Our Board is supported by a dedicated Audit and Finance Committee (AFC). The AFC is responsible for ensuring that Islamic Relief Worldwide has robust systems of internal control, financial compliance, safeguarding, complaints management and audit to manage risk and to take advantage of emerging opportunities.
Assessing and mitigating risk is central to our governance and management. Risks are regularly reviewed, reported and acted upon at Board of Directors level, divisionally and in country office teams. In 2022 we further strengthened our risk mitigation measures by raising staff awareness through internal campaigns about fraud and cybersecurity risks and establishing dedicated and regular counter-fraud reporting directly to the AFC. We also have an independent Internal Audit function reporting to the AFC. This ensures that there is professional oversight and assurance of adherence to risk management policies and procedures, as well as effective mitigation actions when needed.
We conduct risk and assurance assessments periodically in every country office and functional division, alongside the strategiclevel leadership of the senior executive and Board of Trustees. We are assisted in this by our use of a comprehensive risk management solution across all our offices in the UK and internationally, ensuring a consistent and coherent approach to risk monitoring, reporting and mitigation.
Our key processes include:
carrying out quarterly risk management reviews at both executive and operational levels, with oversight from Internal Audit, reporting to the Audit and Finance Committee.
periodic review of the charity’s strategic risks by the senior executive team.
regular audits undertaken by the Internal Audit function, in addition to statutory annual audits and external audits mandated by institutional funders.
reporting of the results of all internal and external audits to the Audit and Finance Committee, which oversee the implementation of recommendations by the senior executive team.
a dedicated team working to enhance our protocols to ensure that our people, and those we serve and work with, are kept safe and secure. This team also manages and responds to complaints, safeguarding concerns and whistleblowing.
monthly financial reporting, the results of which are reported to and appraised by both the senior executive team and the AFC.
We have identified the following significant risks at an organisational level. The executive monitors specific indicators relating to each risk, and implements specific actions with oversight from Internal Audit, the AFC and the Board of Trustees.
A significant risk to Islamic Relief’s operations and potentially also to the fundraising that underpins them has been the sharp increase in food insecurity across the world in 2022. Supply chain and living costs have been adversely affected by global economic stagnation, rising inflation and the effects of the war in Ukraine on the availability of food and fuel.
The impact on Islamic Relief’s operations has included:
rising costs for food items, and for the logistics required to deliver food aid.
increased demand for food and livelihoods support from affected communities both in the southern hemisphere and in traditional fundraising countries, with a significant rise in the use of food banks in the UK.
question marks over some aspects of future project delivery, requiring either additional funds to meet the needs of the affected communities or a reduction in the scope and reach of some programmes.
question marks over the potential to maintain the strong income growth achieved in recent years, as donors see a tightening of disposable income.
We are responding to these challenges in a number of ways:
reviewing and adjusting the content and size of food packs for seasonal food distributions, to ensure higher costs are factored in while optimising our support for affected communities.
advocacy and fundraising activities internationally and in the UK to raise awareness of global hunger and food insecurity and inspire positive action by policy makers and by institutional and individual donors.
an increased focus on, and resourcing for, domestic food security programmes to meet increased demand from affected communities in traditional fundraising countries, and to ease the hardships of donor communities.
Safeguarding continues to be a high priority for Islamic Relief Worldwide. This year we established a dedicated global team, evidencing the organisational commitment in safeguarding with further plans to expand. Over the past few years, the capacity of safeguarding staff in country offices has continued to improve and evolve.
We implemented an ambitious schedule of bespoke safeguarding and dignity at work training. All country office staff have continued to increase their knowledge and practices around safeguarding particularly around protection from sexual exploitation, sexual abuse and sexual harassment, workplace bullying, welcoming and raising complaints, and how we can best protect vulnerable people from experiencing harm.
Building upon the achievements of a safeguarding programme that built capacity of five country offices in 2020, a subsequent project has replicated its success, building capacity in an additional eight countries. This two-year project to strengthen safeguarding mechanisms continues to build staff capacity around safeguarding, raise community awareness – particularly for those at risk such as people with disabilities – and build engagement with faith leaders to establish a community-led approach to safeguarding. Islamic Relief is developing a new tool to increase awareness of safeguarding amongst children of all ages and abilities in our projects and programmes.
Ongoing, robust safeguarding training is critical in preventing sexual exploitation, abuse and harassment. In 2022, 27 specialist safeguarding professionals across the 25 country offices came together to attend a Global Safeguarding Summit in Türkiye. The conference included training and sharing best practice around safeguarding across the wide range of contexts in which we operate.
Our collective efforts to raise awareness and improve reporting mechanisms have contributed to an increase in the number of people coming forward to report concerns. In 2022, the safeguarding team received a total of 42 cases. Of these, 21 related to staff, some of which led to investigations and formal disciplinary action. Nineteen cases related to the community and did not involve Islamic Relief staff, volunteers or representatives. These figures are comparable to cases in 2021, indicating that communities, staff and volunteers trust in our complaints and feedback response mechanisms.
Communities continue to be at the forefront of reporting and preventing cases of sexual exploitation, abuse and harassment and protecting vulnerable members of their societies. The trust and relationship that communities have with Islamic Relief has led to greater accountability and open dialogue. Islamic Relief continues to adhere to best practice when investigating breaches of safeguarding policies, with the needs of the survivor always at the heart of our response.
Islamic Relief Worldwide takes cybersecurity and data protection very seriously. We have strong security measures in place to protect our data in a context in which there continues to be a high risk from phishing, malware and ransom attacks across all sectors.
Throughout 2022 we continued to strengthen our security provisions to protect our data and our underlying operating environment. We have seen cybersecurity threats increase in sophistication and number this year, so our approach has been to continually review our defences and the effectiveness of our countermeasures, with particular focus on high-risk assets and data.
As a consequence of our digital transformation programme, IT systems have a significant and increasing importance in the delivery of our mission. We recognise that operations could be adversely affected by IT system outages or by cybersecurity breaches. In this context we continue to train staff in cybersecurity awareness as part of the organisation’s mandated annual training programme, and we regularly review our IT and security risk posture at board level.
Governance and reputation
Good governance across our global family is essential to fulfil our mission effectively, in alignment with our own values and with the needs and expectations of the communities we serve, our staff, our donors and other stakeholders.
Given the fragile and turbulent international context in which we work, it is essential to maintain high standards in our global governance and sustain momentum in the implementation of progressive governance reforms. It is also important to be proactive in managing threats to Islamic Relief Worldwide’s reputation, and to be open and accountable in providing information and assurances to our key external stakeholders concerning governance and reputational matters.
All Islamic Relief offices continue to enact complementary plans to deliver good governance under the new governance model introduced in 2020, as well as implementing additional governance reform recommendations stemming from the Independent Commission report published in January 2021.
All senior executives and board members of every member entity in the Islamic Relief family are screened using the Refinitiv World Check software favoured by the international finance sector, to ensure we do not engage anyone with links to proscribed entities or individuals on global watch lists. As part of our appointment processes, all senior executives and board members also have their personal social media accounts reviewed by a specialist independent monitoring agency. The agency’s reports are shared with our Membership Accreditation Committee, which is empowered to veto appointments if necessary to uphold our values.
In 2022 our International General Assembly, which elects and oversees our Board of Trustees, appointed its first two independent members, identified through competitive public recruitment from a pool of candidates unlinked to any Islamic Relief member entities. In 2023, these independent IGA members will be added to our Board of Trustees after a year’s service on the IGA, ensuring that the diversity and wider accountability of the board is further enhanced. All our trustees receive rigorous, bespoke induction and ongoing governance training.
Islamic Relief Worldwide continues to refute false or misleading adverse media reports to protect its own standing and the reputation of its partners. This work involves challenging media outlets to amend or remove false content, or to give Islamic Relief a suitably prominent right of reply, as well as setting the record straight with stakeholders when required.
Fraud and corruption
Risk is always present in challenging environments, humanitarian emergencies and other contexts in which Islamic Relief operates – so we must ensure funds and resources are not lost.
Islamic Relief Worldwide therefore continues to develop holistic counter-fraud resilience, which involves nurturing a counter-fraud culture across all Islamic Relief entities. We have recently defined and updated our counterfraud roles, and are reviewing our strategy and planning to increase resourcing for fraud risk reduction.
Over the past year, we have enhanced our control processes and standardised procurement across country offices. We will audit these to assess their effectiveness.
Islamic Relief continually monitors and responds to financial risks and opportunities, particularly the evolving economic environment in the UK and internationally as this affects the economic outlook for our funders, donors and the communities we serve.
An important part of our financial resilience is maintaining close working relations and communications with our key financial partners, whose expertise and engagement are vital in a global context in which some financial providers choose not to engage with the humanitarian aid sector because of risk concerns that are often misplaced. Another important discipline is continually monitoring our reserves to ensure that we strike the appropriate balance set out in our reserves policy. This requires us to maximise the funding we transfer as swiftly and effectively as possible to programmes delivering our global charitable mission, while maintaining a modest but prudent cushion of operational costs in reserve to absorb any financial shocks and thereby protect our future operations.
In 2022 the economic environment has been one in which sharply rising inflation, increasing costs of food aid and fuel in our aid programme delivery and the impact of cost-of-living challenges on food security and fundraising in our donor communities have all come into sharp focus – see ‘the food insecurity’ section above for further information.
An important priority financially, operationally and reputationally this year and every year is delivering aid in conflict zones and other complex environments while meeting the often-complex requirements of international sanctions, counter-terrorism regulation and bank compliance regimes. Islamic Relief continues to maintain strong relationships with its financial services providers to help us achieve this, and new partnerships were forged in 2022 to scale up funding for our programmes in Afghanistan in particular – vital in a context of severe drought, strict sanctions and economic collapse. Our Treasury team’s efforts in this area are supported and enhanced by the knowledge and insight gleaned from Islamic Relief’s membership of the UK Home Office’s Tri-Sector Group, which brings leading aid agencies, banks and government together to address sanctions challenges and overcome financial hurdles in transferring funds.