People often talk about being afraid of change. But the ability to change is, perhaps, one of the most striking characteristics of the charity sector. The most effective charities are those who find a balance between evolving to improve the way they support their beneficiaries, and knowing when to stick with tried and tested approaches. Charities thrive because of their creativity and adaptability. They can take risks and trial innovative solutions to social problems, and they are also good at coping in changing circumstances – when faced with uncertain funding, for example – a trait that is particularly valuable in the current economic climate.
The board of trustees can sometimes be an important force for change, leading a charity in new directions and championing innovation. But sometimes the board can get left behind as a charity evolves, continuing to use approaches and structures that, over the years, have become out of sync with the charity’s development.
Charities are currently facing tough times, and their trustees will need to invest more time and energy to help see them through. When times are tough, it is more important than ever that charities can turn to a strong board for guidance and support. Boards need to be willing to adapt to the changing circumstances and to make the hard decisions that might be necessary to keep their charity going.
Our new report, Stories from the boardroom, shares reflections and recommendations from trustees who attended a recent series of seminars that NPC ran with the Clothworkers’ Company. It also includes a handful of case studies exploring how boards have tackled particular challenges, including reductions in public funding.
One of the charities is Tomorrow’s People, a UK employment charity that helps excluded and disadvantaged people to get and keep a job. Over the last few years, the majority of the charity’s income has come from the government. But changes to government funding streams mean that Tomorrow’s People cannot count on this money in future.
In this situation it is important for trustees to step up and do what they can to help. Tomorrow’s People’s chair, David Stewart, told us how the board anticipated financial challenges and has been thinking hard about how it can sustain the charity’s services in the absence of public funding. Last year, the board carried out a strategic review, with the help of the consultancy PricewaterhouseCoopers, to look at the financial viability and impact of each of Tomorrow’s People’s programmes. This process has clarified their thinking and resulted in a shift in priorities towards services with promising results funded by private money.
The main challenge now is to bring in new funding. The trustees are rolling up their sleeves and getting involved in fundraising, for example by attending meetings with the chief executive and forming a working group to investigate alternative new sources of funding, such as social investment and venture philanthropy. The board has recognized the need to change the way things are done in order to thrive, and is leading the charity forwards.
NPC spoke to many charity trustees in the process of writing this report, and an underlying theme that kept coming up was that of change: how boards can evolve to meet their charity’s changing needs and adapt to the changing contexts in which they work. Trustees need to ask themselves whether the current board size and structure, and the trustees’ mix of skills and experience, is suitable for the charity in its current state. And, if the answer is no, they should then ask themselves whether they are willing to make difficult but important changes to ensure the board is leading and supporting the charity as effectively as possible. As one trustee commented, ‘Be prepared to change’ might be a good motto for the moment.
Clare Yeowart is senior consultant at New Philanthropy Capital