge – and so it is vital for individuals to keep on giving to their favourite good causes.
Keith Hickey, Chief Executive of the Charity Finance Directors’ Group, says that previous recessions have shown a lag between the start of a recession and the time when the full force of its impacts hits. In this quiet before the storm charity finance directors will need to show real leadership and work proactively to guide charities through the uncertain times ahead.
If your organisation has in place or is preparing a plan to weather the economic downturn in Australia we’d like to hear about it.
FEEDBACK from OurCommunity – Australians are refusing to let the global economic crisis affect their Christmas generosity
Our Community’s online Australian Giving Centre received more than $163,000 in public donations last month – an increase of over 30 per cent on the November 2007 total and almost $100,000 up on the November 2006 figure.
The centre is also on track to top last December’s total of $143,000, with over $115,000 having been donated in the first two weeks of this month.
The Giving Centre allows people to donate online to their choice of more than 1300 community causes nationally and has received over $8 million in donations since its inception.
Find out more about The Giving Centre: www.ourcommunity.com.au/giving
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