Fab Blogsworth

Abortions, money and missions

2011-09-05T09:06:00.000-07:00

Tomorrow the Health and Social Care Bill comes to Parliament, and an amendment to the Bill proposed by Nadine Dorries and supported by Frank Field has brought the issue of abortion rights to the top of the news.

Simon Blake, Chief Executive of Brook has written a great blog outlining some of the key issues.

There is, however, an important element to this debate that affects the broader third sector. The more one looks at these arguments, it becomes clear that Dorries, Field, and their supporters, assume the premise that not for profit providers of counseling and abortions are driven by money rather than their missions.

Take Marie Stopes. It’s a charity (number 265543). It’s vision is "A world in which every birth is wanted". Their website outlines the range of activities which they undertake around the world.

Dorries et al argue that because Marie Stopes receives money from the NHS to provide abortions, it is not fit to deliver impartial counselling as its business model relies on that income. (The same logic is applied to other providers.) The argument goes that other organisations must therefore provide that counselling.

There are many reasons why this argument should be resisted, including the fact, as Simon Blake points out, that both the counselling and the provision of abortions is heavily regulated. There is also the fact that Marie Stopes is also reimbursed for delivering counselling regardless of whether or not the client goes on to have an abortion or not.

However, a key reason to resist this argument is that charities are driven by their missions not by their income streams. To allow this amendment to pass would set a very dangerous precedent that the government believes the opposite. Charities work to build a business model which allow them to deliver their mission, not the other way around. That is the duty of charity trustees and a principle on which the whole third sector is based.

If Marie Stopes were a for-profit organisation then this argument might hold water (although personally I probably wouldn’t buy it as there would still be many imperatives including reputation management that would complicate the picture). But it’s not. It’s a charity and charities put mission before money.

Regardless of one’s views on the rights and wrongs of abortions, the sector must not let the argument that charities are driven solely by financial imperatives stick. The implications would be very serious indeed.

BHF have missed a trick and taken the sector one step backwards

2011-08-31T06:07:00.000-07:00

BHF have today managed to secure a remarkable amount of air time for their research into charity collections for clothes, including Today, the Times and Guardian. The publication of this research was timed to fit with the launch of a major fundraising campaign by BHF, of course a good cause. However, I don’t think this was a responsible or particularly productive thing for BHF to do.

Firstly the debate about where money from donated clothes goes and where charity income comes from has nothing whatsoever to do with effectiveness of a charity and is no proxy for comparing different charities. Many charities have no shops of their own nor any network for collecting bags from people’s homes. However, if they are able to make some money from this donation method through outsourcing to a firm which collects those bags then good for them. Clearly they have a duty to look for the best deal, but there are a lot of overheads involved in such a process.

Now you can say that the charity which does have its own shops and it’s own army of staff to collect bags are seeing 100% of the donations go to the charity. But the 100% is not all going to the charity’s mission. Some is going to the overheads of running shops and employing collection staff.

The comparisons get harder if the two charities are doing different work. If I want to give my clothes to benefit a charity which protects ducks but doesn’t have any shops, then I’m not going to be motivated to give to a charity which protects badgers just because they have their own charity shops. I might feel completely fine about say 40% of the value of my clothes going to ducks rather than say 60% which would have gone to badgers, because I don’t like badgers.

These comparisons therefore are misleading and unhelpful.

But there is a much more fundamental problem with the line which BHF have taken, that it will simply perpetuate the same old myths about charities. The overwhelming public feeling to today’s story will not be that we’d better give to BHF rather than anyone else, it will be that all charities end up being tarred with the same brush: we can’t be trusted and all the money we’re given is wasted on bureaucracy. I did a phone in on BBC Radio Sheffield this morning and this was the overwhelming sentiment from people there.

It’s nonsense for any charity to claim that all of any donation goes to the cause. And it doesn’t help anyone to encourage the public to judge us in this way. BHF are right to stress the need for transparency, but with transparency we should also be leading the debate about what is of real value when judging a charity. We should be judged on our impact and the value for money of our work, not on crude measures of inputs. what matters is how much difference did we make for the money which donors invested in us? If BHF wanted to say that they are the most worthy charity to give to then they should have championed the impact of their work, the lives they are saving, the many thousands of people for whom their support has been invaluable. After all they have a great story to tell.

Charities do and should compete for donations, and sometimes that competition will be fierce and even dirty. But as the sector grows and becomes increasingly professional we do all have a shared responsibility to treat the public with a bit more respect and start a real debate about how effective we really are, or we will all lose out.

Big Society is back where it belongs

2011-05-25T01:33:00.000-07:00

The resignation of Nat Wei yesterday marks the end of an era of the “Big Society”, but it would be a grave mistake for the sector if we let it die.

New governments have a habit of thinking that they must reinvent the world, and only those who were close to them in the humble days before power can possibly help. For David Cameron and his close friends, this reinvention came under the banner of Big Society, an amorphous and ill-defined concept which has left many both inside his party and within the third sector cold and confused.

Part of the reason why sector leaders have been left cold and confused is down to an inherent paradox in way Big Society as a policy has been developed. For a policy which is all about empowerment and bottom-up decision making, the intellectual framework has been developed in a top-down way, by a group of people that most third sector leaders had never heard of. This group has included Nat Wei, who resigned yeaterday. His ideas have been of interest, but have never been sufficiently policy focused or practical and have never inspired the sector. As a mouthpiece for the agenda he has been a distraction.

So in spite of thinking that Big Society is broadly a good thing (as 64% of ACEVO members agree that it is), third sector leaders don’t believe that the government understands the sector (only 8% agree) or values the sector (25% agree). There has therefore been significant scepticism, or even toxicity surrounding the Big Society brand. This has been a big problem when there are so many important policy agendas for the sector bound up within it (such as giving, public service reform, social investment and volunteering).

This is now set to change. With the departure of Nat Wei, government will now need to listen to those who have real experience, knowledge and networks across the third sector. The Commission on Big Society, which ACEVO hosted and facilitated, has produced the best and most coherent set of policies which both support the clear articulation of what Big Society is about, and outlines real practical policy initiatives which can help to make it happen. The focus being placed on the work of the OCS strategic partners around implementing and measuring aspects of the Big Society will help to drive the agenda forwards too.

It is striking then that the momentum from within the sector to define Big Society in our terms and to drive that agenda forwards is peaking at a time when the Government’s enthusiasm for the brand Big Society seems to be waning. The Cabinet’s progress report after one year in office makes no mention of the phrase. Number 10's poor handling of the anniversary of Big Society this Monday has been derided by the media as just another re-launch, further devaluing the brand. The PM failed to articulate the progress which the government has made on the agenda. Instead he yet again talked about it in brand and all-encompassing terms, and therefore also detracted from the firm commitments in the giving white paper launched on the same day.

So we’ve become the life support for Big Society, and that is as it should be. This is an agenda of the third sector and it is right that we lead the debate. However it is impetrate that we don’t let it die because the current policy alternatives would be much worse for the sector and for our beneficiaries.

If the Tory party abandon Big Society then there would be very little to check the fervour of deficit reduction, resulting in less focus on involving the third sector in public service reform but instead pushing wide-scale privatisation and an expectation that philanthropy will step-in as the state withdraws. Similarly if Big Society disappears as an agenda then the dinosaurs on the left of the Labour Party will have free reign to promote statist solutions. Either of these would be a big step back for our sector.

All this was foreseeable. President Bush Jnr made the same mistakes when he took over in 2001, ignoring the established non profit players and talking only to his mates, mainly from within faith communities. However after a year of lots of talking and no progress he realised that to deliver on his social policies he needed the non profit sector as a partner.

We now must be those agents of delivery in partnership with government to realise the best of the Big Society. There is too much at stake for us to let allow the government’s incompetence in explaining and promoting Big Society be an excuse for its demise.

"Why can't we be more like America?"

2010-12-09T01:20:00.000-08:00

Yesterday saw the launch of DCMS’s strategy for developing philanthropy. At the heart of much of the media debate around this was the comparison with the US where levels of giving, especially to the arts, are much higher (see Wednesday’s Today programme on Radio 4). Now I am a big believer in the value of learning from our peers around the world, but that learning has to be within a cultural context.

Avid readers of Fab will know that I’ve spent time in the US, most recently in April this year, picking up ideas about how non profit sector leaders are being supported. While at the GEO conference in Pittsburgh I learned of an initiative whereby foundations support sector leaders in taking sabbaticals allowing them the kind of space for personal development they would never otherwise have and also hugely benefitting their organisations. I was really pleased that ACEVO was able to host Claire Peeps from the Durfee Foundation based in LA which had supported this work at our National Conference to explore how it could be applied to foundations here.

Of course international learning works both ways. Last week I was in Toronto speaking to Philanthropic Foundations Canada about the work ACEVO has done on full cost recovery. The previous day had seen the launch of the Canadian taskforce on social finance which had drawn very heavily on similar work in the UK. It was strange to be sitting in an auditorium in Toronto hearing about the great example of a social impact bond pilot at HM Peterborough being led by the St Giles Trust, but it was a very powerful illustration of how much influence the UK sector has around the globe.

International learning can be really valuable, but an understanding of the cultures concerned is vital if those lessons are to have relevance. My colleagues in Euclid Network, have found this a particularly interesting in promoting networks of civil society leaders across Europe. How does one do this in Germany, where the whole concept of leadership is a fundamentally difficult one?

The Coalition Government has spend a great deal of time in looking at the USA as a model for many of the kinds of reforms which they want to see. Various gurus have come across the pond to help the government articulate the Big Society narrative. In some areas such as policing and welfare to work provision it seems that these will be fruitful lessons.

But giving is different. I’m no expert on the topic, but in my conversations with non profit folk in the US about the relationship between the public, the state and the sector, it’s clear that America’s history and national narrative, going right back to the founding fathers, looms large.

America was created in revolution. It was a reaction against a government, that of King George III, but in many ways that identity has become a reaction against government of all forms. Hence the Tea Party can attract so much support to the bafflement of Europeans.

The motivations for philanthropy in the US need to be understood in this context. The idea of giving as a duty is stronger in the US than it is in the UK because there is less shared expectation or desire for the state to act. It’s not so much that Americans give because the state can’t act, its more that they give because they don’t want the state to act. Therefore the culture of giving has become engrained over generations and become a norm.

This is a very crude generalization, but it is important to understand some of these differences. DCMS want to encourage philanthropy because they have less money to fund the arts. Public spending is going to fall in many areas such as the arts so giving must increase to save national treasures as well as essential services.

Even if people accept this necessity, it’s not quite the same motivation for giving as you find across America. Britons would still rather the state acted in the first place. And therefore the lessons won’t always quite fit. For a change in cultural norms in the UK to result in more giving people need to feel more than a greater sense of altruism or community spirit, and indeed it will take more than people knowing that the state is unable to act. For the culture of giving to better reflect America people will need to feel that they don’t want the state to act, and that’s a much bigger task for the government.

Of course I am all for initiatives to promote more giving, and there are definitely lessons to be learned from the US, but these initiatives need to be in a UK context and not pretend that we just less generous Americans.

The Big Society approach to drugs

2010-11-01T05:56:00.000-07:00

I was interested to see that the relative costs to society of legal and illegal drugs has made the news again today. Last week I finally got round to watching the last episode of Our Drugs War, an great documentary series made by Angus Macqueen shown over the summer. In the three episodes Angus follows the consequences of the criminalisation of drugs from the estates of Edinburgh and New York to the poppy fields in Afghanistan to demonstrate that it is the battle against drugs, our societal insistence to treat a medical problem as a criminal one and therefore fuel a huge black economy, which causes far more harm than the drugs themselves.

In the UK alone our domestic policy to drugs is a manifest failure. Penalties get harsher, more and more substances are criminalised, and yet drug consumption continues to rise. Talk to the leaders of charities working with addicts and its clear that it is the consequences of the criminality associated with drugs; with the poverty, the exploitation, the spirals of deprivation, which is the fundamental problem.

I am not coming at this really from an ideological point of view. I completely understand the motive to want to protect people from harmful things by making them illegal. Governments of old made perfectly reasonable assumptions when banning drugs that this would stop people using them. My problem with the status quo is simply that it doesn’t work. In this debate facts simply are not the driver of policy, fear and misunderstanding take the lead.

This government has been clear that it has a response to areas of policy where government interventions don’t work. It’s called Big Society. As I’ve blogged before I think that Big Society is best conceived of as a political philosophy rather than a coherent programme of work in its own right; an approach based on devolving power and building personal and community responsibility. Speech after speech from senior members of the government has declared that government can’t have all the answers for the tricky problems which society faces. Sometimes society itself just has to be left to found the answer. Where government gets in the way it should withdraw and let the people take charge.

The Big Society narrative has of course been used in the context of championing those who work in communities affected by drugs including those who work with addicts. The sector’s record here is outstanding and of course more should be invested in treating addicts as people with a medical problem rather than a criminal one.

However is there not a more fundamental application of Big Society principles to the drugs problem (and I’m really posing the question here rather than being sure of the answer!)? If government is the problem in the sense that it is the criminalisation of drugs which is more harmful than drugs themselves, then shouldn’t the harmful influence of government simply step back. Shouldn’t we decriminalise all drugs and then focus on a social and medical set of interventions to build the communities which have been ravaged by drug related crime? Take away the criminality and you take away the illegal drug trade with all its associated harm. You change incentives and you change opportunities in those communities no longer driving people towards the drug trade as the only available enterprise. You empower people to seek help without the fear of being locked up. In short you change the whole structure of communities affected by drugs to seek solutions rather than be stuck in spirals of harm.

David Cameron is keen to be pictured as the radical. Big Society is his vision for changing the country. The question therefore is just how radical is he prepared to be to empower society to solve the problems that government can’t.

BS

2010-10-07T09:35:00.000-07:00

Back home after a very interesting and busy Tory conference, with a whole host of impressions. There were a great many ACEVO members there; all working hard to get a feel for the mood and in particular get a sense of where the Big Society narrative is going.

On that latter point I fear that they will have left disappointed. In spite of roughly half of all the fringes being badged Big Society in one way or another, the difficulties in getting a handle on the policy implications remain.

Lord Wei was a big draw. He spoke at two of our fringe events, as well as the Respublica Big Society reception on the Sunday Night. The audience at each were hanging off his every word, often furiously scribbling down what was being said (some were even recording it). Lord Wei spoke about the Big Society as being a society in which “none of us feel small”. He frequently drew on international comparisons apparently to prove that this is now a global trend. His vocabulary was riddled with jargon, such as his debate about the benefits of “bridging and bonding social capital”. He extolled the gains that there could be if only we all formed more coherent groups – and at one point said that something as simple as learning each other’s names could save the state £billions.

It’s crude to take Lord Wei’s comments out of context. His job is to be the muse and when you listen to him speak you kind of know what he’s getting at. But the fact is that his audience perfectly legitimately want to know what this means in terms of how they do their job differently, what it means in terms of policy, and in my personal view in this particular regard he appeared out of his depth.

Lord Wei’s answer to what it all means, an answer also given by Nick Hurd, is that it’s not government’s job to define it. That’s old thinking. Big Society means devolution and localism, groups and communities taking control. We decide what it means. We make it happen. “Set forth and build the Big Society.”

There is of course some logic to that. If Big Society is simply a political philosophy then this is where we are left. The problem is that there is lots of evidence that government is not actually taking that approach, and therefore it is not a satisfactory answer for a number of important reasons.

Firstly government has been seeking to tie all sorts of policy announcements to the Big Society since it came into office. We have seen the announcements about the four pilot areas where local communities will be given extra support in building big society projects. We have the Big Society bank in the offing. And we have the work of the Big Society network, a new body which, as widely reported this week, is in danger of alienating the established third sector. Far from stepping back and letting society get on with making itself Big, the policy fragments which we do have paint a rather rigid picture of what sort of projects constitute Big Society.

Claire Cox from the institute of ideas spoke at our joint fringe with Policy Exchange on Monday night and gave a highly amusing description of Big Society as sanitised, enforced activism where the civil service decide what counts. We’re left with a feeling that the Big Society can be what you make it, as long as the powers that be agree.

There is an broader link here to the Tories views on campaigning. A colleague working the stand for a big national charity this week reported a lot of hostility from party members that they were there to advocate and campaign rather than fundraise. “We don’t give to charity for you to spend the money on campaigning.” A few indiscrete remarks from people close to the centre of Government who should know better have suggested that ACEVO has been foolish to speak out on projects like the National Citizen Service with which we have disagreed. We of course know Oliver Letwin’s position on this from his remarks to NCVO last year. The sector must be careful to protect its campaigning in face of this hostility and there is a clear contradiction between the ideal of Big Society and government not wanting to hear hostile messages.

The second reason why the laissez-faire argument isn’t satisfactory concerns the government’s approach to public service reform. Amongst the less ethereal parts of the Big Society narrative are the very welcome pronouncements about pushing ahead with market based reforms in public services with a clear commitment that the third sector must be able to play a significant role in those markets. The messages from government about removing barriers to level playing fields, reforming commissioning to focus on outcomes, removing bureaucracy, and accessing capital show a good understanding of the challenges which third sector providers face. But getting these market structures right requires some very serious and very specific policy direction from government. Lack of clarity about what and how government wants to buy would be disastrous.

Again in reality, and quite rightly, government is not leaving all this up to chance. There are some important over-riding messages about needing to focus on outcomes and payment by results in the provision of services and different departments across government are bringing about significant changes to the market structures of services. The government understands that good public service markets cannot be spontaneously created from the grass roots.

A third reason concerns the fact that the most radical change which the government is seeking to bring about is coming from ministers who are showing real political bravery and leadership.

I was struck across many of the government speakers on the fringes by how many ministers spoke like they were still in opposition. Asking for ideas and input. Weighing up arguments on both sides and seeking to come to a dispassionate judgement. The idea that Big Society can just be left to happen rather fits into this mould. However, the likes of Iain Duncan Smith and Andrew Lansley (who in my view was the best speaker on the fringe) have shown quite the opposite qualities, demonstrating real boldness in pushing trough their reform agendas. They understand that they have responsibilities to live up to and that their decisions have consequences, and in so doing leave those who need to understand those areas of policy which a clear idea about the direction of travel.

These bold policy pronouncements where they exist, as well as contradicting the idea that Big Society shouldn’t be defined by government, do also present third sector leaders with further confusions. If one looks at the nature of the these reforms to public service markets there is a fundamental inconsistency in how they are being applied. As Sonia Sodha from Demos argued at our joint fringe, in some public service markets we are seeing consolidation and in others a fragmentation. Welfare to work, for example, is moving to yet bigger regional prime contracts for delivery, with a complex supply chain below. The NHS on the other hand, is moving in exactly the opposite direction, with commissioning being devolved to GPs. This inconsistency will make the joining up of areas of public services, vital if the third sector’s role really does mean doing things differently in a way which can reduce spending on those services, much more difficult.

The point is this: facilitating the Big Society requires a coherent policy framework which all the key actors can understand. I suspect that third sector leaders have left Tory conference none the wiser about the Big Society as a concept. We have no reason to buy the argument that defining the Big Society should be left up to us because government has not in fact been leaving it up to us and nor should it. We need to know the rules of the game in which we are being asked to play. Those working with Lord Wei need to understand that reasonable demand and give the sector some answers, if indeed there are any.

The Bonfire

2010-09-24T08:26:00.000-07:00

So the inevitable has been almost confirmed. The bonfire of the Quangos will, according to a leaked list published by the Telegraph, consume both Capacitybuilders and the Commission for the Compact.

No one can be very surprised by this decision, and the sector should resist its natural urge for outcry. Both organisations have done good things over the last few years, but what matters now is how their functions are delivered in new architecture, and how effectively the sector is supported as a result.

There is no doubt that the sector will need ongoing capacity building support if our potential in building strong communities and delivering public services is going to be realized. ACEVO has for many months been arguing for a more demand led approach, and we will be making this case strongly in the forthcoming OCS consultation. Our focus therefore must not be on institutions but on the quality and impact of the support which is provided.

Similarly with the Commission for the Compact, what matters is better partnership working between statutory bodies and the sector. There is a promotion role there which must still be done, although others like Compact Voice are well placed to do that. And there is the accountability role too, which the Commission, because of its lack of statutory power, has never been able to deliver. Greater accountability measures are part of the deal for the new compact, on which Compact Voice is currently consulting.

There is so much still to be decided over the coming months, so it’s vital that we all concentrate on what matters and getting the right outcomes to support the sector.

Saving the NHS

2010-08-09T06:26:00.000-07:00

Interesting to see the comments by Prof Steve Field, Chair of the Royal College of GPs, in yesterday’s Observer. He argues that much more responsibility for good health needs to lie with the general public and strongly criticises “reckless” behaviour such as excessive drinking, smoking and poor diets.

He also makes clear though that this personal responsibility does not exist in a vacuum, nor is it the whole solution, and that the NHS and government must be there to support and encourage better decisions.

It is interesting because the new government somehow needs to find a way to make conversations about spending less money on healthcare politically acceptable. The Tories knew that any suspicion of being hostile to the NHS or seeking to cut health budgets would be electorally fatal. The Coalition has maintained the promise to ring fence health spending, even though the Lib-Dems did not match that promise during the campaign.

Now I have absolutely no desire for government to spend less on healthcare for its own sake. But as I have argued here before, the focus in our popular narrative on protecting acute care above all else means that we neglect investing in community care and preventative interventions which crucially both cost less money and can stop people getting acutely ill in the first place. The kind of behaviour change which Prof Field speaks of should be our strength as a sector.

The conversation which government needs to stimulate therefore is not how to cut money from the NHS, but rather how can health care and public health be delivered in a way which focuses less on institutions and more on good outcomes for the public. As we know, seeking to close a hospital is met with placards and protests. Yet there no longer being a need for that hospital could be met with celebration.

The third sector has an absolutely key role to play in all of this. Recently Paul Corrigan wrote an outstanding pamphlet for us on how the third sector will be the catalyst for a transformation of the way in which healthcare is delivered through revolutionising the business model and changing the way in which value in healthcare is conceived. The public themselves can add value to their own healthcare, not just by adopting healthier behaviour but by learning more about the long term conditions from which they may suffer. His argument is purely an economic one – although with a clear moral obligation.

I can’t recommend it strongly enough. It will change the way you think about the healthcare sector. You can download it here (you just need to enter your email address to see it).

So how do we get there? This round of NHS reform is going to be crucial for the third sector. GP commissioning consortia could be a huge opportunity for third sector organisations to have a greater role in both provision and in working with clinicians to commission the right interventions for particular demographic groups. Details of the White Paper are currently open for consultation and the ACEVO policy team is working furiously with members to respond.

But it will be a difficult challenge. A colleague of mine was recently hosting a roundtable with GPs to talk about how the third sector could play a significant role in markets for patients with personal health budgets. While very enthusiastic about what the third sector could offer in their local area they ended the meeting asking whether there were in fact any third sector organisations in that area!

That dialogue must be quickly formed if we stand any chance of encouraging behaviour change in the general public to live healthier lifestyles, or create a health service which can respond to the challenges it now faces.

The Big Society

2010-07-20T10:00:00.000-07:00

Last week I spoke at the ACEVO-Action Planning Funding Readshow in Brimingham, pre-empting Cameron's spech yesterday. This is what I said:

Thank you David [Senior from Action Planning, not to be confused with Cameron!] for that very kind introduction. Our partnership with Action Planning means a great deal to us and I am really pleased to be here today in this great venue.

We’ve got a great line up here this morning with the opportunity to hear straight from the horses mouth with officials across government able to explain how policy is developing across departments. My job is to set a little of the context, to explore what Big Society may mean and how it will affect our roles in running charities.

It’s now three months since the election and a result which I don’t think many of us would have predicted. It’s been a whirlwind period for all of us as we try to identify what is at the heart of the new government’s vision, and how new policies will affect us and the work we do.

As the dust has begun to settle it is clear that there are some important narratives which are coming to the fore, and which will dominate policy making across government.

The first of these big narratives is of course The Big Society. While this agenda certainly does need some more development there is a great deal of welcome news for the sector in the announcements which have been made.

I think that many of the principles for which we have been fighting for over many years seem now to be the starting point for the Coalition’s interaction with the sector. Government is talking with great enthusiasm about the importance of vibrant civil life and the role of the third sector in delivering reformed public services.

The likes of David Cameron and Francis Maude are talking about the need for a “smart, strategic state” to make the Big Society possible, avoiding simple state retrenchment and recognizing that the detail of the commissioning process, with a level playing field for the third sector, is what matters.

Words are warm elsewhere too with figures as diverse as Iain Duncan Smith, Chris Grayling and HM the Queen making it explicitly clear that the third sector is central to the new government’s vision.

This is without doubt good news. Our sector’s dialogue with the new government starts from a strong position. We don’t need to work at getting our foot in the door, but rather we should be able to get stuck in to the details about making the relationship work.

The Big Society narrative does however I think present some questions for us here in this room, what you might call the organized part of civil society.

Firstly, as I’ve hinted at, there is still a lack of clarity over what exactly it means. Reports from the election campaign suggested that did not go down well on the doorstep as it failed to make much practical sense to ordinary voters.

It is unclear the extent to which this is an agenda about the third sector and supporting the work of third sector organisations, or a more ethereal idea of stimulating civic action and engagement. On the one hand we have very clear, concrete and very welcome initiatives in the offing such as the Big Society Bank, but on the other hand many of the key individuals who have been at the heart of the development of the government’s vision for the Big Society have tended not been established third sector leaders.

A look at the Big Society website, jointly run by Lord Wei the advisor to the new government on the Big Society agenda, illustrates some of this. The blogs, articles and videos on the site very colorfully illustrate examples of what is Big Society. However, they do not really provide much analysis of how to turn these examples into a broader policy agenda, or indeed how the levers of government can turn this wide scale reality.

Now this lack of clarity is also a significant opportunity for us all here, as it is our collective role to work with government to better define Big Society. ACEVO has been arguing since the election that the rather romantic language used to articulate Big Society needs grounding in the reality of the modern third sector. Stephen Bubb gave a lecture back in May which argued that to achieve the vision of the Big Society we need not just civic action but organized civic action and that means a professional third sector which is well capitalized and business-like.

The second challenge which government faces with implementing the Big Society is a challenge which it will also face in many other areas, which is how to swing parliament and the juggernaut of central government behind it.

The Coalition’s majority is much smaller than those which have been enjoyed by the recent Labour governments, and even then government wasn’t always able to do what it wanted. Parliament will therefore have a stronger role; and the political reform agenda is set to give it a stronger role still. Backbenchers will matter and there is little telling at this stage whether or not the Big Society matters to them.

Ministers and senior officials may “get” the role which the sector can play, but it will mean lots of doing things differently, lots of new structures and systems, and the taking of lots of chances – some of which will of course fail. Convincing the treasury mandarin or the local authority chief executive of the need to take these chances will require sustained policy direction and real political bravery from central government. It will also require a sector better able to demonstrate its impact and make its own case.

So Big Society presents definite opportunities for the sector, and we all have some work to do in developing it further. But there is of course a cloud over all of this.

On the last page of the Coalition agreement, after thirty odd pages of commitments, it says in large letters in the middle of the page: “The Deficit reduction programme takes precedence over any of the other measures in this agreement”.

Spending cuts are the biggest game in town and this is of course the second big narrative of the Ccoalition. This year we have seen the beginning of the cuts, and already we have seen an impact on the work of the third sector with the end of programmes such as the Future Jobs Fund. The budget made clear the enormity of the challenge ahead: an average of 25% cuts in departmental spending over the course of the parliament, £11bn lopped from the welfare bill and tax rises of which many (such as the rise in VAT) will hit the sector and those we serve hard. The Autumn’s spending review will be all important as each department submits its proposals for the 2011-14 period.

Now, there is no doubt that public services need reforming in many areas, and there is the potential for a bigger role for the third sector to deliver those services which are preventative and holistic, and keep people out of the most expensive government institutions like hospitals and prisons. We had a conference with our Health and Social care members yesterday and there was a real buzz in the room about the opportunities for a significant increase in the role of the sector in health and social care. But even optimists like us at ACEVO would see it a little far fetched to believe that the sector isn’t going to be hit hard by these cuts.

When we look back at the last decade or so we have seen a very significant expansion of the third sector. Now while there has been some very favourable specific policies towards the sector in terms of capacity building and capitalization, the real change for us has not been down to these sector specific policies, but rather down to the public service reform agenda, the significant growth in the public services industry and the increase in contestability with more opportunity for third sector organizations to play a role in providing those services. Capacity building didn’t grow the sector on its own. Public service reform did.

In this light we might reflect that however well intentioned the policies around the big society are, and however significant the opportunities for the will be to transform the way services are delivered, the reality is that the savage cuts which we will see across the board are likely to have more significant impact in the short and medium term on what it feels like to run a charity.

We don’t yet know exactly what Big Society means in terms of our day to day jobs, but we do know what losing funding would mean. Big Society could be a very interesting and coherent political philosophy, but we may not feel that this is the time for philosophizing.

Our focus at ACEVO is to support the sector’s leaders through spending cuts, with guidance and advice on collaboration and partnerships, on demonstrating impact, and on making those tough decisions which senior managers will have to take. We have recently launched cutswatch.org.uk to provide a first port of call for sector leaders and I’d commend it to you.

So to conclude David, two key narratives from the new government will significantly impact on the sector, Big Society and spending cuts. Both present opportunities and challenges, but one still needs a good deal more explaining. We all have a big role in shaping the debate about what the big society means, but until you’re clear on how it will impact on your day to day role, my advice would be to focus on the spending review, think about income diversity, investigate collaboration and demonstrate your impact; because the challenge of spending cuts is a very real one.

I look forward to hearing the perspectives to colleagues here from government and look forward to the discussion.

Convergence

2010-07-16T03:59:00.000-07:00

“Convergence” is a great report produced by La Piana Consulting for the James Irvine Foundation. The report argues that there are five converging trends which are aligning to shape the future of the sector. Successful organisations will be the ones which can adapt to these trends:
· Demographic shifts redefining participation;
· Rapid advanced in technology;
· Networks enabling work to be organised in new ways;
· Rising interest in civil engagement and volunteering; and
· Blurring boundaries between the sectors.

The report outlines the ways in which organisations will need to respond and how we will need to develop the sector’s leadership to rise to these challenges.

For me the highlights are the quotes from sector leaders which explain what these changes will mean and present some real challenges to our thinking:

Tara Mohr, a coach from San Francisco said on the growth of inter-organisational networks:

“The organisation as an entity is becoming less and less important... We need to be looking at entrepreneurs, programs, organisations and networks of organisations, and thinking about how we organise our work and organise our impact across all four of those things, and less focused on the organisation as a central unit of how we get our work done.”

Shiree Teng, a consultant working with the sector argues that a radically different approach is needed for the models of leadership (not necessarily on-message for ACEVO!):

"It’s interesting to look at recent studies on nonprofit leadership deficits. That’s very conventional thinking — "replacement thinking." I think generational shift, along with trends related to diversity and technological advances, will change how we look at the leadership pipeline. Less replacement theory, more demand to revamp the executive director job so [it is] more doable. [We need to] increasingly look at the single leader model... and challenge that assumption of "leader." We need to move to more shared leadership for organizations."

Stephen Bauer, from American Humanics warned of the consequences of ignoring good HR:

"In our drive to put mission first, sometimes the staff are sacrificed. There are some funders out there that have taken the initiative in supporting effective HR functions and staff development, but if we don’t do more to take care of our own folk, we are going to lose them to other sectors."

David Eisner, former CEO of the Corporation for National and Community Service, champions the need for new partnerships:

"Organizations must become more facile around all sorts of dynamics, from 'co-opetition,' where an organization they are competing with they must also have to cooperate with, to understanding joint ventures, mergers, and acquisitions activities. The geographic world is changing dramatically. In the business landscape, there have been massive changes about how organizations are meeting supply; a lot of big nonprofits have not been able to restructure themselves to meet these new realities."

Peter Brinckerhoff, another consultant argued that funders have a key role in supporting organisations through these changes:

"As nonprofits, we can’t set money aside in a fund; you have to spend all the money according to the norms, which are "If we are not poor we are not holy." This gives us no cushion to thinking strategically. If nonprofits always budget just to break even, they can never grow and help more people."

As we focus on the immediate challenges we face around spending cuts and responding to the new government it is easy to forget the broader context and the longer term evolution of our environment. However we will ignore this at our peril.

On being a (future) Chief Executive

2010-06-18T02:54:00.000-07:00

I’m glad I’m not Tony Haywood. It’s not that that BP deserves any particular sympathy, but he’s clearly had a pretty rough few weeks. In the eyes of America’s media and politicians, desperate to trump one another in the outrage stakes to curry favour with November’s electorate, he cannot do anything right.

Appear contrite and apologetic and he’s not sincere, or he’s wasting time when he could be plugging the hole himself. Appear pro-active in fixing the problem and he’s not sorry enough. Appear British (which he finds hard not to) and it’s the fault of his whole country. Appear to worry more about his own life and family and everyone hates him.

Now Tony is pretty well paid for his trouble. According to Wikipedia he is paid an annual salary of £998,000 and in 2008 his bonus was £1,496,000. But his experience does proove that it’s lonely at the top. His Chair has avoided putting his head above the parrapet except to declare how much he cares for the small people. Tony has been in the firing line, and, to be fair to him, he has not shirked away from it.

Today is our future leaders summit and I am looking forward to chairing the afternoon session. The conference, aimed at our associate members who are looking to make the step up to the role of chief executive, will see a great line up of speakers sharing experience about how to bag that top job. It will also see the launch of our new publication, written by Cass Business School, on How to Become a Third Sector Chief Executive.

I suspect that most of the delegates are more interested in leading a charity than a multi-national oil company. But Tony’s experience should remind them all of one thing: once you’re the CEO there is no passing the buck. When something goes wrong it’s all your fault, even if it’s a genuine accident, even if you had all the right policies in place, even if your staff do something completely stupid.

It’s that kind of isolating responsibility which makes ACEVO’s networks so valuable. There is a point at which only other CEOs can provide you with the support you need, because only they can know what’s it’s really like.

And it is that responsibility which justifies the salaries which we pay to our CEOs. In the media circus surrounding executive pay, it’s easy to forget that it is responsibility, and not just the complexity of the role or the hours worked, which makes CEOs so valuable.

Everything comes on a scale, and not many ACEVO members have the capacity to destroy large swathes of the American coastline. But we do extremely complicated work with the most vulnerable people in the UK and around the world. The risks are enormous, and the responsibility sometimes overwhelming. Things have gone wrong in our sector and you can be sure they will again. So spare a thought for those who choose to isolate themselves with responsibility, and don’t complain when we pay them a little for their trouble.

Partnership and Placards

2010-06-11T03:09:00.001-07:00

There’s a fascinating article on the relationship between the corporate sector and NGOs in The Economist this week. It’s written in the context of a backlash against NGOs who have build long term relationships with BP following the disaster in the Gulf of Mexico.

The article cites a number of major campaigning organizations, including the Nature Conservancy, Conservation International and The Environmental Defense Fund, who have worked closely with BP to advise on extraction methods or help develop carbon trading schemes. Some have received donations from BP in return. Now, many of the groups’ supporters and other activists are protesting that those organizations are too close to the wicked BP and have sold-out.

The article reminds us that in the last twenty years the relationships between the corporate sector and nonprofits has changed beyond all recognition, and real partnership is the norm on both sides. ACEVO is currently working closely with the CBI on identifying what leadership skills are needed in both third and private sector in order to build effective service delivery partnerships. We are also running the Sustainable Business Forum, led by Oliver Rothschild, which is looking at the future of corporate-third sector relationships.

BP’s shattered reputation does raise some important questions about how our sector works with big corporates. There is no doubt that close partnerships make a real difference to the behaviour of organizations. McDonald’s relationship with a number of environmental groups is a case in point. An equal seat at the decision making table is always likely to bring about more change than waiving placards outside the board room. However, every nonprofit has, or should have, its limit; and sometimes things happen which we must oppose. So understanding the point at which we turn our back on partnerships and pick up our placards again is key.

Many organizations in the UK will be feeling a similar dilemma about our relationship with government. The partnership between the sector and government here is the most sophisticated in the world. However, the age of austerity and fears for our most vulnerable beneficiaries cause us all to ask at what point we have to turn away from partnership and protest. (Polly Toynbee wrote on this a couple of weeks ago.)

It is a tough call for third sector organizations as there is still huge potential opportunity in partnership with government. As ACEVO has been arguing since the start of the credit crunch, by focusing on prevention, devolving control towards service users and joining up silos, the third sector can bring about real reform in our public services – both saving money and delivering better outcomes. The question is whether or not government is brave enough and bold enough to lead that kind of reform. If not, salami slicing and the protection of vested public sector interests will leave many of our service users much worse off. When this happens we have a responsibility to cry out. We must not be afraid to do so when necessary.

“Uncovering” salaries

2010-06-04T03:03:00.000-07:00

Pay of public sector chief executives has been thrust into the headlines again this week thanks to the Cabinet Office’s decision to release the names of 170 civil servants earning more than £150,000 per year.

Much more significant for third sector leaders is the decision of Grant Shapps the new housing minister to highlight the salaries of housing association chief executives, as reported in the Telegraph the following day. The fact that these organizations receive a significant amount of public money is key to the argument in the article.

The report claims that these figures have been “uncovered” by Mr Shapps, suggesting an air of cover-up. It doesn’t, of course, take much uncovering to look through the annual reports of housing associations which, like other charities, publish the salaries of the highest paid. But this language is important as Mr Shapps is clearly suggesting that any salary over than of the prime Minister is unacceptable, and the article goes on to say:

“The housing association salary packages are embarrassing as the executives run non-profit making bodies providing housing to some of Britain’s most disadvantaged citizens.”

The obvious question is how long will it be before salaries of other third sector chief executives are again making the headlines, and how will we respond when they do?

Salaries such as those reported in the Telegraph, even for those running housing associations, are very rare in our sector. (Journalists do like to turn the exception into the rule.) The ACEVO pay survey for 2009-10 shows a median salary of £57,264, and even for organizations with a turnover of more than £25m the median salary is 104,500 (significantly less than David Cameron).

But we know that there is a significant gulf between what the public think we do in the third sector and the reality of our work in the 21st Century. In the still-frenzied media world following the expenses scandals of last year, and the supposed “new politics” of the coalition government, there is a very real risk that the very modest salaries which most third sector CEOs are paid could be conflated yet again with the excesses of the city and alienate many of the public on whose support we depend. Many serious people believe that charity CEOs should do the job for free.

The National Housing Federation are right to point out in their response to the article that housing associations have been open and accountable about senior salaries for many years (unlike the civil service) and match every penny of public money with two pence of their own resources, thus providing excellent value to the tax payer. The same argument is true of other charities.

I am not going to try to make a detailed value-for-money case here. My point is simply that making such a case is the only way for the public to judge whether or not these salaries are acceptable. I have argued many times in this blog that as a sector we need to take charge of the narrative about what makes for a good charity. Measuring and judging inputs is pointless. Describing how our work makes a difference to the world and how we use recourses effectively to achieve that difference must be the priority.

We have nothing to hide about what we pay our chief executives, and nor have we been hiding it. But in this climate we need more than ever to champion how the sector’s leaders bring about change for the most vulnerable and needy in society and how they are worth every penny.

Smarter Capacity Building

2010-05-11T02:17:00.000-07:00

Amongst the many issues Nick Clegg is weighing up this morning, I suspect the future of third sector capacity building may not be top of the list. Whatever the colour of the new government, however, the way in which it supports the sector will need attention in the context of a comprehensive spending review.

We’ve had it good for the last ten years. Government has wisely recognised the need to invest in the sector’s capacity in a number of key areas including financial management, governance, workforce development and IT infrastructure, as well as providing greater access to capital. This investment has been a great success story for the sector and many organisations have transformed in the way in which they can meet the needs of their beneficiaries. For some of these interventions, such as Futurebuilders, the evidence of impact is clear. For others, such as the regional infrastructure consortia, the evidence is more sketchy.

However successful the last ten years have been, the job is not done and the sector still needs support in building its capacity. We also know that government spending will be radically curtailed. It is inconceivable that the sector can expect ten more years of the kind of support we have received. Therefore in order to make the case for continued investment we must propose a new model of smarter capacity building that meets the sector’s needs in a more efficient and effective way.

Looking back on the way in which some of these services were delivered it is fair to say that there are lessons to learn. The desire from many to equate the sector’s with capacity building has led to the duplication of services at national, regional and local levels. Similarly the principle that the sector should deliver its own capacity building has led to some confusing commissioning arrangements where conflicts of interest have had to be carefully managed. Much of the time the standard answer to addressing a particular capacity deficiency has been to set up an organisation, or a quasi-organisation like the Hubs, to deliver services to solve the problem. This kind of supply-led intervention has meant that services are often not flexible enough and run the risk of speaking to the lowest common denominator.

Now we find ourselves at something of a watershed. The state of public finances present us with huge challenges as well as significant opportunities in our role of transforming public services. Significant changes to market structures such as the lead provider model and personalisation mean that organisations have to change their business models and compete with other sectors. And all this time demand for our services continues to rise.

So what might smarter capacity building to meet these challenges look like? Social investment will be at the cornerstone of much of the sector’s development and the growth of this market, with the creation of the Social Investment Bank, is as essential as it is sustainable. However, other more traditional forms of capacity building will also the required. In a speech last September Stephen Bubb, ACEVO’s chief executive, outlined three principles which should guide our thinking in how this should evolve.

Firstly we need to be clear about the difference between capacity building and advocacy for the sector. Both functions are critical, but may operate best at different scales. It makes sense to lobby local, regional and national government over relevant issues at the same time, but it makes less sense to invest in the development of support services to improve third sector governance at multiple scales. What matters is that organisations of all sizes can access the services they need. National expertise in developing generic sector wide support, like ACEVO’s Full Cost Recovery model, may be the most effective way of building basic capacity.

Secondly statutory funded capacity building needs to become more demand led rather than supply dominated. In some cases the organisations, or quasi-organisations which have been set up have spend a great deal of their time trying to find the organisations whose capacity they can build. That’s not a very efficient system.

Since Stephen made his speech ACEVO has begun to offer third sector leaders individual budgets, funded through our Income Generation and In Better Health programmes, allowing those leaders to identify the support they need and then procure it in a way which works for them. Just as with personalisation in health and social care, this model requires an active market of providers of capacity building services, “guides” to help identify need and connect people with the services which the market provides, and resource to allow users to access those services.

Later this year we will begin a research project with leaders of infrastructure organisations to develop a model for how such a demand led market of capacity building could work at a local level, including the roles which local authorities and other statutory agencies should play.

There are other ways of changing the way in which capacity building is resourced, including incentivising lead providers in supply chains to build the capacity of other providers (such as will be promoted through the Merlin standard used by DWP in welfare to work services), and to better develop the building of the sector’s capacity and especially its leadership as a CSR activity. As you might expect ACEVO is leading the debate on these issues too.

Thirdly, we need to gather better evidence about the impact of capacity building and the difference we make. Gathering evidence on this is notoriously difficult but critical if we are to be able to coherently make a case for continued investment.

It is vital that the sector takes the lead on this debate itself and presents the new government with a realistic, constructive and effective model for how investment should be developed. We must use our resources wisely to maximum impact so that the sector is better placed to meet the needs of our beneficiaries.

ImpACT Coalition

2010-05-05T04:54:00.000-07:00

I've just posted my first blog for the ImpACT Coalition. You can read it here:
http://bit.ly/bBl9TJ

And find out more about the work of the ImpACT Coalition here:
http://impactcoalition.org.uk/

How far we have come

2010-04-22T15:08:00.000-07:00

I’ve written before about the lack of awareness of the role and scope of the nonprofit sector at all levels of government in the US.

Amazingly now, given the severe fiscal challenges of State governments, the sector is being attacked on new fronts. State and municipal administrations are even seeking to impose additional fees and taxes on nonprofits to boost revenue, in spite of these being the very same organisations that are already massively subsidising the delivery of essential services.

A report by the National Council of Nonprofit Associations shows these trends starkly. Tim Delaney, their CEO, described to me the scale of the problem. The vast majority of the sector’s interaction with government takes place at the State level of below, yet 48 of the 50 states are in serious financial difficulty. In Arizona they have sold the state building and the government is leasing it back just to bring in some short term cash. This fiscal crisis is leading on to three broad trends which are hurting nonprofits and those who use their services.

Firstly, many programmes are being slashed or simply stopped all together, and these include the programmes which are providing essential support to those most affected by the recession.

Secondly, government is getting worse and worse at contracting with the sector, with agreements signed sometimes a year after work began. In New York over 75% of contracts with the sector are signed late. California owes the sector more than $2bn and was paying some organisations with IOUs at the end of the last budget cycle.

Thirdly, and most shockingly, governments are seeking ways to bypass tax exemptions and create new taxes and fees for nonprofits to pay. Examples include taxes in Minnesota on streetlamps outside your office, taxes on sick-bed occupancy in Cleveland, and taxes on any students you may be teaching in Pittsburgh. Remember that it is almost unheard of for a nonprofit to recover the full cost of service delivery from the government here in the US (hence there is so much interest in our work on full cost recovery). Nonprofits are already massively subsidising the delivery of essential services, and yet their tax exempt status has made them a prime target for additional fees.

Tim believes the worst may yet be to come. He argues that because of the lag time in the recovery (first the market has to recover, then business have to recovery, then government has to refill its coffers and finally the sector will be funded again) it may take until the end of the decade for things to get back to how they were before the crisis.

There is huge synergy between the work of NCNA and ACEVO and I am really excited about building the partnership – we have a lot to share. The situation here is completely unsustainable and NCNA are working on their own version of the “Big Offer” to break the cycle, presenting to government the reasons why they need the sector now more than ever to fix the expensive social problems. But they have a tough job ahead as much of the architecture that we take for granted in the UK (such as the Office of the Third Sector, the Compact, Capacitybuilders and the Social Investment Business) simply does not exist here. Tim’s first job is to get a seat at the table, and for his members to have seats at the tables of government in each State. It’s a humbling reminder of how far we have come in the UK over the last decade.

US and UK leaders share optimism

2010-04-20T12:49:00.000-07:00

The Nonprofit Finance Fund’s state of the sector survey was published in March. Over 1,300 nonprofits across the US responded. The headlines show that:

Only 18% expect to operate above break-even in 2010
80% expect more demand for their services in the same period
89% expect 2010 to be as difficult of more difficult than 2009.

In terms of income predictions, 59% expect income from government to fall. However predictions for individual giving and earned income are more optimistic with a majority saying that both will increase or stay the same.

61% have less than three months cash available but the fund also reports that nonprofits are strengthening their financial management and 52% have collaborated on the delivery of a programme with another nonprofit.

Looking particularly at those organisations which describe themselves as “lifeline” organisations, offering critical services to people in need, 56% expect to find 2010 harder than 2009 for their organisations and 64% don’t think they will be able to keep up with demand.

In spite of this picture, nonprofit leaders remain optimistic. The Fund reports how leaders have redesigned the delivery of services to create efficiencies and actively planned for future scenarios.

A very similar pattern emerged from the 2009 ACEVO pay survey (Press release here). Leaders showed that although they were finding the environment tough, and they expected worse to come, they remained optimistic about the long term future, and remained passionate about their jobs, with 90% saying they were happy in their role and 96% saying they would recommend working in the sector to others. The survey is now being sent to all ACEVO members and their chairs to complete for 2010.

Board Behaviour

2010-04-19T14:30:00.000-07:00

The similarities in governance structures between the sector in the US and the UK are striking.

On Friday afternoon I had a great meeting with Bill Ryan, research fellow at the Kennedy School of Government at Harvard. He is a leading thinker on board effectiveness and runs an online programme for chief executives supporting them to develop the performance of their boards. We discussed how this programme could be made available to chief executives in the UK.

Bill described how the narrative around nonprofit governance over the last decade in the US has focused increasingly on the control and audit aspects of boards, with the sector seeming to want to fit into an agenda of post-Enron corporate governance structural reform. Nonprofits adopted the onerous Sarbanes-Oxley regulation even though it did not automatically apply to them. Committees, audit trails and regulation proliferated, and yet governance did not necessarily improve.

Bill cited the example of the Smithsonian in Washington, an organisation which could not have had better governing structures on paper if it tried. It’s chair is the chief justice of the US supreme court. However scandal broke in 2007 where amongst other things the Chief Executive’s remuneration got out of hand (even by ACEVO standards!). The issue according to Bill was that the board had neglected the behavioural aspects of governance, the way in which people on the board actually related to each other and made decisions, and focused instead on structures.

This is pretty common. It is after all a good deal easier to talk about structures than it is to talk about behaviours. And it’s an important lesson as we work on revising the code of good governance in the UK. The right structures, with all the text-book checks and balances, are necessary for good governance but not sufficient. People need to behave in the right way, relationships must be cultivated and nurtured. Egos must be kept in check. This is of course equally true on both sides of the Atlantic and is why it is so important that tools like ACEVO’s governance review service look at both structures and behaviours.

The comparison between the UK and US structures therefore is very helpful. More diverse are the systems of governance across Europe. With partners across the continent Euclid Network is leading on the creation of a set of Europe-wide governance principles. In Paris last December representatives from across the UK and France began work in defining principles common to the two countries, and in spite of varying structures being described, those common principles of accountability, of collective responsibility, and of board leadership shone through. In the summer this will be expanded to Scandinavia with an event in Oslo.

ACEVO passionately believes in the importance of providing an international perspective to third sector leadership, and it is clear that in observing how topics such as governance develop around the world we can all learn from each other. Long may that continue.

Creative Disruption

2010-04-14T14:53:00.000-07:00

The GEO Conference has also showcased some outstanding practice of foundations developing leaders as a core part of the support they can offer to the sector.

At a packed session this morning an overwhelming majority of the foundations polled said that they were already investing in leaders and almost everyone else said that they would like to start. It was acknowledged that there are many strategies for offering such support (and the value of these approaches are demonstrated in various of GEO’s publications), but the two we focused on were executive coaching and skills development.

Linda Wood from the Evelyn and Walter Haas, Jr. Fund talked about how the foundation considered the sector’s leaders to be its most significant asset. She showed a series of interviews with leaders who had received support for coaching from the foundation and it was clear that the experience had been transformational. One stood out, a founding leader of a nonprofit in California who had led the organisation for 30 years described how he was overwhelmed with fear at the thought of expanding to a new city and effectively starting again. The honesty and self awareness of his story was startling and effective coaching, with support aligned to the organisation’s mission, allowed the expansion to be a success.

Linda also reflected on the question of how you evaluate the impact and return on investment of such interventions and concluded that trying to turn such intangibles into quantitative data was pointless. The stories speak for themselves. Indeed in the private sector this kind of investment in leaders is considered a no-brainer, a duty even. Such investment must be core to how the sector is developed.

Also on the panel was Steve Fitzgerald from the Bank of America Charitable Foundation which runs the pioneering Neighbourhood Excellence Initiative (which is also run in London with support from ACEVO). The programme provides two year unrestricted grants for community organisations based in 45 cities where the bank has a big presence, and provides a bespoke leadership development programme, run by the Centre for Leadership Innovation, for the leader and a next generation leader in the organisation.

Steve spoke about how it has been a significant culture change for the bank to run with a programme which does not provide the kind of hard data on outcomes to which his colleagues are used. Instead they listened to the organisations they want to support and changed the programme to reflect their needs. An example which many other foundations could follow.

Most impressive of all though was a session yesterday on sabbaticals. The Durfee Foundation in LA provides support for non-profit leaders to take 3-4 month sabbaticals where they are not allowed to do anything work related at all.

An evaluation report written by Third Sector New England and CompassPoint (Creative Disruption) shows how such an investment can have amazing results for the leader and for the organisation as a whole, and more far-reaching results than almost any other form of capacity building.

Many of the leaders who qualified for the programme had been in post for a long time and faced burn out. The time off allowed them to focus on themselves and do something they had always wanted to do, from travelling the world to cultivating their gardens. When they came back those leaders were more likely to stay but also had time to separate the wood from the trees, and often came back to make significant improvements to the way the organisation was running.

The organisation also benefitted significantly with the next tier of leaders placed into a leadership role, helping with succession planning and emphasising the need for the organisation to nurture its talent. 60% of participants reported that governance was strengthened as the organisation build structures around the departure and return of the CEO. And funders benefit with new trusting relationship fostered and leaders able to better understanding the needs of their communities.

The report makes for fascinating reading and I can’t wait for ACEVO members to see it. Great potential for new methods of investing in leaders is out there, let’s hope the sector in the UK can realise that potential too.

Big is Beautiful

2010-04-13T17:27:00.000-07:00

I’m at the conference of Grantmakers for Effective Organisations (GEO) in Pittsburgh. There are over 500 leaders from the most progressive foundations in the States discussing how to better support nonprofits to deliver better outcomes.

GEO is an impressive outfit, and provides a space for timely conversations about how foundations should behave; including providing unrestricted core funding, getting smarter at reporting and evaluation, and treating nonprofits as partners not poor relations. Crucially they bring the voices of nonprofits into those conversations in order to have an honest dialogue.

I am running a session on how ACEVO’s work on Full Cost Recovery has changed funder behaviours and third sector capacity in the UK and we are working closely with GEO on how a similar campaign can be developed in the US.

GEO are also closely involved in the White House’s Social Innovation Fund and everyone is excited about a big announcement by President Obama expected in the coming weeks to kick the fund off.

This morning’s plenary session was one of those moments when you remind yourself how inspiring working in the third sector can be. The theme was “The possibilities and perils of scale”, but there certainly seemed much more in the way of possibilities than perils for the two speakers as they refuted the misguided notion that small is always beautiful.

Bill Strickland runs the Manchester Bidwell Corporation which began here in Pittsburgh, working to train people from disadvantaged communities in areas such as catering, pharmaceuticals, art, horticulture, design and many more. Bill spoke passionately about the recipe for his success, which included how the very high quality of the buildings and environments matters in order to raise people’s aspirations. The centre works because, as Bill says, it proves to the wider community that these poor people who have been considered a liability, are in fact an asset. “The only thing wrong with poor people is that they don’t have any money”, says Bill. In areas where fewer than 50% get a high school diploma, 95% of those who have been trained by the corporation graduate and then many work for the corporation’s various enterprises generating resources to expand the work.

Once the model was proven in Pittsburgh, and with the help of Jeff Skoll, Bill has set up centres across the country and has a goal for 100 in the US and 100 more around the world. “We’re not in the miracle business”, he says; “we’re in the hard work business”. Bill spoke at length about the leadership qualities needed to bring about this kind of scale. The expansion was not driven by a franchise model but rather by an affiliate model so investing in supporting the local leaders of the centres was crucial, and building local partnerships made all the difference.

Angelica Salas runs the Coalition for Humane Immigrant Rights of Los Angeles and showed what scale means in advocacy. The task of fighting for better rights for immigrant communities in the US is huge, there are over 4m undocumented young people let alone all those of working age, but the achievements of Angelica and her colleagues are impressive. Mass protests were coordinated across the country in 2006. In 2008 they registered over half a million new voters. In March this year thousands of immigrants marched in DC to encourage Obama to live up to his promises on immigration reform and now a new $10m fund will support immigrant integration.

For mobilising immigrant communities you need both national impact and reach into what may be disparate immigrant communities. Coordination is what makes this happen and Angelica reports how every Tuesday she holds meetings with colleagues from groups across the country to discuss what needs to happen next. “For us to be successful we must be coordinated in LA, at the state level and across the country”, she says.

The conversation showed how scale is achieved in different ways in both delivery and advocacy organisations, but that scale – put simply – made things happen that couldn’t otherwise have happened.

For Bill the vision is that there are so many successful centres that public policy begins to change as a result because the evidence of success is overwhelming. Service delivery can only impact on policy on this way when it reaches scale, and this is just one of the things which is lost when we are blinded by the misplaced quasi-romantic notion that small is beautiful and big is bad.

Scale is a good thing in our sector. Let’s take the lessons from groups like Bill’s and Angelica’s and stop being afraid of it.

So we're off

2010-04-06T03:56:00.000-07:00

So we’re off: the election has been called. Critical for the country as a whole this election is critical for the sector too. What is at stake and what change do we need?

Fortunately ACEVO and our partners at the Community Alliance and Social Enterprise Coalition have already answered those questions. Our joint manifesto outlines the four things which the next government needs to get right in order for our sector to play its potential role in transforming public services, cutting the debt, and empowering citizens and communities.

1 Smart investment in an age of austerity

Use a variety of funding vehicles when working with third sector organisations which are best suited to the desired outcome, including contracts, grants and loans.
Support the capitalisation of the third sector by continuing to develop social investment, the creation of the Social Investment Wholesale bank and stimulating new forms of social finance such as social impact bonds.
Attract private investment into the sector through adapting investment tax incentives to give a higher return for those organisations delivering social or environmental benefit.
Transfer more assets into community ownership and invest in the communities which will manage those assets.
Deliver better banking by reforming financial regulations so that banks can more easily deliver for all the communities they need to serve.

2 Improved public service markets and the democratisation of commissioning

Create an environment where commissioners are able to take risks and dare to try something new.
Ensure a level playing field, transparency and openness in all public procurement, with simplified and proportionate processes.
Value co-design in the commissioning of services.
Respect the terms of the Compact.
Supporting the development of social enterprise models across public sector agencies
Commission services on a scale which makes sense to service users and allows third sector organisations to play to their strengths.
In tendering processes support and facilitate collaborations between local partners, between large and small, and between national and local organisations and those with different business models.
Value social and environmental outcomes in commissioning processes.
Support and incentivise capacity building through procurement.
Develop skills of commissioners and providers, and create the space for strategic conversations.
Ensure services are personalised and joined-up.

3 A supportive architecture

Sustain a department and minister with sole responsibility for the third sector at the heart of government.
Performance manage government departments on their involvement and engagement with the third sector in all areas of policy development.
Reform benefits to remove disincentives to volunteering and allow part time paid work in community groups and social enterprises.
Reform regulation affecting the third sector to encourage more community action and volunteering.
Allow more flexible governance arrangements in the sector.
Continue to invest in building the sector’s capacity, in particular in leadership and governance, with a smarter more demand led approach.
Create a tax system which promotes social entrepreneurialism and philanthropy while maximising returns to the sector.

4 An environmentally sustainable relationship

Deliver the recommendations of the third sector ministerial taskforce.
Embed green outcomes in public procurement.
Place the third sector at the heart of a green economy.
Support all organisations to deliver a triple bottom line.
Support third sector leaders to respond and adapt to the future of public services.

Closing hospitals should be our goal

2010-03-30T09:35:00.000-07:00

I watched the Chancellors’ debate with interest last night. All three missed opportunities for killer blows – I guess everyone was nervous.

My favourite question was from an A&E doctor who asked which of the three could guarantee the maintenance of front-line services in his department. Cue lots of assurances from both the Tories and Labour about protecting the NHS at all costs.

However they all missed the opportunity to provide a much more progressive answer to that question. That is: of course we want to protect front-line hospital services for those who need them, but the real opportunity in health care reform must be to keep as many people out of acute care as possible and seek opportunities through a greater use of the third sector to further improve primary and community care. Services should be re-designed and re-prioritised so that fewer and fewer people end up in A&E, resulting in better more tailored services particularly for those with long term conditions, allowing people to stay in their homes, and delivering savings to the stretched public purse.

Consider the opportunities. Someone with diabetes can quite easily end up in A&E if they have not been able to administer their own medication. However support from a third sector organisation at a modest cost could prevent that admission and save the huge costs associated, as well as avoid the suffering for that individual.

Our recent manifesto published with sector partners showed the example of Age Concern South Staffordshire who run a support service for elderly people who have been discharged from hospital, supporting them in those first few vulnerable days. An investment of £0.5 million has saved over 8,000 hospital bed days at a cost of almost £2.5 million.

There are countless other examples but this debate is something of a taboo with the general public and particular with the press. The “reconfiguring” or closing on acute services is always met with great resistance from local campaigners, even when the money saved will be used on better primary care or where those hospitals have been deemed unsafe.

As third sector leaders it is time for us to lead on this debate. We must be bold and advocate for a better balance between acute and primary and community care, with a significantly bigger role for the third sector. This can dramatically improve outcomes for patients, but is can also save huge amounts of public money at the time when those savings are most needed.

This means some hospitals closing. We should celebrate this as a success for the third sector and those we exist to support. After all, no one actually wants to be in a hospital if they don't have to be. We have the potential to harness the voices of our service users to help lead the debate about how we reform health services. Image the power of thousands of diabetes suffers hailing the closure of a hospital because they are receiving better primary care. It would certainly be harder to resist than NHS managers talking about efficiencies.

This potential for reform is why our victory over Burnham’s disastrous preferred provider policy is so important. The third sector has so much to bring and we must be allowed the opportunity to do so. Rest assured there are other significant vested interests who will continue to fight against such reform but it’s time for the sector to champion this change. Service users know what they want and third sector leaders are ideally placed to help to convey that message.

Can Business Save The World?

2010-03-23T09:02:00.000-07:00

This week I am finally back in the office after the nastiest bout of flu I have had in years.

One advantage of having all that time was it allowed me to catch up on my reading. I have just finished Michael Edwards new book Small Change, Why Business Won’t Save the World. Edwards has had a prestigious career in the sector and was for many years a director of the Ford Foundation in New York.

As in his previous works, Edwards’ argument focuses on deconstructing what he calls “Philanthrocapitalism”, the trend in the non profit sector towards market forces and business discipline being harnessed to expediate greater social change. Grouping together a slightly amorphous group including social entrepreneurs, venture philanthropists, and social investors he picks apart the philanthrocapitalist ideology for its lack of evidence, its arrogance and crucially that it may undermine the more traditional non profit role of stimulating social change.

Edwards does not believe that more effective use of the market can be a means to solve many complex social problems because often it is the market which has caused those problems. Real social change can only come about from the grass roots advocacy role within civil society stimulated by a desire for social justice rather than income generation.

Citing Albert Cho, an academic who studies this field worldwide, he draws the distinction between “ the social entrepreneur asking, ‘how can I mobilize recourses to solve this issue,’ rather than, ‘why does this issue exist?’” Edwards challenges us: “Do we want to address the symptoms of social inequity, or do we want genuine social transformation?”

This is a fascinating challenge to our sector where the wind is most definitely in the sales of the social entrepreneurs and investors. I think Edwards is right to highlight the limitations of philanthrocapitalism, and the fact that the distinction between social enterprise and the more traditional non profit sector is often over stated, particularly by social entrepreneurs themselves. (I wrote a blog on this topic a few weeks ago.) As Edwards reports public charities in the states already receive over 70% of their income from the sale of goods or services. The danger for social enterprise is that as presenting itself as the panacea it can only disappoint. An interesting sub-text for Edwards is the fact that new philanthrocapitalists are often better at presenting themselves and explaining the changes they are trying to bring about than parts of the traditional sector, perhaps because of a corporate training in communications. But that doesn’t necessarily mean that they are better at bringing about real social change or have any firmer evidence for those changes.

For me though this challenge is slightly overstated. It would of course be a tragedy if what Edwards calls citizen philanthropy was lost at the expense of purely market based solutions to tacking social justice; but that isn’t really on the cards. Instead the two can and should exist side by side. Both have faults and both have merits. Some social problems can be tackled by using the market, others can’t. It is incumbent on us in the sector to try to fully understand the causes of those problems so we can develop the right solutions. As Edwards himself highlights “Its not that our old ideas about social transformation were perfect; it’s that our new ideas are imperfect, too, and almost certainly won’t turn out as planned”.

Also in the book there is a particularly good analysis of the difficulties of comparing different organisations and the perils of trying to develop simple tools to measure comparative performance, and a healthy challenge to both philanthrocapitalists and the foundation community to improve accountability. I’d recommend it to anyone interested in where the sector is headed.

When Charity and Politics Collide

2010-02-24T06:48:00.000-08:00

Christine Pratt thrust herself into the limelight on Sunday afternoon and in the process all but destroyed her charity, brought the confidentiality of help lines into question and raised questions about the role of charities in political debate.

Whatever one makes of her motivation to speak out, I think that there are a couple of interesting lessons for third sector leaders.

ACEVO has for many years campaigned for greater clarity and more flexibility in the rules about charity involvement in public policy. The sector’s campaigning role has come into question again in recent weeks as a result Oliver Letwin’s recent comments at the NCVO campaigning conference and extra guidance issued by the Charity Commission ahead of the general election. I hope that sector leaders are not any more reluctant to become involved in the political process as a result of the backlash against Pratt. They shouldn’t because Pratt did a great deal wrong.

The website of the National Bullying Helpline contains quotes of endorsement from David Cameron and other prominent Tories. Her board was comprised of other local Tory activists and the office was two doors away from the local branch of the Conservative party. I don’t for a second believe that her actions were part of a coordinated Tory plot, but for anyone like me who spent two minutes on Monday morning checking out the NBH website alarm bells were ringing.

A huge number of charities involve politicians in trying to promote their work and help to influence the development of policy. This is absolutely appropriate. But that involvement must not be partisan, and in this world appearance is as important as reality. It was very foolish for the charity not to seek and demonstrate cross party support for its work (it’s hardly a controversial topic after all). Whether or not the charity had inappropriate party political links its reputation and credibility are now destroyed.

The second lesson concerns her decision to put political activity ahead of the confidentiality and interests of her clients. The organisation’s objectives as displayed on the charity commission website are “the preservation and protection of good health of those affected by bulling in the workplace and other environments.”

Political campaigning is only allowed and indeed only appropriate when it helps to further the objectives of the charity and is in the interests of its beneficiaries. In her case Pratt has directly sacrificed the interests of her beneficiaries to give herself a platform. That is the cardinal sin of a third sector leader. I wrote a few weeks ago about how our first principle must always be the interests of our beneficiaries.

Sector leaders shouldn’t be afraid to become involved in political debate. They just need to avoid the mistakes of appearing partisan and ignoring their beneficiaries. Neither should be hard.

The Optimistic Ask

2010-02-18T03:20:00.000-08:00

In Norwich today on the fifth leg of our Big Ask tour. We are going round the country asking members their views on what support they would like from ACEVO both in terms of our lobbying of the next government and the services we provide to chief executives. Turnout at these meeting has been great and members, as always, have been full of constructive and practical ideas about how we tackle the challenges ahead.

One particularly striking thing at each of these meetings has been the proportion of members who say that they are optimistic about the future versus those who say that they are pessimistic. Almost everyone has said that they are optimistic about the future for our sector in spite of the tough times we know we have ahead.

This mood strikes me as being in sharp contrast to much of the rhetoric in the sector at the moment, but is I think entirely appropriate. As a sector we do have the potential to provide the solutions to many of the problems which the country is facing. We can deliver better more personalised and more cost effective service which help to bring and hold communities together. We can provide a voice for the disempowered and support people to contribute to the maximum of their potential. The question is whether we can articulate our offer in a way which makes us “irresistible” to government, and makes them sit up and take note.

It’s all to do with how we position our sector, and we as umbrella bodies have a key role in that. We must avoid presenting ourselves as yet another victim of the recession needing to be propped up by handouts. We must position ourselves as providing the answers to the problems which the country faces and demonstrate the value we bring to justify the necessary investment. We must provide commissioners with solutions to help them to make the brave choices they need to make in order to redesign the way services are delivered.

Some of this is of course about us getting better at collecting and presenting evidence of the impact which we make. But a great deal of it is about attitude. The biggest thrill in my job is working with chief executives who are committed to delivering solutions not problems and I am proud to play my part in representing them.

"Are you a charity or a social enterprise?"

2010-02-12T09:05:00.000-08:00

“Are you a charity or a social enterprise?” This question was asked by a consultant to an ACEVO member at a meeting this morning. I think our member was a little surprised and wasn’t quite sure how to answer.

I feel his pain. Social enterprise as a distinct concept has rocketed up the consciousness of policy makers in recent years and many (including Francis Maude at the SOLACE annual dinner last week) refer obliquely to “the third sector and social enterprise”. How useful is this distinction in terms of promoting the role of the broader non profit sector?

There is no clear definition of social enterprise as a noun. There are of course some specific legal forms which social enterprises can take (CICs for example) but to restrict the social enterprise movement to only those organisations would exclude many which are trading for a social purpose.

A better question to our member might have been “do you do charity or social enterprise?”. The term makes more sense as a verb. Trading is a vital part of the funding mix for many organisations in the sector. According to the NCVO almanac earned income was responsible for 51.2% of the sector’s total income in 2006-7. ACEVO’s income generation team supports organisations in diversifying their income streams and the development of trading is key.

But as a verb social enterprise is nothing new. Charities have been trading for centuries and earned income has been a major source of income for particularly smaller organisations.

So if it is not a noun, and as an activity it is nothing new, what is the relevance of the distinction? I suspect in asking the question our consultant friend was trying to gauge the mindset of the organisation in question. Social enterprise can be associated with being professional and innovative, operating in complex markets and delivering products and services which compete with providers from any sector. This is distinct therefore from traditional charity based on voluntary principles, donations and non marketable interventions.

This is an interesting distinction but many organisations which would never think of themselves as social enterprises would tick all the boxes of being professional, innovative and delivering market based products or services. These qualities are not unique to social enterprises.

This matters because many of the challenges which the sector faces are common to those organisations which class themselves as social enterprises and those which don’t. The quality of the interventions which we can bring are equally high.

There is a spectrum on which third sector organisations sit – some which do a lot of trading may have more social-enterprise-like characteristics - but it is not a polarity. Categorising social enterprise as something other than the rest of the third sector is unhelpful because with common challenges to meet we are best placed meeting them with a shared voice.

First Principles

2010-02-03T05:42:00.000-08:00

Frances Crook, the Chief Executive of the Howard League for Penal Reform, has written in her most recent blog about her and Kevin Curley’s meeting with the Charity Commission on the issue of charities being involved in the running of prisons.

Kevin has made his views on the issue very clear. He set up the “charities must not run prisons group” on facebook (which now has 157 members; including Andy Benson from NCIA) and tweeted on the issue frequently last August (@kevincurley).

I profoundly disagree with these objections which fundamentally boil down to the running of prisons not being the sort of thing which Frances and Kevin feel charities should do. Frances talks of it being “immoral” and cites situations where charities may have to be involved in making difficult decisions about punishment regimes.

Others have responded to these points well (including my colleague Peter Kyle on Crook’s blog last August). Charities have to make difficult decisions every day about the best ways to help their beneficiaries, sometimes compromising short term comfort for long term outcomes. We live in the real world and the best organisations understand how to operate within that real world to bring out the best long term results.

These divergent views are one illustration of a fundamental schism in the sector which is becoming increasingly apparent to me. On a number of issues, such as whether we should pay trustees, whether we should deliver more public services, and how we should present ourselves to the public, there is a polarity between those who approach from the point of view of what charities should look and feel like, including the experience of those who work and volunteer within those organisations, and those who approach from the point of view of what will generate the best outcomes for beneficiaries.

Now I understand that this is a crude distinction. These things are often related and that they are both important. However, I do think this is a helpful distinction because it forces us to refine our first principles when making judgements about how our sector should develop.

Taking a few of those salient issues, my approach to addressing them starts with the question "what’s the best thing for the beneficiaries?" I believe that charities should be able to pay trustees if they want to in order to get the best people on their board to make the best decisions to drive the best outcomes. I believe that charities should get involved in bidding for government contracts if it allows them to better meet the needs of those they were set up to serve. I believe that charities should be able to have a role in running prisons if they will be able to better rehabilitate offenders as a result.

The counter arguments sound to me like they prioritise norms about the sectors character. Charities should not be allowed to pay trustees because our heritage is voluntary and that we should be distinct from the private sector. Charities should be wary of becoming involved in public service delivery because it may jeopardise our independence. Charities should not be involved in running prisons because it might mean that they have to make difficult and unpalatable choices.

So what is more important: what the sector looks like or how well we deliver for those who need us? What are your first principles?

Haiti

2010-01-25T08:18:00.000-08:00

More and more media stories are starting to focus on the international aid response in Haiti. Today the chief executive of the DEC Brendan Gormley has rebutted accusations in the Lancet that aid agencies were “jostling for position”. The head of the Italian response to the L’Aqulia earthquake last year has also criticised the “vanity parade” of the aid community.

There are several reasons for this increasing focus. Criticism of the speed of response is not surprising given the overwhelming need of the people of Haiti and the close attention of the wider world. No response could possibly have been rapid enough.

In addition, the army of journalists in Haiti need stories. Witness the varying hysterical reports last week about the rise of looting and mob violence in the wake of the earthquake. (More down to earth reports pointed out that there was in fact less street violence following the quake than before.) Aid not getting through makes for a great story too.

However these stories do have the potential to damage reputations. It is at times like this when our sector comes under increased scrutiny that we must strive for the highest standards in accountability and transparency.

Haiti poses very particular challenges for aid organisations because of the void of leadership and infrastructure. Doubtless there have been avoidable delays and doubtless the efforts could be better coordinated. The BBC has run a story explaining how the DEC prioritise their work, and usefully challenges the notion of "jostling for position". But it is imperative that the organisations on the ground must do all they can to communicate effectively what they are doing, the challenges they are facing and the difference they have been able to make.

There is varying amounts of detail from the websites of DEC members about their work in Haiti. Some say very little about how they have been mobilizing or what money has been spent on. Others are much more detailed. I was particularly interested in Merlin (as a very good friend of mine works for them in Liberia). I thought their updates were good and they have also been using twitter effectively. I am also following one of their staff (@AlexforMerlin) from Haiti.

It’s easier than ever for charities to communicate effectively with donors and other stakeholders in almost real time. While we mustn’t get caught in a game of responding to every negative press report, we must strive to tell the stories of our work as fully and as honestly as possible. The international aid community has generally been ahead of much of the domestic sector in terms of transparency, it needs to continue to push the boundaries.

Compacted Compact

2010-01-21T09:18:00.000-08:00

Since the launch of the refreshed Compact in December the voluntary agreement between the sector and government has come in for some serious stick.

This week an open letter from the National Coalition for Independent Action was sent to my boss and to the leaders of the other main national umbrella bodies. It called the Compact a “fig leaf for unequal power relationships”, and declares that the relationship between the state and the sector is “in crisis right now”.

At the same time a number of other key players in the sector have been criticising the value of the Compact; the high profile breach by the very same government department which is supposed to champion the agreement hasn’t helped. Two national umbrella bodies, the Community Sector Coalition and Voice 4 Change England have expressed their dissatisfaction with the revised version.

It is true that in the twelve years since the compact was first envisaged it has not completely changed the world. Statutory agencies still sometimes treat the sector badly. However memories in our sector are short. The Compact has made a huge difference to the relationship between government and the sector if for no other reason than it has created a common agenda for the two parties to develop their relationships.

A document alone can’t change anything. It is what people do with it that counts. Where the Compact has made a difference, it has done so because it has raised the profile of the issues which matter and forced them to be discussed and confronted. Every top tier local authority in the country has its own compact with its own local third sector and these have been negotiated in each area, highlighting the key concerns which need to be addressed. What has made a difference is people who would never have been in a room together before now recognising that they need to work together and discussing how to overcome the barriers to better partnership working. The Compact has framed issues such as longer term contracts, accessible consultations and full cost recovery allowing them to be championed.

The reach of the Compact is something unique to the UK. Through ACEVO’s international work in talking to sector leaders around the world, the idea that government accepts what needs to change for a better partnership with the third sector, even at a policy level, and is willing to make clear commitments to improve that relationship causes jaws to drop. The Compact has been copied in a number of countries around the world including Canada and Australia. Sometimes we don’t know how good we have it.

But the Compact and the structures around it must continue to be developed in order for us to achieve the goal of better relationships between the sector and government. The refreshed document is a great improvement because it makes the principles clearer and leaves more room for local compacts to negotiate the issues specific to that area. It is also more accessible for commissioners to read and quickly understand the considerations which they must have for working with the sector.

The Compact does need greater teeth and ACEVO has long championed the case for a statutory footing for the Commission of the Compact allowing the ombudsman the power to investigate breeches and require statutory bodies to change their practices. We are pushing hard for this change in the run up to the election. It would of course also be able to investigate breaches of the Compact by the sector. We’re not beyond reproach ourselves and it would be a fascinating if a case was brought by a statutory body. We have to live up to our commitments as much as government does.

Progressive Governance

2010-01-14T09:57:00.000-08:00

Dorothy Dalton, the former and first chief executive of ACEVO runs the widely respected governance magazine. The publication and website is a great resource to trustees and organisations of all sizes around the country.

In her most recent editorial she has tackled the issue of remunerating trustees and establishing unitary boards. This is, according to Dalton, “wholly inappropriate”. I’m afraid we disagree.

Dalton is writing in response to Kevin Carey’s recent speech at our annual conference, and the subsequent establishment of a progressive governance network to support organisations who wish to reform their governance structures.

In making her case she cites the financial stresses under which organisations currently find themselves, and that some unitary boards have also resulted in poor decision making as witnessed by us all in causing the financial crisis. She discredits unitary boards in the NHS by citing one example of a board who oversaw a dirty hospital.

All of these are inexcusable failures and in the case of our banks the repercussions have been monumental. But the fact that the implications of those governance failures have been so widespread says more about the power of banks than it does about the structure of governance which failed, and does not in one sweep discredit a governance framework which has prevailed in the private sector for more than a century. Lots and lots of third sector organisations are badly run too – but their failures are less widely felt.

Every week I speak to ACEVO members who have thoroughly dysfunctional boards, with in-fighting common and chairs not willing to take control. One board hadn’t had a formal meeting for nine years, yet the organisation continued to operate. In these cases it just so happened that publicity hasn't found them but I am in no doubt that it is just a matter of time before an incident like this in our sector is front page news.

And to tackle the issue of money, clearly paying trustees costs. But the decisions boards take make or break organisations. Avoiding bad investment strategy, or a misjudged budget, would easily outweigh the costs of modestly remunerating your trustees thousands of times over.

No governance system is perfect, all have flaws and in human nature things will always go wrong. Dalton criticises ACEVO for opening up the argument about alternatives to the status quo. Let’s first be clear about ACEVO’s line on this because we are often misrepresented on this point. We do not believe that every third sector organisation should pay its trustees or have a unitary board. For very many this won’t be appropriate.

However we believe that third sector organisations should have the option to explore alternative models if they feel that this is the right decision for them in order to meet the needs of their beneficiaries. (Incidentally Dalton alludes in her article to whether or not such payment is in the interest of the beneficiaries or in the interest of individual board members. The latter would certainly be a serious alligation, and I am keen to know whether there is hard evidence of where charities have tried to make such changes for any reason other than the good of the organisation’s beneficiaries.)

It is a fundamental tenet of good governance to review the way in which the board operates and discuss whether things could be done better. It would be negligent for a board not to consider the question of whether its structures are fit for purpose. The fact that it is incredibly difficult to change a charity’s governance structure to allow paid trustees or unitary boards means that organisations do not in practice have the opportunity to reasonably explore these other options. I know of a number of ACEVO members whose boards would like to make these changes but are simply not prepared to fork out for the legal fees and time in negotiating with the Commission to make their case. In some cases members have reported that the Commission has refused to allow such arrangements without clear feedback on the reasons.

Dalton is quite right that no one should force a governance structure upon any other organisation. However the reality is that the status quo is being forced upon many ACEVO members and their boards who firmly believe that they would be better run if they adopted a different structure. By Dalton’s own logic they should be allowed to do so.

New year and all that...

2010-01-04T07:50:00.000-08:00

I haven’t gone in for new year’s resolutions this time. The only one I’ve ever really kept was three years ago when I resolved to read one novel every month. If you average it out over a full year I can claim success. However I fear fervent promises to myself to join a gym will not meet with immediate success. We’ll play the long game there too.

But 2010 will be a big year with some big questions. Who will win the election? (If today’s news is anything to go by I suspect by Easter we will not care.) Will the recovery finally start, and what will it mean for the beneficiaries of organisations in the sector? And will anything useful emerge from the failure of the Copenhagen summit?

The answers to these questions are a little outside of my gift. However, I’ve been given some pretty clear goals by my boss for 2010. We discussed these at length just before the Christmas break and the key themes included:

Developing the ImpACT Coalition with Liam Cranley our Head of ImpACT. The movement, committed to improving accountability, clarity and transparency in the sector, has huge potential. We will realise that potential and take the campaign to the next level.
Continuing to diversify and grow our income, working with Orli Gorenski our Head of Business Development.
Working closely with the Board and with senior management colleagues to develop ACEVO’s strategy as we move through a significant period of change.
Connecting ACEVO members to networks around the globe including in particular North America and Europe through our colleagues in Euclid Network.
Stephen is also keen for me to, as he put it, develop my presence. More opportunities for public speaking will form part of that.

I am really fortunate to lead a great team of staff, and it has been a fascinating transition for me during 2009 as I moved into my current role. I am really excited about the challenges which lie ahead this year.

But none of these compare to Emma, my PA, who will be scaling Mount Kilimanjaro at the end of January in aid of Scope. We’re all hoping that her phone will work on the way up to keep us all updated on her progress. You can still donate here.

European Governance, Carrots and Sticks

2009-12-09T09:54:00.001-08:00

On Friday Euclid Network is holding an event in Paris to compare third sector governance in the UK and France. This event is part of a significant project led by Euclid Network to define the common principles of governance across the EU. The commonalities in Anglo-French governance will later be tested against standards in Scandinavia, Germany and Mediterranean countries.

I have been delighted to be part of the steering group for this project. It is important for a number of reasons. If the sector doesn’t lead on defining high standards of governance then it is only a matter of time before these standards are imposed by regulators or governments. The European Union is the largest funder of civil society in the world and so has an interest in how the organisations it supports are run. Equally important though is the way codes which outline universal principles and best practice can be a major catalyst for improving governance and raising the profile of organisational performance.

The Code of Good Governance in the UK has been a crucial part of improving governance standards in the UK. Created in 2005 by ACEVO, NCVO, ICSA and Charity Trustee Networks, the code is very well known across the sector (88% of ACEVO’s members knew about it by 2007) and forms the basis for many governance assessment tools such as ACEVO’s own governance review service. The Code’s principles are currently undergoing a refresh to ensure that they are universally understandable across the sector.

The relationship between the Code and the Charity Commission as the regulator has been one of the keys to the code’s success. The code was created by the leading sector support organisations rather than the regulator, but the Commission has warmly endorsed it. This balance means that there is a clear standard which the sector, funders and regulators can all agree upon but the sector also feels complete ownership of the principles. Achieving this at a EU-wide level will be an important step.

Why does this matter I hear you ask?! Well the sector faces a number of significant challenges and we still have a long way to go to improve our governance. 70% of ACEVO members think that this is a priority for the sector. Only half of those who are aware of the code are actually using it regularly. We know that the public don’t understand us, and we know that we need be better at demonstrating the impact that we bring, and make the case for it, if we are to play a more significant role in transforming the public realm. Improved accountability and performance management are key elements of improved governance. You cannot meet the principles of the Code without understanding your stakeholders and effectively communicating with them, and without measuring your performance and improving what you do as a result. Well governed organisations are pretty much always effective organisations which deliver for their beneficiaries, and that is no coincidence.

It is true that governance is not a particularly sexy subject. Much more attention has been given to issues such as chief executive pay and expenses in the sector press over recent months. But as ACEVO argued strongly in our response to the consultation on expenses, all that fuss is an attempt to solve a problem that isn’t there. Any board no matter how incompetent can spot a fraudulent expense claim. Cost control is important in all organisations but we’re not prescriptive about how a charity chooses to buy its envelopes, or even its computers, so why should we need rules about expenses? Good governance and effective internal controls take care of all these issues, but they also take care of the real issues about accountability and performance and that is where we should we focusing our attention.

So what’s next? I hope that the eventual outcome of Euclid Network’s work will be a standard of good governance against which organisations from across Europe can seek accreditation; a passport for funders and other stakeholders to know that the organisation is properly run.

I hope too that we can move in that direction in the UK. This is something for which ACEVO has been calling for many years since our Rethinking Governance report in 2004. The steering group for the Code of Good Governance has more immediate priorities but we will need to revisit this ambition soon. It may be that accreditation is appropriate for some of the larger organisations in the sector. A combination of carrots and sticks may be what is needed to get the whole moving on improving governance.

The "New" Circle Line

2009-12-02T08:26:00.000-08:00

Anyone who knows me well might want to stop reading right here because all of their fears about my geekiness are about to come true.

Seriously though, what is the point in the “new” circle line? As far as I can tell the Circle line will now run in a spiral from Edgware Road via Victoria and Liverpool Street to Hammersmith. Exactly whose journey is going to be made easier by that? The problem with the shallow lines (Circle, Hammersmith and City, District and Metropolitan) is that they are running the oldest infrastructure and are beset by delays and signal problems. The modernisation programme is therefore very welcome. But that programme should actually seek to make journeys easier.

I think TFL should get rid of the Circle line all together. There isn’t any part of it which doesn’t share track with another line. And unless you are actually on a pub crawl no one wants to go round in a big circle. If the Circle line wasn’t there you could run more trains on the District line and the Hammersmith and City line, thus actually connecting different destinations.

Let’s compare a few journeys:

If you want to go from Hammersmith to Liverpool Street you can take the new Circle line, but you can also take the existing Hammersmith and City line. All that matters here is how frequent the service is. More trains on the H&C line would do the same job.

If you want to go from Hammersmith to Victoria, you are not going to travel all round the Circle line via Aldgate to do so, you’ll take the District line straight there. More trains on the District line would help improve that.

If you want to go from Wood Lane to Barking you can get the Hammersmith and City line but you might have to change trains if you get on a Circle line train by mistake which would only take you as far as Aldgate. More trains on the H&C line would obviously help that journey.

If you want to go from Latimer Road to Earl’s Court then you can go via Hammersmith but you will have to cross the road to go to the other station to get on the District Line, just as before. Noting gained there.

I could go on but I think you get the idea. See if you can find a journey made easier by these new arrangements rather than scrapping the Circle line all together?

While we’re on it, if I was Boris I would also change the name of the bit of the District line which runs from Edgware Road to Wimbledon. It doesn’t share any of the route with the main bit of the District line and is just confusing. I would call it the Baysdon line and make it very dark green.

And I would also change the name of the bit of the Northern line which runs from Kennington via Charing Cross to Edgware, and then have all the trains running from Morden via Bank to High Barnet. That would make things much more simple. People may need to change at either Camden or Euston but people need to change anyway if they get on the wrong Northern line train now. So nothing lost. I would call it the Kenware line and it would be black and white striped.

It’s OK friends, you can come back I have finished. Anyone still reading?...

2009-11-27T10:42:00.000-08:00

I thoroughly enjoyed the DSC Social Change awards last night.

DSC is an organisation which has a rather different outlook from ACEVO. We have been known to disagree on the odd issue such as whether or not charities should seek to become more involved in the delivery of public services, or whether it should be possible to pay trustees. But as with most third sector spats, we agree far more often than we disagree and have many of the same goals.

Debra Allcock Tyler gave a rousing speech before the awards themselves. I found myself agreeing with almost everything that she said: government should trust us and our capacity to innovate, that the state can never solve complex social problems on its own, that the public hasn’t engaged with the sector’s role in delivering services and that is a risk for public trust in us, that we must maintain our independence when delivering publically funded services.

I didn’t agree, however, with her critique of large charities. Her analogy was one of the elephant and the ant. The ant knows the details of the ground in much greater detail than the elephant, implying that larger charities cannot know as much as small ones about what is happening on the front line in communities.

This doesn’t sound to me like any large charity I know. I have spent today as an external panel member interviewing potential new trustees for a well known very large charity. The passion of direct experience with which the candidates spoke, and the very apparent connection between front-line experience and the strategic governance of one of the UK’s largest charities was striking. Size does of course bring challenges but one shouldn’t under-estimate the ability and skill of the leaders of the largest charities (both executive and non-executive) to connect on-the-ground experience to high level strategy, and then to their significant ability to affect change.

While at the awards I also enjoyed my conversation with Ben Wittenberg (DSC’s Head of Policy) about the OTS’s cutting of campaigning grants. It was an astonishing decision from the department which is currently tasked with leading the refreshing of the Compact within government. Also if you are going to upset a group of charities, picking on the best campaigners in the country is probably not a good idea. The case is being well championed by DSC, Compact Voice, NCVO and others.

The affected organisations learned of this decision three weeks after having received a grant letter from OTS confirming the success of their application. Now in my experience grant letters are the end of the process. You can go ahead and hire staff, buy equipment or make all the commitments you need to make on the back of a grant letter. Except clearly you can’t.

I wrote a piece a few months ago about the relative merits of grants and contracts in the third sector. One of the advantages of contracts is that it gives groups an equal legal recourse when things go wrong. Contracts aren’t appropriate for all types of funding relationships as I spell out in the article, but you have to wonder if the campaigners had had a contract rather than a grant letter, would OTS have been able to ditch them at the last minute?

One more thing for a Friday afternoon, great article in the Times today on charity accountability from the Finance Director at Oxfam. This is exactly the kind of message we are promoting through the sector with the ImpACT Coalition which is now hosted at ACEVO. Lots of exciting developments will be taking place now that Liam Cranley is in post as Head of ImpACT. Watch this space!

What we can learn from the X Factor

2009-11-18T05:18:00.000-08:00

My colleague Richard McKelvey has just started a blog, and an excellent first post it is too (http://richardmckelvey.blogspot.com). Rather alarmingly in referencing mine he says I focus on the details of the relationship between government and the third sector. Not so high-brow today I’m afraid…

I am an unashamed fan of the X Factor. One of the reasons I like it is the way in which it highlights some interesting British trends. When three weeks ago Danyl Johnson was amazingly in the bottom two the nation turned to itself horrified and wondered how this could possibly have been able to happen. Someone with talent may go out, and Jedward are still there! In most cases the people most outraged were the very same people who didn’t vote. Now that’s fine. Voting in the X Factor cost money and it doesn’t of course actually matter. But it isn’t a very large leap of the imagination to see how this same passive horror could be much more acutely felt following a success for the BNP say in forthcoming elections. I remember clearly John-Marie Le Pen’s shock result in the French election of 2002 caused in exactly the same way. If we don’t vote for what we want things can turn out badly.

There are many reasons why this is a poor analogy. One of them is that lots of people actually hate Danyl and so were pleased when he was in the bottom two. I can’t see it myself but lots of people in the twittersphere despise him for being too cocky and arrogant.

Err, cocky and arrogant pop stars? Isn’t that the point? I don’t want my celebrities to be humble, least of all those who are most entertaining when they have a swagger. In the distorted mirror of X-Factor-land this is a symptom of a chronic British disease. We far too easily translate a positive confidence into a negative arrogance and cockiness. It goes deeper than that though. In our nation’s popular narrative those who are successful through hard work are often derided rather than celebrated. Academic achievement is something we feel we have to apologise for rather than take pride in. And this is something which starts at an early age. The most popular kids in school are not those who do well in class. Think about the last time you said that you were really good at something. Did you feel a bit uncomfortable about doing so? We have all be trained to do so.

This is not always the case in other countries. In the US you’re allowed to tell people if you’re good at something and take pride in your achievements. My very good American friend got the shock of her life when at our school and told us she was good at Basketball. Our classmates looked on horrified at her arrogance. But it was also true. Why shouldn’t she be allowed to say so?

Danyl isn’t nearly so entertaining now he’s trying not to be cocky. The British disease has defeated him. Arrogance is not a good thing, but confidence and taking pride in your success is, and they are not the same. So put a sock in it Cheryl.

Right, enough serious talk. I’m off to vote for Olly.

Cameron learning from Reagan

2009-11-11T06:24:00.000-08:00

David Cameron made some important commitments in his speech at the Guardian last night. He clearly sees an expanded role for charities and social enterprises in the delivery of public services, and crucially as he outlined in response to a question from Stephen Bubb, that role will be funded by the tax payer.

This is very welcome clarity. That commitment is not something which is common to all centre-right politicians as they approach public service reform, as Philip Collins’ excellent recent piece in the Times highlights. There is a widely held fallacy that charities and philanthropy can easily compensate for a withdrawing state. This is simply not the case.

To explore that false argument in more detail, it goes something like this: Charities operate where the state does not. The services we provide are additional to those which are paid for through our taxes, hence we are motivated to give. The needs of the less advantaged in our society are met either by the state (though public services), or by charity; and it is the relative proportion of state provision versus charity support which separates “small state” countries like the USA from “big state” countries like Denmark.

This view is false because it fails to recognize what has been a seismic change over recent decades. Charities now deliver £billions of services for the state, not outside of it. The very significant growth and professionalisation of the sector is a function of this greater interaction with the state.

However, a cursory glance at the history of the relationship between the state and charities would go a long way to explain the false view of the relationship. As AJP Taylor famously wrote, until 1914 the average Englishman could pass through life and hardly notice the existence of the state. Vast swathes of core services were delivered by charities and paid for through philanthropy. During the 20th Century the state slowly took on more and more responsibility for services which were previously charitable. The probation service was nationalised in 1907, and the creation of the NHS in 1946 effectively nationalised a huge volume of charitable activity. During the 1970s the state was at its apex, and for a short time is was largely true that the role of charities was additional and peripheral.

Since then, though, and particularly in the last 15 years, the clear water between the state and charities has drained away. As market based reforms have dominated the new era of public services, charities have found themselves delivering services not as an alternative to the state, but rather for the state. ACEVO is proud to have championed this transformation from within the sector and helped to build the capacity of the sector to deliver more state funded services. Charities are very well placed to deliver services which focus on the needs of the user, joining up fragmented government silos, tackling the root causes of social problems rather than treating their symptoms, and seeking our innovation. These are qualities which are being increasingly valued by public commissioners.

The polarity between state and charity therefore no longer exists. More than a third of the money charities spend comes directly from government, and the links go much deeper than that. Each year central government alone spends over £ ½ billion on building the capacity of the third sector to be more effective at delivering services and providing advocacy.

This transition in the role of the sector is not one, however, with which the public have engaged. Recent research by ACEVO and YouGov showed that only 16% of the public were in the right ball-park in estimating the proportion of charitable income which comes from government. However it is a vital point for policy makers to understand, and as Philip Collins rightly says they must learn from history.

To risk over-stating the point again, it is this: The charity sector has only grown in size and strength because of its relationship with a state which has been committed to using charities to deliver public services in a state funded market. The capability of the sector to thrive is therefore completely intertwined with buoyancy in those markets. It is simply not plausible that charities could step in to the space vacated by a shrinking state, because they will be shrinking too. Even if a smaller state was a catalyst for greater philanthropy, the public would need to roughly treble their current giving to make up for the loss of state funding.

President Reagan faced this dilemma in the early 1980s. He had been elected on a significant tax-cutting mandate and saw the charitable sector as a cheap alternative to federally funded services. However, Reagan and his advisors did not appreciate the extent to which charities were already spending money given directly to them by the federal government, or given to them by the states on behalf of the federal government. Cutting those budgets would cut the life support of the very organisations who were meant to take on the delivery of those services, at precisely the time when demand on their services was rising. In the areas of health and social care in particular Reagan was not therefore able to cut spending as much as he had originally wished.

After spending a week at the Conservative Party conference I left much enlightened about the party’s broader policy agenda. But there are a variety of views within the party about the extent to which the state should shrink. To believe in the fallacy outlined above will be a temptation which all elements of an incoming Conservative Government will need to resist, especially when the party has a clear desire to reduce public spending and stimulate philanthropy.

George Osborne has claimed that the Conservatives are the true inheritors of Blairite market reforms in public services. For this to be true he and his boss must be sure that all of their colleagues understand that charities are not an alternative to the state, but a key partner. The theme of the week in Manchester was to prepare the public for spending cuts. If we really are “All in this together” then the only solution, as Cameron recognises, is for the Conservative party is to use the best of the modern enterprising third sector to bring about real public service reform. A greater role for the third sector in public service markets can both improve outcomes for service users and use public resources more effectively. These outcomes can not be achieved without recognizing the reality of the sector’s relationship with government. Pulling the rug out from under us would not create the stronger charity the sector which the party says it wants, and crucially it would result in a double whammy for service users.