COVID-19 impact on the foundation & dissolution of charitable organisations

Stakeholder and media reports have presented COVID-19, and its associated economic and social effects, as offering an existential threat to many charitable organisations.

As yet, however, there is limited detailed evidence of the effect on the pandemic on organisational events such as the rates of opening and closure of charities.

We present new analysis (as of June 2021) from the Third Sector Research Centre and the University of Stirling that shows how the rates of foundations and dissolutions of charitable organisations have changed (or not) as a result of pandemic. In particular we focus on a) whether the long-run level and trend in dissolutions has been altered by the pandemic; and b) whether the impact has been felt equally across the sector e.g., are certain types of organisations now more likely to dissolve compared to previous years?

We find that there was a significant drop in the number of charity dissolutions observed across the UK, though there was a noticeable increase in a particular type of dissolution (insolvencies of charitable companies). In contrast levels of new charitable organisations being founded have remained steady throughout the pandemic.

Chair: Sarah Vibert (NCVO)

Presenters: Diarmuid McDonnell (Third Sector Research Centre, University of Birmingham); Alasdair Rutherford (University of Stirling)

With practitioner / sector responses from Iona Lawrence, co-creator of Stewarding Loss; and Tom Collinge, Policy Manager at New Philanthropy Capital