Russian Charities Endure First Recession

Nearly two thirds (61 percent) of Russian charitable organisations say their funding has dropped as a result of the recession and over half (52 percent) say they have already lost a quarter or more of their funding. These findings come from the first research, on the impact of the recession on charities in Russia and are published in “Philanthropy in the context of the economic crisis” – a report by CAF Russia, Zircon Research Group, PricewaterhouseCoopers and the Russian Donors Forum.

The report, which is based upon a survey of 440 non-governmental non-profit organisations (NPOs), 36 companies and 11 foundations, found that the majority of NPOs were prepared for the crisis and are adapting their plans to enable them to carry on their work in these difficult financial times. However, nearly a quarter (23 percent) of NPOs surveyed think they are likely to close as a result of this recession and nine percent think they may have to become state, or municipal owned institutions to survive.

The majority (84 percent) of NPOs are expecting funding to drop further and the 59 percent who reported a growth in demand for their services likely to feel the most stretched.

Maria Chertok, Chief Executive of CAF Russia, said: “In 1986 Russia only had 20 NPOs, today there are more than 217,000. They are playing a key role in helping society through the recession and are ambitious to do more. Half of them (51 percent) intend to expand the scope of their services despite the current financial climate.”

NPOs, companies and foundations were united in the view that the State can play an important part in developing philanthropy in this period of crisis.

This recession is the first for the fairly new philanthropic and NGO sector and it will be a trying time for charities and donors who are still to prove their commitment to philanthropy.