The Charity Commission published its ‘Charity Sector Risk Assessment 2026’ on 18 August 2026. It provides a high-level picture of risks facing the sector now or in the future, drawing on Commission data, horizon scanning and insights from sector bodies. Trustees should use it to inform proportionate steps within their own context.
The Charity Sector Risk Assessment is not intended to be a checklist of risks that every charity must address, nor is it a prediction of future events. Instead, it highlights the issues the Commission believes are most likely to affect charities' ability to deliver public benefit and maintain public trust.
The publication also provides a useful opportunity for boards to reflect on whether their risk management processes remain fit for purpose. As charities face increasing financial, technological and operational pressures, understanding emerging risks is becoming just as important as managing existing ones.
"We welcome the Commission’s publication of annual insights drawn from its considerable intelligence across the charity sector. Risks can never be eliminated, but the best charities use good risk management to prioritise their limited time and resources to manage them in the most effective way. As charities navigate increasingly challenging times, strong risk management continues to be essential for maximising their impact through confident decision making and long-term resilience."
Abbie Francis-Pike
National Head of Charities
Financial resilience remains a priority
Financial resilience remains a significant concern for the sector. The Charity Sector Risk Assessment 2026 highlights the continued impact of economic and social pressures on charities' ability to deliver their purposes, with the level of exposure varying widely between organisations. However, the conversation has moved beyond reserves, deficits and short-term cost control.
For many leadership teams, the challenge is increasingly one of strategic sustainability. How resilient is the organisation's operating model? How dependent is it on a small number of funding streams? What happens if demand continues to increase while income growth remains constrained? And is the organisation agile enough to respond?
The strongest charities are looking beyond annual budgets and taking a longer-term view. Scenario planning, income diversification and regular review of operating models are helping charities prepare for a range of possible futures rather than relying on a single set of assumptions.
The reality is that financial resilience is becoming inseparable from wider organisational resilience.
A renewed focus on risks to public benefit
The delivery of public benefit sits at the heart of every charity's purpose. The 2026 assessment places greater emphasis on understanding the factors that can undermine an organisation's ability to achieve that purpose. The Commission identifies two separate areas of focus:
risks arising from individuals
structural vulnerabilities that may affect a charity's ability to deliver public benefit
The first focuses on risks linked to behaviour, decision-making and conduct. This includes issues such as safeguarding failures, conflicts of interest, poor leadership and other actions that can damage trust and affect service delivery.
The second considers weaknesses embedded within an organisation's systems and structures. Examples may include ineffective governance, inadequate controls, skills gaps, over-reliance on key individuals or funding sources, and weaknesses in operational processes.
The distinction is important because charities can face challenges from both directions. Strong systems can be undermined by poor decisions, while capable individuals may struggle within ineffective structures. Trustees should therefore consider how people, culture, governance and organisational design work together to support the delivery of public benefit.
What are the significant ongoing threats facing the charity sector?
Alongside financial resilience and public benefit, the Commission identifies several areas of continuing regulatory interest:
1. Governance risks
Weak oversight, ineffective decision-making and inadequate controls can create wider organisational challenges. Strong governance remains the foundation of effective risk management and good decision making.
2. Safeguarding risks
Safeguarding continues to be a significant area of focus, covering beneficiaries, employees and volunteers. The assessment also highlights the growing importance of managing online harms.
3. Social tensions and misinformation
Polarisation, misinformation and disinformation can increase operational and reputational pressures, as well as the demand for support.
4. Overseas operations
Charities working internationally continue to encounter complex operational, compliance and reputational risks. Local legal, political and cultural factors can add further complexity to programme delivery, requiring global assurance arrangements.
5. Geopolitical turbulence
Global instability can affect charities directly through overseas activities and indirectly through its impact on communities and stakeholder relationships within the UK.
6. Hostile foreign states
The assessment notes that charities may be exposed to attempts by hostile foreign states to exert influence, particularly in sensitive areas such as human rights and advocacy.
7. Emerging technology and cyber risks
Emerging technologies are creating new opportunities, but also new legal, ethical and cybersecurity challenges. As digital transformation accelerates, trustees should understand both the benefits and potential risks of technology adoption.
What’s changed from 2025?
The 2026 assessment retains financial resilience as a core risk for the sector, reflecting the continued impact of economic uncertainty, rising costs and pressure on funding streams. However, the way the Charity Commission has framed several other risks suggests a more nuanced view of the challenges charities face.
The most notable change is the refinement of risks to public benefit. Rather than treating public benefit as a single category, the Commission now distinguishes between risks associated with individuals and those arising from structural weaknesses - providing trustees with a clearer framework for assessing both behavioural and organisational factors that could affect the delivery of charitable objectives.
Technology also occupies a more prominent position than in previous assessments. Cyber risk is identified more explicitly within the broader discussion of emerging technology, reflecting the sector's growing reliance on digital systems and the increasing adoption of artificial intelligence. The shift recognises that technology-related risks now extend beyond information security and into governance, ethics, compliance and reputation.
Trustees may also notice that fraud is no longer highlighted as a separate risk category in the 2026 assessment. This should not be interpreted as a reduced concern. Instead, it acknowledges that fraud is often linked to wider governance, financial control and cyber security issues. As a result, the assessment increasingly focuses on the underlying conditions that can create opportunities for fraud rather than treating it as an isolated risk.
Taken together, these changes suggest a broader evolution in how risk is understood across the charity sector. Financial, operational, fraud, technological and governance risks are becoming more interconnected, requiring trustees to look beyond individual issues and consider the resilience of the organisation as a whole.
Speak to our charities experts
If you'd like to discuss how the risks raised in the Charity Commission’s Charity Risk Assessment 2026 could impact your charity, speak to our experts.
The Failure to Prevent Fraud Offence (introduced under the Economic Crime and Corporate Transparency Act 2023) introduces new regulatory expectations around fraud. The Failure to Prevent Fraud Offence offers charities an opportunity to strengthen governance, build confidence at board level, and protect the organisation’s mission.
