Going into 2024, the word that springs to mind continues to be “turbulence”. This resonates not only because of the inclement weather that has struck us over the recent months, but also because there is still lots going on for charities – including a range of uncertainties and drivers for change.
The Office for National Statistics (ONS) reported that the consumer prices index (CPI) rose to 4% in December 2023, up from 3.9% the previous month, which was slightly higher than consensus expectations. This was a surprise increase but current expectations are that inflation could drop as low as 2% in the middle of the year.
The ONS also reported that annual growth in regular pay slowed sharply to 6.6% in the three months to November 2023. However, with inflation falling back at a faster pace, pay is still growing in real terms, and we may well see meaningful real pay growth throughout this year. There are also continued indications that the UK labour market is gradually cooling.
Known unknowns
Although the economic outlook for the coming year is far rosier than what was expected this time last year, a number of uncertainties – “known unknowns” – could impact this, including the forthcoming general election and geopolitical tensions.
PwC’s 27th UK CEO Survey found that now is the time for reinvention. In the face of persistent challenges and growth concerns, there is a need to drive transformative change – systemic rather than iterative – with investments in skills and technology, alongside meeting now-vital commitments on climate and trust. These themes should also strike a chord with charity leaders.
Many CEOs are not expecting a challenging UK economy to offer an organic uplift and so the impetus for change will need to come from clear leadership, akin to a confident pilot in the face of bumpy skies.
While change can happen at a contrasting pace in different areas as challenges and opportunities dictate, it is important that investments are not made in isolation and there is an alignment to an overall strategy for the future direction of the organisation.
The emergence of generative artificial intelligence (GenAI) has come at pace and quickly moved up the CEO agenda. Charities should similarly embrace this, including a need to reskill people to maximise the opportunities of GenAI. However, GenAI is not without its risks, such as bias and so-called “hallucinations”, where entirely erroneous answers are provided, in addition to the wider risk of cyber threats. The recognition of this is crucial for charities when seeking to capitalise on its transformative potential, as public trust and confidence is vital.
Daniel Chan is a director at PwC
