Case Study On Oxfam

Analytical framework of the fundraising and campaigning sides of Oxfam’s business:

Legal: The operations and activities of charities in the UK are regulated by the Charities Act, 2006. All charities in the UK are required to keep annual records, prepare annual accounts and make the accounts available to the public on request. Therefore Oxfam must keep detailed records of its income and expenditure from trading and campaigning activities. Since Oxfam is a charity with assets in excess of Ð'Ј2.8 million, its accounts must be audited by a registered auditor. Recently, changes in the legal and regulatory framework in which charities operate, were brought about through the enactment of the Charities Act 2006, partly by amending provisions in the Charities Act 1993. The aim was to reduce the bureaucratic red tape, improve accountability and modernize certain provisions that dated back some 400 years. The main provisions of the new Act deal with the definition of the requirements to qualify as a charity, alterations to the requirements for registering charities and the establishment of a Charity Tribunal to hear appeals from decisions of the Charity Commission that were previously handled by the High Court. The Act also introduced a new form of incorporation; the Charitable Incorporated Organization (CIO) designed specifically for charities that will allow trustees to form a company without needing dual registration with both the Charity Commission and Companies House.

Ecological: One of Oxfam’s aims is to relieve poverty but its efforts are being increasingly undermined by changes in the world’s climate. In many parts of the world effects of climate change like increased flooding, droughts, or rising sea level rises are hurting the poor who are dependent on predictable weather patterns. The negative impact of climate change on food and crops can mean no food and no earnings which makes it more difficult for Oxfam to achieve its aim of ensuring the right to life and security and a sustainable livelihood. The organization is a founding member of the UK Working Group on Climate Change and Development and has been working to spread public awareness of the links between poverty and climate change since 2003. Oxfam’s strategic plan for the next few years aims to increase programs dealing with climate change in vulnerable communities in several countries. The organization is campaigning on this issue globally and also working with organizations at all levels and people in the affected areas to help them adapt their lives and reduce their vulnerability. Oxfam’s Wastesaver program recycles clothes, textiles and shoes, computers, printer cartridges and mobile phones and then utilizes the funds for its charitable activities. Since Oxfam takes a strong position on the issue of climate change it regularly assesses and measures its carbon footprint and tries to minimize its environmental impact by improving energy efficiency in its buildings, increasing recycling and reducing paper use, videoconferencing to reduce air travel, using electricity that comes from renewable sources and transport with high levels of fuel economy and encouraging its staff to walk, cycle or use mass transit.

Political: Oxfam’s campaigns seek to exert public pressure on governments and multilateral organizations at key events like G8, World Bank and WTO meetings. Oxfam’s global campaigns have had success in ensuring debt cancellation for poor countries and a United Nations to vote in favor of an Arms Trade Treaty but failed to get key countries to meet their aid commitments and make concessions in trade negotiations with poor countries. Oxfam is dependent on institutional funding from sources such as the UK government, the European Commission Humanitarian Aid department (ECHO), UN agencies, G8 government donors and foundations for a substantial amount of funding. In 2006, the Department for International Development’s (DFID) and government and public authorities contributed around 24% of Oxfam’ income. The European Commission (EC) has been a major donor from 1976 but the co-funding program is to end after 2007 so new EC strategies and potential impact on Oxfam’s program funding are being analyzed.

As a charity, Oxfam can claim relief from tax on most income or gains from investments, estates, land and property if it is used for charitable purposes and on profits from some activities. British taxpayers are entitled to tax relief on charitable donations when giving to a charity registered in the UK. This tax relief was introduced to encourage individuals and businesses to donate more money to charity and is known as Gift Aid. A charity can reclaim this tax to increase the value of a donation. In 2006, Oxfam recovered taxes exceeding Ð'Ј15 million but proposed changes to the basic rate of income tax in future years will reduce its Gift Aid income by approximately Ð'Ј2 million.

Oxfam works to ensure free and fair elections in many countries and campaigns for fair trade and policies that do not have an adverse impact on the poor. Oxfam engages in dialogue with multilateral donor organizations to prevent them from imposing free market policies that harm the poor in developing countries. The political environment of a country can also influence Oxfam’s activities. Conflict in Darfur, Sudan which resulted in widespread death and homelessness prompted Oxfam to campaign for emergency aid and currently as many as 11 out of the 13 affiliate members of Oxfam International are operating in the country.

Economic: Oxfam’s income in a particular year is affected by the economic situation and outlook. Donations and income from its shops tend to rise during periods of high growth and low unemployment. The state of the economy in the UK and Europe can influence the level of funding from sources such as the DFID and the EC. Inflation due to high energy prices raises and rises in rent and utility costs increases Oxfam’s expenditure and reduces the profits from trading activities. Oxfam’s income is also affected by changes in income tax and VAT regulations which affect disposable income.

Social and demographic: The bulk of Oxfam’s income comes from donations and legacies and the contribution of the more than 500,000 people who support Oxfam on a monthly basis represents nearly 16% of yearly income. Another 120,000 people made cash donations while more than 200,000 people bought from Oxfam’s online store. Many people leave Oxfam a gift in their will and income from legacies in 2006 was over Ð'Ј12 million. With changes in demographic trends, Oxfam closes its poorly performing