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Half of charities fear funding levels will be inadequate for meeting 2020 objectives

Melanie May | 26 September 2019 | News

Half of charities are not confident that their funding levels will enable them to meet their charitable objectives in 2020, according to research by charity investment managers Brewin Dolphin, with political uncertainty and fears of an economic downturn among the biggest concerns.
Brewin Dolphin’s report Charity Investment: navigating uncertain times is based on the views of 110 charity trustees and senior managers of grant-making and service-providing charities.
It found that a slowdown in the economy is considered the biggest risk to future income and the ability to meet charitable objectives for 45% of charities, while the number of charities fearing a global recession has more than doubled to 26% against 11% in 2017. Over a third (35%) say political uncertainty is among their primary concerns.
Ruth Murphy, Head of Charities at Brewin Dolphin said:

“Charities are being asked to take on more every year and cracks are beginning to show, particularly for small and medium-sized charities.
“That half of the charities surveyed do not believe current funding levels and fundraising activity will allow them to meet their charitable objectives over the next year is worrying.  Grant-making charities can always cut their cloth accordingly by reducing the grants they make, but service-providing charities do not have that flexibility.”

Low growth in markets is cited as the primary investment risk for nearly half (48%) of charities, followed closely by volatility (44%).
In addition, the research found:

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Murphy added:

“There is an alphabet soup of requirements from MIFID, FACTA and SORP, plus the demands of the Charity Commission.  It is not surprising that 43% of trustees believe that the requirements are simply too demanding.

“Given that the average size of a charity’s board of trustees is between six and ten, they have little realistic chance of digesting easily all that is required of them.  The one-size fits all approach to charity regulation isn’t working, and the likely result is that charities will find trustees in short supply.  A number of our survey respondents made comments about regulators, including calls for the Charity Commission to introduce a telephone helpline for trustees. Charities want a simple and speedy response.”

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