Pilotlight has been keenly watching for signs of impact of the credit crunch on small charities and social enterprises in the UK. In her introduction, Fiona quotes from PricewaterhouseCoopers‘s “Managing in a Downturn” paper summarising the results of a survey of voluntary sector Finance Directors and Fundraisers carried out in November 2008.
The report shows charities anticipating falls in income versus growing need, and 21% were already reporting a drop in income at the time of the survey. The greatest decline is expected in the areas of corporate giving, trusts and legacies. However 71% are already taking action, principally in the area of financial management, and many saw opportunities as well as risks in the changing climate.
Several described the credit crunch conditions as a catalyst to improve management and governance. The report concludes, “All experience says that recessions can be viewed as similar to “pit stops” in a grand prix, with those organisations using the time to reassess their position emerging stronger and those that don’t at risk of falling behind.”
Small charities were described as more optimistic about the impact, but the report speculates that they may well lack the resources to fully model the impact of the recession.
A Pilotlight relationship could be just the pit stop charities and social enterprises need to weather the recession and come out stronger. The voluntary sector is well practiced in responding fast to the needs of disadvantaged people on scant resources; now more than ever they need the business skills and tools to mediate risk and capitalise on opportunities.
We are often asked what effect the economic conditions are having on our membership. We are grateful for the continuing support of our corporate partners as their organisations adjust, and delighted to report that enquiries from individuals are on the increase. Perhaps as organisations assess their fitness to cope with recession, individuals are reassessing their personal priorities in the light of a shifting environment. Whatever the reason, we are very pleased to put their skills and expertise to work preparing our charities to meet greater need with fewer funds, and continue their essential work.
To read "Managing in a Downturn" paper, please click here.