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Charities expect innovation and digital growth to outlast the pandemic.

By Harriet Whitehead - Civil Society.

Most charities plan to continue to develop digital working and collaboration in 2021, according to new research.

Organisations that took part in the Pro Bono Economics (PBE) Covid Charity Tracker, produced in partnership with Charity Finance Group and the Chartered Institute of Fundraising, said they plan to build on the innovation borne from the Covid-19 crisis.

However the research also highlights challenges facing the sector, with income under pressure and demand rising, with sector leaders emphasising that the ability to be innovative was underpinned by financial sustainability, which continues to be under threat for many charities. 

Greater use of digital 

The research finds that three quarters, 77%, of charities have made greater use of digital and technology during the pandemic, while two thirds, 67%, have innovated to deliver services remotely.

In 2019 10% of charities reported in the Digital Skills Report that they had been through a digital transformation process that was embedded in all they did. 

The figures from PBE show seven in 10 charities want to make more services digital and deliver new services remotely over the next 12 months. Over half, 54%, want to increase their use of technology and digital within their back office functions. 

Meanwhile, 50% of charities are looking to collaborate more with others in their sector, something 30% were reporting undertaking in August last year. 

'The funding gap is a flashing red light on the sector’s dashboard'

Anya Martin, senior research and policy analyst at Pro Bono Economics, said: “Much about the months and years ahead are uncertain and the funding gap is a flashing red light on the sector’s dashboard.

“Yet a determined focus on collaboration and digital innovation means it is possible the charity sector emerges from the pandemic more closely knit and more efficient in the long-term – ultimately able to help more people, more effectively.” 

The research adds that 35% of respondents wish to enhance their relationships with business. However, previous surveys revealed just under a third, 28%, of charities have reported a decline in corporate giving in 2020.

The research also highlights some other challenges facing the sector.

For example, one in four charities anticipate it taking at least two years for income to return to pre-Covid levels, and 81% expect the pandemic to negatively affect their ability to deliver their objectives over the six months ahead. 

Charities are also expecting demand for their services to continue growing in 2021. Many intend to continue adapting. Indeed, 81% reported an intent to seek alternate funding sources and 71% to deliver more services online.

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