Empowering charity sustainability: Driving change in Nonprofits – PODCAST

Charity sustainability expert Alex Davies joins us on our podcast to discuss insights, challenges, and tips to create a lasting impact.

Empowering charity sustainability: Driving change in Nonprofits – PODCAST

Charity sustainability expert Alex Davies joins us on our podcast to discuss insights, challenges, and tips to create a lasting impact.


Meet the authors

Ruth Wilkinson

Sustainability, Purpose and Impact Lead

Tomas Vieira-Short

Associate Consultant

Alex Davies

Sustainability and ESG Lead at Cancer Research UK

As the current Sustainability and ESG Lead at Cancer Research UK, Alex Davies is an expert on all things charity sustainability.

In the second episode of ‘Knowing Not for profits’, hosts Tomas Vieira-Short and Ruth Wilkinson chat to Alex about how non-profit organisations can embrace sustainable practices to drive efficiency, engage partners, and make a positive impact on their missions.

The trio explore challenges, funding opportunities, and practical strategies for implementing sustainability within the charity sector. 

Listen here or read on for an edited transcript.

Welcome to Knowing Not for profits, a podcast series where Clarasys consultants will be talking through some of the most pressing issues from the not-for-profit world, bringing together thought leaders and industry experts to discuss their real-life experiences on these topics. 

Tomas Vieira-Short: Hello, and welcome to Knowing Not for profits brought to you by Clarasys. My name is Tomas Vieira Short and I’m an Associate Consultant here at Clarasys. I’m joined today by my colleague Ruth Wilkinson, Clarasys sustainability co-lead and former sustainability and impact lead to leading UK children’s charity. 

Tomas Vieira-Short: In today’s episode, we’ll be speaking to Alex Davies, Sustainability and ESG Lead at Cancer Research UK and chair of the board of trustees at the Marlborough Brandt Group. Welcome to you both. 

Tomas Vieira-Short: So in this podcast, Alex and Ruth will be sharing with us their thoughts on the role of sustainability in the charity sector. We’ll discuss some of the emerging challenges and issues before closing with some top tips for those looking to ensure their charities remain relevant, responsible organisations in the eyes of funders, supporters and society at large. Now, before we dive in, why don’t we start by you both telling us a bit about your background and how you got into sustainability? 

Introducing guest Alex Davies and how he got into a charity sustainability role

Alex Davies: Thanks. So I had 20 years of experience in international development and about 10 years in youth development and youth work. And that sort of led across to quite a traditional corporate social responsibility position in the FTSE 100 finance business. And that really started off in the giving away money and societal impact and quite a traditional sense of how you have impact in the world beyond and separate to your products and your purpose as an organisation, as a business. And then over the seven years, eight years there, that morphed and migrated into corporate responsibility, into sustainability, then finally into responsible business. And it came into a much larger team. So you join as an individual and leave a much larger team really with a completely different remit and environmental sustainability, inclusion, diversity, your reporting, your investments, et cetera, all becoming part of that. And fundamentally it changing from being something that was side of desk and what money you’re giving away into where is that money coming from? And how is it impacting, what is the impact of your core product? And then having been there and written a few strategies there, moved across to Cancer Research UK. And really that was about the opportunity to think, well, there’s a whole sector here that’s beginning to explore what sustainability can do for it. How it can benefit the charity sector and how does it align in a proactive and positive way to its core missions? 

Ruth Wilkinson: Great. Thank you. I had a very different entry into sustainability. I always was super passionate about the environment as a young person. I knew I wanted to work in the social impact world. So I had a number of jobs in the charity sector and fundraising and digital and comms. And I was loving that and I was working at a UK children’s charity and one of our directors was appointed as a strategy and transformation director, part of a new launch of our strategy, and she came to me and she said, we need someone to take forward this piece we’re thinking about, which is how are we a responsible organisation, as well as delivering our mission and purpose. What else are we doing and what’s our negative impact that we’re having as part of our activity? We might be having a positive impact here, but actually we know that we’re having a negative impact out here. We need someone to come in and look at that and write us a strategy basically to improve that. And I said, yes, please. I’d love that. Thank you. And so I did that role and learned so much. It expanded as I went. It’s never ending sometimes from doing our carbon footprinting all the way through to writing the strategy, comms and when talking about it with, with our stakeholders, and then it branched out into thinking about more broadly, how do we measure impact in, in the social not for profit space?

Ruth Wilkinson: And then, yeah, joined Clarasys as a, as a Managing Consultant to support more broadly in the sector. So the first question I think we should cover is charities have core mission and purpose, the thing that they are set up to go out and achieve. Should they care about sustainability beyond that? Why? 

Exploring the importance of charity sustainability

Alex Davies: Short answer is absolutely! The longer answer, I guess, bringing in a different way, why are large businesses, why have they been doing this for a long time and why are small businesses, with another hat I do consultancy for Elephant’s Child and that focuses in on very small businesses. And they’re now really getting into this. And again, they’re very, very lean, they’ve got very core focus on what they’re doing and they’re all doing it for business gain. They’re all doing it because it drives their profitability. It reduces waste. It improves their ability to attract and retain talent, gives them a better brand protection, but also better brand lift. Those are all things that pretty much every charity will also want. It’s just you’re swapping out profits and share price protection for charitable impact and purpose completion, hopefully one day, et cetera. So, I think that the starting point for any charity is around sustainability should be helping you to meet your core mission, your core objectives. There’s an inflection here between how you do it and what you’re trying to do. So if you think about Cancer Research UK as an example, we’re very clear around there’s the, how do we beat cancer? And then there’s the very specifics about why we do it and the mission and the purpose. So there’s very clearly what research we look to fund, but then how do we operate as an organisation? So for any charity, you’re always looking at those two aspects and how do you align them? So you always want to be thinking around, well, how do we go about achieving our mission? What is our HR policies? How are we inclusive? How do we diverse? How are we reducing our environmental impact in terms of our operations? And then thinking about, how do you bring that into your purpose and the activities that you do? So, you know, there’s a difference between the fundraising event versus your charitable activities into whatever your mission is. And that’s the same for any business as well. They’ll always be thinking, okay, well, there’s our product that we want and how does that impact the world? Then there’s how do we manufacture the product? How do we run our organisation behind the scenes for our finance team, our HR team, et cetera. So any organisation is on that maturity journey, usually starting with your own operations and then thinking about your purpose and your product. Charities, it’s a little bit odd because it’s the other way around, right? You start with purpose, you start with impact and societal impact, and then you’re trying to bring in that operational side, and then you almost come full circle back around to how does it enhance your mission and purpose. But as a charity, you know, we’re very lean. You’ll always be giving maybe 15% cost or 20% cost or 10% cost, whatever it is. The vast majority of your income is going to be going on charitable spend, your charitable mission. So you haven’t got that much cash usually to play with in this space. So it has to be linked to your core objective. Sustainability isn’t driving and enhancing what that charitable impact is. That can be through better brand impact and reaching more people. It could be through less waste, more efficiency, whatever it is. But if it’s not linking back to that, that mission output, then you’re probably doing sustainability wrong, because it should be.

Ruth Wilkinson: Interesting. I completely agree with you, but I’m going to test, I’d really love to hear your example of how do you connect reducing your carbon footprint to Cancer Research UK, you know, curing cancer.

Alex Davies: Just cheaper, saves money. Yeah, there’s different angles. So one would be, how do you think about research in a more sustainable way? So there’s the LEAF framework from University College London, and that’s thinking about how would you just reduce your waste. So that’s just saving money, being more efficient, how you do things, thinking about how do we make sure that our events are more sustainable.

Alex Davies: Sustainability, one of the great things about sustainability, it gives you permission to stop doing things. You know, it’s a really powerful tool to go into a process or an activity or an event or whatever and say, well, why, why are we buying that? So, you know, we’ve done some work to say to people, do you really want to have a t shirt for that event? A lot of people say, yes, it’s the medal. They do want medals. Of course they do. And they say, we’ve already had one. Do you want another one? Could you bring the same one next year? Or thinking just take the year, these are basic things, but take the year off the events, marketing and the collateral and off the t shirts so people can reuse them, you know, so it can save you money from that perspective. But then there’s also the intangibles and one of the challenges you always get with sustainability, and this is for any organisation, usually the area of the organisation that pays the cost doesn’t see the gain. So you might be in property and you’re putting in LED lights. And at the moment it’s an upfront cost, you’ll almost certainly get a saving just because electricity prices at the moment. Or you’ll make a decision to move to all recycled paper, or you’ll choose a more expensive supplier or a responsible supplier. Now those are costs borne by that delivery department, but the gain may be felt in your brand department or the reduced risk or increased relevance of your brand and your message out to people who care about sustainability and diversity and inclusion, et cetera. Or it’s, you’re reducing risks or you’re improving your message out to people who might want to come and work for your organisation, or you’re improving the connection with the people who are already in your organisation so they don’t leave. Now those are, those are gains that are felt in different departments to the ones that are paying the money. So you always need, and this is the same for any organisation, you need to start thinking about how do you, how do you talk a language of sustainability and talk a language of gain across the organisation to have a joined up approach? So, to go back to your original question, how is it supporting cancer research, in that example to beat cancer? Well, it’s cure is money in, it can reduce the cost of events. It can make us more efficient as an organisation It can reduce staff turnover, which is enormously beneficial at the moment. It reduces your core costs like electricity. And then it can make your actual product or what you do whatever that is, whatever charity you are, make that more efficient as well. So you’ve got a cash gain, reduced risk, brand enhancement, staff engagement all the way through that whole model. So that’s hitting your bottom line and your impact as well.

Ruth Wilkinson: I really appreciate you pulling that out because I think people often don’t always think about that level. They think about it as, I know it’s the right thing to do, but there’s so many barriers, so it’s too hard and it becomes too overwhelming.

Ruth Wilkinson: There is an argument that I always try to make, and I think is also really important. I agree with all of your points as well, but it’s about fundamentally, if we want to achieve our mission and purpose, and we can see there’s huge other global challenges in this world, that’s going to negatively impact our ability to achieve our mission and purpose. Almost every not for profit I think will have that as the case. You know, where I was working, it was a children’s charity aimed to build better futures for children. We were doing that through very specific kind of medical care and rehabilitation. If we’re doing that for young people, but we’re not protecting the environment they’re going to live in, we’re negatively impacting their future as well as trying to help them in some cases. And then I also made the case as well that, you know, we had staff delivering this rehabilitation. They were wearing uniforms that we bought from a supplier where we couldn’t guarantee there wasn’t modern day slavery in the supply chain. We obviously went ahead to do that guarantee and make sure that was the case, but that’s a possibility in people’s supply chains. And so you might be negatively impacting a child somewhere in the world while you deliver great services somewhere else. So I tried to make that connection.

Alex Davies: That’s a really good point. And it speaks to the culture of any organisation you’re operating in, you know, what levers do you want to pull? Charities are always interesting because they have the mission, they have the purpose, that sense of self is usually extremely powerful. So to be able to embed sustainability you need to connect into that. That’s just so you, frankly, so you can get some cash to spend on either staff or support or reporting or whatever it is, and pay for LED lights. The happy by product is that you help save the world at the same time. That’s a useful output for all of us, but any charity and any organisation when it thinks forward 10 years will need to be factoring in that climate change could be a, defining, if not the defining factor impacting upon them. So what they may be happily trying to go out and impacting the areas that they most care about, and they’ll be aligned to UN SDGs and sustainable development goals. Be very clear about the social impact and value of what you’re doing, be measuring and evidencing that. But coming in from left field is going to be the impact of climate change and whether that is migration movement, whether there’s access to the raw materials and rare metals you might need for your cancer research if you’re doing that, or for the events you want to do or travel, transport, whatever, you know, whatever field you’re in, it will be a defining factor. All organisations, when you start getting into the space, you may want to do what’s called a materiality study to understand not just how is that impacting you now and what the relevance is and what the connections are, but where is that looking in 10 years time? And for a lot of organisations, when they do that, they’ll find that if, when you ask your stakeholders, when you ask yourselves, where do you think climate change is in 10 years time? You take yourself out of the immediate strategic and tactical fires and priorities that are going on around you. Everybody usually becomes quite clear that climate change is an enormous factor. So there’s always a question then, well, what point, if you think that’s where you’re going to be in 10 years time, and World Economic Forum data is showing this very clearly now, where between today and 10 years time, does that change ever happen? And are you ready for it? Because we don’t know when it is. And we don’t know when it is for your organisation. So it might be in three years time, it becomes a defining factor. It might be in 10 years time it becomes the defining factor, but it will become a really critical issue. And if you’re not thinking proactively about that, being ready for that, the relevance of what you’re trying to achieve could be overtaken by the issues created by climate change. Now that can mean that you just need to make sure that you are aligned to the impacts of climate change in terms of what your mission is and what you’re trying to do. Or that you, you really ask yourself the tough questions around, well, how are we relevant to this bigger debate? And thinking around how do we strategically shift what we’re about to make sure we are responding to those threats coming down the line. 

Ruth Wilkinson: I think that’s taking us in a really good direction of starting to think about how can charities make this change. But before we do that, I’m really glad you mentioned materiality studies. It’s one of the questions I wanted to ask and hear from you is where have you seen need and drive for this kind of work in the not for profit sector from stakeholders? Where are you hearing it? Where are you not hearing it that you might expect to hear it? 

Alex Davies: I’m seeing it quite a lot, so some of the conferences we’ve been to and some of the organisations that we’re now talking to when I say that there’s a, there’s a side issue here that the charity sector, one of the real strengths we have is we can be collaborative where we don’t need to be protective on this, we don’t need to use it as a point of difference or unique selling point. And we can work collaboratively and I strongly recommend that any charities that are active in this space, you know, be active with other charities, share your knowledge, share your information, be open source. It just means that we, we save valuable money and valuable time and effort by using and seeing what others are doing. So I am seeing a lot of organisations use materiality study and it’s a really good foundation stone. You don’t have to go to a top end brand, if you’re a large organisation and you want to have the real credibility of a recognizable brand behind it, fine. I would suggest in this sector, that’s not important particularly, just go for an organisation that can do a good job. And then what a materiality study does is give you a set of data and researched and carefully thought through an evidence or methodology to think about what your priorities are. So rather than just guessing at what your priorities are, you talk to your internal stakeholders, you talk to most important external stakeholders, you understand the landscape both today and in five or 10 years time. And then that gives you, you know, you can publish that, you make that open source. And then that gives you the credibility to say that we’re going to focus in on these areas. We’re not going to focus in on these areas. And I think one of the things that, you know, we get to the hints and tips and stuff at the end, there’s no bad things to do by and large in sustainability. The trick is to work out what the best things to do, like where, where’s the most return on investment, where all charities, you want to spend your money in the most efficient and effective way. What materiality study helps you to do is narrow that down and make sure that it is clear from an evidence base about where you’re doing that.

Ruth Wilkinson: And don’t reinvent the wheel, learn from other organisations. 

Ruth Wilkinson: And I would say I’ve seen that cause I, since I left the charity sector, I’ve worked with lots of for profit clients in this space. It’s pretty collaborative across the board. I would encourage, even if you’re not a not for profit, be collaborative and open source as far as possible. Bring together industries to tackle these challenges. 

Alex Davies: I mean, just on that, if you are an organisation starting out in this, one of the things you can do is, you know, you think about your maturity scale, about giving away money side of desk towards, your operations into your product, almost beyond that is then into collaboration and you can think geographically and think, well, who are the companies or Charities or organisations within the building we occupy, who are on the estate we’re based on, who in the village or the town or the community, and work with them. They could be in completely different sectors, but they’ll all be going through the same journey of maturity, starting out. Some of them will be ahead of you, grab their ideas. They’ll be delighted to share. You know, work together, it doesn’t have to be sector by sector. You can literally just walk out of wherever you are, if you’re in an office, if you’re at home, figure out, well, who’s around you, you know, go and reach out. Most organisations are happy. The end product here is a gain for everybody. 

Ruth Wilkinson: Our marketing manager bumped into someone in the lift once in our office building and we ended up having a Zoom call where we shared all our carbon stuff with them and they shared back and it was great.

Ruth Wilkinson: Shall we move on then to, I don’t want to take it in a difficult direction, but should we move on to what are the challenges that we think charities are facing? Bearing in mind that people are out there trying to do this work, what do we think the challenges are and how do we recommend people overcome them?

Understanding the challenges: Balancing mission and financial viability

Alex Davies: The first thing in any organisation, it’s that fear of what do you do? You’re stepping into a space that can feel daunting because of greenwashing or virtue signaling. There’s a lot of brand and marketing involved. And usually when we’re doing, with the consultancy hat on a lot of it is just to give organisations confidence to make a first step in this space. And again, you can just be flooded with the options of what do you do? Again, almost everything is good. So where do you start? And I think that often creates a paralysis in terms of organisations, like, okay, well, where do we start? Materiality study is a really good place to start.

Alex Davies: Frankly, just get on with anything whilst you’re doing that. Look for the easy wins, just Google easy environmental wins. You will find things you can just get on with. LED lights, the classic one, get started on something. Start measuring where you are just so you have a bit of a baseline to begin . And again, a lot of organisations will put off by a fear of having to do it really well. You don’t, you really don’t, you know, just often what your gut reaction usually is probably going to take you in roughly the right direction or certainly in a direction that’s good enough for a year whilst you figure out the detail.

Alex Davies: So getting the confidence to get started. And you don’t have to shout about it straight away. You know, you can just do it internally and get on with some activities and start figuring out how it would look like. So I think that is usually the biggest barrier straight off. 

Alex Davies: If you’re through that, it’s then figuring out where are your priorities? Where do you want to put your effort? Where are you going to see your best return on investment? Where does cash go potentially? And for any charity, particularly any organisation that matters, but for charities in particular, because you need to be quite public in justifying where you’re spending donations ultimately. And you need to be able to look people in the eye when they’ve done that fundraising activity, that this was money well spent, you know, it really does matter to charities. Working out the priorities so that, you know, you’re putting it into high impact areas. The trick and the challenge often is the balance between direct and genuine impact. So reducing your remissions as an example. Into brand protection, so it might be meeting legislation or compliance or taxation requirements into brand lift, to getting out there, having a message to tell, because you may talk to your supporters and find it’s a really important issue. So there’s a brand opportunity lift there and then into what people feel touch, see and do, you know, that event, they turn up, but it doesn’t matter what you’re doing over in your direct outputs, if your fundraising event has got single use plastic everywhere and balloons everywhere, you’re undermining the credibility. So when you think about what you’re doing, you need to balance those four activities. The direct impact, your risk mitigation, hygiene, your brand lift, and then into what your supporters actually touch and see and do.

Alex Davies: And balancing that can be tricky. You need to talk to people. You need to work out, well, what are your people’s expectations? And the charity sector right now has very little knowledge about what its supporters want. This is how obviously Clarasys and Cancer Research UK came to contact, trying to pilot some of this work. It’s work that we’re going to do later in the year. And again, we’ll make open source for all charities to see the results, hopefully have that out around October time. But knowing what your supporters, what your staff and your donors, particularly, expect of you, helps you to give you a baseline of where to start and what level of ambition to do and that that can be a really powerful guide as well, particularly that brand lift versus risk mitigation to move beyond that. But frankly, getting started is usually the, the biggest barrier just getting started is the best outcome from that as well. 

Tomas Vieira-Short: It’s interesting as well that you talk about doing this study into, you know, what donors and supporters think. Cause I think, speaking for myself as someone who looks out to charities, It feels like sustainability is a very hot topic issue. And so I’d be curious, if you can speak to it, what’s your experience so far been on presenting that information back? Is that for you the major drive in pushing change here or are there other metrics involved in helping convince internal stakeholders, I think, especially of the importance of this case?

Alex Davies: It’s one of several. So I think it’s always worth remembering that a supporter for any charity is a multidimensional person, that they are somebody who has a job. They may be parents, a sister, brother, et cetera. They will care about many areas. They may be a donor for this charity, but they may also care about sustainability and be involved in a diversity charity and be supporting animal charity and et cetera, et cetera.

Alex Davies: So a risk I think some charities can fall into is to see their supporters as people who support them. Where so people can support lots of things. And that’s where that potential comes from, that opportunity comes from through understanding and talking to them. And again, it’s the same thing for your corporate donors, for people giving £10 a month. It’s a bit about long term protection. They may care about this issue now, but you know, going back to that point around what point does climate change become a topic that may override your mission purpose. So there’s a bit of protection there to make sure you’re still relevant. So understanding that is really important, but you still need to understand what is your staff perspectives, your employees perspective, what are the local community around you. Getting that information is tricky for charities because you want to ask them a whole load of things. So getting sustainability on the agenda and simply ask the questions can be tricky, but it is important. And again, see it as a brand opportunity, as an engagement opportunity, rather than something we have to do it just to protect ourselves or a risk, it is much more about saying, how do we find another angle, another way to connect with people who care about what we’re trying to do. Influencing stakeholders, so again, you need to understand the organisation you’re in or the organisation to understand itself. Is it about efficiency gains? Is it about more effective engagement? Is it about brand lift? Is it about if you’re a campaigning charity, do you need to bring climate change or inclusion, diversity, whatever, into your campaigning angles to create relevance and to create better cut through? So yes, it’s really important to understand your supporters point of view, but it’s only one point of view. It’s only one set of data that you need to have. 

Alex Davies: Understanding where your competitors are, so benchmarking. Now that might be competitors, it can also be peers. If you work through a common set of providers for your mission, then what are they doing on climate change? What are they doing on modern slavery? What are they doing on their responsible sourcing? What are they doing on inclusion and diversity? If you’re not in line with them, does that become an issue? Is there ultimately a risk that they stop working with you? You know, if they start to assess the charity from a supplier perspective, are you actually a brand risk for them? Now, I think to be clear, I think we’re way off that in the charity sector. I don’t think we’re getting there yet, but it is the direction of travel.

Alex Davies: So if those are what your key stakeholders and your key organisations, your key enabling organisations, are doing in this space, then are you aligned with that? And then turn that into an opportunity, go and ask them for help. If they’re already doing it, then come back and create that. 

Ruth Wilkinson: That is exactly what we did in my last organisation. And when we looked into it, we found that a number of our funders were bringing in quite stringent questions and scoring metrics around what we were doing around responsible organisation. And we really needed them to help. So this organisation is heavily funded by the NHS who brought up a really pioneering net zero strategy. And so actually we then just went back to them and said, can you help us? Let’s work together to do that. And we ended up bringing in other organisations as well, which worked really effectively, and also gave me some reassurance because I was exactly that person going, I must have perfection before I can do anything. And I was sat in front of a spreadsheet of horrifying numbers trying to calculate our carbon footprint to the last tiny cubic meter of, of carbon emitted. And that was really hindering me and holding me back. And I think I also wasn’t brave enough to make the case to where I needed investment. I didn’t feel brave enough to take a not perfect carbon footprint forward to say we need investment in these areas because I’m pretty sure they’re the biggest areas. Not, I’m a hundred percent sure. And here’s the breakdown and over time here’s the change. So that would be my advice as well. Yeah, not to shoot for perfection, especially not in the data collection landscape, unless you’re huge and you need to do it for your disclosures. And then you can probably make good assumptions and good measures based on the information you do have to work out what you can best do to have the best impact.

Ruth Wilkinson: The question I was going to ask next was, getting cash to do anything in the charity sector is really tough. What can charities do that does not require them to invest financially? Is there anything that they can do?

Alex Davies: I think there’s always looking at the long term. So there’s two sides to that. One is to say, are we spending money where we will see a return on investment?

Driving efficiency and savings – sustainable practices for charities

Alex Davies: So again, LED lighting, reducing electricity costs, reducing your energy costs of any kind, reducing waste, using sustainability as a mechanism to drive efficiency changes. It may involve money, but you’ll see a saving longer term. So there’s that side to it. You can always, as I said, use sustainability as a way to drive cultural transformation and to drive reviews and exploration of how do you change what you do. So, as I said, permission to stop doing things is one of the great tools you can use sustainability for. From that perspective, you’re simply saving money. It doesn’t have to cost you anything. Another angle is to think about how do you weave this into the message when you go out to people. To say we want to be more efficient and look to raise money off the back of that. If you are able to talk to businesses, many of them will be going through this same thought process. So it’s a way of engaging with them. And again, this can bring this in from a partnership perspective. So if you’re able to go in and say, well, can you help us on our journey to be more sustainable? More as a pro bono or as a direct funding option. I think for charities that that is a way to view it as new money rather than redirecting money. That can be a difficult thing to do because you always want to pick up the money and drop it into your core mission, right? And we all do, but there may be businesses out there that you go and have that conversation and say to us, look, can you help us with who we are as charity rather than as a specific topic? Now for a lot of businesses, they’ll say no, because they want to have their name on a specific activity, and this goes for philanthropy as well, but there are people, there are organisations out there that are looking at the story of the charity as a whole and saying in financial terms, you can take a percent credit for all the things we do, rather than a big percent credit of one specific activity. And actually that can be really effective for charities. In effect, what you’re asking for is unrestricted funding, but it’s restricted for operational use and operational effectiveness from the perspective of sustainability. 

Alex Davies: For any organisation that’s trying to create a credibility foundation or bolster its credibility or look for innovative ways to give funding that old donations corporate social responsibility methodology, that can be an effective can be an interesting different conversation to walk in and have. It sets them apart and there’s lots of opportunities then for staff to get involved, whether it’s somebody from the property team to come in and do a security audit, whether it’s someone from a data security team to come and look at data security, whether it’s somebody to come in from the inclusion diversity team to come and give you support on that, whether it’s someone from, I don’t know, pensions to come and talk to a charity about pensions or effective use of Microsoft Excel or whatever, suddenly you can make it about Waste reduction, waste reduction in the broadest sense, because it’s about efficiency. And then that can be an avenue to create opportunities to build out those efficiencies that is ultimately sustainability. And ultimately it does support your bottom line, but without having to redirect existing funds. 

Ruth Wilkinson: Great points. Can you please rewind time and tell me that when I started, because I would have loved those ideas of many years ago that I was trying to do that. Some of those did come through, but in a slightly more diluted way than I think you just articulated them, Alex. 

Making the case for sustainability – empowering change within non-profits

Ruth Wilkinson: Okay. So if we deviate away from challenges and wheel back to, you’re a person working in a not-for-profit, you think they should be thinking about sustainability. How can you, as an individual, make the case for thinking about sustainability in your organisation, what should you do and how should you make that case?

Alex Davies: It depends on the culture of the organisation, so as always, clear caveat. However, I think that there are a couple of things you can do. You can go right to the top and make the case. And again, argue for the business benefits, the business case benefits in terms of, we’re going to save money. We’re going to be more efficient. We reduce these risks. We’ll create relevance with our people. Now, a lot of that’s assumptions, but you can just look into Google, there’ll be lots of papers out there, don’t be afraid of looking at businesses and understanding why are they doing it, why business are really pushing hard at this. Fundamentally, it makes them more money. If you’re more diverse than you tend to be more profitable because you have better creative thinking, you represent the people you’re trying to actually sell your product to, et cetera, et cetera, exactly the same for environment, exactly the same for supply chain. And we saw this through COVID, robust supply chains, where there were more substantial and responsible relationships built up with supplies, survived better than those that just went for the cheapest price. So there’s lots of very, very clear business reasons. So as a charity, don’t be afraid to lean into those and use those cases because that is all about how do you create more money? How do you bring in more money? How do you reduce your costs and how do you drive effectiveness for your mission, your purpose? 

Alex Davies: A different way to do it is to ask for other people, find allies around you, do the bottom up approach, create a sustainability network, find someone senior to sponsor you if you can, but if you can’t just get on with it, you know, just find ways that you can improve, create a story, create a case study, share that around, push your way into the staff newsletter if you can, if you haven’t got one, create one, you know, do that slightly bolshie sort of bottom up approach. And that can be amazingly effective. And I’ve seen it in organisations where the organisation has moved its strategy to include sustainability because staff have just demanded it. The staff have come together, they’ve created a network, they’ve just got on with things. They’ve shown they can save money, and then they’ve demanded it off their executive board. 

Ruth Wilkinson: I was going to add on that grassroots piece, look for ways that you can contribute and respond to consultation that the charity is doing. So are they about to refresh strategy? Are they looking at values? Are they doing feedback surveys, you know, where can you input that? So it’s just a constant kind of drumbeat of ‘we want this’. And once you’ve garnered that support at whatever level, you can start to kind of have that echoing throughout the organisation. And that will inevitably lead to people hearing it and hopefully some change.

Alex Davies: And you will find people who for them, it’s real passion, absolute passion. So you know, there’ll be at the charity, they care about the charity mission, but this is something they really want to be doing and they will make time for it. They will drive themselves into it. And that can be a massive engagement point for why they’re at the organisation, why they stay at the organisation and how they feel really motivated to the organisation. And that, again, it’s just one of the extra benefits that you can find. 

Ruth Wilkinson: Okay. So one of the things that I found when I was working in the sector was that there were challenges to the kind of legitimacy that we had to make action and take decisions beyond mission and purpose. And I would say that in inverted commas, although that’s not very helpful on a podcast. And I think that one of the big things that we talked about was how we invested. So we had reserves, we had money that we were able to invest to get a financial return. And we worked within the kind of charity commission guidelines to maximize our financial return, which is what we’re supposed to do so that we can continue to serve our mission and purpose. That’s a broader question around how charities spend their money to maximize their mission and purpose. There was some charity commission discussion about it. Should we allow charities to do things like divest from oil and gas investments? What’s your perspective? Would you recommend charities consider that? How would you take it forward? 

Investment and impact – Charities and ethical divestment

Alex Davies: It’s a really important topic. And again, this depends on what your charity structure is, how many reserves you hold, what cash you hold beyond your core reserves for operational solidity, et cetera. So, you know, we’ve seen NCVO tomorrow are launching their push to divest from, oil gas. And I think that, if we look at Cancer Research UK, there is quite a proactive approach not to invest in those areas. So my background in financial services, I think there is real power in this space. And I think that the starting point is that cash does talk in this area and you can make a difference here. So there’s, a few dynamics happening. One is around how do you try and remove negative impacts that are having on your charitable mission? You talked earlier, Ruth, about the organisation you’re in, about the impact of climate change on children in the long term and reflecting then around when you factor that in and think about what are the factors and influences upon that mission, you can very quickly see the organisations and the kind of things that you might not want to be directly funding. Divesting from that, I think is actually relatively straightforward activity for a charity to do personally. And I think looking at where charity commission is, I know that the guidance will come out later this summer and the Butler Sloss findings is saying that charities need to maximize their income, but they should also be factoring in other considerations like what’s the brand cost of taking funds or investing in these areas? What’s the marketing damage? What is the perception damage? And frankly, do you actually get best returns? I think that the second point then is this doesn’t have to be a compromise. Most investments here will see an ES environmental, social governance ESG fund will perform as well, sometimes better than a standard investment opportunity and option. So it doesn’t have to actually be a trade off or certainly not a trade off that’s of significant impact, but the brand lift, your credibility lifts, your engagement with your staff and your supporters could significantly outweigh that anyway. The other side is that personally, I don’t think it’s with the charities trying to influence these sectors. If you’re a big investment firm, if you’re a pension holder, it’s actually, you may be trying to actually influence how these organisations go about their work. I don’t think that’s where charities should be. Like that’s a bit more contentious and people have different views on that right. But I think unless it’s your absolute core purpose, then drill down and try and find positive impacts on that. You can look in that area, but otherwise I don’t think it’s the reserve of a health charity to be trying to influence oil, gas, et cetera. And frankly, I don’t think we’ll have the funds to be able to do that anyway.

Ruth Wilkinson: Yeah, I mean, there’s been examples where collective investment has been proven where organisations have come together to take a majority shareholder and then influence the organisations in a more positive direction, but I agree with you. I think that’s probably a step too far for organisations whose mission and purpose doesn’t link directly to that.

Ruth Wilkinson: Great. Okay. So I think we’re coming towards the end of our time that we have on this. So I think I’d really love to wrap up by hearing Alex, what are your top tips for those to try to take this forward, we’ve covered a lot of the challenges, a lot of the areas, a lot of ways people get started, but concisely punchy what are your top tips that you think people should be thinking about? 

Top tips for taking action – embracing sustainability in the non-profit sector

Alex Davies: I mean, tip one is just get started. Just do something. Don’t be afraid. Do something, it doesn’t have to be complicated. It doesn’t have to be perfect. Just get on with something. And you can tell people, I’d say, don’t be afraid of greenwashing. You know, don’t break the green claims code and don’t make claims that aren’t true, but it’s okay to be open to set targets, to show what you’re doing and be transparent. Every organisation is on a journey here. That’s the classic sort of sustainability quote. We’re on a journey, which we’re all in this together, et cetera. But that is okay to say, you know, this is where we are and this is what we’re trying to do. But critically have a clear reason why it matters to your organisation. Why does it matter to our mission and purpose? Have that link. We’re doing this because it matters to why you support us, why our staff are here, why we are relevant in the world, why we exist to solve whatever issue we exist to solve. Create that staff sustainability network. That is really helpful. It magnifies everything you do. It has real benefits in terms of staff engagements, but also they will come up with really good ideas. They will just save you money as well as being more motivated. Just release that power of your staff to do that. And then remember that people do value what they see and touch and do, et cetera. It isn’t just about the scale of the impact. It is also about the perception of the impact and building out that credibility. So do look for your weakest points. Do look for the easy area of criticism. You’re still using balloons, just stop using balloons. That is literally single use plastic. So, you know, examples like that, and just critically review what you’re doing through the lens of sustainability. And you will suddenly find a lot of areas that usually you can just stop doing things and save money and then tell people that’s what you did. If you’re saving money by no longer having balloons or asking people to reuse a t shirt at the event from last year, say that you’re trying to do it because you want to do it for sustainability reasons. Oh, and by the way, it reduces our costs and more money is going to charity. Just be open about that. 

Alex Davies: And I guess lastly, it is all about continuous improvement. So. Start where you are, review your strategy, review what you’re doing, and then just keep reviewing it. Make sure every year you’re definitely reviewing at least yearly and keep reflecting and doing more. You can get more refined on your priorities. You can become more sophisticated in your data gathering. You can do ever better emissions mapping, scope one, scope two, into scope three, et cetera. But that can come over time. You don’t have to be good immediately. Just get good enough for now. And then good enough for later.

Alex Davies: And, you know, we went back to the questions, how can people make the case to get started? Personally, I wouldn’t go for a moonshot. I would just say, well, what is good enough for the next year and just sell that, just agree to that. And then you can do the same again, the year after year after and over five years, you’ll probably have achieved whatever moonshot you might’ve put in at the start.

Alex Davies: But you’ve never actually had to have that debate. You can allow the zeitgeist and the general movement of opinion, carry the organisation forward. And I think you can lean into that a lot. And a final tip, personally, charity, I wouldn’t worry about net zero commitments. I wouldn’t do any kind of carbon offsetting, paying for that. Just spend those funds on making your own operations more efficient and less carbon intensive because that’s ultimately reducing your costs and making you better at achieving your mission.

Ruth Wilkinson: Could not agree more with those. The only one I’d add is ask for help and don’t be afraid of not achieving perfection. It wraps back to your first one, which is just get started. But once you’ve started, even if you’re a year in and you’re kind of embarrassed that you haven’t quite got there, that’s okay. Perfection is not possible in this space yet and probably never will be. It’s about being on that journey, but ask for help because people know.

Alex Davies: Absolutely. And it’s amazing how many people want to share their experience and their learning. And if you can see the results of an organisation like yours and just bypass three months of thinking that they had to do so you can just get started with the great and almost certainly they’ll be happy to do that because they know that they can then go to you for what you do. And again, something that Cancer Research UK is proactively trying to do is identify with other charities. What can we do? What can you do? What can you do? What can you do? And then those four charities share those results. Well, we’ve just quartered the cost, quartered the effort and we’ve just moved forward twice the pace. By just thinking more strategically.

Tomas Vieira-Short: I think I can speak for both of us, Alex, when we say it’s been a really fascinating discussion. So then again, thank you, Alex. And thank you, Ruth, for providing all those insights. To summarize, I guess, key takeaway here, if you have any, is just get started. And hopefully having listened to this podcast, you’ll feel more empowered, more engaged and ready to help find a way to make your charity more sustainable. But unfortunately, that’s all we’ve got time for today. So please join us again for the next episode or check out our website if you want to find out more about sustainability and the not for profit space. Thanks for listening. 

Tomas Vieira-Short: Thank you for listening to Knowing Not for profits we hope you enjoyed it and look forward to welcoming you back on our next episode. If you have a topic that you would like covered on the show or want more information on the topics discussed, please drop us an email at podcast@clarasys.com.

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