Ecclesiastical report highlights largest risks facing UK charity sector
New report will help brokers support their charity clients through uncertain times
Funding remains the biggest concern to charities over the short- and medium-term, while reputational risk is the biggest threat over the long-term
The threat of cyber-attack is a major concern
Report warns charities need to take a longer-term view of risk to ensure their future prosperity
A new report revealing the biggest risks facing the charity sector will help brokers support their charity clients through uncertain times.
Ecclesiastical, insurer of more than 45,000 charities in the UK, has published its first Charity Risk Barometer, an in-depth study exploring the immediate and emerging risks facing the charity sector.
The report, entitled ‘Risk and reward in an uncertain world’ also highlights potential solutions, with expert commentary from leading thinkers in the sector.
It will help brokers gain a deeper understanding of the issues facing charities and enable them to work with their clients to find solutions.
The report asked charity leaders about the biggest risks facing them over the short- (12months), medium- (1-3 years) and long-term (5 years).
Funding continues to be the major concern for all charities. The research found it was the top issue for charity leaders for the short- and medium-term and the second biggest concern over the next five years.
Unsurprisingly, the impact of Brexit is a major concern for the year ahead, with more than half of charities citing it as a concern, followed closely by growing political instability. Brexit was more of an issue for larger charities and became less important to all charities over the longer-term.
In the wake of the Charity Commission’s criticism of Oxfam’s handling of the sexual exploitation scandal, reputational risks are also high on charities’ agendas, emerging as the biggest perceived risk over the long-term.
The threat of cyber-attack was also revealed as a major concern alongside a number of emerging risks including charities’ ability to attract and retain talent, stress-related burnout among staff and engaging with the next generation of supporters.
In these increasingly uncertain times, the report also highlights the need for charities to think more strategically about risk management to ensure their future prosperity.
Three-quarters of boards have risk discussions as a standing agenda item, but one in four charity leaders feel they aren’t spending enough time considering risk at a strategic level. Worryingly one in three small charities don’t spend any time considering strategic risk on a regular basis.
The research also found that many charities were taking a short-term view of risk. One in five charities is only looking ahead 12 months when considering their strategic risks, and just 40 per cent are looking beyond three years.
Angus Roy, charity director at Ecclesiastical Insurance, said: “These are challenging times for the sector – uncertainty is the new norm and new risks are emerging all of the time. It is imperative that charities spend more time thinking about not only the potential rewards, but also the risks they are facing, now and in the future.
“As a specialist partner to the charity sector, our role is to help customers manage their risks and our research shows that too many charities are taking a short-term view, which may be limiting their ability to grasp new opportunities and identify emerging threats.
“Brokers have an important role to play in supporting their charity clients to understand and manage their risks and we hope this new report will provide invaluable insight for them.”
Fair. Care. Share… three little words that make a big difference to the way we do business.
Founded in 1887, Ecclesiastical is a specialist insurer providing solutions for your clients in the Art & Private Client, Charity, Education, Heritage, Faith, Schemes and Real Estate sectors. We are a commercial business with a charitable purpose, sharing our profits with good causes in communities all over the country.
We insure amazing people, places and treasures. From iconic buildings to art collections, from charity volunteers to brass bands, we draw on over 130 years of experience to provide the cover your clients need. We care deeply about our chosen sectors and invest in research and talent that allow us to develop and share specialist knowledge and risk management advice.
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