Transparency and trust has become a hot topic for the charity sector since the collapse of the Kids Company, bad press about CEO pay and the suicide of Olive Cook, who had been receiving thousands of direct mail pleas from charities at the time she took her life. In 2016, a Charity Commission census found that that public trust in charities in England and Wales had dropped to its lowest level since 2005, when monitoring began, falling from 67% to 57%. The fact that such terms as "chugger" – short for "charity mugger" – are now part of the vernacular suggest that trust is waning and "charity fatigue" is setting in. 

 

One in five of the UK's biggest charities are 'spending less than half of their income on good causes' (and some spend as little as ONE PER CENT on charitable work) – Headline from The Mail in 2016. 

 

As well as being the “right thing to do”, below we have listed the top 5 reasons why transparency should be top of your priority list. Most charities have responded well to this crisis already, and public trust is already on the rise again but there is still a long way to go if we want to have the same rigour and transparency in the non-profit sector as is expected in other major sectors. 

 The public have told us they want more transparency. 

 

 A recent NFP survey in 2016 showed that the top two factors that encourage people to give are: 

  • The charity is clear about what donations are spent on (56%) 
  • Learning about the impact which the charity has (47%) 

The public have told us they would like to see at least 58% of its income being spent directly on its beneficiaries, and they want this information clear and easy to find. 

See this example from Oxfam who have created a personalised app to give donors more control over how much they donate and more information about the causes theyre supporting. 

http://www.contagious.com/blogs/news-and-views/oxfam-charity-and-transparency 

 

 

Transparency is EVEN more important for millennial donors (the future). 

78 per cent of millennials arevery likely or somewhat likely to stop donating if they didnt know how the donation was making an impact.” (Millennial Impact Project) 

Millennials have huge purchasing power and, even if they arent the most valuable donors today, they are the driving force behind what individual giving will look like in the future. Millennials will change how change is made, and they are already telling us that this is most likely to be focussed on increased transparency and accountability.  

Funders have told us they want more transparency. 

Against a landscape of increasing competitiveness for funding, major donors and trusts and foundations are seeking an increase in transparency and proof of impact. By taking a proactive approach to better impact measurement you can actually make this your USP and bring in even more funding (we have!).  

See an example of this approach by the Epic Foundation in selecting the charities and NGO’s that they support, in which they request quarterly updates in quantifiable impact indicators that are shared in real-time with the donor portfolio. Street League was selected to be one of the esteemed charities in their portfolio in 2016. 

 

Transparency helps your organisation to learn and improve its services. 

Instead of being afraid of transparency and what it might “unearth”, think of it as an opportunity to discover trends, analysis and really insightful information that can HELP you to improve the way you help your beneficiaries and ultimately become a more well-run organisation.  

Your stakeholders do not expect 100% success rates – charity work is hard.   

Embrace the challenges and things that didn’t work so well, as they are the things you will learn the most from, and from our experience, all of your stakeholders will respect your pro-active approach to analysis and improvement.  

There are three simple steps to transparency you can implement RIGHT NOW. 

At Street League we’re on an ongoing journey to become even more transparent about our impact, and learn from it and improve our programmes at the same time. In 2016, we developed our Three Golden Rules for transparent impact reporting. The goal was to simplify down a complex challenge into bite-size and easy to implement guidelines which any charity can implement now, regardless of size or resource 

The Three Golden rules are: 

  1. Never over-claim what we do 
  2. All percentages will include actual numbers to avoid being misleading 
  3. All impact outcomes are backed up by auditable evidence 

 

 

Some of the things we’ve done recently which show how we’re putting these Golden Rules into action: 

  1. We have highlighted the 109 young people who dropped out of one of our programmes without an outcome. 
  2. We discounted 48 outcomes which we did actually achieve because we didn’t have the payslip or employers letter to back them up. 
  3. We’ve gone back through all our data to add in the sample sizes to percentages (tell us if you find one without a number!). 
  4. We map every single young persons’ journey through Street League, no generalisations! 
  5. We have introduced a four-stage internal audit process for every single one of our outcomes, which could stand to test against a rigorous external audit. 

Read more on our journey and how we developed the Three Golden Rules. 

 

Read this blog from our CEO on how charities can balance telling stories with hard hitting facts on impact to back them up.

 

Follow us on Twitter @Street_League to join the conversation on transparency and let us know how you’re getting on.