Navigating Reputational Risks: Key concerns for charity leaders in 2024
As the landscape for charities evolves, so do the reputational risks that leaders must navigate. A recent Alder poll of 100 charity CEOs highlighted five key concerns for 2024, ranging from regulatory scrutiny to trade union disputes. This blog explores the complex environment many charities operate in, the key reputational risks identified from the survey, and proactive strategies for managing them.
Legal and regulatory scrutiny
One in five charity CEOs are concerned about how regulatory scrutiny and litigation impacts on their reputation. Since high-profile scandals in 2015, and more recent cases involving the Runnymede Trust and the Captain Tom Foundation, such scrutiny has intensified. Increased transparency requirements, stricter compliance regulations, and higher public expectations demand that charities adhere to legal and ethical standards more rigorously than ever.
Charities should ensure all key financial and operational decisions are well-documented. Regular audits and transparent reporting can build public trust and reduce reputational damage. When faced with crises, a comprehensive communications plan that includes scenarios for potential regulatory issues, along with clear communication lines with stakeholders, is crucial.
Positioning on international conflicts
The results show that 18% of CEOs also felt vulnerable regarding their positioning on international conflicts. Events like the war in Gaza highlight generational expectations for organisations to take a stand on political and social causes.
There is often internal pressure to issue a statement expressing solidarity with what is going on elsewhere, but charity leaders need to be aware of the regulatory and reputational impact of these decisions while also balancing stakeholder expectations.
Does the charity have a policy on when, if ever, it is right to issue a solidarity statement? What do employees expect? Would such a public position directly align with the charity’s core values and mission? These are all questions that should be asked while navigating this complex issue.
Stakeholder complaints
In the survey, 17% of charity leaders raised the concern of stakeholder complaints.
Poorly managed complaints can not only erode trust and confidence, impacting donations and volunteer engagement, but can also trigger reports to regulators and further harm the charity’s reputation.
To address this, charities should establish clear, accessible channels for stakeholders to voice concerns and ensure that these channels are well-publicised and easy to use. Monitor complaints to identify patterns or recurring issues that may give a broader picture of specific areas of risk – then show how feedback has led to tangible improvements.
Trade union disputes
16% of leaders expressed concern about their relations with unions. Disputes can attract negative media attention and distract from the charity’s objectives and cause. Whether employees are pushing for fair pay and conditions or there have been governance failures and poor workplace culture, proactive steps can address this concern.
Given the range of issues that a union dispute could involve it would be prudent to update crisis communications plans to cover these scenarios, audit internal cultures and build an understanding of employee expectations.
Alder has recently conducted research on key reputational risks to the sector. We will be sharing our research in an upcoming whitepaper. If you would like to register your interest, contact [email protected]. If you have questions or concerns about managing your reputational risk, then contact a member of the specialist charities team at [email protected].
