The non-profit sector, although a massive contributor to the Canadian economy and infrastructure, can be overlooked on a day to day. Thought of as contained in its own ecosystem, despite functioning and supporting thousands in our communities, it has suffered exponentially as a result of the coronavirus pandemic.
With thousands of Canadians now leaning on charitable organizations more than ever, the sector is struggling to keep up with changing health and safety requirements while managing a crippling loss in funding.
Now, two non-profit organizations, CanadaHelps and Imagine Canada, are working to fill funding gaps with The COVID-19 Charity Adaptation & Innovation Fund, a one stop forum that allows Canadians to donate to a number of charities through only one transaction.
The Numbers
According to Imagine Canada’s Sector Monitor report, to date more than two-thirds of non-profit organizations have declared a 31 percent decrease in revenue. For hundreds of Canadian charities that have been operating at a barely sustainable rate long before the coronavirus outbreak Marina Glogovac, President and CEO of CanadaHelps.org, says the fallout will be unmanageable.
“There are 86,000 charities across Canada, and most Canadians probably don’t even realize how many charities they are interacting with as part of their lives: schools and universities, camps, senior care, art galleries and museums… a sector that employs 10 percent of the full-time workforce in Canada and represents eight percent of the GDP— one in five organizations have either suspended operations or ceased programs as a result of the COVID-19,” says Glogovac.
Despite the weight this sector holds in the economy, the funding model inherently contends with a number of complications. Unlike for-profit organizations, non-profit ‘s find themselves impacted by whats knows as the ‘admin-ratio’, which is the amount of funding spent on operational costs as opposed to running programs. In a survey conducted by CanadaHelps 85 percent of participants stated that supporting charities that “do not spend a lot on overhead” was an important factor in deciding which organization to support. This a detrimental amount considering what it takes update practises in a pandemic.
“From The Giving Report, an annual data-driven report CanadaHelps publishes, we see that, on average, charities spend only 8 percent on “Management & Administration”. Vast majority of charities are underfunding their operations which results in the chronic lack of operational, strategic, technological and change capacity, which, like in any other organization, is needed not only to operate efficiently but to weather crisis, grow and most importantly, scale results,” says Glogovac.
The COVID-19 Charity Adaptation & Innovation Fund is now working to combat these roadblocks ensuring Canadians can continue to receive support.
Innovations in Donating Practises
The COVID-19 Charity Adaptation & Innovation Fund supports the investment in infrastructure needed to help charities not only survive this crisis, but come out the other side stronger.
The initiative creates funding pockets in which donors can choose to support a cause or issue they are passionate about and donate a sum of money to be equally distributed across the registered charities within that fund.
Like all businesses re-evaluating operating standards to ensure safe conditions for customers, charities are taking on thousands in additional costs in order to continue providing for those in need.
“Infrastructure and overhead costs will increase as a result of COVID,” says Glogovac, “In a COVID world, charities will have to spend much more on cleaning, staffing and PPE [personal protective equipment]; they will require more room to run programs at post-pandemic capacity to observe physical distancing”
That unfortunately does not include what is needed to keep the non-profit sector thriving in the technologically advanced post-covid-world that experts are predicting. After taking major losses in usual crowdfunding campaigns like walks, runs and social events, charities are faced with the need to re-invent ways of collecting large sums of regular revenue.
“Technology requires investment, not just in software and infrastructure but more importantly in the know-how. Much like businesses are embracing eCommerce now, charities too will have to build their digital capacity, and quickly.” Says Glogovac.
Not only does The COVID-19 Charity Adaptation & Innovation Fund donation process ensure that charities, regardless of size, are getting the financial assistance they need, but also does away with donor’s concerns about how their money will contribute while stimulating engagement from new donors and support management teams in adapting to a COVID world.
A Charitable Future for Canadians
In order for non-profits to function beyond COVID-19, Glogovac, and many other experts, believe the only way forward is to do away with the misconception that charities are not functioning businesses that need to dedicate time and funding to innovation and infrastructure.
In April, the Canadian Government announced that $350 million dollars in relief funding would be available to charities and non-profit organizations. An amount Glogovac says while helpful, will not close the $8 billion gap current circumstances have blown into the sector.
“We need to apply business thinking that first and foremost asks the question: how can more be achieved efficiently and what investments need to be made – in learning, technology, innovation, research?” Says Glogovac, “The years ahead are going to be tough for many Canadians and businesses; the economic fallout of COVID-19 is going to be huge, and it will mean that more Canadians—perhaps those that never expected to need the services of a charity—will turn to charities.”
To donate to The COVID-19 Charity Adaptation & Innovation Fund and learn more about supporting Canadian non-profits visit Imagine Canada and CanadaHelps.org.
