The Australian Red Cross is one of the longest-running charities in Australian history, with more than a century of service that spans from World War I to today.
Now known for its blood donation service and natural disaster response unit, the Red Cross is a key example of how organisations can maintain trust and legitimacy to ensure their longevity.
Dr Debbie Wills teaches financial accounting at the Tasmanian School of Business and Economics, and is interested in links between accounting education and maths literacy, along with organisational legitimacy management and impression management.
She is investigating the overlap between impression management and organisational legitimacy management – a less studied aspect of not-for-profit organisations that can have a big impact on their success.
In her recently published PhD, she used the Australian Red Cross as a case study to investigate the organisational management techniques that organisations use to maintain public trust, and the role of accountability, transparency, and good governance in their long-term success.
“Charities need continued support from the public, funding from the government, and support in the way of volunteers offering their time,” said Dr Wills.
Without legitimacy, a charitable organisation cannot have continued access to the resources it needs.
The driving factor of my PhD was that there had been little longitudinal research on organisational legitimacy at that point in charitable organisations.”
The study involved analysing 70 years of archived papers, including media articles and annual reports. The documents were dated from between 1945 (the end of World War II) and 2014.
By the mid-1940s, the Australian Red Cross had been established for several decades, and its role, or mission, in society was clear – as an arm of the British Red Cross, the charity supported soldiers on and off the battlefield during World War I and World War II. When peace was declared in 1945, the charity had to re-establish itself in society and determine its role during a time of peace.
The Red Cross has since maintained its status as one of Australia’s biggest charities, and it took in more than $1 billion in revenue in 2014. The key to the Australian Red Cross’ longevity, said Dr Wills, is that the organisation used a toolbox of communication techniques rather than relying on a solitary method.
“They used emotive and assertive language to educate the public on their work, and instituted real change with particular attention paid to policy review and change,” Dr Wills explains.
Of particular interest to Dr Wills’ investigation was what she calls “legitimacy events” – how the Red Cross dealt with challenges, crises, and criticism. These ranged from the contamination of blood donation products in the 1990s to criticism over the use of funds raised in response to the Bali bombings in 2002 and the Asian Boxing Day tsunamis in 2004.
There were three stages of legitimacy that Wills categorised during these events: maintain, gain, and repair.
“It was about more than just how the charity handled a crisis,” she said. “It was about how they could maintain their legitimacy – how they would gain legitimacy, and what they would do to repair it.”
The Australian Red Cross has created an efficient management network to deal with crises by placing emphasis on transparency, teamwork, and accountability with the public.
They paid attention to accountability, transparency, and good governance. But not just in communicating what they were doing, but by giving importance to achieving real change, and monitoring that within the organisation.
It’s hoped that the insights that have come from Dr Wills’ research will inform guidelines for future not-for-profit organisations, so that they can follow the Red Cross’ example in running a charity that the public can trust.
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