The Institute of Chartered Accountants in England and Wales (ICAEW) collaborated with the Charity Commission to examine charities strategy development, implementation and review. The final summary report was made available on the ICAEW website in April 2015.

These reviews provided an opportunity to charities to receive a free consultation by experienced accountants on the charity’s policies, procedures and practices relating to strategic planning. The collective outcome of the reviews has provided important feedback to the Commission regarding sector practices in this area.

25 volunteer reviewers and charities participated in the project. The charities selected were all registered with the Charity Commission and with annual income less than £5 million.  The reviews covered general awareness about the processes associated with developing, reviewing and implementing strategies.

The key findings of the reviews were:

It was apparent from the review that there are considerable advantages to be gained by charities who undertake the strategy process.

There were a number of general themes emerging from the reviews some extant of the detailed findings on strategy including:

  • Those charities with strategies appear more able to deal with fluctuating economic conditions
  • Few charities considered mergers in their strategies
  • Many trustee boards lacked both financial and general experience, particularly in developing strategies
  • A number of charities appeared to suffer from a conflict between the CEO and trustees
  • Few charities linked strategy to risk assessment

It was apparent that the charities that had a strategy (58%) were better equipped to meet pressures and to even change direction. For those without strategies, there was a theme for the very small charities that survival was all consuming. Whether a strategy might have helped mitigate their financial plight is inconclusive.

Generally however, those charities that had strategies, embraced them and used them to the advantage of the organisation.

More disappointing, was the continuing theme of poor governance; boards not understanding their role; not understanding their charities and not reacting positively with management. The lack of financial acumen amongst boards is also a continuing concern.