Top 9 risks that charities face in 2022

First, the bad news. We hate to remind you that, after two long and tough years, the charity sector still isn’t out of the woods. 

Second, the good news: by carrying out a regular PESTLE analysis, you can assess what risks your charity faces, and take action to strengthen your position. 

Read on for our guide to the top risks in 2022, and download your PESTLE analysis guide today.

Risks in 2021

Let’s take a look at last year’s risk forecast from Ecclesiastical Insurance. 

Its Charity Risk Barometer 2021 predicted loss of funding, amplified by the Covid-19 pandemic, as the number one concern. No surprises there…

But it also gave prominence to staff burnout, cited as a significant threat by 44% of respondents. Forward-thinking charities were putting measures in place to reduce staff stress, such as flexible working and counselling. 

So what risks should you be mitigating for in 2022? Here, in no particular order, are our top nine.

1. Being left behind digitally

This is a huge category and we could talk all day about it. There are so many digital opportunities for charities, and if you don’t seize them, another charity will. Here are just a few. 

Blockchain enables you to be hyper-transparent, improving your accountability to donors. AI-powered chatbots allow your users to self-serve. And contactless and cashless donations are becoming the norm.

2. Cyber threats and data protection

Of course, there are risks to embracing digital too. You need to choose software that meets the very latest cybersecurity standards. 

But the biggest risk to your customer data comes from human error. Train your staff well, and make sure that data protection is embedded in your charity’s culture.

3. Rise in living costs

Energy bills, food prices and rents are rocketing up, causing hardship for many. That means an increase in both demand and bills for many charities. Read our recent charity survival guide  for steps you could take. 

4. Recruitment and retention

Those increased household bills could lead to your staff asking for pay rises. Plus, employers in many fields, including health and social care, are struggling to fill vacancies. 

If you can’t boost pay, you could consider offering other benefits to keep and attract staff, such as training.

5. Staff and volunteer stress

A combination of increased workloads, pressure at home, health fears, money worries, and isolation is leading to burnout in the workplace. Could you implement an enhanced Employee Assistance Programme for your staff and volunteers?

6. Drop in public donations

Research last spring found that 40% of people forecast they would cut back on their charitable donations in the coming year. With household bills rising, 2022 could be crunch time for those charities which are heavily reliant on public generosity. 

7. Bad publicity

This one’s a perennial risk. Negative media can lead to a drop in donations – though occasionally, as the RNLI found out, it can actually have the opposite effect. 

8. Political risks

Well, anything could happen here! The full effects of Brexit aren’t yet known. And according to the NCVO, the forthcoming Elections Bill could create confusion for charities around whether they need to register as a non-party campaigner. 

9. Covid resurgence

We saved this one till last because we don’t want to believe it. But the pandemic is by no means over.

As the NCVO says: “Adapting our lives around the virus may mean regular changes of restrictions and repeated calls for volunteers to vaccinate the country.

“It may also mean more volatile swings in demand for the services of charities and continuous changes to how we deliver services and channel our resources.”

Protecting your charity in 2022

We really hope that 2022 will bring greater stability to us all. But if Covid-19 has proven anything, it’s that charities need excellent business continuity strategies to adapt and survive.

By carrying out a PESTLE analysis every 6-12 months, your charity can review risks and be prepared. You can download our charity PESTLE analysis guide here.

And remember – a good partner can make you stronger. Contact us today to discuss working together.