Conflict with Third Parties
What to consider when you’re at odds with the outside world
There is a range of third parties with whom charities may find themselves in conflict. It is difficult for organisations who face any of these situations. Unlike internal conflicts, disagreements with third parties often carry a heightened risk of reputational damage to your charity. Often the best course of action is to take a considered and dispassionate approach.
Acting in the charity’s best interest
Conflicts are often emotionally charged and there can be a temptation to base decisions on matters of principle, or emotions, rather than what is best for the organisation
Ideas that are subject to a challenge will have been well thought out and developed. Very rarely is our first version of an idea perfect and unable to be enhanced through a robust discussion of its merits. Ideas are “road tested” before they are presented in their final form. The process can also make us more committed to an idea.
Bring in professional support when appropriate
Where the charity and its trustees are not fully equipped to understand the best course of action, it is important to bring in professional support to guide the decision.
Things to consider before taking legal action
The Charity Commission stipulates that charitable funds must not be spent on defending legal claims that have no merit or prospect of success. Before undertaking expensive legal action, mediation can also provide a cost-effective solution to resolve the conflict.
Managing risk through the risk register
Managing the risk of conflict with third parties does not always need to be reactive, indeed managing the risk proactively should be encouraged. The charity’s risk register is a helpful place to begin identifying the risk of third party conflict, as well as how the risk can be managed.
Keeping calm and carrying on
It is inevitable that your organisation will encounter conflict with a third party at some point during its lifetime. Although stressful, conflict can also be an opportunity to improve relationships or ways of working. Provided organisations can keep a level head and work through conflicts rationally and methodically, obtaining outside support when needed, they can be opportunities rather than disasters
What do do if you are in conflict with third parties
Most conflicts with third parties can be resolved by the staff or the trustees themselves, sometimes with some advice. However, in serious cases the Commission may need to advise the trustees or take action to protect the charity. If something goes wrong, the trustees should be asking themselves the following questions:
- Do we need to take any steps to minimise any future losses, or recover losses incurred to date?
- Do we need to report the situation to the Charity Commission?
- Do we need to enlist the help of a professional to support our decision making?
- Do we need to say anything to staff, volunteers, members or the public?
- What do we need to put in place to prevent a similar conflict occurring again in the future?
Next month’s topic is is Conflicts between Treasurers and Finance Directors.