State of the Sector 2020: what should we be aiming for?

19 May 2020 | By Naomi Chapman

Cause4 shares its thoughts on the top three qualities the government should incentivise in charities to inform funding and policy going forwards.


On the 18th May, NPC released its latest State of the Sector report with a (virtual) launch event, presenting key findings about the state of the charity sector as the Covid-19 crisis hit, and then facilitating a panel discussion about how we can learn from the report to shape the recovery of the sector.


In her response to the research, the Minister for Civil Society, Baroness Diana Barran, asked attendees to consider which three qualities the government should incentivise in charities to inform funding and policy going forwards. Although our thoughts on this change often, here isCause4’s take in response to this question and the State of the Sector 2020 report.



We often think of charities as overstretched and under-resourced, and this research displays the truth in this perception. The data shows charities to be spreading themselves too thin: charities are focussing on more activity types than in 2017, whilst the NCVO Almanac shows that resources have stayed fairly constant in this period. Looking ahead, charities surveyed plan to do more of everything in the next three years.

Charities should endeavour to buck this trend – in the charity sector, especially post Covid-19, prioritisation is paramount. Charities should seek to return to their core objects, considering which projects and programmes are vital and which are not delivering sufficient impact, in order to consolidate services and ensure sustainability going forwards. With a projection of less resources, the sector simply cannot afford to try to continue to do it all. 



At Cause4 we are passionate proponents of collective working between charities. Consolidation should also be encouraged across charities, to ensure that charities aren’t duplicating services but rather working collaboratively to support beneficiaries.

In the launch event, Kim Shutler, Chief Executive of the Cellar Trust in Bradford, spoke of her experience in representing small charities in the Covid-19 response, and raised the interesting idea that small charities need to find mechanisms to share evaluation data in order to show their combined impact and the demand they are meeting. Collaboration is not merely a case of collaborating in the delivery of a programme, but also in the design and evaluation of what is needed.

Covid-19 is leading to some unprecedented examples of collaboration which we hope to see more of: during the launch event Javed Khan, Chief Executive of Barnardo’s, talked about building a consortium of 20 children’s charities in order to reach ‘forgotten children’, and in early May a coalition of anti-poverty charities joined together to call for a temporary Coronavirus Emergency Income Support Scheme. 

Collaboration and prioritisation, in combination with the financial impacts of Covid-19, could lead to more mergers in the charity sector, or deregistration of charities. The NPC report, however, found that only 25% of boards had discussed mergers in the previous year, and just 10% had discussed deregistration or closure. These are conversations that need to be had at the board level, whether in regular meetings or away days, with honest analysis of what is truly in the best interest of beneficiaries. 



The NPC report contains a multitude of findings around what we have classified as ‘Connection’: a commitment to diversity, local representation, and service users in programme design. 78% of charities surveyed in the State of the Sector 2020 report said that their workforce did not represent the community that they serve, but there was also interesting variation by income size. Small and medium charities were found to be more likely to involve their users in various capacities than major charities. This included:

  • Serving on boards (57% vs 46%)
  • Delivering services (63% vs 56%)
  • Developing campaign messaging (62% vs 49%)

Connection is even more important than ever as the charity sector looks to rebuild post Covid-19. During the crisis, it has been the charities with connection to beneficiaries that have been able to diagnose where support is needed, and to respond and deliver impact to those in need.

In late 2019, only 3% of charities surveyed by NPC saw increased connection with beneficiaries as a way to increase their impact going forwards. The pandemic has shown that Connection is vital to impact, helping beneficiaries and building trust in the sector, and hope that the State of the Sector report in 2023 sees more respondents recognising this quality.


Does the State of the Sector 2020 report reflect your experience of the charity sector? Which three qualities would you choose to incentivise through funding or policy making? Let us know @OfficialCause4.

If you would like support in developing your charity over the next three years, start a conversation that matters with an initial Cause4 consultation here.

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