For Finance Directors looking to move into the charitable sector, you will often find that the responsibilities are very similar to that in the private sector - the role of Manager, Bookkeeper, and Financial Controller. So, what are the main reasons why Finance Directors decide to move into the Not-For-Profit sector? The key difference between roles in the private and third sectors are the strategic relationships your role will involve. In the third sector, you will face exciting challenges that are unique to the Third Sector, including generating income and funds for your Not-for-Profit organisation.
The past few years have seen Britain in a period of uncertainty, which in turn has presented a unique set of challenges to British businesses. Charities and Not-For-Profit organisations face many unique challenges that other sectors do not come up against, and ongoing funding challenges and potential changes with EU funding that could be presented by Brexit have potentially tightened government and NHS contract margins even further. Uncertainty and economic instability surrounding Brexit has undoubtedly impacted many markets, including the Third Sector, although some claim the charity sector has bounced back and in the past year or two, we have seen the UK government finally talking about the charity sector. Although basic salaries tend to be lower than those offered in the commercial world, there are many other benefits, challenges, and reasons why Finance Directors choose to make the move into the charitable sector.
1. The feel-good factor
Making a difference is cited as one of the main reasons senior-level finance professionals make a move. Sometimes, a personal calling and an affinity to a particular cause such as religion, animals, disability, health, the young and/or the elderly or poverty relief will drive this, whereas sometimes it may just be a general desire to give back and help, rather than generate profit for shareholders.
2. Charities tend to be more agile and reactive
Not being answerable to shareholders, charities tend to attract a unique set of individuals who are bound by their principles and integrity and as a result, have a strong sense of wellbeing which can be refreshing in comparison to the private sector. Many cite their organisation's culture and working environment as a reason for working in the Third Sector. Being able to work in an environment where you are not restricted by red tape and shareholder’s demand for profit allows you to be agile and reactive to the causes you work so hard for. The challenges faced by a Finance Director in Not-for Profit organisations are very different, and as a result, can be much more rewarding. Whilst basic salaries are often lower, the benefits offered can be comparable if not better than the private sector with generous pension and holiday entitlements. and flexible working as well as softer wellbeing and lifestyle benefits often also offered. As a whole package, therefore, third sector roles can often be highly comparable to the private sector.
3. New opportunities and a diverse working environment
As touched on above, the charitable sector tends to excel in compassion to the commercial world by offering a flexible and diverse working environment. Working patterns, hours or contracts which suit both parties or maybe offering the opportunity to travel internationally / be posted overseas for those charitable organisations which support global causes. The roles offered within the sector are often diverse and can range with regional staff on the ground supporting the people the charity supports, to retail and commercial operational teams, fundraising, lobbying teams, journalists, care and support staff through to the full array of corporate roles mirroring the commercial world such as Marketing, Finance and HR. What all these members of staff tend to have in common is that they are passionate and united by the cause they support which is very powerful and rewarding. These professionals share a passion and fight to help their cause and the sector which those in the private sector may not get. Ultimately, in your role as a Charity Finance Director, your commercial acumen gained from the private sector can be key to the charity not only surviving challenging times but in helping it thrive. In addition, you will be in a unique position the charitable sector offers in helping some of society’s most vulnerable by controlling costs, managing investments to generate more income, controlling capital projects, the financial management of key contracts and relationships, and ensuring the financial wellbeing of the charity.