Charity is everybody's business - do we know enough about the leaders?

Press release from the David Hume Institute

7th February 2022

New research shows a lack of diversity in Scotland’s top charity leaders.

Scotland’s leading independent think tank, the David Hume Institute, today publishes new research finding a lack of diversity in Scotland’s highest income charities.

The top 300 charities by income represent just 1% of the total charities in Scotland and control over £10 billion each year - 73% of the sector's total annual income - but their leaders are not representative of the communities they serve.

The research, which analyses the backgrounds of the chairs and chief executives of the 300 highest income charities in Scotland, finds that:

• Only 1 in 3 leaders (34%) are women and only 1 in 50 (2%) are black or Asian, compared to 10% female and 1% people from ethnic minorities in business and investment leaders

• 1 in 25 (4%) hold a top leadership position in another one of the top 300 charities. 

The research showed the picture is not uniform across the top 300 charities which include universities, colleges, housing associations, fee-paying schools, health and social care charities. 

Researchers also found it harder to find information about some organisations and their leaders than for other sectors in Scotland. There was less diversity and transparency for religious organisations and school leaders.

Susan Murray, director of the David Hume Institute, says:

“In a sector that is often associated with bake sales rather than billions in income, many will be surprised at the scale and the range of charities analysed in this research. 

“We thought we would find it easier to find out about leaders in this sector and that was not the case across the board.  

“Charitable status comes with high levels of public trust and tax breaks, as well as the legal responsibility to deliver public benefit. But not all organisations are open about who is in control. It is hard for the public to hold people to account if they don’t know who they are.” 

Unlike businesses, there is no searchable public register of who is making the decisions and it is difficult to find out when an individual is connected to multiple charities. Before the creation of Scottish Charitable Incorporated Organisations) many more charities were limited companies and were required to declare their directors.

The research recommends an extension of the Scottish Charity Regulator’s (OSCR) powers to create a publicly searchable register of charity trustees to bring them in line with company directors. This change will increase transparency and enable monitoring on diversity. 

The research found one significant difference to the recent analysis of business leaders; there was a wider range of experience in the two key leadership positions, often with the Chair and CEO having professional backgrounds. In both roles, the public sector was the most common background at 18% and 19% respectively:

Susan Murray, Director of the David Hume Institute, continued:

“Scotland needs all its current top leaders to actively champion diversity and provide the opportunities to ensure faster progress. 

“Increasing diversity of thought is in everyone’s interests as it helps avoid the pitfalls of group think, and improves risk management and productivity. More equal societies have higher productivity, and high productivity allows more investment to create more equal societies. 

“Charity leaders are no different and if anything, have more responsibility to champion diversity given their legal duty to deliver public benefit.”