Key recommendations for productivity improvements in the charity sector

Research conducted for the Law Family Commission on Civil Society by Pro Bono Economics in January 2023 has identified the changes and initiatives needed to increase productivity and unlock the full potential of the UK's charity sector.

While the report found that the sector was highly innovative and creative, the research shows that there is room for significant improvements within the use and adoption of technological improvements, with 39% of charities actively using or planning to use artificial intelligence compared to 69% across the economy. The report found that 60% of charities have implemented and actively track key performance indicators (KPIs), with this number dropping to 51% for smaller organisations. This finding, coupled with the finding that 19% of small charities should have invested in the training of staff and volunteers in the year reviewed, led the commission to identify persistent skill gaps and issues with consistent leadership and underinvestment as obstacles to progress.

Based on the findings of the Productivity of Purpose: Bringing Charities into the UK's productivity drive report, the commission, along with input from experts and those working within the charity sector, have developed a proposal focused on making needed improvements in key areas:

Financial generation and management

• Making funding more flexible and longer-term: Longer-term grants with fewer restrictions enable charities to invest in organisational improvements based on their unique experience and the needs of the communities they serve.

• Improving grant-making practices: Having an authority such as The Charity Commission be more active in assessing issues caused by poor-quality grant-making and creating a template of what high-quality grant-making should look like would provide the resources needed to make improvements.

• Government support to increase philanthropy: The commission suggests appointing a 'Philanthropy Champion' to help drive the UK's approach to philanthropy. This should be combined with civil services to improve a general understanding of philanthropic efforts' opportunities.

Generation, dissemination and use of data and evidence

• A Civil Society Evidence Organisation (CSEVO): Such an organisation would be tasked with developing and sharing evidence on how charities can be most productive by gathering and disseminating data and evidence. Acting as an 'information broker', this organisation would assist and advise charities on the most useful information and train them to seek out their own information and implement it to see improvements.
• Productivity data and benchmarking tools: Developing a programme to collate and analyse employees' responses to productivity-related surveys would be beneficial by providing insight into the internal state of productivity. This data could then be used to create interactive data tools through which organisations could compare performance across cohorts and benchmark year-on-year performance.

​Expanding support, increasing local infrastructure and boosting volunteers

• Opening existing government-funded productivity schemes to the charity sector: Government productivity schemes like Help to Grow, are aimed at helping SMEs improve their productivity and should be opened to charity participation.
• Infrastructure review: The government needs to undertake a strategic review of local charity sector infrastructure to ensure each is financially sustainable and can best support the sector's need to improve productivity.
• Work collaboratively with Vision for Volunteering team: This newly formed team should work with business organisations and the UK Pro Bono Network to fulfil the need for skilled volunteers.

While work needs to be done to unlock the full potential of the charity sector, the research and guidance provided above go a long way toward informing the next best steps to ensure longevity for the sector. Much of the information shared above is familiar to Common Call and has been shared within previous articles; we hope that with data being presented and disseminated from multiple sources, needed changes will be made.  As these suggestions develop and take shape within the implementation, we'll update you on what they mean for our sector and how they affect our actions. 


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