Engaging hearts and minds through charities’ reporting
30 September 2016
We were delighted to present the 2016 Award for ‘Excellence in Reporting’ in Charities at the annual PwC Building Public Trust in Corporate Reporting Awards Dinner on 29 September 2016. Our award assessed the reporting by registered charities in the Charity Finance ‘Charity 100 Index’ based on criteria which included the themes of: clarity of message, strategy, measures of success, risks and sustainability. We also looked at the charities’ reporting of ‘hot topics’ which have impacted the sector during the year, in particular: governance, fundraising ethics and corporate partnerships. A shortlist from this process was assessed by an independent judging panel.
The winner of this year’s award was the Royal National Lifeboat Institution (RNLI), the charity that saves lives at sea. The charity’s reporting was honest, transparent and impactful based around a consistent theme of “One Courageous Community”. RNLI clearly explained the charity’s strategy, achievements, ways of working and impact. Supported by informative case studies, its reporting gave a real sense of RNLI’s purpose and its longer-term priorities and goals.
The two highly commended charities by the independent judging panel were Cancer Research UK and Dogs Trust. Their reporting had interesting and innovative aspects: Cancer Research UK had impressive reporting on its strategy and gave a clear breakdown of where its funds came from. Dogs Trust used a distinctive ‘menu’ theme which made it easy for readers to navigate its reporting and clearly explained how its activities benefit the public.
There has been increased scrutiny over the work of charities and their impact, particularly in the media, including how they are governed and how they hold themselves to account. In this environment, public trust is at the top of the agenda for the sector as it is foundational for charities to succeed and thrive. Transparency is a critical enabler of trust, and a charity’s annual report is a key opportunity for them to communicate with their stakeholders. There is an important need for charities to reflect on how they can best share their stories about what they do, why they do it and the impact their work has.
We are pleased to report that progress has been made compared with our assessments for the awards in previous years. While charities continue to be on a journey, we have seen greater effort taken by charities to create impactful reporting which gives readers detailed information on their activities and engages with them emotionally. In addition to continued innovation, we have identified, as examples, three key ways which can be adopted to develop the reporting by charities of all sizes and build public trust in the sector.
Clear, authentic communication – from our assessment, we found that some charities’ reporting was generic and non-specific to their circumstances. Charities should engage with their stakeholders in an authentic way; this will help to distinguish themselves and give credibility to their purpose. More importantly, charities can bring to the fore their personality and allow stakeholders to connect with them at an individual level.
Communicating with ‘one voice’ – Annual reports are often prepared by multiple teams in a charity; from our assessment, we found that some charities’ reporting was internally inconsistent, particularly the way in which different sections were written. Charities should not only ensure all sections in its annual report are aligned, but that all sections need to speak with one voice so that there is no dilution in their message. This will also help to give their stakeholders confidence that everyone in the charity, no matter how big or small, is working as one to achieve their charitable objectives.
A clear theme, and ‘less is more’ – Historically, the annual report has been seen by some charities as a mere compliance exercise. From our assessment, it was not unusual for us to see mass amounts of, sometimes irrelevant, information about the charity compiled together without a coherent structure. A significant amount of effort goes into the preparation of a charity’s reporting, so it makes sense to pay attention to what information is included and how it is communicated. Charities should explain the environment in which they operate and take a thematic approach connected to their purpose. Charities need to meet their regulatory reporting requirements but they should seek to be concise and keep their reporting relevant to their stakeholders.
Within their reporting, charities should also turn their attention to other fundamental questions which underpin public trust:
- How do we proactively engage with all of our stakeholders to ensure that our goals are aligned with theirs, and thereby safeguard the legitimacy of our mission?
- What does it take to be effective in delivering our mission now and in the future, and how can we be perceived to be so?
- How do we continue to evolve and respond to a changing world to ensure our relevance during times of change?
It is vital that charities recognise the importance of effective reporting and dedicate the resources needed for this. There are great stories that a charity can tell about its purpose and the impact that its achievements have on its beneficiaries. This narrative should be authentic, consistent and reflect its values.
By engaging the hearts and minds of the public through authentic reporting, charities will maintain and build on the trust afforded to them. There has never been a better time for charities to critique their stories and to reflect on their purpose, including how this is realised and communicated with their stakeholders.