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International Charity Financial Benchmarking Report 2020

6th October 2020

In our introduction last year, we commented on the uncertain times faced by international charities. Whilst there were many factors we had anticipated, such as Brexit and the focus on high profile safeguarding cases, we could certainly not have anticipated challenges of the size and scale of the COVID-19 global pandemic. 

Combined with the pre-existing challenges, and other new obstacles like the merger of the Foreign and Commonwealth Office and the Department for International Development (DfID), the scale of threats faced by the sector is extraordinary. We have already seen cases of charities announcing closure, with Bristol-based African Initiatives announcing that it will close in early 2021 as a result of difficulties raising sufficient income. There have been other cases reported in the sector press of international charities making significant redundancies — in May 2020, Bond1 reported that 50 out of 116 organisations surveyed said they would not survive for longer than six months without additional funding. 

At the same time, the need addressed by international charities remains great, and at the time of writing in September 2020, we are seeing many international charities re-evaluate their future plans, having secured short-term survival. For many organisations, this may mean a different future to the one envisaged at the start of the year, and recent research suggests that this may lead to an increased appetite for mergers within the sector. 

In this report we have again considered a selection of the areas which, in our experience, are most important in achieving good financial governance: risk, reserves, fundraising, and the trustee board itself. In addition to the areas considered last year, we have expanded our research to include a smaller scale survey which expands on a number of the areas covered in the report and also some of the pertinent factors relating to COVID-19. 

We hope you will find the results of our work useful, both to inform debate and to help your individual organisation benchmark its own figures against similar organisations. More importantly, we hope this work will help to stimulate discussion and support the adoption of best practice in the sector. We would welcome feedback on the contents of the report, as well as suggestions for areas to benchmark in the future. 

If you would like to discuss any of the points raised in this edition please do not hesitate to get in touch with your usual haysmacintyre contact, Charities Partner, Steve Harper, or Head of Charities, Partner, Murtaza Jessa

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