ORI GIN AL PA PER

Financial Sustainability Within UK Charities:Community Sport Trusts and Corporate SocialResponsibility Partnerships

Timothy Bingham Geoff Walters

Published online: 9 March 2012

International Society for Third-Sector Research and The Johns Hopkins University 2012

Abstract The change in political leadership in the UK in 2010 has createdfinancial uncertainty and instability for many third sector organisations. In a shifting

funding landscape, it is clear that an over-reliance on Government funding is a risky

strategy and that there is a need to diversify and seek out alternative sources of

revenue. This article considers the impact of political change on the financial sus-

tainability of community sports trusts associated with Premier League and Football

League clubs in England. It explores sources of revenue through the analysis of

financial statements, revealing that on average community sports trusts receive a

significant proportion of income from grant funding whilst sponsorship income is

relatively small. The article goes on to discuss the potential for community sports

trusts to diversify revenue streams by developing social partnerships that address the

corporate social responsibility (CSR) agendas of commercial organisations. It

illustrates that although commercial sponsorship can provide benefits including the

provision of additional funding that can enable financial stability, key issues include

the balance of power, the impact on organisational flexibility, whether there is a

need to restructure, and the development of long-term partnerships. Although the

findings from this article are focused on a particular type of charity, given the

importance of CSR partnership income for the charities sector they may also have

broader implications for other charitable organisations.

Resume Le changement de direction politique au Royaume-Uni en 2010 a susciteune incertitude et une instabilite financie`re pour de nombreuses organisations du

secteur tertiaire. Dans un contexte marque par un financement aleatoire, il est clair

quune dependance excessive a` legard du financement gouvernemental est une

strategie risquee et quun besoin se fait jour en faveur dune diversification et dune

recherche de sources alternatives de revenu. Cet article examine limpact de

T. Bingham G. Walters (&)Birkbeck, University of London, Malet Street, London WC1E 7HX, UK

e-mail: g.walters@bbk.ac.uk

123

Voluntas (2013) 24:606629

DOI 10.1007/s11266-012-9275-z

lalternance politique sur la durabilite financie`re des trusts sportifs communautaires

associes aux clubs de Premie`re division et de Ligue de Football en Angleterre. Il

explore leurs sources de revenus dans le cadre dune analyse des etats financiers,

laquelle reve`le quen moyenne les trust sportifs communautaires recoivent une part

significative de leurs revenus des subventions alors que le financement par parrai-

nage est relativement modeste. Larticle se poursuit par une discussion sur le po-

tentiel des trusts sportifs communautaires en faveur dune diversification des flux de

revenus par le biais du developpement de partenariats sociaux prenant en compte les

objectifs de responsabilite sociale dentreprise (corporate social responsibility -

CSR) des organisations commerciales. Il met en evidence que bien que le parrainage

commercial puisse presenter des avantages notamment lapport dun financement

supplementaire susceptible de permettre une stabilite financie`re, les questions cles

comportent lequilibre des pouvoirs, limpact de la flexibilite organisationnelle, le

besoin ou non dune restructuration et le developpement de partenariats a` long

terme. En depit du fait que les conclusions de cet article soient consacrees a` un type

particulier dorganisation caritative, eu egard a` limportance des revenus du par-

tenariat CSR pour le secteur caritatif, elles pourraient egalement avoir des impli-

cations plus vastes pour dautres organisations caritatives.

Zusammenfassung Die Anderung in der politischen Fuhrung Grobritanniens imJahr 2010 brachte vielen Organisationen des dritten Sektors finanzielle Unsicherheit

und Instabilitat. In einer sich andernden Finanzierungslandschaft ist eine allzu groe

Abhangigkeit von staatlicher Finanzierung eindeutig eine riskante Strategie, und es

sollten auf jeden Fall verschiedene alternative Einnahmequellen ausgemacht wer-

den. Der vorliegende Beitrag betrachtet die Auswirkungen der politischen Ander-

ungen auf die finanzielle Nachhaltigkeit von Gemeindesportverbanden, die mit

Vereinen der englischen Premier League und Football League verbunden sind. Die

Einnahmequellen werden anhand von Finanzaufstellungen untersucht, wobei sich

herausstellt, dass Zuschussforderungen im Durchschnitt einen Groteil der Ein-

nahmen der Gemeindesportverbande ausmachen, wahrend die Einnahmen aus

Sponsorenschaften nur relativ gering sind. Der Beitrag diskutiert sodann das

Potential fur Gemeindesportverbande, ihre Einnahmequellen zu diversifizieren,

indem sie soziale Partnerschaften entwickeln, die sich mit den Programmen ge-

werblicher Organisationen zur Corporate Social Responsibility, der unternehme-

rischen Gesellschaftsverantwortung, befassen. Es wird dargelegt, dass trotz

moglicher Vorteile einer kommerziellen Sponsorenschaft, einschlielich der Bere-

itstellung zusatzlicher Gelder zur Forderung der finanziellen Stabilitat, unter an-

derem das Gleichgewicht der Krafte, die Auswirkungen auf die organisatorische

Flexibilitat, ggf. der Bedarf fur eine Umstrukturierung sowie die Entwicklung

langfristiger Partnerschaften wichtige Aspekte darstellen. Zwar beziehen sich die

Ergebnisse dieses Beitrags hauptsachlich auf eine bestimmte Art von Wo-

hltatigkeitsorganisation, doch haben sie angesichts der Bedeutung der Einnahmen

aus der Corporate Social Responsibility-Partnerschaft fur den gemeinnutzigen

Sektor auch weitreichendere Auswirkungen fur andere gemeinnutzige

Organisationen.

Voluntas (2013) 24:606629 607

123

Resumen El cambio de liderazgo poltico en el Reino Unido en 2010 ha creadoincertidumbre financiera e inestabilidad en muchas organizaciones del sector ter-

ciario. Con un panorama de financiacion cambiante, resulta claro que un exceso de

confianza en la financiacion gubernamental es una estrategia arriesgada y que hace

falta diversificar y buscar fuentes de ingresos alternativas. Este artculo considera el

impacto del cambio poltico en la sostenibilidad financiera de las fundaciones de-

portivas comunitarias asociadas a los clubes de la Primera Liga y de la Liga de

Futbol en Inglaterra. Explora fuentes de ingresos mediante el analisis de los estados

financieros, revelando que, como promedio, las fundaciones deportivas comunita-

rias reciben una proporcion significativa de ingresos procedentes de subvenciones

mientras que los ingresos por patrocinio son relativamente pequenos. El artculo

prosigue tratando el potencial de que las fundaciones deportivas comunitarias di-

versifiquen los flujos de ingresos mediante el desarrollo de asociaciones sociales que

aborden las agendas sobre responsabilidad social corporativa (RSC o CSR, del

ingles corporate social responsibility) de las organizaciones comerciales. Ilustra que

aunque el patrocinio comercial puede proporcionar beneficios, incluso la provision

de financiacion adicional que puede permitir estabilidad financiera, las cuestiones

claves incluyen el equilibrio de poder, el impacto sobre la flexibilidad organizativa,

si existe la necesidad de reestructurar, y el desarrollo de asociaciones de largo plazo.

Aunque los hallazgos del presente documento se centran en un tipo especfico de

organizacion benefica, dada la importancia de los ingresos de la asociacion RSC

para el sector de las organizaciones beneficas, pueden tener tambien implicaciones

mas amplias para otras organizaciones beneficas.

Keywords Financial sustainability Charities Community sport trusts Social partnerships Corporate social responsibility

Introduction

It is widely acknowledged that organisations within the third sector, including

charities, social enterprises, community interest companies, mutuals and

co-operatives, voluntary associations and community trusts (Evans 2011), differ

from for-profit organisations in a number of ways. They demonstrate different

ownership structures; they can be subject to the non-distribution constraint

(Hansmann 1980); they often require the involvement of a large number of

volunteers; and the motivations for operating differ, where multiple objectives

contrast to the prioritising of the financial bottom line. A further difference is in

relation to the ways that third sector organisations are financed. Often, multiple

sources of funding contribute to the income streams of third sector organisations,

which can have implications on the financial sustainability of the organisation

(Froelich 1999; Helmig et al. 2004). Government funding is one particular source of

finance that is significant for many third sector organisations (Young et al. 2010).

However, it can vary due to changes in political leadership and this can lead to

instability (Hodge and Piccolo 2005). This is the current situation within the UK:

608 Voluntas (2013) 24:606629

123

the third sector is experiencing financial uncertainty following the formation of the

Coalition Government in 2010. The advance of the Big Society, and the outcomes

of the 2010 spending review, threaten the viability of many third sector

organisations given their dependence on public funding (Evans 2011).

Within the charities sectora specific sub-sector of the third sectorrevenues

are generated from various sources, including earned revenues, Government

contracts, memberships, business activities and returns on investment, as well as

revenues that are unique to the sector, such as charitable contributions, grants from

Government and private foundations and gifts in-kind (Moore 2000; Young et al.

2010; Zappala and Lyons 2006). Research by the National Council for Voluntary

Organisations (2009) revealed that in 2006/2007, Government funding accounted

for approximately 34.5% of charities income, with 25% of charities having a

funding relationship with Government. For some charities, there is the potential risk

of overdependence on Government funding: a number of charitable organisations

have been significantly affected by the spending review (Ramesh 2010; Savage

2011). In a changing funding landscape, it is clear that charities that rely on grant

funding, particularly from Government sources, are at risk. Where this is the case,

there is a need for some to diversify their funding portfolio in order to reduce

revenue volatility (Carroll and Stater 2009). Nevertheless, it is also evident that

charitable organisations are financed in different ways with 75% of charities not in

receipt of Government funding. Whilst these charities may not be so vulnerable to

public sector cuts, the Charity Forecast Survey from the National Council for

Voluntary Organisations (2011) showed that 60% of chief executives, trustees and

senior managers claimed that the organisations financial situation had declined

between 2010 and 2011, with 65% expecting it to decline further in 2012. These

figures demonstrate that financial sustainability is an important issue across the

charities sector and that alternative ways for charities to generate additional

revenue, including private sector payments and contributions, to maintain and

expand programs and services are important (Crittenden 2000; Struthers 2004;

Doherty and Murray 2007).

This article considers the impact of political change on the financial sustainability

of community sports trusts. A community sports trust is a particular type of

charitable organisation that uses sport as the vehicle with which to deliver a range of

community-oriented initiatives. They have become common across many local

authorities in the UK as a model to manage and operate leisure facilities and

reinvest profit into providing services to local communities (Sesnan 2001). This

article will focus on a particular type of community sports trust in place within the

professional football industry in England. This type of charitable organisation

evolved out of the Football in the Community schemes that were originally set up in

the 1980s at professional football clubs as a response to problems of hooliganism

and the need for clubs to engage and develop closer links with local community

stakeholders (Walters and Chadwick 2009). Whilst Football in the Community

schemes were operated by football clubs, it was acknowledged that increasing

commercial practices resulted in confusion surrounding club-community responsi-

bilities, and subsequently football clubs were failing to understand what was meant

by the concept of community and how they should respond to different stakeholders

Voluntas (2013) 24:606629 609

123

(Brown et al. 2006). At the same time, it was argued that there has been a lack of

strategy from Government on how football clubs should address social issues,

despite the fact that football was promoted as a way to do so. Brown et al. (2006)

recommended that Football in the Community departments should convert to

outward facing independent charitable organisations. Whilst in 2006 a small number

had already done so, over the past 6 years, there has been a trend for Football in the

Community schemes to register as charitable organisations: in May 2011, there were

a total of 89 community sports trusts which operate under the names of community

trusts, foundations and community education and sporting trusts. This separation

from a football club allows for a greater level of autonomy in relation to strategic

and financial decision-making (Walters 2009); however, a community sports trust

maintains the name of a football club through a licence agreement.

During the period in which the Labour Government was in office, Football in the

Community schemes, and subsequently community sports trusts, were seen as a way

to deliver the third way agenda (Mellor 2008) and many were in receipt of public

funding. Whilst prior research has looked at the governance of community sport

trusts in the football industry (Walters 2009; Walters and Chadwick 2009), little is

known about revenue sources. Given the lack of previous research on an emerging

sub-sector within the charity sector, this article has two key objectives. Firstly, it

seeks to illustrate the revenue mix at community sports trusts and to determine the

level of funding received from Government sources and from commercial

organisations. Given the concerns around the current financial climate, the second

objective is to consider whether there is potential for community sports trusts to

diversify revenue streams through the development of social partnerships with

commercial organisations that address the issue of corporate social responsibility

(CSR). The focus on CSR partnerships between community sports trusts and

commercial organisations provides exploratory insights into CSR partnerships

within a sub-sector of the charities sector. The findings may also have relevance to

the broader charities sector given that in 2010 2 billion was generated for UK

charities through CSR partnerships demonstrating that for many it is an important

source of revenue (Demetriou et al. 2010; Barrett 2011). It has also been claimed

that charities need to develop a collaborative approach to CSR partnerships (Staples

2004; Barrett 2011)a reflection of the move towards CSR activities adding value

to a business (Porter and Kramer 2006). Furthermore 65% of charities are expecting

to have to engage in greater collaboration with other organisations in 2012 (National

Council for Voluntary Organisations 2011).

The article is structured as follows. It begins by setting out the changing political

context within the UK and how this could impact on third sector organisations, and

more specifically, on charities. Drawing on resource dependency as a theoretical

frame, it then considers the potential for charitable organisations to develop CSR

partnerships with commercial organisations in order to reduce grant funding and

improve financial sustainability. The method is set out, which details the empirical

work carried out. Following this, the results are presented and discussed. Although

the findings relate to community sports trusts, in light of the importance of CSR

partnership income, the results may also have broader implications for other

charitable organisations.

610 Voluntas (2013) 24:606629

123

The Changing Policy Context Within the UK

The landscape in which charitable organisations operate in the UK has changed

significantly over the last three decades. In the 1980s, the Conservative Government

sought to privatise public sector activities and argued for the separation of welfare

activities from the State. This policy objective was underpinned by the argument

that State provision led to welfare dependency and the corrosion of individual,

family and social responsibility, whilst at the same time it was believed that the

public sector was inefficient and ineffective (Stewart 2007, in Powell 2007). The

idea that there is a mixed economy of welfare (Powell 2007) led to the growth of

service providers from outside the State that addressed welfare issues, particularly

around the areas of health, community care and sheltered housing (Bennett 2008).

With Government increasingly looking to contract out activities that were once seen

as the role of the State, this enabled the development of the Third Sector, or

voluntary sector, as a legitimate sector in its own right. Indeed, over a period of

10 years between 1982 and 1992, Government contracts to the third sector rose

from 1.85 to 42 billion (Bennett 2008). Notwithstanding its increasing promi-

nence, Kendall (2003) observed that the voluntary sector was never central to the

Conservatives original policy priorities.

Following the election success of the Labour Government in 1997, four broad

streams were central to public and social policy (Harris 2010). These included

partnerships and collaboration; redefining the nature of public services provision;

the belief in market principles; and expectations on local communities. Inspired by

the Third Way approach, the third sector was considered to be a key partner in the

modernisation of the welfare state and a pro-voluntary sector stance was taken with

the State providing support for the development of community and voluntary

organisations. This led to a step change in the relationship between the voluntary

sector and the UK Central Government (Kendall 2003, p. 62) whereby the Labour

Government sought to recognise the independence of the voluntary sector rather

than the previously held conservative view of the sector as an alternative service

provider (Lewis 2005). This recognition was evidenced through the development of

partnerships between the Government and the voluntary sector to address welfare

and social inclusion issues. Indeed, partnerships became a central feature of New

Labour policy (Kendall 2003; Lusted and OGorman 2010).

The acknowledgement of the third sector by the Labour Government led to

increasing financial support from central and local Government (Chew and Osborne

2009). This has raised some concerns. For example, Hutchison and Cairns (2010,

pp. 138142) outline that increased funding from Government meant that many

third sector organisations faced a shift in the purpose and mission of the

organisation, the prioritising of areas where funding was available, and a reduction

in their capacity to act as community advocates. For Hutchison and Cairns (2010),

this led to two organisational responses: the need to develop additional sources of

independent funding and restructuring the organisation to increase awareness of the

policy environment. Within the charities sector, similar changes have occurred, as

increased funding from Government was also a key feature throughout the duration

of the Labour Government. Indeed, Government funding has been shown to be the

Voluntas (2013) 24:606629 611

123

most significant source of revenue, followed by market activities and contributions

(Hodgkinson et al. 1996, in Crittenden 2000). Nevertheless, it has been stated that

describing this picture with a sufficient degree of clarity and detail has proved

elusive (National Council for Voluntary Organisations 2009, p. 12). For instance,

whilst Crittenden (2000) suggested that Government contributes 50% of funding for

charities, the National Council for Voluntary Organisations (2009) put the figure at

a more conservative 34% in 2009. These differences notwithstanding, what is

evident is that Government funding is a significant source of income for many

charitable organisations.

Funding for the charities sector, and the third sector more broadly, has, since the

formation of the coalition Government of the Conservatives and Liberal Democrats

in 2010, been under threat. A key strategy of the incoming Government has been the

adaptation of the Third Way into a political vision labelled the Big Society. The

Conservative Party describes the aims of the Big Society as seeking to be a cheaper

alternative to an oversized and over-spending public sector; to drive change; and to

give voters greater power and information (Evans 2011). The implementation of the

Big Society vision is underpinned by the desire to devolve power and responsibility

from the State to individuals, neighbourhoods and the lowest tier of Government

(Evans 2011). Within this context, third sector organisations are expected to expand

their scope of activities to supplement and eventually replace the State in the field of

public service. Although this would seem to be a continuation of the Labour

Governments policy to involve the third sector, in parallel to the advance of the Big

Society is a significant debt reduction policy. The coalition inherited a public deficit

of approximately 150 billion. Throughout 2010, a series of measures were

announced to reduce public borrowing by 113 billion by 20142015, including

83 billion through funding cuts (Rogers 2010). These cuts averaged 19% across

each Government Department although there are considerable differences between

Departments: the Department of Health and the Department of Work and Pensions

received real-term increases in funding, whilst the Department of Communities and

Local Government lost 51% of their budget (Allen and Stratton 2010), with local

Governments hit by a 7.1% reduction. These cuts threaten the viability of third

sector organisations given their dependence on public funding (Evans 2011).

Within the charities sector, it has been noted that many organisations have

already been significantly affected (Evans 2011). Early figures indicate a loss of

funding from local authorities of 110 million, causing 2,200 charities to either

close or reduce their operations (Savage 2011). This situation mirrors the reduction

in Government spending on the third sector in the US in the early-1980s and mid-

1990s (Salamon 1999). Similarly, Struthers (2004) researched the financial vibrancy

of charitable organisations in Canada when the sector was growing and the

Government was downsizing. It was found that around 60% of charitable

organisations reported problems in reductions or the flow of funds and 25% of

those were serious. Despite the focus on the Big Society in the UK, there is

concern that the withdrawal of funding to the third sector will negatively impact

upon the survival ability of many charities (Young 2011; Evans 2011; Savage

2011).

612 Voluntas (2013) 24:606629

123

Resource Dependence, Social Partnerships and CSR

Resource dependency theory offers an appropriate theoretical framework with

which to understand the current environment faced by charitable organisations.

Resource dependency theory is based on the premise that organisations are

dependent on other organisations that control critical resources (Pfeffer and

Salancik 1978). Effective organisations will strengthen relationships with sources of

dependence and/or modify the locus of their dependence in order to reduce

uncertainty in external environments and to survive (Froelich 1999, referring to

Pfeffer and Salancik 1978). The degree of dependence is determined by the

importance and concentration of its resources (Froelich 1999). For charitable

organisations, financial resources have been argued to be the critical factor

determining the activities of the organisation (Weisbrod 1998). As such, the issue of

resource dependency is clearly important to charitable organisations that are

dependent upon funding bodies and are less able to generate income from other

sources such as capital markets (Helmig et al. 2004). There are two implications

arising from this. First, it is important for charitable organisations to manage the

relationship with the funding organisations on which they are dependent. Second, it

requires that those responsible for the management of charities consider alternative

sources of funding in order to address resource dependency issues (Hodge and

Piccolo 2005).

This second implication and the extent to which charitable organisations

diversify revenue streams have been the focus of a small body of literature (Chang

and Tuckman 1994; Hager 2001; Young et al. 2010). Indeed, in a landscape of

limited Government funding, it has been argued that charitable organisations must

develop alternative funding sources to maintain and expand programs and services

(Doherty and Murray 2007). Whether revenue diversification is an appropriate

strategy for charitable organisations is debatable. Some argue that the additional

costs in pursuing other revenues are prohibitive, and that the lower administrative

costs associated with a limited revenue base are advantageous (Frumkin and

Keating 2002). Moreover, there have been concerns that the drive for additional

funds will lead to a shift in the overall purpose of the charity (Hutchison and Cairns

2010). Alternatively, Chang and Tuckman (1994) and Kingma (1993) claim that

revenue diversification is positively associated with long-term stability, and

Galaskiewicz and Bielefeld (1998) added that revenue diversification increases

organisational legitimacy. One particular way that many charities have sought to

diversify revenues has been to form social partnerships with commercial organi-

sations. A social partnership is a form of collaboration between organisations from

different economic sectors created to address social issues and within which there is

a shared understanding of responsibilities and a commitment of resources (Waddock

1988; Warhurst 2001; Selsky and Parker 2005). As mentioned above, the discourse

of partnerships have become a central tenet within public and social policy (Harris

2010; Alcock and Kendall 2011), and increasingly organisations have been

encouraged to consider cross-sector collaborations.

Whilst charitable organisations will, in the current funding climate, have to seek

additional revenue streams and resources to enable the continued delivery of

Voluntas (2013) 24:606629 613

123

initiatives and expansion of operations (Demetriou et al. 2010), the appetite for

partnerships within the commercial sector is mutual. Increasingly, private compa-

nies have looked to third sector partnerships to address CSR agendas (Barone et al.

2000). From the companys point of view, these partnerships are often termed as

cause-related marketing (CRM) (Hempel and Gard 2004) and are often considered

as part of a marketing strategy that combines their social responsibilities through

charitable sponsorships with fundraising and raising awareness for the charitable

organisation (Wu and Hung 2008). The benefits to companies are largely based on

the notion that identifying initiatives to form a long-term relationship (i.e. a social

partnership) can deliver more benefits than one-off donations (Demetriou et al.

2010). These benefits include increasing legitimacy, improving corporate image and

reputation, expanding the target market and offsetting Government regulation

(Varadarajan and Menon 1988; Sagawa and Segal 2000; Arya and Salk 2006; Porter

and Kramer 2006; Jamali and Keshishian 2009). For these reasons, many companies

are open to the development of a social partnership with a charitable organisation as

part of a long-term CSR strategy.

For charitable organisations, the benefit is principally through the provision of

funding and resources (Demetriou et al. 2010; File and Prince 1998) and the

opportunity to increase delivery of initiatives (Walters 2009). Importantly, Grau and

Folse (2007) noted that the charity has the opportunity to diversify its revenue

streams. Warneke (2005, in Thomas et al. 2010) acknowledged that an alliance with

a for-profit organisation can provide access to a network of future partners, whilst

Lafferty et al. (2004, in Du et al. 2008) found that attitudes towards a particular

cause were improved as a result of the partnership. Moreover, partnerships between

for-profit and not-for-profit organisations have been argued to provide the

opportunity to infuse participants with greater incentives to be socially responsible

(Arya and Salk 2006, p. 211).

Despite the fact that social partnerships have been described as one of the most

exciting and challenging ways that organisations have been implementing CSR in

recent years (Seitanidi and Ryan 2007, p. 413), there are also a number of

challenges. They are considered high-risk and more challenging than other forms of

CSR (Harley and Warburton 2008; Jamali and Keshishian 2009). Andreasen (1996)

identified four potential risks for non-profit organisations including wasted

resources, reduced donations, a loss of organisational flexibility and tainted

partners. It has also been argued that the creation of partnerships requires a level of

commitment from both organisations over a number of years (Waddock 1988). This

may be difficult if the commercial organisation views the partnership as a short-term

arrangement: indeed much corporate philanthropy is actual pseudo-altruism in that

it is commercially motivated (Collins 1994, in Polonsky and Speed 2001). The issue

of fit is also critical and there is a need for a strategic match between the activities of

the non-profit organisation and the commercial organisation in terms of mission,

target audience and/or values (Becker-Olsen and Hill 2006). A lack of fit can

adversely affect perceptions of both sponsor and the recipient charity. Thomas et al.

(2010) agreed adding that firms with high levels of compatibility between core

business and social activities are viewed favourably.

614 Voluntas (2013) 24:606629

123

Managing the relationship between partners is also critical to the partnership, and

relational quality plays an important role in partner interactions (Arino et al. 2005).

It has been suggested that partnerships formed around social issues are based more

on trust than power (Tomlinson 2005). Jamali et al. (2011) found that attributes of

trust, communication and coordination enhanced the quality of the relationship,

facilitated collaborative behaviour, reduced opportunism and led to new types of

association. This point is important in the context of social partnerships between

charities and commercial organisations. Where the commercial organisation is

funding a charity, the relationship can be viewed as a power relationship (Shaw and

Allen 2009). As such, it has been argued that non-profit organisations will be

constrained by the needs of the funder and the environment in which the funding

organisation exists (Salamon 1996). More specifically, in relation to CSR, there

have been some that have questioned whether it is appropriate for commercial

organisations to achieve their CSR objectives through non-profit (third sector)

organisations (Parkes and Harris 2008, in Harris 2010). Indeed, there are concerns

that fund recipients are not always at the centre of CSR campaigns (Liston-Heyes

and Liu 2010). The concern here is that the activities of the non-profit organisation

will be driven by the requirements of the funding organisation and there exists the

potential for a shift in the focus of the non-profit organisation (Shaw and Allen

2009). This particular criticism is not exclusive to charitable-commercial partner-

ships: it has also been argued that Government funding can also be detrimental

(Young and Salamon 2002). Charities therefore need to consider whether there are

any associated risks with a commercial partner, the impact on the organisations

autonomy and the predictability of the source of funding (Fischer et al. 2011;

Kingma 1993).

Method

This article is based on a two-staged mixed method approach. The first stage of

research involved the collection and analysis of the financial statements of

community sports trusts to explore revenue sources. The purpose of this was to

address the first research objective to illustrate the revenue mix at these

organisations and to determine the level of funding received from Government

sources and commercial organisations. The second stage involved a small number of

semi-structured interviews with senior staff at community sports trusts, together

with supporting secondary data, with the aim to explore whether community sports

trusts could diversify revenue streams by developing CSR partnerships with

commercial organisations. The mixed method has the central premise that, when

combined appropriately, the two approaches can together provide a better

understanding of the research problem than either alone (Creswell 2009).

Data Collection

Stage one of the data collection involved obtaining financial data from the published

accounts available on the website of the Charity Commission. In accordance with

Voluntas (2013) 24:606629 615

123

the Charities Act 1993, all charitable organisations are required to prepare a

Trustees Annual Report which must be submitted to the Charity Commission if the

total income exceeds 25,000. The Charity Commission then makes each charitys

accounts and Trustees Annual Report publicly available through each charitys

profile. Of the 89 community sports trusts, appropriate accounts were not available

for 15: two were not submitted as in both cases the total income was not sufficient to

require full accounts; 11 related to newly registered charities such that accounts

were not yet required; and two were overdue, one of which related to a registered

community sports trust that had not yet submitted any annual accounts, whilst the

other related to a community sports trust that had submitted accounts up until year

ending 31 March 2008 but not since thenthis was omitted from the analysis as the

period arguably does not reflect the current economic landscape. Accordingly the

final sample size was 74.

The second stage of data collection involved semi-structured interviews with five

senior staff at four community sports trusts. The advantages of conducting semi-

structured interviews are that they provide a better understanding of context,

facilitate the understanding of the motivating rationales behind behaviours and

actions, and give a better appreciation of the meanings that an interviewee may

attach to a particular issue (Easterby-Smith et al. 2008). Interviewees included two

chief executives, a joint managing director responsible for strategy, a community

director and a founder of a community sports trust. The selection of interviewees

was based on the data collected in stage one, therefore reflecting a purposive

sampling technique (Silverman 2001). The main criteria used for selection was total

income. It was decided to select community sports trusts that were in the upper

echelon of total income as the assumption was made that these would be

undertaking the widest range of activities and have the greatest resources available

and so be more able to engage commercial organisations. Total income at the four

community sports trusts was 1.22, 1.41, 2.29 and 3.45 m. Sponsorship income

from commercial organisations was also considered with the four community sports

trusts demonstrating considerable variations: two reported no sponsorship income,

one received 26,500 and the other reported 1.86 m from sponsorships.

Interviews were conducted between July 2011 and November 2011. Two were

conducted in person, and three were conducted over the telephone. Two interview

schedules were developed, one for the community sports trusts that had reported

income from sponsorship and one for those that had not. The questions attempted to

provide detail around the community sports trusts operations and organisational

structure that were not otherwise known from the review of secondary data, to

confirm the revenue mix at the community sports trusts, to consider the resources

available, to reveal any current reliance on grant funding, and to explore the

mechanisms in place to reduce reliance on grant funding, in particular the

opportunities for sponsorship arrangements with commercial organisations. Where

sponsorship arrangements were in place the questions focused on the terms and

timing of these agreements, the strength of relationship between the parties and any

challenges encountered. Whilst the interviews provided the primary form of data

secondary data was also collected and analysed. This included financial statements,

Trustees Annual Reports, information from each community sports trusts website,

616 Voluntas (2013) 24:606629

123

external affairs materials, newspaper articles and other publications. Secondary

source data were used to inform the development of interview questions, provide

background material in preparation for each interview, as well as triangulate the

interview response data.

It is recognised that there are a number of limitations with the data collection.

First, the choice of community sports trusts that had a significant level of total

income meant that small community sports trusts were not part of the interview

process and that they could also have provided an interesting perspective on the

issue of CSR partnerships. Second, whilst we support the interviews with secondary

data from each of the community sports trusts, we recognise that five interviews is a

small number with which to base our analysis. Although by no means a

representative sample, these interviews provide some exploratory insights into the

issue of social partnerships and CSR. Third, the use of the telephone interview in

qualitative research has been criticised for its failure to allow the interviewer to

develop rapport with the interviewee, to probe deeper on issues of interest, and

therefore compromise the interpretation of responses (Novick 2008). Fourth, with

annual accounts and interviews conducted within one particular year, this research

is representative of a particular point in time and, as such, offers a limited

understanding of longitudinal developments. For these reasons, the conclusions

offer exploratory insights that require further investigation.

Data Analysis

The analysis of the financial statements involved allocating the income of the

community sports trusts to five different streams as per the definitions of each

revenue type provided by the Charity Commission in their Statement of

Recommended Practices (Charity Commission 2005, pp. 1923) (Table 1).

Analysing community sports trusts data based on these income allocations is

suitable given the specific definitions provided and the fact that community sports

trusts ought to have reported against these categories. Nevertheless, there are

problems inherent in such a reliance on these accounts. Particular issues were

encountered around interpreting whether grants are for general or specific purposes

and therefore voluntary or charitable activity income, and whether sponsorships are

classified as pure donations or in return for a good or service and so voluntary

income or income derived from activities for generating funds (trading income). For

instance, one community sports trust declared their grants in two forms: grants

received from charitable foundations and grants received for the provision of

services. Others, though, are not quite so clear and treat all income from grants

under activities for generating funds, or in the case of one, treat grant income

entirely as income relating to charitable activities. The detail in the accounts is often

minimal with limited explanation as to what organisations provide each type of

grant and whether these are restricted or unrestricted funds. Similar to grant funding

classifications, income from sponsors is often left undefined or combined with other

incomes with no details available. Assumptions can be made as to whether the

various income sources are restricted or unrestricted based on the presumption that

Voluntas (2013) 24:606629 617

123

community sports trusts are strictly adhering to the Charity Commissions

definitions of income sources, but these are assumptions only.

The challenges in understanding and interpreting the accounts of the community

sports trusts further demonstrate that within the charities sector describing sources

of revenue is difficult (National Council for Voluntary Organisations 2009). As a

result of the above challenges, the decision was made to total all grant income,

regardless of source or classification, to find a total proportion of revenues received

from grant funding of any type. Similarly, the decision was made to total all

references to funding from partnerships or sponsors, including where it is reported

together with other types of fundraising. In this way, grant funding includes general

grants (voluntary) and those for specific purposes (charitable activity), covering

funding from both Government and other foundations. The total figures for

sponsorships include those that may be pure donations (voluntary) as well as those

in return for a good or service (trading) and include when sponsorship income was

reported with other income on one line. It should be noted that this means the

proportion of income from such sponsorships will be overestimated, rather than

underestimated, suggesting that any differences between grant and sponsorship

funding may be even more pronounced.

Beyond these issues, auditors may also classify types of revenues differently or

elect not to include particular types of revenue, resulting in a lack of homogeneity

and clarity as to how income sources are recorded across community sports trusts.

Table 1 Sources of revenue for charitable organisations

Revenue source

Voluntary income Resources generated from gifts and donations; grants of a general

nature from Government and charitable foundations; membership

subscriptions and sponsorships where these are essentially donations

rather than payment for goods or services; and gifts in-kind

Activities for generating funds Trading or other fundraising activities undertaken by the charity to

generate incoming resources to carry out its charitable activities.

Activities within this category require an element of exchange, such

that the charity receives income in return for providing a good or

service. These activities may include fundraising events, sponsorship

that is not pure donation, shop income, providing goods and services

other than for the benefit of the charitys beneficiaries, or letting and

licensing arrangements of the charitys property when temporarily

surplus to requirements

Investment income Derived from investment assets, including dividends, interest

receivable and rent

Incoming resources from

charitable activities

Any resources generated through promoting the charitys objects, such

as the sales of goods or services as a charitable activity or provided by

the charitys beneficiaries, letting of non-investment property in

carrying out the charitys objects, or grants specifically for the

provision of goods or services as part of charitable activities or

services to beneficiaries

Other incoming resources Gains from the disposal of tangible fixed assets or any incoming

resources not included under the alternative categories

Source Charity Commission (2005, pp. 1923)

618 Voluntas (2013) 24:606629

123

For instance, one community sports trust stated that the value of voluntary help

given by the trustees and other workers is not included in the financial statements,

whilst another declared such in-kind gifts as a voluntary incoming resource. These

issues have implications for the accuracy of the allocations; however, for the

purposes of this research it was important only to know the proportions of income

from grants and sponsorship which could then be explored in further detail through

the interviews. Accordingly, the above approach in summing for total grants and

total sponsorship income is appropriate in this instance.

Inductive thematic data analysis was adopted for the analysis of interview and

secondary source data. The literature review and stage one research informed the

research topic and key interview questions, but within that broad umbrella the

themes were analysed as they became evident; that is, the experience and responses

from the initial interviews served to inform patterns of inquiry for subsequent

interviews. The interview data were then compared and contrasted for similarities

and differences in an attempt to triangulate between cases and build a stronger

picture of the revenue opportunities across community sports trusts.

Results

Sources of Income

The first aim of this article is to illustrate the revenue mix at community sports trusts

and to determine the level of funding received from Government sources and

commercial organisations. The accounts revealed that the mean total income for the

74 community sports trusts was 678,936 (standard deviation 646,588). The

skewness measure of 1.79 indicates that the distribution is highly positively skewed;

this is supported by the median of 448,919 and the vast range: the maximum income

was 3,449,863, whilst the minimum was 32,919. The results show that whilst the

majority of community sports trusts tend to have income of up to 600,000 per

annum, the few that have higher levels of income positively skew the mean.

Table 2 splits the income of the community sports trusts into the five sources

noted above: voluntary income; activities for generating funds (trading activities

undertaken by the community sports trust to generate incoming resources to carry out

its charitable activities such as summer school coaching schemes); investment

income; income from charitable activities (such as grants received to deliver specific

community programmes) and other incoming resources. It illustrates that the mean

for voluntary income was 183,310. Overall, voluntary income accounted for

27.19% of all community sports trusts income; however, there were 22 that reported

no voluntary income. Of those that reported income from this source (n = 52), 16

community sports trusts reported that it accounted for more 50% of the total, and for

seven it accounted for more than 75%. The average proportion of total income for

these 52 community sports trusts was 31.06%, whilst the maximum was 99.98%.

The mean amount of income generated through activities for generating funds

(trading activities) was 85,872, which accounted for 12.74% of revenues overall.

Whilst the reported maximum income derived from activities for generating funds

Voluntas (2013) 24:606629 619

123

was 2,287,687, there were 40 community sports trusts that reported no income at

all. Of those that reported income from activities for generating funds (n = 34), the

average proportion of total income was 29.41%; seven community sports trusts

reported that it accounted for more than 50% of the total, whilst six reported it

accounted for more than 75%.

The mean income from charitable activities was 402,439. There were 11

community sports trusts that reported no income from charitable activities, whilst

the maximum was 1,695,761. Charitable activities accounted for 59.69% of the

total income reported across all community sports trusts. For those that relied on any

charitable activity income (n = 63), the average proportion of total revenues it

accounted for was 73.36%. Income from charitable activities accounted for more

than 50% of the total at 47 community sports trusts and more than 75% of the total

at 40 community sports trusts. The final two sources of incomeinvestment and

other activitiesonly account for a small proportion of the total income of

community sports trusts. Table 2 illustrates that the mean income through

investment was 1,257 and accounted for 0.19% of all community sports trusts

income, whilst other incoming resources accounted for 0.21% of all community

sports trusts income, with a mean of 1,384 across the 74 community sports trusts.

Table 2 illustrates that income from charitable activities, voluntary income and

activities for generating funds (trading activities) are the key sources of revenue. Of

these, charitable activities (59.69%) accounts for over twice as much income from

than voluntary donations (27.19%) and almost five times more than activities for

generating funds (12.74%). It was found that the number of community sports trusts

that rely on charitable activity income for more than half of their total revenues (47) far

exceeds those that rely on either voluntary income (16) or on activities for generating

funds (7) for more than half of their total revenues. Over 75% (56) of community sports

trusts relied on activities for generating funds for between 0 and 10% of total income;

this compares to fewer than 18% (11) of community sports trusts that have a minimal

reliance on charitable activity income. Clearly, community sports trusts are relying

more on charitable activity income than other income sources.

Grant and Sponsorship Income

The annual accounts revealed that the mean amount of income generated though

grant funding was 213,557. The mean amount generated through sponsorships was

Table 2 Sources of income for the 74 community sports trusts (s)

Voluntary

income

Activities for

generating funds

Investment

income

Income from

charitable activities

Other incoming

resources

Mean 183,310 85,872 1,257 402,439 1,384

Maximum 2,956,479 2,287,687 17,895 1,695,761 61,595

Total 13,564,975 6,354,562 93,005 29,780,501 102,411

Percent of

total income

27.19 12.74 0.19 59.69 0.21

620 Voluntas (2013) 24:606629

123

38,676. The analysis of the financial statements revealed that 18 community sports

trusts reported no grant income whatsoever whilst a third of community sports trusts

(n = 25) stated that they received at most 10% of their total income from grants.

Nevertheless, such a limited reliance on grant funding is not widespread. Of those

that did receive grant income (n = 56), the average proportion of total income it

accounted for was 43.22%. At 24 community sports trusts, grant income accounted

for more than 50% of the total income and more than 80% of the total at six

community sports trusts. The maximum total income from grants was 1,169,669,

whilst the maximum proportion was 90.77%. Overall, grant income accounts for

31.45% of the total income for community sports trusts.

A total of 37 community sports trusts reported no sponsorship income at all, whilst

over 90% of community sports trusts (67) receive between 0 and 10% of their total

income from sponsorships. Only one community sports trust reported sponsorship

income that accounted for more than 50% of total revenues with the highest

proportion of 53.98%. Sponsorship income accounted for 5.70% of the total income

across all community sports trusts, whilst for those that did receive sponsorship

income (n = 37) the average proportion of total income it accounted for was 6.91%.

Given the inclusion of other incomes in the sponsorship allocation as detailed in the

method section, this proportion may even be higher than the actual figure. On

average, community sports trusts receive over six times the income from grant

funding (31.45%) than sponsorships (5.70%). It was also found that the number of

community sports trusts that rely on grant funding for more than half of their total

revenues (24) far exceeds those that rely significantly on sponsorships (one).

The figures reported above show community sports trusts receive on average a

small proportion of income through commercial sponsorships. The view of all the

interviewees was that there has been a heavy reliance on grant funding within the

community sports trust sector and that this would, in the future, be a particularly

risky strategy. For example, even at the community sports trust that acknowledged

they had a balanced income and were therefore less reliant on Government funding

compared to other trusts, the current political context and the reduction of local

authority budgets had left the trust feeling exposed. Nevertheless, due to the fact

they had been in existence for 6 years and had a balanced income, the trust had been

able to remain resilient in the face of Government cuts. The interviews also revealed

that there was a belief that the reliance on Government funding was an issue that

was affecting the broader charities sector and that too many were too heavily

dependent on Government grants. Both the analysis of the financial statements and

the interviews suggest that there is a need for community sports trusts to develop

alternative funding sources to maintain and expand programs and services.

Social Partnerships and CSR

The small level of income drawn from commercial sponsorships suggests that there

is the need for community sports trusts to seek to develop social partnerships with

commercial organisations to address CSR agendas. Three of the community trusts

interviewed revealed that they had implemented sponsorship and partnership

strategies as a core element of commercial growth, whilst the other had recently had

Voluntas (2013) 24:606629 621

123

a primary sponsor, although income from these was not necessarily reported in the

financial statements due to the timing of the accounting period that was analysed.

Furthermore, all the interviewees revealed that their community sports trusts were

continually seeking new opportunities for sponsorship from commercial companies

and that the opportunity to take advantage of the prominence attached to CSR by

companies was important. Indeed, the community sports trusts had created different

levels of commercial partnership, from headline partnerships that appeal more to

larger organisations, to smaller scale partnerships. This enabled the trusts to target

different types of company, from nationally recognised organisations to smaller,

local or regional organisations. It was also found that two of the community sports

trusts were proactive in seeking out commercial organisations where they felt there

was an alignment with the activities of the commercial company and the specific

areas in which they deliver activities. Finding a strategic match between the

sponsoring firm and the charity in terms of mission, target audience and/or values, is

argued to lead to a more successful partnership (Becker-Olsen and Hill 2006;

Thomas et al. 2010). In these two cases, the fact that the community sports trusts

were seeking to identify appropriate commercial organisations is important as it

potentially enables the trust to obtain funding to continue to deliver programmes in

a particular area in which they have the expertise, knowledge and experience. It is

also beneficial for the commercial organisation in that it provides an opportunity for

programmes that fit the companys CSR agenda and can enable the commercial

organisation to embed themselves within the community. Notwithstanding the

above, this income does not come without certain constraints: the existing

sponsorship agreements with the commercial partners enabled the commercial

organisations to request that their funds were used for specific projects and

initiatives and also to provide opportunities for employee volunteers to give their

time to these projects. It therefore demonstrates the potential for a loss of

organisational flexibility (Andreasen 1996).

Discussion

Government funding has been found to be a relatively significant source of finance

for community sports trusts. Although there are variations, with the analysis of the

financial statements revealing that some are more heavily reliant on Government

funding than others, given the current cuts in public sector spending this raises

concerns relating to the financial sustainability of community sports trusts. If a

community sports trust is faced with a significant reduction in finance, there is the

potential that it will constrain their ability to sustain the level of activities that they

currently deliver. The impact of a reduction in funding would be to scale back their

community activities. The interviews with community sports trust representatives

demonstrate a clear recognition that the current funding environment has the

potential to adversely impact on their finances and, in parallel with the arguments

made by Hutchison and Cairns (2010), the organisations in this study were found to

be responding to the current financial circumstances in two ways. Firstly, it was

found that these community sports trusts are seeking to reduce uncertainty by

622 Voluntas (2013) 24:606629

123

diversifying their funding portfolio, with a focus on the private sector. The

respondents indicated that the community sports trusts were seeking to increase the

number of commercial sponsors in the hope that overall commercial income would

increase and that the programmes would become more sustainable. It was also clear

that they identify the development of social partnerships that address the CSR

agendas of commercial organisations as a way for them to continue to receive the

financial support necessary to deliver community-based activities.

The second response has been to undergo an organisational restructure. For

example, one community sports trust had implemented a major overhaul of the way

it was organised with the new departmental structure used as the basis for generating

funding through theme-based sponsorship (sports participation; education; health;

social inclusion). Another had implemented a similar theme-based programme to

attract funding, whilst one community sports trust had created a commercial

department to seek out new forms of revenue through sponsorships. This latter

strategy was unique: two of the community sports trusts revealed that they had

minimal resources to commit to finding sponsorship, with the task falling on the

Chief Executive. Although the need to develop additional sources of independent

funding and restructuring the organisation can be considered as distinct issues, it is

clear that in the case of the community sports trusts in this study, restructuring is

driven by the need to be more strategic and is intended to sharpen the organisational

focus on generating alternative sources of funding income.

Hutchison and Cairns (2010) argued that organisational restructuring was

necessary to increase awareness of the policy environment and to develop more of

an external focus and spend more time on marketing and developing links with other

organisations. Similarly, Froelich (1999) observed that organisations need to modify

their locus of reliance to survive. The three community sports trusts that are

restructuring are clearly aware of how the issue of survival for them is dependent

upon some level of restructuring, whilst all four community sports trusts are seeking

alternative revenue sources through CSR partnerships. These responses can be

understood within the context of resource dependency theory (Pfeffer and Salancik

1978) as it is evident that community sports trusts, in the current financial climate,

perceive the need to consider alternative sources of funding in order to reduce

uncertainty in external environments. Nevertheless, the development of social

partnerships with commercial organisations and increasing dependence on the

commercial sector for finance raises issues for community sports trusts.

Of particular interest is the nature of the relationship between the community

sports trust and the commercial organisation. It has been argued more broadly that

where the relationship between a charity and a commercial organisation is based on

the provision of funding, there are potential issues of power (Shaw and Allen 2009)

and the charity may potentially find itself constrained by the needs of the funder.

This was an issue that was recognised by the community sports trusts in the study as

it was stated that with a commercial organisation there is the potential for the

relationship to be scaled back as the sponsors position and strategies change.

Indeed, it was also stated at two of the community sports trusts that existing

sponsorship agreements with commercial partners enabled the commercial organ-

isations to request that their funds were used for specific projects and initiatives and

Voluntas (2013) 24:606629 623

123

also to provide opportunities for employee volunteers to give their time to these

projects. Although this is not unexpected, and it was noted that there were

advantages in that sponsorship funding could potentially be unrestricted and did

provide organisational flexibility, it was also made clear that it was important to

ensure that the sponsor was satisfied and their objectives were met. These findings

have relevance for other community sports trusts as they need to be aware of these

types of issues if they are seeking to derive income from the commercial sector

through developing social partnerships. It may also be of relevance to other

charitable organisations when developing a social partnership around the issue of

CSR. For example, whether there is an impact on the organisations autonomy and a

possible shift in the overall purpose and focus of the charity are critical factors that

must be balanced against the need for additional funding through a commercial

partnership. Given the current funding climate, this could be a critical issue and it

may be that in order to survive, charities will indeed face difficulties in maintaining

an independent strategic vision (Hutchison and Cairns 2010).

Despite the potential for commercial influence, the community sports trusts in

this study have shown that they are seeking long-term CSR partnerships, with one

having signed a 10-year sponsorship deal. Indeed, it was stated that a long-term deal

would allow the sharing of resources between parties, the ability to seek guidance

from the commercial organisation on commercial operations, as well as the

community sports trust being in a position to share its expertise in engaging local

communities. Indeed, long-term social partnerships were advocated by Waddock

(1988) as they suggest a more meaningful commitment on the part of the

commercial organisation and encourage a reciprocal partnership approach that was

argued by Ning et al. (2006, in Du et al. 2008) to produce potential advantages for a

commercial organisation through obtaining social capital and learning from the

charitable organisation. Whether the development of a long-term CSR partnership is

a realistic prospect for the broader charities sector is unclear. For a community

sports trust, there is arguably more scope for the development of CSR partnerships

than other charitable organisations given that the association with a professional

football club provides a community sports trust with a greater profile than other

charitable organisations of similar size. This may lead to an enhanced ability for a

community sports trust to form long-term CSR partnerships when seeking to attract

funding.

Nevertheless, an issue that was identified that was specific to the community

sports trust model in the professional football industry that may impact on the

ability to develop a CSR partnership was the association that a trust maintains with a

football club. Although such an association can provide a community sports trust

and the football club with a range of benefits (Walters 2009), it was found that the

link to the club required a cautious approach to engaging commercial sponsorships.

This was underpinned by a concern that the community sports trust may undermine

the commercial sponsorship strategy of the football club and therefore it could

potentially have an effect on the number and type of commercial organisations that

a community sports trust can target. There were also concerns about the public

perception of a trust with the feeling that the association with a football club meant

that they were financially stable. This is not the casemany clubs provide little

624 Voluntas (2013) 24:606629

123

financial support, if any, to the community sports trusts. Whilst independence is

advantageous in that the clubs direction has minimal impact on the activities of

trust, support of the club is also important. Many do provide support in-kind. For

example, the lack of resources to devote to attracting commercial sponsors could be

an area that the football club is able to offer support through providing access to

business networks or by the commercial team promoting the community sports trust

to potential sponsors that are interested in community initiatives. This requires a

good working relationship between the community sports trust and the club. It is

also dependent upon the circumstances of the football club: one of the interviewees

revealed that when the football club itself faced financial uncertainty the in-kind

support to the community sports trust was cut.

The relationship with a professional football club is a distinguishing feature of

the community sports trust model. An additional distinguishing characteristic is the

fact that many community sports trusts are relatively new organisations with the

majority having been in existence for less than 5 years. This demonstrates that the

vast majority are in an embryonic stage of development, illustrated by the survey

results that showed only a small percentage of income (0.19%) was generated

through investments and therefore community sports trusts have not had the time to

build endowments. Given that community sports trusts are in an early stage of

development and have not been in existence long enough to demonstrate longevity,

care must be taken when considering the broader implications around the issue of

financial sustainability. Nevertheless, like many charitable organisations, commu-

nity sports trusts are still facing financial challenges brought on by the changing

political context and therefore the issue of funding is as relevant to them as it is to

other charitable organisations.

Conclusion

This article has presented the results of a study that has considered the impact of

political change on the financial sustainability of community sports trusts associated

with Premier League and Football League clubs in England. It set out firstly to

illustrate the revenue mix at community sports trusts in order to determine the level

of funding received from Government sources and commercial organisations. The

second objective was to consider the potential for community sports trusts to

diversify revenue streams by developing social partnerships that address the CSR

agendas of commercial organisations. Despite a number of challenges in classifying

and allocating income to different revenue sources due to differences in definitions,

accounting processes, and lack of detail provided on grant providers and purposes,

the analysis of the financial accounts at 74 community sports trusts revealed that on

average community sports trusts receive a significant proportion of income from

grant funding whilst sponsorship income is relatively small. The interviews,

although by no means a representative sample, detail the experiences at four

community sports and demonstrate firstly that there is a perception that Government

funding cuts will adversely impact on the community sports trusts, and secondly

that there is a need to diversify revenue sources.

Voluntas (2013) 24:606629 625

123

These findings suggest the need for community sports trusts to develop strategies

to attract commercial sponsorship income and that CSR offers a potential platform

to do so. Indeed, it was found that clear steps had been taken to position the

community sports trusts in such a way as to facilitate this process. This was based

on an understanding that CSR sponsorship has the potential to provide benefits to a

community sports trust including the provision of additional funding and resources,

financial stability and the expansion of operations. Nevertheless, a number of

challenges were identified. These include the nature of the relationship between the

commercial funder and community sports trust and the balance of power; the impact

on organisational flexibility; whether pursuing commercial sponsorship requires the

community sports trusts to restructure; and the need to focus on developing long-

term partnerships.

The findings from this article provide some exploratory insights into the issue of

social partnerships and CSR within a particular sub-sector of the charities sector in

which little research has been undertaken. Further in-depth qualitative research is

needed that takes a longitudinal perspective to understand the processes involved in

developing a CSR partnership. Moreover, research into the organisational structures

at community sports trusts could also help to determine whether they are appropriate

in a more competitive funding environment. This is a particularly relevant point

given the embryonic status of many of these organisations. This research has

provided an initial understanding of financial sustainability within community

sports trusts, and, although it has been shown that community sports trusts

demonstrate certain features that distinguish them from many charitable organisa-

tions, there is potential relevance for the broader charities sector given the

importance of CSR partnership income (Demetriou et al. 2010; Barrett 2011).

Nevertheless, these distinguishing features mean that care must be taken when

considering the relevance of the findings for the broader charities sector.

References

Alcock, P., & Kendall, J. (2011). Constituting the third sector: Processes of decontestation and contention

under the UK labour governments in England. VOLUNTAS: International Journal of Voluntary and

Nonprofit Organizations, 22(3), 450469.

Allen, P., & Stratton, A. (2010, October 20). Spending review 2010: The winners and losers. The

Guardian.

Andreasen, A. R. (1996). Profits for non-profits: Find a corporate partner. Harvard Business Review, 74,

4755.

Arino, A., de la Torre, J., & Ring, P. S. (2005). Relational quality and inter-personal trust in strategic

alliances. European Management Review, 2(1), 1527.

Arya, B., & Salk, J. E. (2006). Cross-sector alliance learning and effectiveness of voluntary codes of

corporate social responsibility. Business Ethics Quarterly, 16(2), 211234.

Barone, M. J., Miyazaki, A. D., & Taylor, K. A. (2000). The influence of cause-related marketing on

consumer choice: Does one good turn deserve another? Journal of the Academy of Marketing

Science, 28(2), 248262.

Barrett, H. (2011, July 26). Charity funding: How to approach business for help. The Guardian.

Becker-Olsen, K. L., & Hill, R. P. (2006). The impact of sponsor fit on brand equity: The case of

nonprofit service providers. Journal of Service Research, 9(1), 7383.

626 Voluntas (2013) 24:606629

123

Bennett, R. (2008). Marketing of voluntary organizations as contract providers of national and local

government welfare services in the UK. VOLUNTAS: International Journal of Voluntary and

Nonprofit Organizations, 19(3), 268295.

Brown, A., Crabbe, T., Mellor, G., Blackshaw, T., & Stone, C. (2006). Football and its Communities:

Final Report, The Football Foundation and Manchester Metropolitan University.

Carroll, D. A., & Stater, K. J. (2009). Revenue diversification in nonprofit organisations: Does it lead to

financial stability? Journal of Public Administration Research and Theory, 19(4), 947966.

Chang, C., & Tuckman, H. (1994). Revenue diversification among nonprofits. VOLUNTAS: International

Journal of Voluntary and Nonprofit Organizations, 5(3), 273290.

Charity Commission. (2005). Accounting and reporting by charities: Statement of recommended practice.

London: Charity Commission.

Chew, C., & Osborne, S. P. (2009). Exploring strategic positioning in the UK charitable sector: Emerging

evidence from charitable organizations that provide public services. British Journal of Management,

20(1), 90105.

Collins, M. (1994). Global corporate philanthropy and relationship marketing. European Management

Journal, 12(2), 226233.

Creswell, J. W. (2009). Research design, qualitative, quantitative and mixed methods approaches.

Thousand Oaks: Sage.

Crittenden, W. F. (2000). Spinning straw into gold: The tenuous strategy, funding, and financial

performance linkage. Nonprofit and Voluntary Sector Quarterly, 29(1), 164182.

Demetriou, M., Papasolomou, I., & Vrontis, D. (2010). Cause-related marketing: Building the corporate

image while supporting worthwhile causes. Journal of Brand Management, 17, 266278.

Doherty, A., & Murray, M. (2007). The strategic sponsorship process in a nonprofit sport organization.

Sport Marketing Quarterly, 16(1), 4959.

Du, L., Hou, J., & Huang, Y. (2008). Mechanisms of power and action for cause-related marketing:

Perspectives of enterprise and non-profit organizations. Baltic Journal of Management, 3(1),

92104.

Easterby-Smith, M., Thorpe, R., & Jackson, P. R. (2008). Management research (3rd ed.). London: Sage.

Evans, K. (2011). Big society in the UK: A policy review. Children and Society, 25, 164175.

File, K. M., & Prince, R. A. (1998). Cause related marketing and corporate philanthropy in the privately

held enterprise. Journal of Business Ethics, 17(14), 15291539.

Fischer, R. L., Wilsker, A., & Young, D. R. (2011). Exploring the revenue mix of nonprofit organizations:

Does it relate to publicness? Nonprofit and Voluntary Sector Quarterly, 40(4), 662681.

Froelich, K. A. (1999). Diversification of revenue strategies: Evolving resource dependence in nonprofits

organizations. Nonprofit and Voluntary Sector Quarterly, 28(3), 246268.

Frumkin, P., & Keating, E. K. (2002). The risks and rewards of nonprofit revenue concentration. Paper

presented at the ARNOVA annual conference, Montreal, QC, Canada.

Galaskiewicz, J., & Bielefeld, W. (1998). Nonprofit organizations in an age of uncertainty. New York:

Aldine De Gruyter.

Grau, S. L., & Folse, J. A. G. (2007). Cause-related marketing: The influence of donation proximity and

message-framing cues on the less-involved consumer. Journal of Advertising, 36(4), 1933.

Hager, M. A. (2001). Financial vulnerability among arts organizations: A test of the TuckmanChang

measures. Nonprofit and Voluntary Sector Quarterly, 30(2), 376392.

Hansmann, H. B. (1980). The role of nonprofit enterprise. Yale Law Journal, 89, 835898.

Harley, M., & Warburton, J. (2008). Risks to business in social involvement: An Australian case example.

Journal of Corporate Citizenship, 29, 4960.

Harris, M. (2010). Third sector organizations in a contradictory policy environment. In D. Billis (Ed.),

Hybrid organizations and the third sector (pp. 2545). Basingstoke: Palgrave MacMillan.

Helmig, B., Jegers, M., & Lapsley, I. (2004). Challenges in managing nonprofit organizations: A research

overview. VOLUNTAS: International Journal of Voluntary and Nonprofit Organizations, 15(2),

101116.

Hempel, J., & Gard, L. (2004, November 29). The corporate givers. Business Week, pp. 100104.

Hodge, M. M., & Piccolo, R. R. (2005). Funding source, board involvement techniques, and financial

vulnerability in nonprofit organizations: A test of resource dependence. Nonprofit Management and

Leadership, 16(2), 171190.

Hodgkinson, V., Weitzmann, M., Abrahams, J. A., Crutchfield, E. A., & Stevenson, D. R. (1996).

Nonprofit almanac 19961997. Washington: Independent Sector.

Voluntas (2013) 24:606629 627

123

Hutchison, R., & Cairns, B. (2010). Community anchor organizations: Sustainability and independence.

In D. Billis (Ed.), Hybrid organizations and the third sector (pp. 134152). Basingstoke: Palgrave

MacMillan.

Jamali, D., & Keshishian, T. (2009). Uneasy alliances: Lessons learned from partnerships between

businesses and NGOs in the context of CSR. Journal of Business Ethics, 84(2), 277295.

Jamali, D., Yianni, M., & Abdallah, H. (2011). Strategic partnerships, social capital and innovation:

Accounting for social alliance innovation. Business Ethics: A European Review, 20(4), 375391.

Kendall, J. (2003). The voluntary sector. London: Routledge.

Kingma, B. R. (1993). Portfolio theory and nonprofit financial stability. Nonprofit and Voluntary Sector

Quarterly, 22(2), 105119.

Lafferty, B. A., Goldsmith, R. E., Tomas, G., & Hult, M. (2004). The impact of the alliance on the

partners: A look at cause-brand alliances. Psychology and Marketing, 21(7), 509527.

Lewis, J. (2005). New labours approach to the voluntary sector: Independence and the meaning of

partnership. Social Policy and Society, 4(2), 121131.

Liston-Heyes, C., & Liu, G. (2010). Cause-related marketing in the retail and finance sectors: An

exploratory study of the determinants of cause selection and nonprofit alliances. Nonprofit and

Voluntary Sector Quarterly, 39(1), 77101.

Lusted, J., & OGorman, J. (2010). The impact of new labours modernisation agenda on the English

grass-roots football workforce. Managing Leisure, 15(1/2), 140154.

Mellor, G. (2008). The Janus-faced sport: English football, community and the legacy of the third way.

Soccer and Society, 9(3), 313324.

Moore, M. H. (2000). Managing for value: Organizational strategy in for-profit, nonprofit, and

governmental organizations. Nonprofit and Voluntary Sector Quarterly, 29(1), 183204.

National Council for Voluntary Organisations. (2009). The state and the voluntary sector: Recent trends

in government funding and public service delivery. London: National Council for Voluntary

Organisations.

National Council for Voluntary Organisations. (2011). Charity forecast: A quarterly survey of sector

leaders, December 2011. London: National Council for Voluntary Organisations.

Ning, C., Hu, Y., & Zhang, B. (2006). Mechanisms of obtaining corporate competitive advantage by

collaborating with nonprofit organizations. Studies in Science of Science, 24(3), 339343.

Novick, G. (2008). Is there a bias against telephone interviews in qualitative research? Research in

Nursing & Health, 31(4), 391398.

Parkes, C., & Harris, M. (2008). Corporate responsibility, ethics and strategic HRM in Aston Centre for

Human Resources. In Strategic human resource management: Building research based practice

(pp. 296326). London: Chartered Institute of Personnel and Development.

Pfeffer, J., & Salancik, G. R. (1978). The external control of organizations. New York: Harper and Row.

Polonsky, M. J., & Speed, R. (2001). Linking sponsorship and cause related marketing: Complementaries

and conflicts. European Journal of Marketing, 35(11/12), 13611385.

Porter, M. E., & Kramer, M. R. (2006). Strategy and society: The link between competitive advantage and

corporate social responsibility. Harvard Business Review, 84, 7892.

Powell, M. (Ed.). (2007). Understanding the mixed economy of welfare. Bristol: The Policy Press.

Ramesh, R. (2010, October 20). Spending review 2010: Key points at a glance. The Guardian.

Rogers, S. (2010, October 19). Comprehensive spending review: What is the 83 bn? The Guardian.

Sagawa, S., & Segal, E. (2000). Common interest, common good: Creating value through business and

social sector partnerships. Boston: Harvard Business School Press.

Salamon, L. M. (1996). The crisis of the nonprofit sector and the challenge of renewal. National Civic

Review, 85(4), 317.

Salamon, L. (1999). The non-profit sector at a crossroads: The case of America. VOLUNTAS:

International Journal of Voluntary and Nonprofit Organizations, 10(1), 523.

Savage, M. (2011, August 2). Councils cuts to 2,200 charities undermine Big Society. The Times.

Seitanidi, M., & Ryan, A. (2007). A critical review of forms of corporate community involvement: From

philanthropy to partnerships. International Journal of Non-profit and Voluntary Sector Marketing,

12(3), 247266.

Selsky, J. W., & Parker, B. (2005). Cross-sector partnerships to address social issues: Challenges to

theory and practice. Journal of Management, 31(6), 125.

Sesnan, M. (2001). Greenwich Leisure Limitedthe third way: From cuts and closures to expansion

and success. Journal of Leisure Property, 1(3), 220226.

628 Voluntas (2013) 24:606629

123

Shaw, S., & Allen, J. B. (2009). To be a business and to keep our humanity: A critical management

studies analysis of the relationship between a funder and nonprofit community organizations.

Nonprofit Management and Leadership, 20(1), 8396.

Silverman, D. (2001). Interpreting qualitative data: Methods for analysing talk, text and interaction.

London: Sage.

Staples, C. (2004). What does corporate social responsibility mean for charitable fundraising in the UK?

International Journal of Nonprofit and Voluntary Sector Marketing, 9(2), 154158.

Stewart, J. (2007). The mixed economy of welfare in historical context. In M. Powell (Ed.),

Understanding the mixed economy of welfare (pp. 2640). Bristol: The Policy Press.

Struthers, M. (2004). Supporting financial vibrancy in the quest for sustainability in the not-for-profit

sector. The Philanthropist, 19(4), 241260.

Thomas, M. L., Mullen, L. G., & Fraedrich, J. (2010). Increased word-of-mouth via strategic cause-

related marketing. International Journal of Nonprofit and Voluntary Sector Marketing, 16(1),

3649.

Tomlinson, F. (2005). Idealistic and pragmatic versions of the discourse of partnership. Organization

Studies, 26(8), 11691188.

Varadarajan, P. R., & Menon, A. (1988). Cause-related marketing: A co-alignment of marketing strategy

and corporate philanthropy. Journal of Marketing, 52(3), 5874.

Waddock, S. (1988). Building successful partnerships (pp. 1723). Summer: Sloan Management Review.

Walters, G. (2009). Corporate social responsibility through sport: The community sports trust model as a

CSR delivery agency. Journal of Corporate Citizenship, 35, 8194.

Walters, G., & Chadwick, S. (2009). Corporate citizenship in football: Delivering strategic benefits

through stakeholder engagement. Management Decision, 47(1), 5166.

Warhurst, A. (2001). Corporate citizenship and corporate social investment: Drivers of tri-sector

partnerships. Journal of Corporate Citizenship, 1(1), 5773.

Warneke, K. (2005). Keeping tabs at the Ronald McDonald house in Omaha: How a