autumn leaves

Does the size of a charity actually matter?

By Iona Joy 6 May 2016

So Leicester City have been crowned kings of football this season. This David beat Goliaths including Chelsea, Manchester City, and Newcastle to claw their way to the top of the league. It goes to show you don’t have to be one of the big names to succeed.

At NPC we regularly see smaller, lesser known charities punching well above their weight.

So if size is no indicator of impact, why do we still talk about charities in terms of ‘large’ ‘medium’ and ‘small’? Why not only talk instead about ‘high impact’ and ‘low impact’ charities?

At NPC, we know that size is important because of how the public perceives charities. Our research has found that more than three quarters (77%) of people think of charities as either national or international organisations, compared to 15% who mostly associate charities with local bodies. This is despite the fact that the majority of charities in the sector (83%) are small or micro, with an income of £100,000 or less. And we know from recent NCVO data that large charities are increasingly getting a larger slice of the public donations cake. Since public support is so crucial to charities’ ability to do their work, this isn’t something to be taken lightly.

So it seems that with great size comes great responsibility. And as well as being accountable to many more beneficiaries, the prominence of large charities—their fame and influence—means that they are also in part responsible for shaping the health and the reputation of the charity sector as a whole. This is something worth reflecting on at a time when the sector is struggling to get out of the public’s bad books.

We’ll be discussing this issue further at our free upcoming event: Has the behaviour of large charities contaminated the whole charity sector? To whet your appetite, here’s a recap of how size can affect a charity’s offer:

‘Small is beautiful’?

So what of the Leicesters of the charity sector? Many of us are well versed in the idea that being a smaller organisation brings the advantage of agility. Compared with trying to shift a large organisation’s direction, structures and culture, it’s easy to get a small team in a room to learn lessons, formulate strategy, and make decisions quickly.

Smaller organisations can focus on a single issue. Take Star Wards, for example. With an income of £100,000 or so, it is changing practices on psychiatric wards, where over 20,000 people are committed each year.

Because they don’t have to please large numbers of stakeholders, pulling them in different directions, they can pioneer new approaches, and devote their resources to changing bits of the system that aren’t being addressed by larger, more generalised organisations.

Big charities, meanwhile can reach large numbers of people in a light way, say through a helpline or website, which is valuable. But trying to offer intensive services to everyone everywhere? Unlikely to happen.

Smaller organisations may envy big incomes and brand power, but arguably living below the public radar allows a charity to espouse unpopular causes, and work on unglamorous tasks that hold little appeal for fundraisers.

The downside of being small is precarious finances. But even this has a silver lining—most smaller charities can claim virtue in recent furore over fundraising practices because they simply couldn’t afford a direct marketing campaign.

Or is it ‘big is beautiful’?

But let’s not forget what benefits being a large charity can bring.

  • Fame. The public is more likely to have heard of the cause, and support it, if you have money to spend on raising awareness.
  • Influence. Those in the corridors of power listen to the voice of the big and beefy.
  • Flexibility. You don’t have to bet the farm on one activity because you can’t afford to run more than one type of service. You can keep your options open.
  • Resources to invest. The ability to invest in infrastructure, such as really good websites, digital opportunities, good financial systems, fundraising and so forth can enhance results. Yes really—good admin does contribute to impact!
  • Daring. With decent unrestricted sums you can take risks and innovate.

Being big can also help with taking a systems change approach. Increasingly our systems (health, criminal justice, social care etc) are regional, so reconfiguring a cancer care pathway in Manchester, say, engages the NHS at the right level and can significantly impact the regional population. This type of activity usually requires decent financial investment and manpower, which large charities—particularly those with a healthy appetite for risk—could offer.