Research looked at charities in the broadest possible sense - including private schools and universities
Scotland’s biggest registered charities suffer from a lack of diversity in leadership, a report claims.
Think tank the David Hume Institute conducted a survey of the country’s top 300 groups with charitable status – and found their leaders are “not representative of the communities they serve”.
The top 300 by income represent just one per cent of the total charities in Scotland and control over £10 billion each year - 73% of the sector's total annual income.
The research looked at charities in the broadest possible sense – so its top 300 included the leadership of problematic grey-areas of the sector.
These include high income private schools, some religious groups, universities and arms-length organisations (aleos), which have legal charitable status but are not widely considered part of Scotland’s voluntary sector.
The research analysed the backgrounds of the chairs and chief executives of the 300 highest income charities in Scotland.
It found that one in three leaders (34%) are women and only one in 50 (2%) are black or Asian.
Researchers found it harder to find information about some charitable groups and their leaders than for other sectors in Scotland. There was less diversity and transparency for religious organisations and school leaders.
The report - Scotland's Top Charity Leaders: How Diverse Are They? - can be found here.
Susan Murray, director of the David Hume Institute, said: “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, report authors said.
Murray 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.”
Anna Fowlie, chief executive of the Scottish Council for Voluntary Organisations (SCVO), responded: “Clearly, just like other sectors and most aspects of Scottish society, there’s a way to go in terms of diversity. But it’s often voluntary organisations that are leading campaigners on equalities issues and making real progress in terms of inclusion and diversity. The report surfaces two other long-standing issues – transparency around trustees and the definition of a charity.
“SCVO supports the call for a searchable public register of trustees provided there are safeguards in place, particularly for trustees who bring their lived experience into the boardroom. This reflects work we did with the sector back in 2019 in response to the Scottish Government’s consultation on charity law reform when there was broad support for more transparency.
“At that time, we also called for a review of what’s regarded as “public benefit,” which fundamentally determines the legal definition of a charity. It’s time to grasp that nettle and make sure our charity legislation reflects current public expectations.”