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Recovery challenges for the charity and not-for-profit sector

Recovery challenges for the charity and not-for-profit sector

Income, digitalisation and workforce will be three of the big challenges for charities and not-for-profits on the recovery path from the global crisis, an industry expert has outlined.

Non-executive Director at BUPA Dr Lisa O’Brien, who will be chairing the ‘Not-for-profits — challenges for governance and service delivery’ session at Governance Institute’s National Conference says some sectors have been hit particularly hard recently.

As donations and fundraising feel the impact in the wake of the bushfire and the global pandemic, income is a challenge for the sector.

“There are of course parts of the sector that have seen growth in donations in response to the bushfires and then the pandemic,” Dr O’Brien said.

“But there are other parts of the sector, like the arts, where donations have drastically declined.”

With the main source of income for the sector being government, it is a priority area for government investment for the recovery path.

There must be stronger investment in technology in the sector, Dr O’Brien said.

“There is real value for the sector in being able to invest more in technology that moves the sector from paper-based and face-to-face to more digital solutions focussed on the customer. The access to capital to effect that transformation is however another challenge.”

The Smith Family, for which Dr O’Brien was the CEO until earlier this year, had been on an impressive digital transformation for the last decade which held them in good stead this last year. They were able to quickly transition their mentoring, learning and programmes for children online at a time when most children were being home-schooled in the wake of the pandemic.

“The focus now is on building the way back after the COVID-19 crisis. I think investment in technology is part of the solution. But the other part of this is the digital access challenge for our clients. If the sector wants to deliver services more efficiently through digital channels, then those we serve must have access, skills, and capacity. It is not just about saying – here’s a laptop, off you go.

“There is a big capability component. And not just for young people; it is the elderly, the homeless, a whole range of groups that the sector serves that don’t have the digital access and skills.”

One of the areas of focus for National Charity Crisis Cabinet formed during the COVID-19 pandemic, of which Dr O’Brien was a member, was on the urgency for a digital roadmap.

“What is the pathway to make Australia a more digitally inclusive nation? Because those with no access or skills to use digital technologies are left on the fringes of social and economic life and existing disadvantage is exacerbated by digital inequalities.”

The third challenge is the workforce because of wages growth and a lack of skilled people. It is also about having appropriately qualified and experienced people available for the price that the sector can afford, says Dr O’Brien.

“The labour market is contracting. There is no doubt about it. Demand is going to outstrip supply. And the ones who will suffer most are in the not-for-profit sector because they cannot afford to pay top dollar.

“There are a lot of people who will come to work in the sector because they want to work in a purpose driven organisation, or for an issue or social purpose they feel a strong connection to. That is a distinguisher. But the trade-off is usually financial. And so those pressures for the sector will I think continue to increase if the financial differentials continue to grow.”

The ‘Not-for-profits — challenges for governance and service delivery’ session will be held on day two of Governance Institute’s National Conference in September and is sponsored by BoardPro.

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