In the last few weeks I’ve attended two, quite different, leadership events. The first was a public event, our Impact Leadership Conference—held jointly with Charity Finance Group—where charities at the forefront of measuring and reporting their impact presented to and learnt from one another. The second was leadership in practice; I participated in a discussion with the board of trustees of a large and successful charity that wants to get  better at the same things.

While the presentations and conversations at the conference were very good, they did not pick up on a big issue discussed during the trustee meeting that I believe will distinguish tomorrow’s leaders in the charity sector: the transparent reporting of impact, both positive and negative.

Charity impact reports are invariably full of nice data (“vanity statistics”) and good stories. Rarely do they include cases where charities have not been able to overcome the challenges they face when trying to bring about change, and the lessons learned (see my article in the Impact Coalition’s publication on transparency, Through the Glass Darkly for more on this).

While I was making the case for transparency, one of the trustees asked me whether it’s reasonable to expect charities to talk publicly about their failures as well as successes. Not only is it reasonable, I believe it’s an ethical responsibility and required of trustees.

At issue is the tension between two requirements that trustees must abide by. The Charity Commission notes that Trustees have and must accept ultimate responsibility for…ensuring that [the charity] is solvent, well-run, and delivering the charitable outcomes for the benefit of the public for which it has been set up.’ The tension arises when a charity has information about what does not work in trying to deliver its ‘charitable outcomes for the benefit of the public‘, but keeps this information private to avoid jeopardising its (future) solvency.

We see this a lot. NPC’s position is that charities should instead contribute to public knowledge about what works and what doesn’t as an integral part of delivering its charitable outcomes. This does not have to take place in real time, thus allowing room to improve or drop weak services before publishing.

This is not a legal position and we recognise that in a competitive environment charities need resources if they are to do good. But we also think it’s not credible to claim to act in the public interest while keeping private information that will help beneficiaries and even competitors improve their services. Getting the right balance between organisational survival vs. promoting public benefit by being more transparent is not easy, but charities currently give too much weight to the former. We are keen to support pioneering charities who want to take steps to be more transparent about their impact. Anyone of a like mind should get in touch.

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