Solid foundations Crowdfunding finance Adding social value Crowdfunding finance Crowdfunding for...
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Solid foundations Positive returns offered by commercial property investment
Crowdfunding finance Crowdfunding for charities as a test bed for fundraising skills
Adding social value The social economy is on the march to build a stronger society
August/September 2014 l www.charitytimes.com
One interesting but little focused on trend, is the
one that highlighted charities involved in mergers
transferred over £225m to form new organisations
last year. This is considerable.
Together, the 189 organisations undertaking mergers
turned over almost £1bn, or some 2.4 per cent of
total voluntary sector income. This was according to
The Good Merger Index, the first overview of charity
sector mergers, produced by management consultancy
There was significant activity amongst health and social care organisations,
which accounted for more than 50 per cent of mergers, with a disproportionate
bias towards mental health and disability charities, reflecting commissioners’
preoccupation with lower costs and pan-disability provision.
The Good Merger Index also revealed comparatively high levels of merger
activity in supported housing, community development, minorities,
intermediary and religious charities.
Broken down into approaches: mergers represented: 23 per cent, takeovers:
43 per cent, subsidiaries: 23 per cent; group structures 7 per cent and asset
exchanges 5 per cent.
Sector hotspots were health & social care (53 per cent of all deals),
intermediaries (23 per cent); faith-based organisations (17 per cent),
community (15 per cent) and housing (14%).
Richard Litchfield, CEO of Eastside Primetimers, noted that the data for
2013/4 shows that many negative perceptions of mergers are misplaced,
which, of course, is a good thing for the sector.
In 75 per cent of deals, the acquired organisations were able to retain some
form of identity, management control and Board representation. The study
shows that mergers come in all shapes and sizes, and reach into almost every
part of the charity sector.
This suggests the sector is consolidating; or, put another way, becoming
leaner and fitter for the future. This can only be a good thing for the sector
On a final note, this is my last issue of Charity Times as Editor, as I move on to
pastures new. I wish you all the very best in your endeavours and outstanding
work in the sector.
Andrew Holt Editor
Editor Andrew Holt email@example.com 020 7562 2411
Contributing Writers Dawn Austwick, Rachael Badger, Anna Bloch, Dan Corry, Nicola Davies, Harry de Ferry Foster, Peter Holbrook, Julie Howell, Tris Lumley, Paul Palmer, Jayne Phenton, Antony Savvas, Asheem Singh, Sam Simmons Design & Production Matleena Lilja firstname.lastname@example.org 020 7562 2400
Commercial Manager Cerys Brafield email@example.com 07766 662 610
Advertising Manager Sam Ridley firstname.lastname@example.org 020 7562 4386
Subscriptions Joel Whitefoot email@example.com 020 8950 9117 Subscription Rates (6 issues pa) £79pa registered charities £119pa rest of UK, £127pa EU £132pa elsewhere Printed by Warners Midlands All rights reserved. The views expressed are not necessarily those of the publishers. ISSN : 1355-4573 Published by Perspective Publishing, 6th Floor, 3 London Wall Buildings, London EC2M 5PD www.perspectivepublishing.com Managing Director John Woods
Publishing Director Mark Evans
Average net circulation of 9,426 copies for July 13 –
E D I T O R I A L C O M M E N T
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Updates to regulation may not sound like the most exciting development, but we believe that recent regulatory changes can benefit charity investors.
Newton has recently launched the Newton Growth Fund for Charities and the Newton Growth and Income Fund for Charities*. These two Non-UCITS Retail Schemes (‘NURS’) are designed especially for the charity sector and will allow charities to eliminate some of the tax costs associated with their investments, specifically:
• any profits made from investments will be exempt from capital gains tax
• the Fund’s annual management charge will not be subject to VAT
• the Fund will not pay stamp duty on UK equities
• quarterly dividend payments are not subject to tax
These new Funds underscore Newton’s commitment to the UK charities sector, in which we have managed client assets for over 25 years.
Call Stephanie Gore on 0800 917 6594 or email firstname.lastname@example.org for more information.
*BNY Mellon Charities Funds is an UK umbrella unit trust authorised by the Financial Conduct Authority as a non-UCITS retail scheme, currently comprising two sub-funds, the Newton Growth Fund for Charities and the Newton Growth and Income Fund for Charities. BNY Mellon Fund Managers Limited is the manager of the fund. Newton Investment Management Limited has been appointed by the manager as the investment manager of the fund. Tax treatment depends on the individual circumstances of each client and may be subject to change in the future. Newton is not a tax expert and independent tax advice should be sought. The opinions expressed in this document are those of Newton and should not be construed as investment advice. This is a financial promotion. Issued by Newton Investment Management Limited (Newton), The BNY Mellon Centre, 160 Queen Victoria Street, London EC4V 4LA. Registered in England No. 01371973. Newton is authorised and regulated by the Financial Conduct Authority.
Charity Times_204x271_1.indd 1 27/6/14 13:51:16
News in brief 6-9 Latest sector news
The Review 12 Towards Effective Prevention Reviewed by Asheem Singh
13 Rising to the Challenge Reviewed by Rachael Badger
14 Everyday Justice Reviewed by Jayne Phenton
15 Restoring the Balance Reviewed by Paul Palmer
10 Fundraising in the dock Andrew Holt analyses allegations about fundraising
Columns 16 Sector reputations Anna Bloch on transparency
17 Political outlook Rosie Olliver on vision
18 Localism and scale Dan Corry & Tris Lumley on delivery
19 After the Big Society Dawn Austwick on a localist agenda
55 Suppliers Directory Comprehensive listings of products and services for the sector
C O V E R S T O R Y : B E Y O N D T H E B I G S O C I E T Y Nicola Davies looks at the politics and finance that could indicate future visions of the charity sector
C O N T E N T S
COmmERCIAL PROPERTY 34 Solid foundations
Harry de Ferry Foster answers questions from leading charities on the issues and approach to commercial property investment
SOCIAL ENTERPRISE 46 Adding social value
Peter Holbrook argues that social enter- prises should play a greater role in getting involved with public service contracts
wEB DESIGN & INNOVATION 50 Digital future
when it comes to innovative web design, charities are taking calculated risks where they promise to deliver substantial return on investment, finds Julie Howell
In association with:
The ChariTy Commission has opened
a statutory inquiry into Ummah Welfare
Foundation, registered charity number
1150190. The charity has objects to relieve
poverty and sickness and advance
education throughout the world by
the provision of services. The Charity
Commission carried out a compliance visit
to the charity in June 2013, which included
an inspection of the charity’s books and
records. During the visit, concerns were
identified regarding the governance and
financial management of the charity,
which the regulator provided specific
advice and guidance on.
UK bUsinesses and individUals
who are solving social problems will be
celebrated in October at the first-ever
social investment awards, backed by
the Cabinet Office and RBS. The UK social
investment market is worth over £200
million, supporting social enterprises that
contribute over £55 billion to the economy
each year. The market now employs over
two million people in the UK. The market
enables ventures that might otherwise
struggle to access finance to grow and
make an impact on local communities.
PoliTiCians From all ParTies should
pledge to turn around the nation’s most
deprived social housing estates within the