The importance of focusing on your charity’s organisational identity

When the word identity is used in the corporate world today, it is usually associated with the image that an organisation wishes to project to the outside world and – as such – is often entrusted in the hands of communication departments and consultant agencies that are employed for the specific purpose of nurturing and maintaining it.

Organisations which equate image with identity, however, fail to appreciate that there is more to identity than savvy communication: many organizations have identities that are deeply rooted in their history and deeply felt by their employees, as well as their stakeholders more generally.

Organisational identity reflects members’ collective answer to the question “who are we?” as an organisation and captures a range of qualities including its purpose, its way of doing things, its history and the values that members share. As such, it is a powerful device – especially for charities – for clarifying and carrying out organisational strategy.

Being unclear about identity

Charities occupy a unique situation where those who benefit from their activities tend to be separate from those who finance them. All too often, the interests and objectives of large benefactors and funders are not exactly aligned with those of the charities they wish to support. Securing their support may require compromise or may push charities – wittingly or unwittingly – in directions they would not have chosen otherwise.

In an increasingly competitive funding environment, the belief that “beggars can’t be choosers” often prevails and charities – especially small ones – will often feel compelled to comply with a major funder’s demands lest they fail to raise sufficient funds to ensure their survival.

Over time, as charities continue to make adjustments to suit these demands, their identity may suffer from mission “drift” or mission “creep” – a situation where a charity has strayed too far from or has lost focus on its core mission by spreading itself too thin, trying to do too much with too few resources, or simply as a consequence of cumulative compromises made over time.

We argue that charities can better manage this problem by becoming more conscious of their organisational identity: what it is, how others perceive it and, more importantly, by understanding which features of their identity are most important to them.

In order to better understand this phenomenon, we conducted research with four Canadian charities which showed that active and regular reflections on organisational identity – declarations and ideas of “who we are” and “who we want to be” as an organisation – can be useful for helping charities decide which funding opportunities to accept, what programmes to pursue, and how to scale up or grow - and by so doing, actively and more deliberately manage the risks associated with mission drift.

Refinement or enrichment

In observing the four charities in Canada, we documented two distinct models of identity development that helped them to differentiate themselves from similar organisations. We termed these distinct models “identity-refinement” and “identity-enrichment”.

Charities pursuing a model of identity-refinement usually articulated their identity in ways that highlighted the fact that they belonged to a specific grouping or category of organisations. For example, one sustainable development charity, we will refer to simply as Earth, began defining itself broadly as a sustainable development organisation, saying in a 2000 annual report that they were “founded…by a group of young people…[who] shared a vision of sustainable development”.

As time, passed, the charity sharpened and refined these claims to clarify their intent and distinguish them from other sustainable development organisations. In 2002, for instance, it revised its mission statement to better articulate its identity as an advocacy organisation which sought to influence not only individuals and corporations but also governments to make “individual and collective choices that are both ecologically and socially equitable”.

Around this time, the charity also developed an Ethics Code that dictated from whom it would and would not accept funds. This statement opened it up – which was unusual, at the time, for an advocacy organisation – to collaborations with business on “concrete solutions” to sustainable development problems – taking on a distinctive “dealmaker” approach to its work that made it stand out from its counterparts.

Increasingly specialist

Charities which “refine” their organisational identities in this way will typically seek to differentiate themselves from other organisations by emphasising the impact that they have or by emphasising their unique perspective as distinct from peer organisations. Over time, they become increasingly specialist.

Meanwhile, charities pursuing a model of identity-enrichment, usually articulated their identities in ways that emphasised the kinds of relationships they wished to maintain with constituents. These charities would go on to differentiate themselves from other organisations doing similar work through the unique assembly of services they offered to their constituents.

For example, a charity, which we will call Meals, was initially founded as a youth led meals-on-wheels “to provide a community, non-profit, food delivery service to persons experiencing a temporary or permanent loss of autonomy”.

Its foundational ethos, however, was not simply to provide meals to needy seniors, but to reach out “to people who were isolated from their own community”, while at the same time “empowering” young people by offering them an opportunity to gain work experience while making a difference in their community.

As it took advantage of available funding opportunities, other activities were added: a housing and job training programme for troubled youth, and an “intergenerational community centre” offering recreational activities to seniors. Not all these activities proved sustainable in the medium term, but contributed eventually to a rethink of the charity and identity of the charity around “intergenerational community building” as an underlying rationale and unifying theme for its activities.

Breaking boundaries

Charities which “enrich” their identities in this way are more likely to break boundaries, sometimes appearing even unorthodox in their approach, as they seek to cater to, build meaningful relationships with, and meet the needs of their constituencies. This is not to say that identity-enrichment, as a model of organisational development, is any better, or indeed any worse, than identity-refinement. Different models will be more appropriate for different types of organisation. What our research shows, more importantly, is that one’s choice of approach has different strategic implications for charities.

For example, organisations which articulate their identity by making mostly category-based identity claims (of the kind we saw made by Earth) should usually aim to follow an identity-refinement model of development. They can achieve this by:

  • Committing to epitomising the values that are implicit in their mission in everything they do.
  • Prioritising and continually refining the unique qualities that help them to distinguish themselves from other charities committed to the same cause.

Similarly, charities which articulate their identities by making mostly relationship-based claims (of the kind we saw made by Meals) should usually follow an identity-enrichment model of development, which can be achieved through:

  • Periodically redefining the scope of their activities to accommodate projects that explore the many different ways they can address the needs of the constituencies they seek to help.
  • Deliberately revising the identity narrative they weave through their mission, website and other forms of communication on an ongoing basis, so as to maintain a sense of continuity and evolution in their work in the eyes of stakeholders.

Differences in approach

Of course, the model of identity development that a charity embarks on affects the opportunities it can pursue. Charities following an identity-refinement model of development should seek and take advantage of opportunities that help reinforce their distinctiveness within their chosen category. Opportunities that help them stand out among similar peers, by providing them with a unique angle through which to pursue their cause within the boundaries of the category they have positioned themselves in.

For instance, Earth notably pursued a strategy of promoting “concrete changes in attitudes and behaviours oriented towards ecological and socially equitable choices”, in the belief that even small changes were important for improving sustainability in the long term, a belief few other organisations shared at that time.

Conversely, charities pursuing a model of identity-enrichment can afford to be less selective and more open to a wider variety of opportunities, as long as they contribute to addressing the needs of their focal constituency. This, however, may come at the price of diversifying their activities to the point of making it difficult for funders or other stakeholders to fully understand what it is that the charity does, as they have no clear basis for comparison.

Meals at one point expanded into urban agriculture, a move which helped it appeal to a wider array of donors, but which blurred external perceptions of the charity, requiring that it reformulate its identity once again as an “intergenerational community food hub”.

As they pursue different opportunities, therefore, charity leaders must deliberate on the impact that new activities could have or are having on the charity, and people’s perception of it. They must pay attention to potential divergences between what the charity says it is and what it does, and be prepared to periodically craft new narratives that serve as a basis for reinterpreting and possibly reframing its identity in order to better reflect “what we do now”.

Merging identities

There are also times when organisational identity changes much more quickly and more dramatically than in the models outlined above. The exceptionally difficult circumstances of 2020 and now 2021 have left many charities to face far greater difficulties than they may have expected or prepared for. Thus trustees’ obligation to keep a close eye on their financial position may lead them to consider the benefits of merging with a second charity in order to ensure survival.

The administrative and financial elements of decisions of this nature are for academics of other disciplines to analyse, but considerations of organisational identity should be taken into account as well.

Once a merger is proposed, it should be seen, at least in part, as an opportunity for charities to reflect on their identity and ask themselves which of its features they should prioritise. Research has consistently highlighted the difficulties that organisations face when they have to find a way to integrate different traditions, different outlooks, and find new unifying symbols (and occasionally even a new name).

A smooth merger will rely on making both charities’ constituent members feel like they belong to the new organisation, so that ties are forged across prior divisions. Acknowledging and encouraging collective reflection on “who we are” that includes “who we were” as well as “who we want to be” can be very important to ensuring this.

With this in mind, two charities serving a similar constituency in different ways which are embarking on a merger may choose to communicate a new declaration of identity in relationship-based terms, building a compelling narrative that helps capture what they aim to achieve.

Alternatively, a merger may situate a new organisation more firmly within a category or sector, with its new identity claims marking it out as better than any other organisation working in that same category. These choices are nuanced, but incredibly important. After all, they will dictate the important work a newly merged charity will go on to do.

As with all industries, the charity sector has been hard hit by the pandemic, and so it is more important than ever going forward that charities consider their organisational identity. Keeping a watchful eye over your organisation’s identity will better prepare you and your employees for the innumerable challenges ahead.

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