Top Trends for the Social Sector 2013
Posted: Thursday, January 17, 2013 - 11:04
Author: Karen Mahlab
As we launch into 2013, Pro Bono Australia founder, Karen Mahlab, says that if there is any sector undergoing huge transformation it’s the social sector. After a busy year of meeting and talking with a number of sector leaders, here she offers her insights into the trends that will define the social sector in the coming 12 months.
1. The convergence of “for profit” and “for good”
The shape of what some have called internationally the “social economy” continues to emerge in Australia in 2013. The blending of “for good” and “for profit” motives to establish organisations that are either social businesses, social enterprises, or for profit businesses engaging in corporate community investment, will continue to grow.
So will the ways private monies are channeled into organisations doing social good.
Ten years down the track, in our post Global Financial Crisis and resource challenged world, we will see the disappearance of terms such as social entrepreneur, Social Enterprise, Impact Investment - as consideration of social outcomes will become a part of doing business and assumed to do no harm. Capitalism and the business sector will be instrumental in effecting this move.
Naturally before then there will be years of discussion about what this all means in terms of financial models, financial instruments, investment asset classes, taxation, management and measurement of outcomes. If all of this sounds a bit like gobbldy gook well hold onto your hat because it’s just going to increase in complexity and diversity until it all becomes simpler again. These discussion will be loud and varied over 2013.
Watch out for more buzzwords: Collective Impact, Impact Assessment, Impact Investment, Shared Value, Wellbeing, Open data, crowd - everything and 2.0-everything.
Applications for new ways of connecting time, talent and treasure to the social sector will continue to emerge.
We are seeing a new initiative almost every week as entrepreneurial folk, both from within the existing sector and outside the sector, introduce their networks and expertise to addressing new ways to connect and resource the social sector.
New Initiatives like Budge (winner of Anthill Cool Company Award in the Social Capital section) and GiveEasy, which enables donations to disaster relief straight from mobile phones (winner The Australian Innovation Award), are just two such examples. Traditional ways of fundraising will be joined and/ or turned on their heads as these new initiatives are offered into Not for Profit organisations.
Not for Profits will need to be able to assess the fundraising opportunities for themselves and ensure they guard their precious donor database and/ or share it with those they trust to mutual benefit.
Not for Profits will increasingly use new technologies (eg Customer Relationship Management systems and cloud applications) to decrease their internal operating costs and change the way they deliver services to their clients and other “stakeholders” ie their Board, donor base, the public.
The establishment of these initiatives is being recognised in a raft of new innovation awards with categories never seen before such as Anthills Social Capitalist Award.
In the more traditional area of fundraising, the development of bequesting strategies by more and more Not for Profits reflects the demographics of Ageing in Australia.
3. What the sector calls itself will continue to evolve as the sector evolves
Influenced by the convergence of for good and for profit agendas the name of “the sector” will continue to morph and continue to be in flux.
Are we the social economy sector, the community sector, the social sector, the third sector, the Not for Profit sector, the non-profit sector, the “for purpose” sector?
Philanthropy is becoming more democratised and multi channeled as technology solutions offer new ways to engage with charities.
2013 will see more of a general push to get high net worth individuals and families to start to make significant donations and to change the culture of giving in Australia. We are way behind other developed countries in this area despite topping the world in the recent Charities Aid Foundation Global research where more Australians had, on average, donated money, volunteered time or helped a stranger.
The profile of philanthropic giving will be an interesting space to watch as there is a new regime at Australia’s peak philanthropic body, Philanthropy Australia, which has been seen in the past as being very traditional.
Philanthropic organisations, who in the past may have been very conservative in their funds management, will be looking closely at how they invest their corpus funds on the back of the growing interest in investing for financial and social outcomes (i.e. impact investing). This has the potential to leverage the effect their philanthropic funds have even further.
5. Social Enterprise
Social Enterprise will continue to thrive. What will become interesting - and problematic - is how many of these small ventures will survive past the initial externally funded (usually grants) phases. A parallel is with the survival rate of small business generally. Accreditation of Social Enterprises will become more formal as organisations such as B Corp make their way into Australia.
Government will be tracking closely how the social enterprise space affects their long term taxation revenue base.
6. Impact Investing
Early 2013 will see the release of a number of reports into how Impact Investing can be best implemented in Australia and what needs to happen to facilitate the best environment for it and what it should “look” like. These scoping initiatives are being taken by a variety of people in different organisations in Australia - foremost amongst them are DEEWR, the Centre for Social Impact, Foresters, SEDIF and Social Ventures Australia .
Impact Investment offers private investors new assets classes eg Social Impact Bonds that fund projects and organisations which enable an investor to reap financial rewards at the same time as reaping positive social outcomes for the community. JP Morgan and the Global Impact Investing Network’s (GIIN) recent global research estimates Impact Investing to account for 9 billion worldwide in 2013 up from 8 billion in 2012.
The challenge for the Australian social sector will be as much about how to develop investment-ready projects with measurable and meaningful outcomes, as to how to attract financial investors. In the same way as there has been a matching issue between willing volunteers and NFP organisations needing skills i.e. where intermediary organisations are needed - so too is there an emerging need for new intermediary organisations to facilitate Impact Investment in Australia. 2013 will see more of these arising.
7. Loops: person to person, person to group, person to planet, people to planet
This may be a little cosmic for some, but awareness of the interconnectivity between people and between people and planet will continue to grow. Our awareness of the impact, seen and unseen, we have on each other and on our environment will take another step.
Tools - sites, methods for reusing, sharing and disposing of whatever it may be: food, clothing, household goods, usable space will continue to pop up everywhere - and some of this will benefit Not for Profit organisations and those they serve and others will just be good for the community generally. See, for example, Gumtree, car-share, or buynothingnew.com.au.
8. Spin off applications of data arising from the ACNC
The ACNC will hit its stride as it’s now fully operational and there will be a range of innovations that will come out of the data that can soon be accessed publicly by researchers, academics, philanthropists, Not for Profits and entrepreneurial organisations. This will stretch into 2014 as the ACNC evolves.
Not for Profits, Charities in particular during this early phase of the ACNC, will be looking for the efficiencies the ACNC promised and hoping that a change of government will not disrupt the improvement process.
Volunteering is an unloved child generally but was particularly so in 2012. Volunteering generates no revenue, costs very little and happens anyway - so it’s no surprise that even though it carries great value in so many ways, its intangible nature makes it under-resourced, and underdeveloped in Australia. Whilst it has been measured in the census to account for $14.6 billion and includes 5.2 generous citizens, it has been generally defunded by government and its peak national and state bodies have come under fire in 2012.
2013 may see it resuscitate to some extent through Volunteering Australia’s move to Canberra and due to Australia winning the bid to host the 2014 International World Volunteering Conference. Skilled Volunteering and corporate volunteering will continue to grow.
10. The 2013 Federal Election
All eyes will be on the Election which will take place by October. The foundations that the Labor Party has established for sector reform seem unlikely to be undone, even though coalition policy announcements to date speak against it (see our story here).
We’ll make sure we revisit these predictions in 2014 to see what did and didn’t happen.
Add your own predictions on the comments section below - and we’ll see where we all end up - and perhaps too, it will generate discussion about what we WISH to see for 2013 and beyond. (BTW over new year I had a go at my own “vision board” for 2013. A process of cutting magazine images and words and pasting them onto a canvas. A fabulous, clarifying process.)
Check out our cartoonist Simon Kneebone's take on the convergence of "for good" and "for profit" by clicking here.
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