This analysis was published in February 2022 in the latest Good Merger Index (GMI) from Eastside Primetimers, using data from both before and after the COVID-19 pandemic began.
Tracey O'Keefe (of Eastside Primetimers) stressed in the GMI report that it is difficult to know the causes behind these trends, but suggested that larger charities may "have been able to weather the storm, so have stopped or deferred more complex merger activity," created by COVID-19 while "smaller organisations, with limited options for mitigating the effects of the pandemic have resorted to being acquired by takeover to try and maintain their activities and beneficiairy impact".
However, as well as formal mergers, the research found that "closer partnership working and collaboration may also provide valuable opportunities for charities and social enterprises to increase their impact, whilst driving efficiencies".
In this briefing, we will explore three ways that charities can work together on different levels to facilitate efficiency, growth and sustainability, from a full merger to collaborative working.
The Charity Commission (the Commission) uses the word 'merger' to describe the transfer or combination of the assets (and liabilities) of two or more seperately registered charities. Key considerations include:
Group structures are a distinct form of working together, enabling charities to fulfil common purposes over a wide area, or deliver a complex range of related services to their beneficiaires. Key considerations include:
Collaborative working describes joint working by two or more organisations in order to better fulfil their purposes, while remaining as separate organisations. Key considerations include:
Trustees should frequently consider whether their work can be better delivered in partnership with others, whether that be via a formal merger or more informal collaborative working, with the ultimate aim being to provide the very best services for the charity's beneficiaires.
When considering a merger or collaborative working, the trustees must act in accordance with the charity's governing document, essential trustee duties, and the law.
As Tracey O'Keefe says, "what the GMI report shows is that, with clear strategic focus and commitment, merger and wider partnership working remains a key route to improving sustainability and delivering impact for beneficiaries. As such they should be central to both executive and board thinking as we continue to navigate the pandemic and its aftermath".
Choosing to collaborate: helping you succeed
Collaborative working and mergers: an introduction
Small charities turn to merger during Covid period