Resilience in Motion

1. Introduction

2. Characteristics of Respondents

3. Key Findings

4. Conclusions and Recommendations

5. Future Outlook

6. Call to Action

1.1 Introduction

Black-led charities and social enterprises (CSEs) in London have been navigating a series of complex challenges stemming from systemic inequalities and recent economic shocks. Research by the Runnymede Trust has shown that Black-led organisations in the UK receive disproportionately smaller philanthropic funding than their white-led counterparts​, reflecting longstanding biases in the funding system. The COVID-19 pandemic exacerbated this situation: an early 2020 survey by The Ubele Initiative warned that nearly 90% of Black, Asian and Minority Ethnic (BAME) micro and small organisations were at risk of permanent closure within just three months if the lockdown continued​. More recently, the cost-of-living crisis has further strained Black-led CSEs’ finances. In a 2023 survey of 93 Black-led charities and social enterprises, 59% reported they could not operate beyond six months under current conditions, and only 4% expressed high confidence that funders had their best interests at heart during the crisis​. In light of these pressures, a comprehensive Organisational Health Check was conducted in late 2024 to assess the operational and financial resilience of Black-led CSEs in London​. This assessment, building on findings from the 2023 “A Desert without Resources” Cost of Living Crisis report, aimed to identify critical weaknesses and needs – especially as the ongoing funding crisis has compounded governance, financial, and operational challenges for these organisations​. Trained assessors evaluated 35 Black-led CSEs through interviews and document reviews, examining key areas such as governance, financial management, human resources, operational systems, and program delivery. The following report presents verified insights from that health check, highlighting the characteristics of the organisations surveyed, the key challenges they face, and recommendations for strengthening their resilience. All claims are supported with evidence from reputable sources, and any unfounded assertions from the original report have been removed to ensure accuracy and credibility.

Governance

Sector Norms: Governance challenges are not uncommon across UK charities, especially for smaller organisations. Boards often lack diversity and breadth of experience; for example, a major study found that 92% of charity trustees in England and Wales are white and men outnumber women on boards by two to one​. Additionally, many charities operate entirely with volunteer leadership – in about 80% of charities, trustees perform both governance and day-to-day management roles due to having no paid staff support​. Such limitations in board diversity and capacity are frequently cited as factors undermining strategic oversight and effective governance sector-wide.

Black-led CSEs in London: Governance issues were especially acute for the Black-led CSEs assessed. In our 2024 health check, succession planning emerged as a key weakness – several organisations had no formal plan for leadership transition (some scored 0 on this metric). While succession planning is often informal or overlooked in smaller charities generally, larger and better-resourced organisations are more likely to have such plans in place. The absence of clear succession processes in Black-led CSEs highlights a significant vulnerability in governance, making leadership continuity a pressing issue for these organisations.

Financial Stability

Sector Norms: Financial stability has become a major concern for UK charities in recent years. Roughly one-third of small charities report having no financial reserves at all​, leaving them extremely vulnerable to funding shocks. More than half of charities have been worrying about their ability to survive amid the rising cost of living and other economic pressures. Building up reserves and diversifying income streams are widely seen as crucial for financial health, yet many organisations struggle to do so. In fact, 42% of small charities cite insufficient reserves as a significant problem, and nearly a third admit to over-reliance on a single income source​. This means that even in the broader sector, smaller charities often operate with precarious finances and limited safety nets.

Black-led CSEs in London: The financial challenges observed in Black-led CSEs mirror these sector-wide issues but are more severe. Over 70% of the organisations we assessed had less than six months of operating reserves on hand, well below the commonly recommended buffer of 3–6 months for stability. By comparison, many charities in the wider sector (particularly larger ones) aim to maintain at least a few months of reserves for contingencies. The lack of financial buffers among Black-led groups is compounded by additional barriers such as systemic bias in funding allocation. These organisations not only struggle with low reserves like many small charities, but also face difficulties accessing funding opportunities, which exacerbates their financial instability relative to sector norms.

Human Resources

Sector Norms: Staffing and human resource issues are widespread across the charity sector, particularly for small and medium-sized organisations. The vast majority of charities have few or no paid staff – indeed, many charities are run solely by volunteers​. In small charities, volunteers typically far outnumber employees; on average there are about four volunteers for every one paid staff member, a ratio that climbs even higher for the very smallest organisations​. This heavy reliance on volunteer labour, while essential to mission delivery, can lead to challenges in recruitment, retention, and consistent management. Under tight budgets, organisations often struggle to invest in formal HR structures or staff development, which can affect workforce stability and capacity in the sector.

Black-led CSEs in London: Our assessment found significant human resource gaps in Black-led CSEs, even beyond the usual sector strains. Only about 35% of the organisations had robust systems for staff recruitment and volunteer management in place, indicating that two-thirds lacked formal HR policies or practices. In contrast, many UK charities with greater resources have more structured HR frameworks (even when they rely on volunteers, they might have standardized recruitment or training processes). The absence of such structures in Black-led CSEs means these groups often operate without dedicated HR support, making it harder to retain talent and manage volunteers effectively. These HR capacity limitations are more pronounced than the norm, underscoring the need for tailored support in people management for Black-led organisations.

Operational and Programme Management

Sector Norms: Operational management capabilities vary widely by organisation size in the UK charity sector. Larger charities usually have well-documented systems, processes, and IT infrastructure to support their work, enabling them to operate efficiently and scale up programs when needed. Smaller charities, however, frequently struggle to formalise internal processes due to resource constraints. For instance, nearly half of small charities report that lack of funding is their biggest barrier to adopting better digital tools and IT systems​. Additionally, over one-third of small charities consistently cite excessive workload as their greatest challenge​, indicating limited capacity to focus on improving operational processes. Consequently, it is often the case that only the better-resourced organisations have comprehensive policies and procedures, while small organisations rely on ad-hoc approaches.

Black-led CSEs in London: The 2024 health check showed that Black-led CSEs generally manage basic operations adequately, but they tend to lack formalised documentation and systems. Only 40% of these organisations had fully documented IT systems or written operational policies. This is below sector norms – larger charities are far more likely to have such documentation and standard operating procedures in place. The absence of formal policies and systems can limit an organisation’s ability to meet funder requirements, ensure consistency, and scale its programs. In practice, Black-led CSEs often rely on the agility and commitment of their team to get work done, but without documented processes they face risks in efficiency and continuity that more established charities have learned to mitigate through formal operational management.

Fundraising and Revenue Diversification

Sector Norms: Across the UK charity sector, fundraising and diversifying income are persistent challenges, especially for smaller organisations. Many charities depend heavily on a narrow range of funding sources (such as grants or a few key donors). Nearly three-quarters of small charities say that competing for limited grants and contracts is one of their top financial concerns​. Moreover, 29% of small charities acknowledge that over-dependence on a single income stream is a major worry​. Diversifying revenue – through public donations, trading income, social enterprise activities, or other means – is widely regarded as essential for long-term sustainability. In fact, individual giving by the public remains the largest income source for charities on average (providing about half of small charities’ income)​. However, developing new income streams is easier said than done, and many small and mid-sized charities struggle to broaden their funding base beyond grants and a handful of supporters.

Black-led CSEs in London: The Black-led organisations we examined showed an even greater reliance on limited funding sources than typical. Most of these charities and social enterprises are heavily dependent on short-term, project-based grants, with relatively little income coming from donations, trading, or other streams. They often lack the capacity or networks to diversify their revenue. This reflects broader sector findings that smaller community-based charities – particularly those serving marginalised communities – find it difficult to access unrestricted funding or build up alternative revenue streams. In the case of Black-led CSEs, systemic funding inequities (for example, barriers in gaining mainstream grants or corporate partnerships) further heighten this challenge. As a result, these organisations face heightened financial vulnerability, since any change in grant funding or donor priorities can immediately threaten their stability. The need for diversified and sustainable funding is therefore even more acute for Black-led CSEs, given the additional barriers they encounter.

The data presented in the Sector Norms sections of this report is drawn from reputable sources that provide insights into trends across the UK charity sector. These include reports from the Charity Commission, National Council for Voluntary Organisations (NCVO), Charities Aid Foundation (CAF), and Association of Chief Executives of Voluntary Organisations (ACEVO), among others. These organisations regularly publish research on governance, financial stability, human resources, operational management, and fundraising challenges faced by charities of various sizes. Where available, sector-wide statistics on issues such as board diversity, financial reserves, staffing structures, and income diversification have been included to provide context for the specific challenges experienced by Black-led charities and social enterprises (CSEs) in London.