Covid-19 mission drift amongst small and medium sized charities

When the first lockdown came into effect in March 2020, there were legitimate and understandable fears in many quarters about whether this would mean that large numbers of charities would go to the wall. The Government put forward some support (nothing like enough) and, as we have previously reported, many grant funders really stepped up to help keep the sector going.

We have done a lot of work over the last 18 months in particular to help clients reassess their strategies in the light of the impacts of the pandemic. We have found that many, far from going to the wall, have grown substantially over the last two years. There appear to be two main reasons for this (and in many cases both apply):

1. They were very successful in winning “emergency” grant funding either to deliver community support services during lockdowns or core funding to adapt services (e.g. to deliver online) or rebuild following the easing of restrictions.

2. They were so successful delivering community support services during lockdowns that local government and other partners have continued to ask them to provide services, whether or not they are pandemic related. Often (but not always) this has been the case for local infrastructure charities.

We are, of course, delighted that these factors have not only helped small and medium-sized charities survive but that many have experienced significant growth as a result.

However, we are seeing two potential threats to the future of those charities that have grown.

The first is that many face a funding cliff edge both as pandemic specific funding comes to an end, and as competition for funding heats up in the light of the impacts of the pandemic and other factors on the economy.

The second impact is that some charities are now delivering very different services to those they provided before. In the worst cases they are delivering services that are outside their charitable objects (which they are not allowed to do). Those charities need to stop doing work that does not fall within their objects and/or seek Charity Commission consent to extend their objects to include the new services (not an easy thing to do these days).

Even when the services in their portfolio all fit within their charitable purposes, many are now asking themselves whether they have lost sight of their original purpose or if they, at least, need to refocus attention on the things they were doing before the pandemic to ensure those important services do not wither on the vine.

For some, particularly local infrastructure charities, this diversification of services and income is welcome and has become their new normal. As long as that decision is made consciously and deliberately, that is a good thing and will give a new lease of life to a sector that has been struggling for 15 years or more.

For others, a course correction is needed to ensure they do not lose sight of their original beneficiaries and the reason why they exist in the first place. That will not usually mean they should go back to how things were before. That may not be possible; there are new beneficiaries who they will not want to let down. In many cases, learning from service delivery during the pandemic will mean that there will be more effective and/or efficient ways to deliver support to their traditional beneficiaries and that should be embraced.

What it does needs though, is for Trustees and senior staff to take a step back and give some time to consider their future strategy in the light of the upheavals of the last couple of years. Decisions need to be made purposefully so that the strategy has the best chance to success in the more challenging funding environment that is now emerging.

It often helps to have independent support and facilitation to help Trustees and staff consider these big questions. If you would like to know more about the services we offer, particularly around strategic planning, please contact us at julian@almondtreeconsulting.co.uk and we can arrange a free initial consultation to explore how we can help.