In the 5 years since the Charities Regulatory Authority (CRA) was established, the number of charities registered in Ireland has risen to over 10,000, with 715 new charities registered in 2019 alone, according to the 2019 Annual Report of the Charities Regulator.
The majority of charities in Ireland have an income over €100,000 with 875 charities reporting an income of over €1million. Over a quarter of all charities registered are schools and almost 45% of all charities are companies.
We have the following commentary on the findings of the report:
Structure of charities
Charities organised into a company structure benefit from limited liability for their activities. A small percentage of charities remain as trusts and we see a growing trend to review and update their structure. This is to align with the ongoing requirements on all charities to comply with the CRA Governance Code, which is compulsory for all charities to adopt and comply with from 2021. The CRA Governance Code sets our minimum standards for the governance of all charities. We have previously discussed the Governance Code here. We would advise that all charity trustees should consider their charity’s structure in advance of the implementation of the Governance Code.
We are seeing an increased trend for many smaller charities to de-register or look for opportunities to merge with other charities operating in the same space, and this is reflected in the CRA Annual Report.
Public concerns increasing
The number of concerns received by the CRA from the public is growing with 649 concerns received in 2019. Having a strong regulator who can address the public’s concerns is a positive for the charity sector in Ireland. It is noteworthy that almost half of all concerns related to the legitimacy of the charity. This is indicative of the public’s growing awareness of the governance of charities and the role of the CRA.
There are significant challenges ahead for charities, particularly in the circumstances around COVID-19, with fundraising affected. Many more charities will be looking to consolidate or merge with other charities to protect the charity assets and be stronger into the future.
If you have any questions relating the registration of your charity or ongoing requirements under the Charities Act 2009, or CRA Governance Code, please contact our Charities & Not-for-Profit team.