Charities shine bright as leaders for good

Other sectors could learn a thing or two from charities about leading for the public good.

Australians still have faith in charities to provide leadership for the public good, the nation’s largest ever ongoing survey of leadership has found.

The Australian Leadership Index (ALI) found that charities outperformed other institutions like public health and education in public perceptions of their leadership for the greater good.

But despite the headline positive score, charities did record a slight decline of two percentage points on last year’s score.

At the other end of the scale, religious institutions, multinationals and trade unions were seen as not showing leadership for good.

The federal government recorded the largest drop in public perceptions of its leadership for good, falling 11 percentage points to a score of -6, according to the ALI’s May report.

And overall, in 2021 perceptions of leadership for the greater good fell across all four of the major sectors measured by the ALI: government, public, private and not for profit.

Not for profit perceptions drop, but some lead the way

The ALI, which began in 2018, distributes an online survey to a nationally representative sample of 1,000 people each quarter to collect their thoughts on leadership across the four major sectors.

The not-for-profit sector, as measured by the ALI, includes charities, religious institutions and trade unions. Of the three, trade unions recorded the worst score on public perception of its leadership for good at 30 per cent; religious institutions recorded 34 per cent and charities 54 per cent.

Dr Sam Wilson, associate professor of leadership at Swinburne University and co-author of the report, said charities were seen by respondents as being a distinct type of not for profit, separate from trade unions and religious organisations which were usually seen in a less favourable light.

“Those ratings are pretty stubborn. What we basically see is that the not-for-profit sector gets dragged down, if you like, by how people think about trade unions and religious institutions – but charities are just in a league of their own and always have been,” he said.

Charities, he added, are seen to be serving the most vulnerable in society and to be “alive to the need to serve the public interest”.

“In terms of these principles of service and the principles of doing the right thing and being seen to do the right thing, it seems that the public seems to think that charities really exemplify this in a way that few other institutions actually do,” Wilson said.

“Charities have been at the top basically since the beginning [of the survey in 2018].”

The most important factors driving people’s perceptions of leadership for the public good in this sector were ethicality and how the organisations balanced the needs of different groups. 

These were closely followed by accountability, transparency and responsiveness to society – highlighting the caring role that these organisations are seen to take within the wider community.

How do we think about leadership for good?

According to the report, there are a number of drivers of public perception of leadership for the greater good, and these can be contextual.

In 2020, three main drivers were identified: responsiveness to the interests of society (20 per cent), a focus on creating social value (18 per cent), and ethicality (18 per cent).

In 2021, these drivers changed, with nine factors weighing on people’s perceptions given almost the same importance:

• ethicality (13 per cent)
• accountability (12 per cent)
• responsiveness to the interests of society (12 per cent)
• balancing the needs of different stakeholders (12 per cent)
• transparency (12 per cent)
• focus on creating social value (11 per cent)
• responsiveness to the people being served (11 per cent)
• focus on creating environmental value (10 per cent)
• focus on creating economic value (8 per cent)

Wilson said people’s notions of what “good” looks like tend to shift over time.

“It is quite intriguing in terms of what the public good even means. It doesn’t mean one thing for all time. It’s quite a dynamic, malleable thing that evolves with whatever is affecting us as a society,” he explained.

But there does seem to be a clear idea of what leadership looks like, he said, with respondents broadly agreeing that it’s for the good of most people.

Climate crisis the ‘hot’ topic

The report found environmental outcomes were rated a key driver for how the public viewed public institutions. 

When asked the extent to which each institution performs on key leadership drivers, the public rated not for profits at 11 per cent on environmental outcomes – compared to 12 per cent for the private sector, 8 per cent for the public sector, and 10 per cent for government.

Overall, the report noted that 57 per cent of Australians expect institutions to produce positive environmental outcomes – but only 30 per cent believe they actually deliver.

But once again, charities led the way with 38 per cent of respondents saying they produced positive environmental outcomes.

Wilson said public integrity has also become a hot-button issue after several years of the COVID pandemic.

With perceptions of integrity in government dropping according to the report, Wilson said not for profits should honour principles like integrity and authenticity in their activities to maintain public trust.

“The charitable commitment to the good seems to shine ever brighter in the context of its violation in other contexts,” he said.

But he added that this could be viewed in contrast to other sectors reviewed in the report, like government, where perceptions of their integrity have dropped and where stereotypes of untrustworthiness persist.

In that respect, other institutions could potentially learn from charities, Wilson said, by showing a genuine focus on serving society’s needs, being accountable and behaving morally.

Read the full survey online.